Organic food and personal care company Hain Celestial has attracted the attention of several law firms after failing to share its financial results for Q4 2016 and year-end.
Law firms Harwood Feffer, Block & Leviton, Johnson & Weaver and Tripp Levy have invited shareholders to get in touch after Hain delayed the release of its latest financial report on 15 August.
Harwood Feffer said that it was currently investigating whether the company has "breached its fiduciary duties to shareholders, grossly mismanaged the company and/or committed abuses of control in connection with the foregoing".
Hain says that it lists revenue when products are shipped to distributors, rather than when they are sold. It said that it will now conduct an independent review into its audit committee and audit process.
The company said that it will update its shareholders “as soon as practicable”.
Some analysts have speculated that Hain could have shipped excess stock to its distributors in a bid to boost its sales figures. There is no evidence to suggest that this is the case. However, Hain has admitted that it does not expect to have achieved its 2016 full-year targets.
Hain said: “Any potential changes in the timing of the recognition of revenue with respect to these transactions should not impact the total amount of revenue ultimately recognised.”
Shares in the company plummeted shortly after the announcement, dropping almost 30% by the following day.
Hain Celestial’s personal care brands:
Alba Botanical
Avalon Organics
JÄSÖN
Live Clean
Queen Helene
