Gold Coast-based surfwear company’s settlement, which is subject to court approval, is for full and final settlement including interest, litigation costs and legal fees.
Commenced in 2015, the class action was pursued by legal firm Slater and Gordon on behalf of about 730 institutional and retail investors who acquired Billabong securities between 18 February 2011 and 19 December 2011 and also registered to participate in the class action.
The settlement is without any admission of liability by Billabong and has no impact on the company’s immediate or future cash flows or earnings reports as costs have already been paid and provided in previous financial reports.
The proposed settlement was reached before a seven week trial scheduled to start in March 2017. The class action was led by Newstart 123 Pty Ltd, trustee for the Malone Family Superannuation Fund.
According to a report from The Daily Telegraph
, Newstart 123 lost more than half of the value of its $30m investment in Billabong.
From highs of over $11 per share in 2010, the company’s share price dove to as low as 13 cents in 2013. It is now at above $1.30 per share.
In its most recent full year fiscal results, Billabong reported an after tax profit of $4.2m, its first profit in four years. For the current financial year, the company reported in February a $1.6m loss for the first half.
Billabong will pay $45 million to settle a shareholder class action over earnings downgrades that led to drops in the company’s share price in 2011.