San Francisco-based Diamond Foods (NASDAQ: DMND), a company that processes, markets and distributes snacks such as glazed and roasted nuts, dried fruits, trail mixes, seeds, microwave popcorn and chips under various brand names, has announced that it will be restating results for the past two years and part of the current year to take into consideration improperly accounted payments to walnut growers. Diamond Foods launched an internal investigation into the payments to walnut growers last year and found that the payments were improperly accounted for. Diamond Foods is undertaking a cleaning up of its accounts after the irregularities were confirmed.
It is unclear whether the Diamond Foods restatement will be limited to the payments to walnut growers. It is also not yet clear whether Diamond Foods will provide a through explanation for the restatement, which it planned to release after trading hours on Tuesday.
Shares of Diamond Foods has declined in the past year during the investigation. Diamond Foods also saw the departure of its CEO and CFO after the details of the improper accounting emerged and the bid for Proctor & Gamble’s Pringles chips collapsed.
About Diamond Foods
Diamond Foods, based in San Francisco, is engaged in the processing, distribution, and marketing of processed foods. Diamond Foods acquires and energizes various brands associated with processed foods. Some of the brands owned by Diamond Foods include Kettle Chips, Emerald, Pop Secret and Diamond of California. Diamond Foods is a major player in the snack market in the US. Diamond Foods products are available in grocery stores, natural supermarkets, club stores, convenience food stores, impulse channels, mass merchandisers and food service outlets.
Diamond Foods also offers re-sealable, on-the-go packaging for snacks sold under the Emerald brand name. The Emerald brand also offers 100-calorie snack packages for consumers desiring to control portion sizes. Diamond Foods also sells in-shell and culinary nuts under its Diamond of California brand. Diamond Foods has a wide range of snack products in various categories positioned in different outlets to help reach many consumer groups. Diamond Foods offers consumers nuts, chips, popcorn and trail mixes, as well as other processed and packaged snacks.
Shares of Diamond Foods were up 14.5% to close Tuesday’s trading session at $20.43 with 1.2 million shares traded. The short interest for Diamond Foods is near 35% while the options market data reveals a potential for price increases as out of the money calls reaching up to $65.00 for January were traded with dispersion from $20.00 to $65.00.
While investors appeared to anticipate better times for Diamond Foods, other shares fared badly on Tuesday. For instance, shares of Cyclacel Pharmaceuticals (NASDAQ: CYCC) declined by 12.3% to $4.63 with 384,979 shares traded. Another stock that saw a decline was MAKO Surgical (NASDAQ: MAKO), which saw a fall in share prices of 9.1% to close Tuesday’s session at $13.21 with 1.6 million shares traded. NutriSystem (NASDAQ: NTRI) saw its shares decline by 8.7% to $7.60 with 864,859 shares changing hands.
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