NEW YORK, Sept. 09, 2024 (GLOBE NEWSWIRE) -- Attorney Advertising -- Bronstein, Gewirtz & Grossman, LLC, a nationally recognized law firm, notifies investors that a class action lawsuit has been filed against CAE Inc. (“CAE” or “the Company”) (: CAE) and certain of its officers.
Class Definition
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired CAE securities between February 11, 2022, and May 21, 2024, inclusive (the “Class Period”). Such investors are encouraged to join this case by visiting the firm’s site: bgandg.com/CAE.
Case Details
According to the Complaint, CAE is a technology company that offers software-based simulation training and critical operations support solutions primarily in two business segments: (1) Civil Aviation and (2) Defense and Security (“Defense”). CAE’s Defense segment provides independent training and simulation solutions for global defense and security forces.
This case, per the Complaint, concerns Defendants’ misrepresentations concerning significant cost overruns in CAE’s Defense segment caused by several fixed-price, long-term Defense contracts entered into prior to the COVID-19 pandemic. During the Class Period, the CAE’s CFO stated the Company had reduced its “hard costs,” drove “added staffing efficiencies,” and that CAE was “focus[ed] on internally making us stronger and contributing to margin expansion.” The Company also stated that “[n]otwithstanding the ongoing challenges posed by the pandemic, CAE is already delivering stronger financial performance . . . and optimizing its position[.]”
However, the truth began to emerge on August 10, 2022, asserts the Complaint, when CAE issued a press release reporting its first quarter fiscal 2023 results and announced it had incurred “$28.9 million in unfavorable contract profit adjustments in Defense, involving two programs in the U.S.” CAE revealed the unfavorable contract profit adjustments were the result of “delays and meeting customer requirements on scope and timing,” along with “staffing shortages [and] supply chain pressures[.]” On this news, the price of CAE stock declined $4.32 per share, or more than 16%, from $25.80 per share on August 9, 2022, to $21.48 per share on August 10, 2022.
Additionally, on November 14, 2023, the Complaint explains that CAE issued a press release reporting its second quarter fiscal year 2024 results and stated that certain legacy contracts continued to be plagued by cost overruns. CAE revealed that, within the Defense segment, the Company planned to “retir[e] legacy contracts, which have been most affected by inflationary pressures” and further stated that “[w]e are firmly focused on retiring legacy contracts as soon as possible and to mitigating the cost pressures associated with them.” On this news, the price of CAE stock declined $0.85 per share, or nearly 4%, from $21.92 per share on November 13, 2023, to $21.07 per share on November 14, 2023.
Then, on February 14, 2024, states the Complaint, CAE issued a press release reporting its third quarter fiscal year 2024 results and identified “eight distinct legacy contracts” that are firm, fixed-price in structure and that suffered from severe cost overruns due to supply chain disruptions, inflationary pressures, and availability of labor. According to the press release, the Company “sought to further accelerate the retirement of outstanding program risks, mainly associated with certain legacy Defense contracts that we entered into pre-COVID and have been most impacted by economic headwinds.” CAE further revealed that “[a]lthough [the contracts] represent only a small fraction of the current business, these contracts have disproportionately impacted overall Defense profitability.” On this news, the price of CAE stock declined $2.01 per share, or nearly 10%, from $20.92 per share on February 13, 2024, to $18.91 per share on February 14, 2024.
Finally, after the close of trading on May 21, 2024, the Complaint notes that CAE issued a press release announcing a “re-baselining of its Defense business, Defense impairments, accelerated risk recognition on Legacy Contracts and appointment of Nick Leontidis as COO[.]” The Company stated that “CAE has recorded a $568.0 million non-cash impairment of Defense goodwill,” “$90.3 million in unfavorable Defense contract profit adjustments as a result of accelerated risk recognition on the Legacy Contracts,” and a “$35.7 million impairment of related technology and other non-financial assets which are principally related to the Legacy Contracts.” On this news, the price of CAE stock declined $1.03 per share, or more than 5%, from $19.83 per share on May 21, 2024, to $18.80 per share on May 22, 2024.
Therefore, the Complaint alleges that shareholders who purchased CAE stock during the Class Period have suffered damages under the federal securities laws.
What's Next?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm’s site: bgandg.com/CAE or you may contact Peretz Bronstein, Esq. or his Client Relations Manager, Nathan Miller, of Bronstein, Gewirtz & Grossman, LLC at 332-239-2660. If you suffered a loss in CAE you have until September 16, 2024, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
There is No Cost to You
We represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys’ fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide.
Attorney advertising. Prior results do not guarantee similar outcomes.
Contact
Bronstein, Gewirtz & Grossman, LLC
Peretz Bronstein or Nathan Miller
332-239-2660 | [email protected]
