Buddy falls well short in vital bid for capital injection
BUDDY Technologies has raised just $220,455 from its out of the money $10m entitlement offer, while narrowing its full year loss to $6.6m, but neglected to mention major accounting errors and operational problems in its preliminary financial report for the year.
Buddy shares were suspended from trade in April after the company realised that it had made serious accounting errors which had caused it to forecast a “record-breaking March” with that claim based on incorrect figures.
At the time the company, headed up by chief executive David Mclauchlan, withdrew its guidance and also announced that an entire production run of critical semiconductors needed to produce its LIFX products had been sold to someone else.
Three of the company’s board members resigned in June and the chief financial officer Richard Jacroux left in August.
Buddy said in August that it was advertising for a new CFO and had appointed a chief operating officer, as well as a new director.
The company’s shares were reinstated to trade in July, but at a level well-below their 10c, 12month high, and on Wednesday the stock closed at 1.9c, up 18.8 per cent, but well below its recent entitlement offer price of 2.5c per share, which aimed to raise $10m on top of a $6.5m placement.
The company on Wednesday also announced an update on its debt refinancing activities, saying that following an extraordinary general meeting on August 30 it had raised $US4.5M by issuing Us-based Partners For Growth 4.25 million convertible notes.
The company said on Wednesday it made a full year net loss of $6.6m, which it said had “improved dramatically” from a loss of $45.3m the year before. The 2021 loss was favourably impacted by $12.9m in debt forgiveness.
The company’s preliminary final report says revenues fell 7 per cent to $28.77m, and attributed much of the negative impact to the pandemic.
The company did not respond to a request for comment.