Wirecard issuing issuing its 2019 annual results…again

Wirecard has been forced to postponed the publication of its 2019 annual results for the third time after its auditor EY acknowledged it needs more time to finish the work, the company said in a regulatory statement.

Wirecard has faced prolonged accusations of accounting manipulation raised by whistleblowers and reported by PCM. Its shares have fallen by more than a third since late April when it published the results of a company-commissioned special audit by KPMG, who could not verify that the “lion’s share” of Wirecard’s operating profits between 2016 and 2018 were genuine.

On Monday Wirecard disclosed that it would not be able to publish its annual results on June 4th as previously announced as “not all audit procedures have yet been completed” by EY.

“The publication of the consolidated financial statements and the annual press conference will take place on June 18,” the company said.  “Within the scope of the completed parts of the audit procedures, Wirecard has not yet been informed of any material findings. However, not all audit procedures have yet been completed.”

Wirecard told investors that it expected “an unqualified audit opinion” from EY and that it “assumes that there will be no significant deviations” from the preliminary, unaudited 2020 results the company published in February. Back then, the company said that full-year revenue was up 38{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} year on year to €2.8 billion while earnings before interest, tax, depreciation and amortisation increased 40{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} to €785 million.

In its special audit, KPMG raised questions over the company’s accounting of revenue and cash with regard to its business with third-party business partners in countries where the German group does not own its own licences. According to KPMG, such activities were responsible for “the vast majority of sales revenues generated” at the three key Wirecard subsidiaries.

As well as the Finacial Times, TCI Fund Management has filed a complaint against Wirecard executives, an escalation of the activist campaign by the short seller Christopher Hohn.  The call from one of Europe’s most successful investors for a criminal investigation into alleged accounting fraud adds to the pressure.  “The KPMG report published by Wirecard on April 28, 2020 as well as public reporting, including that in the Financial Times and Wirtschaftswoche, reveal anomalies that may have criminal relevance,” TCI said in a statement.