The long wait is over for Medbox Inc (OTCMKTS:MDBX) investors as the company filed its long time pending restated reports. The company confirmed the news after market hours. The reaction of market to the restated filings was unambiguous. Medbox stock prices declined a good 7.26% yesterday, leaving its comfort zone close to $2 and stopped at $1.66 by the closing bell, on massive volume.
Medbox had to restate several financial reports due to numerous errors in revenue reporting. The existing problem forced several private law firms registering class action suits against company. Following the lawsuits, the SEC launched a probe into the reporting matter. With the restated filings disclosed, there appears to be lot factors to frown about.
The financial performance
As per the restated filings, Medbox Inc (OTCMKTS:MDBX) reported net revenue of negative $8,900 for 1Q2014 compared to previous filing of $331,000. The restated annual revenue for FY2012 came at $1.17 million compared to previous filing of $2.59 million. The restated net revenue for FY2013 came at $2.06 million against previous filing of $5.22 million.
The figures clearly show that there is a substantial percentile differences between previously stated figures and the new restated figures. It comes as a huge setback for investors as revenue for 4Q turned from positive to a greater net loss. After restated numbers, the cumulative net loss posted in FY2013 and FY2012 stands at whopping $5.54 million against initial figure of $900,000.
The impact of restated figures was evident on the stock prices of Medbox. The decline is expected to extend in the rest of the week. The deadline for the lawsuits to attract plaintiffs is March 23, 2015. The errors in previously revenue reports are no small change sums. As of now, there is no telling where Medbox might end up once the suits starts and more people focus on the newly restated figures.