The Law Offices of Frank R. Cruz Reminds Investors of Looming Deadline in the Class Action Lawsuit Against CAE Inc. (CAE)
LOS ANGELES--(BUSINESS WIRE)--Sep 13, 2024--
The Law Offices of Frank R. Cruz reminds investors of the upcoming September 16, 2024 deadline to file a lead plaintiff motion in the class action filed on behalf of investors who acquired CAE Inc. (“CAE” or the “Company”) (NYSE: CAE ) securities between February 11, 2022 and May 21, 2024, inclusive (the “Class Period”).
If you are a shareholder who suffered a loss, click here to participate.
On August 10, 2022, CAE released its first quarter fiscal 2023 financial results, disclosing that it had incurred “$28.9 million in unfavourable contract profit adjustments in Defense, involving two programs in the U.S.” due to “delays and meeting customer requirements on scope and timing,” along with “staffing shortages [and] supply chain pressures[.]”
On this news, CAE’s stock price fell $4.32, or 16.7%, to close at $21.48 per share on August 10, 2022, thereby injuring investors.
Then, on November 14, 2023, CAE released its second quarter fiscal year 2024 financial results and disclosed that it planned to “retir[e] legacy contracts, which have been most affected by inflationary pressures,” stating that the Company “[is] firmly focused on retiring legacy contracts as soon as possible and to mitigating the cost pressures associated with them.”
On this news, CAE’s stock price fell $0.85, or 3.9%, to close at $21.07 per share on November 14, 2023.
Then, on February 14, 2024, CAE released its third quarter fiscal year 2024 financial results and identified “eight distinct legacy contracts” that are firm, fixed-price in structure and that suffered from severe cost overruns due to supply chain disruptions, inflationary pressures, and availability of labor. The Company stated that “[a]lthough [the contracts] represent only a small fraction of the current business, these contracts have disproportionately impacted overall Defense profitability.”
On this news, CAE’s stock price fell $2.01, or 9.6%, to close at $18.91 per share on February 14, 2024.
Then, on May 21, 2024, CAE disclosed that it had initiated a “re-baselining” of its defense business due to underperforming fixed-price contracts. Further, the Company reported a $568.0 million non-cash impairment of defense goodwill, $90.3 million in unfavorable defense contract profit adjustments, and a $35.7 million impairment of related technology and other non-financial assets related to legacy contracts.
On this news, CAE’s stock price fell $1.03, or 5.2%, to close at $18.80 per share on May 22, 2024, thereby injuring investors further.
The complaint filed in this class action alleges that throughout the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors that: (1) several of CAE’s pre-COVID fixed-price Defense contracts had incurred severe cost overruns due to supply chain and labor issues—as the segment was significantly impacted by the pandemic—which dented the segment’s profit and operating margin; (2) the Company had failed to successfully reduce hard costs and achieve a sufficient level of operational efficiency, particularly with respect to such contracts, necessitating a re-baselining of the Defense business and significant associated charges; and (3) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
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If you purchased or otherwise acquired CAE securities during the Class Period, you may move the Court no later than September 16, 2024 to request appointment as lead plaintiff in this putative class action lawsuit. To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action. If you wish to learn more about this class action, or if you have any questions concerning this announcement or your rights or interests with respect to the pending class action lawsuit, please contact Frank R. Cruz, of The Law Offices of Frank R. Cruz, 2121 Avenue of the Stars, Suite 800, Century City, California 90067 at 310-914-5007, by email to info@frankcruzlaw.com, or visit our website at www.frankcruzlaw.com. If you inquire by email please include your mailing address, telephone number, and number of shares purchased.
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View source version on businesswire.com:https://www.businesswire.com/news/home/20240913844008/en/
CONTACT: The Law Offices of Frank R. Cruz, Los Angeles
Frank R. Cruz, 310-914-5007
fcruz@frankcruzlaw.com
www.frankcruzlaw.com
KEYWORD: CALIFORNIA UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: CLASS ACTION LAWSUIT PROFESSIONAL SERVICES LEGAL
SOURCE: The Law Offices of Frank R. Cruz
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