Chemori (NYSE:CC) suffered its biggest one-day sell-off on Thursday since it was spun off from Dupont de Nemours in July 2015, -31.4% to its lowest close since September 2020, hit by accounting problems disclosed two weeks ago become much worse than expected.
The chemical company said last night it will place its chief executive and chief financial officer on leave and delay the submission of audited financial documents while it conducts an internal investigation into reports from its accounting, compensation and ethics hotline.
Chemours (CC) said its audit committee’s review of “one or more potential material weaknesses” in its financial reporting controls is also taking into account “the ‘tone at the top’ set by some members of the senior management management”.
Typical underlying problems when companies disclose internal audits are related to financial reporting processes, but Chemours’ (CC) problems appear “broader and deeper than that,” said Arun Viswanathan of RBC Capital.
“What two weeks ago many perceived as likely to be a relatively minor accounting issue now appears larger, longer and more ramifications than the market initially believed,” according to Barclays analyst Michael Leithead.
Nearly lost in the morass of bad news: The company also estimated a net loss for fiscal 2023 of between $225 million and $235 million, up from a net profit of $578 million for 2022.