Shares in XS Leisure, took a beating yesterday after the ten-pin bowling centres, American pool bars and nightclub operator said that its profits had been overstated "by a considerable margin".
The company, which operates 19 outlets of Hustlers pool halls, The Sanctuary nightclubs and XS ten-pin bowling, said that Philip Bunt, the finance director, resigned after the board realised the error. Mr Bunt's share options - worth £93,500 - have been cancelled.
The company said it had been forced to drop plans for an acquisition because of the error, which came to light as the deal was being put together. It added that it expected to make a loss this year.
XS's chairman Sir Aubrey Brocklebank said: "We cancelled a rather large acquisition as that would have involved raising equity. And, as what we thought our profits were and what they are a long way apart, we do not think we are able to do that."
Shares in XS, fell 14p to close at an all-time low of 54.5p.
Sir Aubrey said: "We are not highly borrowed so there is scope there [for future deals]. But the near future will be a time of consolidation."
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