LBC Express Holdings, Inc. has withdrawn its application to conduct a follow-on offering with the Securities and Exchange Commission (SEC), citing how the financial statements required for the issuance have already lapsed.
In a disclosure to the stock exchange Monday, the Araneta-led logistics firm said it has filed the withdrawal for its application to offer a total of 69.101 million common shares, which was submitted in April 2018. The offering included 10 million new common shares and 59.10 million secondary shares.
LBC Express said financial information included in a registration statement should be as of a date not earlier than 180 days from the date of filing. Its application, however, still contains its financial performance for the full year ended 2016, 2017, and 2018, as well as the period ended March 2019.
“Considering that these financial statements have become stale, there is now a need to further update the same,” the company said.
“The company anticipates that it will take some time to have its financial statements audited or reviewed, and for this reason has decided to withdraw its Offer, without prejudice to a possible re-filing by the company of such application at a later date.”
LBC Express has been trying to pursue a follow-on offering for about four years now, since it entered the stock market by taking over dormant holding firm Federal Resources Investment Group, Inc. in 2015.
Its application was previously rejected by the Philippine Stock Exchange because of the pending cases filed by the Philippine Depository Insurance Corp. (PDIC) against its owners.
The PDIC case filed before the Department of Justice in 2016 concerns the officials of the now defunct LBC Development Bank, Inc. for estafa, and violation of the PDIC Charter or Republic Act No. 3591 by conducting business in an “unsafe and unsound manner” that caused the bank to lose at least P1.8 billion.
LBC Express argued then that the PDIC case should not affect its eligibility to conduct the share sale.
Meanwhile, the company has committed to open 70 to 100 branches every year, funded through internally generated sources as well as the supposed proceeds of the follow-on offering.
LBC Express’ net income attributable to the parent fell by 53% to P561.88 million in the first half of 2019, amid a 34% jump in gross revenues to P7.85 billion.
Shares in LBC Express were last traded at P13.54 each at the stock exchange on Friday, Oct. 4. — Arra B. Francia