The bloodbath in the shares of San Jose retailer Businessland Inc on Tuesday was apocalyptic even in the context of the Saddamasochistic frenzy gripping markets in the wake of the extinguishment of Kuwait, and after the company announced a fourth quarter loss of $21.5m and restated its figures for the second and third quarters to increase the reported losses, trading in the stock was delayed as cryptic messages like Businessland Indication 3 To 6; Last Sale 6 7-8 on the Dow followed thick and fast. The message means that the last trade in the stock was at $6.78, but that the current valuation could be anything between $3 and $6, which is a remarkable spread, because when trading in the shares did finally start, the price lost over half its value, plunging $3.75 to hit $3.125 – and it kept going right on down, hitting bottom at $2.75, off $4.125. The company said that its reported losses placed it in violation of some of the covenants of its $50m outstanding senior notes and that it was in contact with its lenders and needed to improve its liquidity position in order to fund growth of its core business. The restatement of the fiscal 1990 second and third quarters’ results reflected adjustments for accounting errors primarily related to expense accruals in the second quarter and recognition of vendor credits in the third quarter. The company has also closed some non-performing stores.
