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Ansell slammed with shareholder class action
A class action has been filed in the Victorian Supreme Court against medical gloves and protective suit manufacturer Ansell Limited on behalf of shareholders who alleged misleading and deceptive conduct.
Lauren Croft
The class action was filed by Slater & Gordon late last week on behalf of investors who bought shares over a five-month period.
Ansell advised the ASX on 24 August 2021 that the company was well positioned and forecast its earnings per share (EPS) for the financial year 2022 in the range of US$1.75 to US$1.95.
Then, in November of the same year, Ansell announced that although the impact of COVID-19 remained a dominant influence on the business and that the market conditions were more challenging than originally anticipated, the EPS guidance would be maintained.
But on 31 January 2022, the company published a corrective FY22 downgrade statement on the ASX, announcing it now expected its FY22 EPS to be in the range of US$1.25 to $1.45, a downgrade of 25 to 28 per cent.
The statement cited pandemic-related operational challenges and softer demand for single-use gloves among its reasons for the downgrade. The FY22 downgrade resulted in Ansell’s share price falling 17 per cent ($5.37) between 31 January and 3 February 2022.
Slater & Gordon class actions senior associate Tom O’Bryan said the claim alleges that Ansell had no reasonable basis to provide the FY22 EPS guidance.
“Ansell knew or ought to have been aware that its FY22 EPS guidance was unreasonably optimistic, and there was a material risk it would not be met. It is alleged that the company should have communicated deficiencies in its forecast earnings much earlier than it did,” he said.
“Investors are entitled to assume that when they purchase shares in a listed company, all of the material information relevant to that company’s financial position has been disclosed. The downgrades by Ansell in January 2022 revealed that was not actually the case. Had the true situation been revealed to the ASX, group members would have acquired shares at a lower price, or they would not have acquired shares at all.”
Lauren Croft
Lauren is a journalist at Lawyers Weekly and graduated with a Bachelor of Journalism from Macleay College. Prior to joining Lawyers Weekly, she worked as a trade journalist for media and travel industry publications and Travel Weekly. Originally born in England, Lauren enjoys trying new bars and restaurants, attending music festivals and travelling. She is also a keen snowboarder and pre-pandemic, spent a season living in a French ski resort.
