Defense contractor AeroVironment discloses Justice Department probe of billing practices
AeroVironment Inc. shares plunged Friday after the Monrovia-based robotic aircraft maker disclosed that it has been under investigation by the U.S. Justice Department since February.
In a filing with the Securities and Exchange Commission, the company said that federal prosecutors have been probing its billing practices for government contracts dating back to fiscal 2006. It said the company “could be adversely affected by a negative audit or investigation by the U.S. government.” After the filing, AeroVironment shares fell nearly 8% to $21.43.
But the company said that contrary to its SEC filing, “the outcome of the investigation will not have a material impact on its business.” AeroVironment asserted that the ongoing investigation “has had no apparent impact on the company’s ability to receive government contracts.” It noted, for example, that it had received orders from the government “in excess of $50 million since February 2010.”
AeroVironment, with its Raven hand-launched drone aircraft, is the Pentagon’s top supplier of small robotic planes. The plane weighs about 4 pounds and is fitted with a video camera to give U.S. troops a bird’s-eye view of what could lie ahead or over a hill.
The disclosure of the investigation came on the heels of AeroVironment’s announcement in March that its chief financial officer, Stephen Wright, resigned to “pursue other opportunities.” The company said Friday that the investigation and the resignation were “unrelated.”
