(Reuters) – Elf Beauty acknowledged on Thursday accusations by short-seller Muddy Waters relating to the attraction agency overemphasizing its revenue and inventory numbers have been “without merit”.
Muddy Waters has really taken a short placement in Elf, asserting that the agency doubtlessly overemphasized its revenue by so long as $190 million over the earlier 3 years and inflated its inventory numbers to cowl for insufficient gross sales, the bush fund’s chief govt officer Carson Block acknowledged on Wednesday at a seminar in London.
Shares of Elf dropped so long as 16% on Wednesday complying with the short-seller file nonetheless pared losses to close 2.2% diminished at $119. The provide has really just about quadrupled from 2023 to strike a doc excessive in March.
“Muddy Waters’ latest report is an attempt by a noted short-seller to negatively impact Elf Beauty’s share price for its own benefit and at the expense of all other Elf Beauty shareholders, and Muddy Waters’ allegations are without merit,” Elf acknowledged in a declaration.
Elf elevated its projections for yearly gross sales and earnings beforehand in November, ending up being the one agency doing effectively in a weak attraction market the place custom cosmetics model names similar to Estee Lauder and L’Oreal have really been encountering lowering want.
The attraction agency likewise acknowledged on Thursday that for reasonably priced components, it had really submitted an ask for discretion with united state Customs and Border Protection in very early 2024, relative to personalizeds import info.
“Therefore, import data available to the public after February 6, 2024, does not include a substantial majority of our actual U.S. imports,” Elf acknowledged.
(Reporting by Ananya Mariam Rajesh in Bengaluru; Editing by Devika Syamnath)
