DENVER-Shareholders of Evolving Systems Inc. filed a federal lawsuit against the Englewood, Colo.-based company saying it misrepresented its financial position in filings related to its initial public offering.
The lawsuit, which names the company and certain officers and directors, was filed in the U.S. District Court in Colorado.
Evolving Systems went public last month with an IPO of about 4.6 million shares priced at $14 per share. The stock actually traded in the $15 to $20 range for a month before sliding to $9.50 June 18 on news the company would report lower-than-expected second quarter financial results.
Analysts had predicted Evolving Systems would earn $13.3 million in revenues and net income of 5 cents per share. The company instead says it expects to report revenues of between $10.5 million and $12 million, and a net loss of between $700,000 and $1.3 million.
J. Richard Abramson, president and chief executive officer of the company, attributed the results to slower sales cycles than expected in some markets.
Evolving System’s stock last week appeared to be making a gradual recovery, trading at about $11.19 on Thursday.
Evolving Systems is a software product development and systems integration firm, involved in local number portability.
