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Avis Europe Probing Portuguese Irregularities

Reuters
Monday, 11 Jun 2007 | 6:26 AM ET

Car hire firm Avis Europe said it was investigating possible financial irregularities at its Portuguese subsidiary, which could knock around 8% off of group annual profits.

Net assets may have been overstated by around 3 million euros ($4 million) as of December 31, and the company has suspended some of its Portuguese management as it looks into the possible malpractice, Avis said on Monday.

The rental firm added that pretax profit for the current year could be impacted by approximately 3 million euros plus legal costs. Analysts in a Reuters poll had estimated on average the company could make a pretax profit of 36 million euros.

Traders said Avis Europe shares were seen falling 9% when the market opens.

Avis said the firm's trading outlook was otherwise unchanged.

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