shares got slammed as the company reveals that its auditors have some "going concern" issues.
The San Jose, Calif., optical networking parts maker said its accountants Ernst & Young issued an audit report Sept. 11 that included "an explanatory paragraph regarding the company's ability to continue as a going concern."
In the company's annual report filed a week ago, the company says it would need to raise at least $10 million to continue operating if its lenders cut off its credit. Bookham's low cash balance and continued losses for the foreseeable future and any inability to tap its $25 million credit line would require the company to raise more cash.
The news comes as Bookham announced Thursday that it sold its assembly and testing facility in Paignton, U.K., for $9.5 million. The company did not name the buyer.
"With this latest transaction we will have raised approximately $41 million from the recent private placement of common stock and the sale of our Paignton facility," CEO Giorgio Anania said in a press release Thursday.
Bookham shares dropped 4% in premarket trading.