Why Diebold Shares Tumbled
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What: Shares of Diebold , maker of ATMs and other cash processing machines hit a snag today, falling 8.4% after reporting preliminary earnings and informing investors that its CEO is leaving.
So what: CEO Tom Swidarski, who spent 17 years with company and the past seven at the helm, said he is leaving immediately and vacating his seat on the board, after apparently being ousted by the board. Chairman of the Board and now acting CEO Henry Wallace remarked that "the company had underperformed against opportunities in the marketplace" and said it was time for a change. Management also said it expects a $0.45 adjusted per-share profit for the quarter on $840 million in revenue.
Now what: Analysts had projected $0.64 in EPS for the quarter, so the miss probably plays into the drop as well. Additional expenses for non-recurring issues will cost the company $40 million and force a loss for the quarter. Diebold also warned on its 2013 guidance, saying revenue will be flat and earnings will decline slightly. With additional problems in its overseas business and recent job cuts, I'd wait for better news until I got on board.
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