LONDON & NEW YORK - Cazoo Group Ltd (NYSE: NYSE:CZOO), the UK-based online car retailer, has been notified by the New York Stock Exchange (NYSE) that it is not in compliance with the exchange's listing standards due to the company's delay in filing its annual report.
The NYSE requires all listed companies to submit periodic financial reports in a timely manner, and Cazoo's failure to file its Form 20-F for the fiscal year ended December 31, 2023, has triggered this notice.
The company had previously disclosed on May 1, 2024, that it could not file the required form without unreasonable effort or expense, citing management's focus on strategic initiatives and a pivot to a marketplace model. Additionally, Cazoo expressed liquidity concerns, indicating it might not be able to demonstrate its ability to continue as a going concern in the medium to long term.
Cazoo has been given an initial period of up to six months to resolve the filing delay, during which its Class A ordinary shares will remain listed and traded on the NYSE, provided the company meets other listing requirements. However, the NYSE may initiate delisting proceedings at any time if it deems necessary.
InvestingPro Insights
As Cazoo Group Ltd (NYSE: CZOO) faces compliance challenges with the NYSE, the company's financial health is under scrutiny. According to InvestingPro data, Cazoo's market capitalization stands at a modest 29.54 million USD. The firm's financials also reflect a concerning picture, with a negative P/E ratio of -0.01, and an adjusted P/E ratio for the last twelve months as of Q2 2023 at -0.07, indicating that investors are wary of the company's earnings potential.
InvestingPro Tips suggest that Cazoo operates with a significant debt burden and may have trouble making interest payments on its debt, which is particularly troubling given the company's liquidity concerns. The tips also highlight that analysts do not anticipate the company will be profitable this year, and the stock has experienced high price volatility.
Despite recent market performance showing a strong return over the last month at 21.29% and over the last three months at 40.79%, the broader trend appears negative, with a one-year price total return at an alarming -94.97%. This volatility is a factor investors must consider, especially in the context of Cazoo's operational challenges and compliance issues.
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