Shares traded were six times higher than usual
BERLIN — Government securities regulators are looking for evidence of illegal insider trading of German distrib giant Kinowelt stock before the release of the company’s annual figures last week.Authorities said the number of Kinowelt shares traded were six times higher than usual, but nevertheless called the examination routine. A decision to launch an official investigation will be made after the initial review. Kinowelt shares hit a record low of 7.20 euros ($6.48) Friday after the company’s less than upbeat fiscal report. When shares fell sharply the day before, suspicion arose that news of Kinowelt’s decline in profits had reached investors early. The poor profits coupled with Oscar wins for Kinowelt pic “Crouching Tiger, Hidden Dragon” has led to contradicting recommendations by some German banks. Trimming outlook ABN Amro halved its upside target for Kinowelt stock from $9 to $4.50 due to the disappointing figures last week and issued a profit warning for 2001; it is also advising shareholders to sell. While Kinowelt foresees cash flow of $50 million this year, analysts are predicting pre-tax profits of around $22.5 million. However, thanks to “Crouching Tiger’s” Oscar successes, including the foreign-lingo film kudo, Teutonic bank Merck Finck is recommending retaining shares in Kinowelt, which is distributing the pic in Germany.
Want Entertainment News First? Sign up for Variety Alerts and Newsletters!