Bolsa Madrid gambling group Codere SA will launch an investigation into the auditing of its Latin American business unit, as the firm admits to inconsistencies published in its year-to-date financial reporting.
Communicated through Spain’s CNMV market authority Codere governance confirms that it will review the auditing of its entire LATAM unit, following ‘overstated accounts’ reported by a number of its LATAM subsidiaries.
Following preliminary investigations, Codere reveals that unnamed LATAM subsidiaries have overstated their YTD results by €13-18 million accounted for in the firm’s trading period ending June 2019.
As a result, Codere governance has warned investors that its LATAM discrepancies may see the company reduce 2019 full-year EBITDA earnings by up to €20 million.
At present, Codere governance maintains its full-year EBITDA guidance range of €280-290 million. In its latest trading update, the Bolsa Madrid gambling group detailed stability reducing YTD operating losses €8.5 million.
Further to the update, Codere’s board of directors has commissioned external consultants ‘of recognised prestige’ to identify all relevant aspects of LATAM unit inconsistencies, ensuring maximum transparency on corporate accounts.
Codere maintains its wider corporate transformation programme, which is being led by investment bank Credit Suisse, in which the operator seeks to raise €200 million in working capital to finance its long-term initiatives