Luna expediting Nasdaq delisting process, ending public financial reporting

Luna Innovations recently made an announcement that they plan to hasten their delisting from the Nasdaq Stock Market and discontinue future financial reporting obligations. This decision came after the Roanoke-based fiber optic sensing and monitoring company failed to file accurate financial statements for over a year, leading to its suspension from the stock market.

Concerns about the company’s financial status have been ongoing for several months. Luna admitted to inaccuracies in their financial reports, prompting Nasdaq to suspend trading and start the delisting process. The root of the problem lies in revenue recognition, specifically whether the reported earnings align with the timing of service delivery. Luna’s failure to meet financial reporting deadlines resulted in lawsuits from shareholders and a significant reshuffle in the executive team.

To address these issues, Luna indicated in their recent press release that they would submit paperwork to the SEC on February 6 to be delisted and deregistered from Nasdaq. They also plan to terminate their financial reporting obligations to the SEC. Luna qualified for these actions since they had fewer than 300 shareholders as of the end of the previous year.

Although Luna will likely keep its common stock on the Over the Counter Expert Market, there is no guarantee of maintaining a trading market in any over-the-counter platform. As of Monday, Luna’s stock was valued at around 90 cents per share, a stark contrast from the $7.92 per share it traded at prior to facing financial challenges.

Luna’s CEO, Kevin Ilcisin, described the company’s decision as strategic, considering the cost savings and the challenges of maintaining public company status. He believes this shift will enable Luna to redirect resources from regulatory compliance towards advancing their core business objectives.

Despite these challenges, Luna remains optimistic about its future. With a focus on business sustainability and growth, Luna’s strategic moves are aimed at overcoming current setbacks and paving the way for a more stable and successful future in the field of fiber optics and monitoring technology.