DryShips (DRYS - Get Report) said unwinding a failed hedging strategy will lop 68 cents a share off third-quarter earnings. Analysts surveyed by Thomson Financial were looking for a 69-cent profit. The stock fell 5.4% to $13.05.
"Earlier this year, the company took the decision to enter into freight-forward agreements to protect against a declining market going into the seasonally low summer period," DryShips said. "Against expectations, the freight market staged a contra-seasonal recovery. When this became apparent, the company settled or closed its positions. Despite the negative impact limited to the third-quarter earnings, we are happy the market has turned out much stronger than expected."
The furniture maker expects to earn 1 cent to 4 cents a share for the quarter ending Oct. 28, down from its earlier forecast of 11 cents to 15 cents a share. Analysts were looking for earnings of 12 cents a share. Shares were giving up $2 to $13.