PRINCETON, N.J., March 5, 2015 (GLOBE NEWSWIRE) -- The Law Offices of Wites & Kapetan, P.A. (www.wklawyers.com) has been investigating Controladora Vuela Compañía de Aviación, S.A.B. de C.V. ("Volaris" or the "Company") for potential violations of the federal securities laws. Investors who purchased Volaris securities in or traceable to the Company's initial public offering ("IPO") of American Depositary Shares ("ADSs") at $12 per ADS on or about September 18, 2013 may be affected.
In the Registration Statement for the IPO dated September 17, 2013, the Company states that non-ticket revenues such as fees relating to transportation of cargo, charter flight services, excess baggage, advance seat election, extra legroom, carriage of sports equipment and pets, ticket changes, VClub subscriptions, the Volaris affinity credit card and onboard advertising, "are collected from passengers and recognized as non-ticket revenue when the service has been provided, which is typically the flight date."
Then, on February 26, 2014, in connection with reporting the Company's financial results for the fourth quarter of 2013, the Company stated that "[w]ith our reservation system migration, we now have the tools to refine our revenue recognition of certain ancillaries like excess baggage and special services at the time of flight". The Company also indicated that prior to this the Company had been recognizing certain ancillary revenues "at the time of sale." Further, Volaris stated that the one-time effect of the "switch" was a reduction in non-ticket revenues of approximately MXN48 million.
A complaint has been filed in the United States District Court for the Southern District of New York alleging that the Registration Statement for the IPO contained untrue statements of material facts due to the representations in the Registration Statement that Volaris recognized non-ticket revenue at the time of flight, contrary to the Company's subsequent February 26, 2014 statements that it had been recognizing non-ticket revenue at the time of sale, not the time of flight.
On February 26, 2014 following this news, the price of Volaris ADSs declined by $1.49, or 13%, to close at $9.90 per share. The price of Volaris' ADSs declined an additional 5% the next day to close at $9.47 per ADS on February 27, 2014.
The Law Offices of Wites & Kapetan, P.A. seeks to uncover additional information about this substantial loss of shareholder value, and potential investor claims against Volaris.
If you are an investor who purchased Volaris stock you may have a legal claim against the Company and could serve as the lead plaintiff in a class action lawsuit. If you are interested in being the lead plaintiff, or would like to speak with an attorney about your legal rights, contact Marc A. Wites and Angela L. Dazzio-Martinez at Wites & Kapetan, P.A., at 1-866-277-8631 or info@wklawyers.com.
Wites & Kapetan, P.A. is a law firm with offices in New Jersey and Florida, with experience in the representation of investors in class actions, securities fraud and investor litigation claims.