After several weeks suspended, embattled logistics software company GetSwift has resumed trading on the ASX this morning.
With its shares last valued at $2.92 on January 22 before suspension, GetSwift is currently trading at $1.23 after a market update in which it stated that “almost 50 percent” of its enterprise client contracts have progressed to early stages of the revenue generation phase.
It’s been a long couple of weeks for the company, with the saga having kicked off with a report in the Australian Financial Review on the weekend of January 20 that questioned details around contracts and revenue figures announced by the company.
While GetSwift had announced it had signed multi-year deals with Fantastic Furniture and The Fruit Box Company, the AFR reported that they had not continued to used the company’s software beyond an initial trial.
Meanwhile, Commonwealth Bank told the AFR that GetSwift had “moved prematurely” in announcing revenue forecasts in December for a partnership that is still only in the trial stage.
Concerns had been raised around GetSwift’s announcements after it raised $75 million in an equity raise in early December following a market announcement stating it had signed a deal with Amazon.
Though the announcement was light on concrete details, with GetSwift stating it had signed a “global agreement” with Amazon but couldn’t reveal any further details or information due to the “highly sensitive nature” of the agreement, GetSwift’s shared jumped 84 percent in reaction to the news.
With GetSwift touting the revenue potential of its deals in all its announcements, the AFR pointed out that the company had recorded only $336,356 in revenue in the year to June 30, on a loss of $1.92 million. It then posted $255,073 in revenue in the third quarter of 2017.
As the ASX demanded GetSwift please explain, the company then engaged consulting firm PwC to assess its compliance and governance framework.
Joel McDonald, GetSwift managing director, stated today that PwC has confirmed the company is in compliance with the ASX’s listing rule 3.1, however PwC will continue to work with the company.
In explaining its contracts, GetSwift stated that its contracts for enterprise clients – which it classes as national or multinational organisations with monthly potential volumes of over 10,000 deliveries – are set up to initially run for two years, with “initial periods of testing and integration”.
According to GetSwift, the majority of its announced enterprise client contracts “continue to progress through various pre-revenue generation phases”.
Image: Bane Hunter and Joel McDonald. Source: Supplied.