Billboard Insider has picked up more information related to our Daktronics story from yesterday.
First is a press release from Daktronics on an addition to their Board of Directors. Here is a portion of that release.
BROOKINGS, S.D., Dec. 07, 2022 (GLOBE NEWSWIRE) — Daktronics, Inc. (NASDAQ – DAKT) today announced the expansion of its Board of Directors to eight members and the appointment of Howard I. Atkins as the eighth director.
Reece A. Kurtenbach, chairman, president and CEO commented “The Board has expanded our ongoing refreshment to support the Company’s long-term growth and value creation strategies. Howard’s extensive expertise and experience, especially in strategic development, margin improvement, and financing, further enhances the Board’s mix of perspectives. We welcome Howard to the Board and look forward to collaborating with him to lead the Company to success in the emerging opportunities in our industry.”
Howard I. Atkins currently owns and manages HIA Capital, a business consulting and investment firm. In 2011, Mr. Atkins retired as the Senior Executive Vice President and Chief Financial Officer of Wells Fargo & Company, a banking and financial services company, where he was responsible for Wells Fargo’s financial management functions, investment portfolios, investor relations, capital management and corporate properties functions from 2001 to 2011. A 37-year veteran of the financial services industry, Mr. Atkins previously served as Executive Vice President and Chief Financial Officer of New York Life Insurance Company; Chief Financial Officer of Midlantic Corporation and Corporate Treasurer of Chase Manhattan Bank. In addition, Mr. Atkins served as a Director for Occidental Petroleum Corporation from 2010-2019 and for Ingram Micro from 2004-2017.
Insiders’ Take: Howard Atkins brings a strong financial management resume to the Board. Billboard Insider doubts Atkins would even consider this position if Daktronics had unsolveable issues.
The next item concerns the legal world. Again a portion of a press release:
LOS ANGELES–(BUSINESS WIRE)–The Law Offices of Frank R. Cruz announces an investigation of Daktronics, Inc. (“Daktronics” or the “Company”) (NASDAQ: DAKT) on behalf of investors concerning the Company’s possible violations of federal securities laws.On December 6, 2022, Daktronics, Inc. disclosed that it would be unable to timely file its Quarterly Report on Form 10-Q for the period ended October 29, 2022, and that there is “substantial doubt” about the Company’s ability to continue as a going concern. Daktronics also disclosed that it recorded a valuation allowance of approximately $13.0 million for deferred tax assets which “created a covenant violation under our line of credit agreement.” The company further disclosed that “[i]n light of the substantial doubt in our ability to continue as a going concern and our related evaluation of the income tax implications of reaching this conclusion, the Company also expects to conclude that its disclosure controls and procedures and internal control over financial reporting were not effective as a result of material weaknesses.” On this news, Daktronics’ share price fell $1.30, or 39.2%, to close at $2.02 per share on December 7, 2022, thereby injuring investors.
Insiders’ Take: This was to be expected. When any public company announces bad news it can expect to be sued by class action attorneys. We’ll have an update on Daktronics after they release their earnings next Tuesday. Daktronics stock fell by 13% yesterday on a day when the S&P 500 rose 0.75%.
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