Cloud computing firm Outsourcery, led by co-chief executive and BBC Dragons’ Den star Piers Linney, saw its shares fall 7.7 per cent yesterday to 15p as investors sold stock due to partners, including Vodafone, generating revenues for the firm slower than expected.
Outsourcery reported a 65 per cent jump in revenue to £3.4m as part of its interim results yesterday, this was enough to narrow the firms loss over the six months to 30 June to £3.8m, but it wasn’t sufficient to rescue shares which had fallen over 88 per cent since its float in May.
“I think the [market] sentiment is negative, in some ways,” Linney told City A.M. “The frustration really has been… that it’s taken a bit longer for them [key partners] to come online, but they are now.”
Linney said the business remained on track to become profitable at the end of 2015, and a recent £4.5m share placing had given Outsourcery the working capital needed to continue until then.
PROFILE: PIERS LINNEY | OUTSOURCERY
Best known for his seat on the hit BBC show Dragons’ Den, Linney started out in the City as a solicitor and then working on mergers & acquisitions and leveraged buyouts at Credit Suisse. When not filming in the Den and investing in startups, the former City worker enjoys BMX riding and has also booked a flight to space with Richard Branson’s Virgin Galactic. He bought mobile business Genesis Communications in 2007 which he eventually sold in 2011 to launch Outsourcery and focus on the hosting of online services.
THE 90 PER CENT CLUB
Outsourcery’s stock has fallen over 88 per cent since its high of 128p in May, to just 15p yesterday. This places it on the brink of an infamous group of shares that have dumped at least nine tenths of their value within three years. Recent entrants include:
MoPowered fell as low as 6.07p this week, down 94 per cent since in March, due to the decision to raise funds by selling a tranche of shares priced at a 76 per cent discount to its trading price last week. The move came after the firm reported lower than expected results in the first half of the year on the back of slower adoption of its commerce platform.
The Bagir Group
Bagir fell to just 8p a share in July, a fall of 87 per cent since its 63.5p high in April when the clothing maker floated. The slump came after it was was forced to issue a profit warning in May due to a sharp reduction in orders from its largest customer Marks & Spencer.
Blur, the online services exchange, was hit by a series of profit warnings and accounting revisions this year that sent its stock plummeting over 91 per cent since January from a high of 733p.