The biggest share tanks in history


June 23, 2010

Here is a list of some of the biggest share price tanks in recent Australian history that were triggered by an announcement.

Allco Finance Group: shares plunged $1.94, or 64%, to $1.11 after shocking the market with this half year "profit" presentation on February 25, 2008, coming off a two week suspension. Allco is now in liquidation.

ABC Learning:
this woeful half year profit result released on February 25, 2008, caused a massive 42.7% slump in the share price the next day from $3.74 to $2.14, although this was well up from the intra-day low of $1.15 as four directors were margin called. ABC is now in liquidation.

Babcock & Brown:
when the true terms of the investment bank's market capitalisation review clause was revealed in this letter on June 12, 2008, shares in the company suffered a two day slump of 44.8% from $9.52 to $5.25. In 2008 nearly 99% of their market value has been destroyed.




Pacific Brands: Australia's largest clothing maker, announced that dividend payments will be dramatically reduced as a way of reducing debt. Shares of Pacific Brands have plunged 87% in the past 12 months from $3.30 to 40c.

Fortescue: took a beating in the last 6 months of 2008
. A high debt level and the falling iron ore price have been major contributers to the falling share price which has plummeted nearly 85%, from a high of almost $13 to $2, in the 6 months from June 2008.

Apac Coal:
one only two floats in 2008, the coal price and sales have been tumbling heavily wiping off millions. Apac is a long way from its initial listing price in June 2008 of 20c, finishing 2008 at around 3c. An 85% fall in 6 months.

Centro Property Group: crashed 84.5% from $5.70 to 88c in two trading days after dropping this bombshell on December 17, 2007, revealing that it couldn't roll over $4 billion in short term debt.

Macmahon Holdings: because of the mining slowdown, Macmahon announced that the first half profit forecast could be down by up to 35%. Between October - December 2008 the share price plummeted from $1.90 to 40c or 83%.

Oz Minerals:
spruiking there was $1 billion in cash in the bank as of June 2008, metal prices plummeted 60% along with the $1 billion in the following 6 months. OZ Minerals' market value has fallen by $6.5 billion, or 79%. Trading is suspended until Feb 27 2009 whilst debt re-financing is explored.

Macarthur Coal:
As the demand for coal decreases, so does the share price of Macarthur Coal. In December 2008, Macarthur announced a reduced production schedule, no interim dividends and job cuts. First half profit predictions have also been diluted by up to 50%. In the 6 months since July 2008, the share price has plunged from around $21 to $3 or 78%.

Paperlinx:
in Dec 2008 shares fell 32% or 34c on the day of an announcement predicting up to a 15% first half profit fall. In 8 months the share price has fell from $2.70 to 60c or 77%. It also has breached lending covenants and has failed to fully complete asset sales.

Credit Corp: shares in the debt collector plunged 77% from $3.08 to 91c after this profit downgrade released on February 11, 2008. The chairman and CEO were both gone within weeks.

Rio Tinto: on the back of the announcement that BHP-Biliton was scrapping its takeover bid, Rio Tinto shares fell 35%. In addition to the slow-down in China, Rio shares have plunged more than 70% from $155 in May 2008 to $40 in December 2008.

MFS:
shares in the failed Gold Coast property and finance company plunged 69% on January 18, 2008, after co-founder Michael King revealed a shock $550 million capital raising in this presentation on a proposed demerger. He resigned two days later.

City Pacific:
shares in the Gold Coast property developer and financier plunged 60.5% from $2.45 to 97c in the two days after releasing this revised profit result late on Friday, February 29, 2008.

Leighton: the value of Australia's largest construction company has fallen by more than 60% in the past 12 months. In Jan 2008 the share price was around $63 and Jan 2009 is around $20. A recent 10% fall was triggered by an announcement of reduced profit forecast of asset write-downs.

Transfield Services:
following a 3 week trading halt, Transfield announced that a $300 million capital raising excersise was going to be at a discount to market price. Each share was offered at $1.25 which was out of line with the share price at the time of $3.50. When trading resumed, the price plunged 60% which corrected the difference.

Burns Philp: shares plunged 58.3% from $2.16 to 90c on September 24, 1997, after it failed to sell the herbs and spices division and instead took a massive write-down.

Elders: plunged 46% to 44c because of downgraded earnings guidance and now expect a 2009/10 full year loss of between $8-$14m, compared to the original prospectus target of a $55.7m profit.

Consolidator Harts Australia
: suffered a 45% drop in their share price in two days, after the company announced it lost $9.4 million in 2000.

Flexigroup: the Margaret Jackson-chaired consumer finance company halved from $1.11 to 55c in the four trading days after releasing this disappointing half year profit on February 25, 2008.

Babcock & Brown Power: shares dropped by 37% to $1.18 over two trading days in late May 2008 after it revealed a $300 million shortfall in its attempts to refinance $3.1 billion in debt.

Pharmaxis:
down 36.7% after releasing clinical trial results for their cystic fibrosis drug Bronchitol. Results showed the drug narrowly failed to improve lung function compared to the placebo.

Babcock & Brown: shares plunged 36% to record low of $2.22 on August 21, 2008 after revealing a disappointing profit and major board and management overhaul.




Transpacific: shares slumped 36%, or $1, to $1.80, wiping off $311m their market value on February 17, 2009 when they issued a profit downgrade.

Pacifica Group: shares plunged 7c, or 32%, to 15c, following a steep downturn in the automotive sector. This car parts supplier announced a loss of $242 million for the December half. In 2007 the managed a profit of more than $21 million which is a $260 million downturn.

Downer EDI: announced a $199 million provision on August 8, 2006, against its troubled Douglas Mineral Sands project in Victoria, resulting in a net loss of $25 million for 2005-06. Share price crashed the next day by 30% from $7.40 to $5.15.

Commander Communications: after a three week suspension for failing to lodge its accounts, the troubled telco saw its shares plunge 29% on October 19, 2007, when trading resumed.

Hedley Leisure & Gaming: share price plunged 28% to 93c after this statement was released on March 6, 2008, revealing some interest rate hedges had been unwound to reduce the company's $850 million debt.

Babcock & Brown Power: plunged 28% on June 12, 2008, after the WA gas explosion and its credit rating was downgraded.

AWB:
plunged 25% or 51c to $1.53 on February 9, 2009, following a profit downgrade warning at the 2009 AGM.

GPT: shares in the property giant plunged 24% from $2.46 to $1.87 in the two days after revealing this shock profit warning on July 7 which cut forecast 2008 operating earnings by 26.7% from $633 million to just $464 million.

Asciano: July 8, 2008, saw the share price plunge 20% or 65c to $2.72 on continuing rumours of a big rights issue to pay off debt.

Commander Communications:
the voice and data communication solutions provider reported a disappointing annual profit increase to $23.6 million on August 22, 2005, sending its shares plunging 46c to $2.07, a loss of 18% on the day.

Ausenco: the mining contractor responsible for Equinox's Zambia-based project has fallen another 3.8% making a 16.6% fall in two
days because of a fire at the project.

Downer EDI: shares crashed 16.5% on August 2, 2007, when CEO Stephen Gillies quit after the 2006-07 profit forecast was slashed from $160 million to $101 million.

Kaz: shares in the IT company dived 5c to 27c (15.6%) on 19 September 2003 after the announcement that chairman Tony Hartnell (ex ASIC boss), Michael Lillicrap and Murray Wells (independent directors) had resigned after a split emerged between the independent and executive directors over how the new CEO would be appointed.

Equinox:
following the news of a fire at their Zambia-based project, the share price fell another 5.8% making a 15.7% fall.

Boral: shares dived 15.7% on January 28, 2009, after another shock warning that profits would drop by 40% in 2008-09 to $120 million.

Transurban: after an announcement it will be slashing dividends, the share price fell nearly 15% to $4.62. This is on top of a 20% share price slump the previous day.


Suncorp: a profit warning on July 31, 2008, explaining that earnings would drop by $500 million sent Suncorp shares tumbling 14% to $11.53 the next day.

Just Group: July 2, 2008 on the back of lower than expected profits coupled with the overhang of a Soloman Lew takeover, the share price plunged 12 per cent to $2.80.

Brambles:
shares fell 10% in 2001 when it was announced that CEO John Fletcher would depart after a disagreement with new chairman Don Argus.

Macquarie Group: this announcement on Feburary 6, 2008, that Allan Moss was retiring and Nicholas Moore would take over as CEO sent shares in the Millionaire Factory down 9%, although the market was off almost 2% and we also had an operational update on the day.

Coles Myer: shares fell 8% on the day in 1994 when their finance director Philip Bowman was terminated and then blew the whistle on Yannon.

Woolworths:
the defection of supermarket boss Ian Cornell to Franklins in November 1998 saw Woolies shares plunged 7.3% as $504 million was wiped off its value. Woolies has since doubled as Roger Corbett proved all the critics wrong.

Perpetual Trustees: when Peter Morgan, senior portfolio manager, resigned from his role in September 2002, Perpetual's share price plunged 7% although it recovered some ground the next day.



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