Troubled education provider Intueri Education has suffered another blow after a negative audit review by the Australian Skills Quality Authority.
The company has been in a trading halt since Friday, after it was told the authority might sanction the company or even cancel the registration of two of its training organisations.
The audits related to how the two organisations complied with required standards. Intueri has until 21 October to respond to the audit before a final decision is made.
But the threat raises the prospect that Intueri will not deliver on its profit expectations. The Australian businesses account for 30 percent of group revenue and two-thirds of its underlying operating earnings forecast of $15 million.
Intueri said early last month it was expecting the Australian review to boost revenue by $A6 million this year, and it was also expecting a backdated payout of $A4.3m for last year.
Intueri was going to use the funds to reduce debt by $A10m by the end of the year, as part of a plan to meet its bank covenants.
"Accordingly, we have engaged with our bank regarding the possible implications," the company said in a statement.
The company is looking to save $5m in New Zealand this year and $8m of annualised savings from 2017 onwards.
It's the latest in a string of problems for Intueri, which last month dumped its chief executive. So far this year it has also cut directors' fees, laid off staff, suspended dividends and written down asset values.
It is under review by the Tertiary Education Commission and Serious Fraud Office in New Zealand.
Acting chief executive Rod Marvin declined to comment to RNZ pending the review of the Australian regulator's report and a further update to the market.
The shares last traded on Thursday at 30 cents each, having fallen nearly 60 percent so far this year. They listed on the stock exchange in mid-2014 at $2.63.