January 26, 2018 / 2:55 PM / 7 months ago

Mexico's Grupo Televisa finds weaknesses in financial controls, shares fall

MEXICO CITY (Reuters) - Mexican broadcaster Grupo Televisa said on Friday it had reported weaknesses in its financial controls to the U.S. Securities Exchange Commission, sending its shares initially down as much as 10 percent.

The company (TLVACPO.MX) said the problems were related to the design of IT controls over users’ access to systems and controls over accounting in its cable and content divisions.

It had consulted auditors PriceWaterhouseCoopers (PWC) over financial information dating to Dec. 31, 2016.

There was no evidence the deficiencies led to incorrect or imprecise figures in its results but the company will update the audit report in its 2016 20-F filing, Televisa said.

Televisa’s shares later recovered and were down 2 percent as of 1:30 p.m. local time (1930 GMT).

Like its U.S. peers, the company has been under pressure from weaker advertising sales as younger viewers choose online streaming over cable television.

Televisa’s long-time Chief Executive Emilio Azcarraga stepped down in January, leaving Bernardo Gomez and Alfonso de Angoitia as co-chief executives. Azcarraga remained chairman of the board.

The head of their cable division was shot dead in November after a group of men tried to steal his bike on a highway outside Mexico City. The company has since appointed a temporary head of the unit.

The new leadership team, coupled with Televisa’s efforts to shore up its advertising business, will likely mean volatility in the company’s stock, Intercam analyst Alik Garcia said.

“There are several issues accumulating,” he said.

Reporting by Mexico City Newsroom; Editing by Frank Jack Daniel and Lisa Shumaker

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