Public shares of ad-agency holding company Interpublic Group of Cos. Inc. plunged nearly 30 percent to $11.44 each Thursday in reaction to the company's
announcement the night before that its third-quarter earnings would be less than
one-half what was previously forecast. Full-year earnings will be about one-third
less than previously forecast, the company said.
It was the second time in two months the company lowered its forecast
for the third quarter and the year. The company also said a pending
restatement of earnings would now result in a charge of $120 million in pretax
earnings over the past five years.
Previously, the company said it believed only $68.5 million had been
improperly recorded as expenses instead of profits. Interpublic insisted however
that the accounting irregularities weren't "material" to the company's bottom
line in any prior reporting period.
The company said it will release its third-quarter financials Nov. 13,
after the 4 p.m. close of the New York Stock Exchange, on which its shares are traded.