Join our daily newsletter At The Bell to receive exclusive market insights
- More twists and turns plague fintech darling iSignthis’ today, with the company suffering a freefall in its market cap after a sharp rise in share value was called into question by governance body Ownership Matters
- iSignthis’ shares rocketed to an all-time high of A$1.76 on Monday but plummeted to a low of A$0.93 just three days later. The company’s market cap fell by nearly half from A$1.9 billion earlier in the week to just A$1.016 billion this morning
- ISX reported a leap in its annual GPTV (gross processing transaction volume). The company smashed through a A$1.1 billion turnover ceiling, up a staggering 160 per cent since June 30 this year
More twists and turns plague fintech darling iSignthis’ today, with the company’s market cap going into freefall after its sharp rise in share value was called into question by governance body Ownership Matters.
iSignthis’ shares rocketed to an all-time high of A$1.76 on Monday but plummeted to A$0.93 just three days later following the query.
The company’s market cap has also undergone a significant crash following the governance report, falling by nearly half from A$1.9 billion earlier in the week to just A$1.016 billion this morning.
The initial share price boom followed ISX’s most recent operational update, indicating astonishing levels of growth and triggering the release of a formal ASX query.
On Monday, ISX reported a leap in its annual GPTV (gross processing transaction volume). The company smashed through a A$1.1 billion turnover ceiling, up a staggering 160 per cent since June 30 this year.
But Ownership Matters released a report following the operations update, questioning the company’s release of performance rights.
“The 2014 performance rights had revenue targets to be met by the end of June 2018. These were met by a margin of $1347 … with revenue falling 78 per cent after the hurdle was tested … “Limited disclosure is provided for what drove the material revenue increase in the six months to June 30 2018,” The report said.
iSignthis issued 336.6 million shares to its executives as part of a plan to work through performance hurdles, referred to in a market announcement as class A, B and C. The board needed to generate revenue of A$5 million to meet their performance targets within three years, or risk the issued shares losing all their value.
During the 2017/18 financial year, the company was yet to meet any of the objectives, with annual revenue coming in at just A$826 912. But on June 22 2018, iSignthis presented their next annual report, and the company had recorded a momentous surge past the first two performance hurdles; cash receipts indicated revenue above A$3.75 million. Within the next six months, the company met the final target by a margin of A$1347, excluding a A$478 519 R&D tax concession.
In a statement responding to the ASX enquiry, iSignthis said Ownership had not approached them for comment and had founded the report on inferences which were not consistent with information disclosed to on the public domain.
The company wasn’t happy about the query, publishing this tweet directed at Ownership’s founders yesterday.
In today’s ASX announcement, iSignthis has said it will take the matter further and bring Ownership Matters to governance regulatory body ASIC.
ISX’s share prices enjoyed humble beginnings, starting off at just A$0.03 apiece when first listed in 2015. But in the last six month alone, iSignthis reported a cool A$7.5 million in revenue and estimates their earnings before tax will sit at A$10.7 million for the 2019 financial year. The dual-listed company is poised to join the ASX 300 later this month and is already trading on the Frankfurt Stock Exchange.
iSignthis broke into the pay identification and payment network game in 2015. The company is being lauded as Australia’s answer to Paypal, providing its clients with payment checks to comply with anti-money laundering regulations. Currently, 260 clients are signed up with ISX’s ‘paydentity’ solution.
The company’s stock traded slightly higher today at A$1.02 per share but is still nowhere near matching the A$1.76 ceiling hit on Monday.
