spacetoday.net: Orbital shares drop on stock option concerns

Posted: Mon, Oct 30, 2006, 8:03 AM ET (1303 GMT)
Shares in Orbital Sciences Corporation dropped in trading Friday despite a strong fiscal third quarter after the company revealed that it may have incorrectly dated stock option grants. Orbital announced that it had a net income of $8.6 million on revenue of $197.7 million in the third quarter of 2006, compared with net income of $6.8 million on $159.3 million in net income for the same quarter of 2005. Revenues were bolstered by a string increase in satellite and space systems division, offseting a small decline in launch systems; the same was true for operating income. Despite the strong performance, shares in the company fell nearly 12 percent in trading on Friday when the company revealed that an internal investigation had uncovered inadvertently misdated stock options, a problem that has afflicted dozens of other companies in recent months. The company said that it would have to restate several years' worth of earnings statements, taking a $14-million charge in the process. The restatement will not materially affect the third quarter results, the company said.