November 21, 2019 - A consolidated amended complaint was filed.
June 7, 2019 - An investor in shares of Ascena Retail Group, Inc. (NASDAQ: ASNA) filed a lawsuit in the U.S. District Court for the District of New Jersey over alleged violations of Federal Securities Laws by Ascena Retail Group, Inc. in connection with certain allegedly false and misleading statements made between September 16, 2015 and June 8, 2017.
Mahwah, NJ based Ascena Retail Group, Inc., through its subsidiaries, operates as a specialty retailer of apparel, shoes, and accessories for women and tween girls in the United States, Canada, and Puerto Rico.
On May 17, 2017, Ascena Retail Group, Inc announced that it was revising its third quarter and full year 2017 sales and earnings outlook, due to “a period of unprecedented secular change that is disruptive to traditional business models,” and that the Company would be taking an impairment charge.
Shares of Ascena Retail Group, Inc. (NASDAQ: ASNA) declined from $14.74 per share in October 2015 to as low as $1.68 per share on May 26, 2017.
Then on June 8, 2017, Ascena Retail Group, Inc announced its third quarter 2017 financial results, reporting a GAAP loss of $5.29 per diluted share compared to net earnings of $.08 per diluted share in the year-ago period. The loss included a non-cash pre-tax impairment charge of $1.324 billion (after tax impact of $5.22 per diluted share) to write down a portion of the Company’s goodwill and other intangible assets.
On September 20, 2017, Ascena Retail Group, Inc reported its fourth quarter and full year fiscal 2017 results. Ascena Retail Group, Inc. reported that its Total Revenue rose from over $4.8 billion for the 12 months period that ended on July 25, 2015 to over $6.99 billion for the 12 months period that ended on July 29, 2016 and that its Net Loss over those respective time periods declined from $236.8 million to $11.9 million
According to the complaint the plaintiff alleges on behalf of purchasers of Ascena Retail Group, Inc. (NASDAQ: ASNA) common shares between September 16, 2015 and June 8, 2017, that the defendants violated Federal Securities Laws. More specifically, the plaintiff claims that between September 16, 2015 and June 8, 2017, the defendants failed to disclose that the Ann Acquisition was a complete disaster for the Company as Ann’s operations were in far worse condition than had been represented to the public; that, in order to mask the true condition of Ann, defendants improperly delayed recognizing an impairment charge to the value of Ann’s goodwill and, as a result, Ascena’s reported income and assets were materially overstated and the Company’s financial results were not prepared in conformity with Generally Accepted Accounting Principles (“GAAP”); and that many of the brands acquired in the Ann Acquisition were in steep decline and were also materially overvalued on Ascena’s financial statements between September 16, 2015 and June 8, 2017.