Cohen Milstein Sellers & Toll PLLC is conducting an investigation to determine whether CIBER, Inc. (“CIBER” or the “Company”) and certain of its officers and directors made false and misleading statements and/or omissions in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.
A class action lawsuit has been filed in the U.S. District Court for the District of Colorado by another law firm on behalf of purchasers of the common stock of CIBER, Inc. (NYSE: CBR) between December 15, 2010 and August 3, 2011, inclusive (the “Class Period”).
The complaint alleges that CIBER and certain of its officers and/or directors (“Defendants”) misrepresented and/or failed to disclose that: (1) the Company could not achieve its reported business outlook and aggressive guidance due to the fact that it was migrating away from its low margin business, and those unprofitable legacy fixed-price contracts would have to be charged against the Company’s revenue and earnings; (2) declining sales in the Company’s North American division would adversely affect the Company’s 2011 results; (3) the Company was not actually implementing new strategic initiatives that would improve its financial performance; (4) the Company’s wholesale transition would adversely affect the Company’s financial performance; (5) the Company lacked an effective system of internal and disclosure controls; and (6) as a result, the Company lacked a basis for its positive statements about the Company’s financial results, significant growth and future guidance.
On August 3, 2011, CIBER released second quarter financial results that were well below expectations, including a net loss of $58.4 million, or $0.81 per share. CIBER attributed the poor results in large part to a $13.4 million charge from the “adjustment for significant changes in estimates related to costs or scope on … five fixed-price projects.” In addition, CIBER’s North American division reported a 23% decline in revenue. CIBER stated that, “[t]he other significant impact on Q2 was the shortfall in North American sales and revenue production,” and acknowledged that, “[a]lthough it is disappointing, it is not completely unforeseen, given the tremendous reorganization this unit has undergone, as it moves from a branch model to a functional model.” The Company further reported that it was withdrawing its 2011 guidance “as a result of the reduction in earnings related to the five fixed-price contracts, a revenue decline in North America and the write-off of historic balance sheet items.”