iSelect stands by market statement
Insurance comparison website iSelect has defended a "potentially misleading" announcement it made to the stock exchange two months ago, after the corporate watchdog demanded it be withdrawn or modified.
In a statement to the market on Wednesday, iSelect said it would leave the August 29 announcement as it was until it had finalised its September quarter accounts.
BusinessDay revealed on Tuesday that the regulator demanded the company either clarify or retract the announcement, stating in a letter to iSelect lawyers it believed the company cut internal revenue forecasts for its health and car insurance businesses without telling the market.
The company confirmed it had received a notice from the Australian Securities and Investments Commission, asking it to explain the assumptions underpinning its earnings before interest, tax, depreciation and amortisation forecast for the year to December of $30 million.
But iSelect said in the interests of shareholders it would issue a trading update only "once it had finalised its management accounts for the September quarter".
The company said it expected to be in a position to provide the market with a trading update for the September quarter within the coming days, but had no reason to depart from its previous advice that it would hit its earnings forecasts.
Shares in iSelect fell 15 per cent after the company listed on the Australian Stock Exchange on June 24. They have not since traded above their issue price of $1.85, and closed on Wednesday down 2.5¢ at $1.20.
The company said it would provide ASIC with a draft trading update on Thursday, following a meeting with regulators on October 3. It was of the view that since listing on the ASX in June, "it has fully complied with all of its continuous disclosure obligations".