Shares of Luceco Drop 46% After Accounting Error

Luceco was the largest faller on the main market after it reported an accounting error.

The financial controller of the LED maker has stepped down after it surfaced that a weak margin had been unidentified, because of a miscalculation of the value of the group.

Profit after tax for the year to 31 December will currently be about £13.2m, instead of the market expectations amounting to £16.7m.

The strength of the Chinese yuan and the ongoing weakness in the pound as compared to the US dollar were blamed for the reduction of the margin to around 33 percent.

In a statement to the market today, Luceco said: “The group will be able to mitigate some of these headwinds through internal efficiency savings and overhead reductions, with margins expected to recover to long-term expectations in H2 2018 as a result of these actions.

“The group also intends to increase its foreign exchange and commodity price hedging activities with particular focus on the Chinese RMB versus the US Dollar.”