Rex responds to ASX query

REGIONAL Express has apologised to the Australian Securities Exchange (ASX) for not providing a formal update about its possible plans for services between the country’s capital cities (TD 13 May), telling the ASX that it “did not expect that information to have a material effect on our share price”.

Compliance officers at the ASX wrote to CEO Lim Kim Hai and Chairman John Sharp in the wake of an article in the Australian Financial Review about the potential plan, which saw the REXex share price jump more than 45% to a high of $1.31.

The ASX asked the Rex execs for a “please explain” and urged the company to ensure its future compliance with the exchange’s continuous disclosure rules.

In its response, the carrier noted that “in the almost 15 years since Rex has been listed on the ASX, we have observed that nothing much excites the stock market concerning Rex besides news of exceptional dividends or profits.

“Rex has made many announcements of contracts worth several hundreds of millions with barely a ripple on the share price.

“Another example is how the newspapers recently carried reports of Rex receiving an outright grant of over $50 million from the Commonwealth and the share price did not even move.

“Given this background, we didn’t expect our share price to move as it did,” the carrier said.

Lim and Sharp added that given the surge after the AFR report “it is evident that our judgement call was erroneous.

“We wish to reassure ASX that Rex will err on the side of caution in the future,” the pair said.

Rex shares are now at $1.05.