Daewoo Shipbuilding & Marine Engineering, one of the nation’s top three shipbuilders, may face a class-action lawsuit by long-term investors over its past false earnings report, according to industry sources.
The move was detected a day after the shipbuilder restated the past earnings Wednesday, with its external audits pointing out that the loss of 2 trillion won ($1.7 billion) in the 2015 earnings report should be dated 2013 and 2014.
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(Yonhap) |
“Some investors are considering legal action against the company as the reduced loss in the past made them take investment decisions,’’ an industry insider said.
The company, however, denied any ulterior motive over the correction of loss in its past earnings, saying the earnings had to be restated it mistakenly failed to include the loss from Norway’s Songa offshore project.
“The revision came as our auditor did not reflect unexpected delay and cancelation of orders from ship owners,” a DSME’s spokesman said.
Despite the company response, market experts have raised speculations about possible “window dressing’’ to improve its financial statements.
If the error turns out to be intentional, the incident might deal a serious blow to the already troubled shipbuilder because according to the Korean commercial law, a company that misleads investors by window dressing has to pay a fine of up to 10 billion won.
Its largest shareholder Korea Development Bank is also under fire, as it poured the public funds of around 4 trillion won into the company for restoration after it posted a massive loss.
Despite the fuss, the stock price of DSME did not move much in the day. Its stock edged down to 5,360 won from 5,400 won of the previous day.
By Shin Ji-hye (
shinjh@heraldcorp.com)
