Jabil takes a hit for $54.3-million
The St. Petersburg company is under investigation for its handling of options.
By Madhusmita Bora, Times Staff Writer
Published March 29, 2007
Citing "administrative errors" and miscalculations, worldwide electronics manufacturer Jabil Circuit said it will record $54.3-million in expenses from stock options.
In a late Wednesday afternoon filing with the U.S. Securities and Exchange Commission, the St. Petersburg company also deemed its 2003 earnings unreliable and said it will readjust its 2004 earnings by an "immaterial" amount.
The news, coming after the close of market, punished Jabil's stock, pushing shares down more than 30 percent at one point in after-market trading. Jabil's stock closed Wednesday at $22.04 a share, down 20 cents.
The charge covers stock options awarded over nearly a decade from 1996 to Aug. 31, 2005, according to the filing. Of that, $1.7-million went to chief executive Tim Main and other company executives, and $3.7-million to a single board member for consulting services over a period of five years. The board member was not named.
Approximately $48.9-million were options granted to employees that weren't executives or company directors. Jabil said the dates used in its stock-related compensation didn't comply with Securities and Exchange Commission requirements.
Jabil is among a growing list of public companies under investigation by the SEC or U.S. Department of Justice over its handling of stock options. Regulators are examining whether executives backdated options to increase their value.
Senior executives in other companies have stepped down over the controversy, but Main has steadfastly maintained his innocence. In December, an internal company investigation found that top executives did not issue themselves backdated stock options or try to get others to issue them.
Madhusmita Bora can be reached at firstname.lastname@example.org.