Quindell shares are expected to resume trading tomorrow after more than a month of suspension from Aim, as it reported annual losses of £238m in the latest chapter in a tumultuous saga which has spurred a second investigation by a City regulator.
An investigation by the Financial Reporting Council (FRC) has forced the company to restate its financial results for the previous two years along with its delayed 2014 figures, resulting in a reduction in revenue of £109m in 2013 and profit after tax of £130m, which was reduced from £83m to a loss of £68m.
The FRC has now launched a fresh investigation into Quindell's auditing, including two auditors in relation to financial statements made between the 2011 and 2014 financial years.
Losses to the end of 2014 were an increase on last year's restated £8.6m loss, after what chairman Richard Rose called a "challenging period" for Quindell. The company is still in the midst of an ongoing investigation by the Financial Conduct Authority (FCA) into its reporting practices, which it admitted had been “at the aggressive end of acceptable”.
The FRC today said that it had not been possible for directors of Quindell and its auditors "to determine that all material errors and omissions arising from historic transactions have been identified" but they would be updated on any further corrections "as may be necessary".
Having disposed of its legal services arm in a £637m deal with Slater & Gordon last year, the company said it now has a greater focus on technology and that an appointment of a new chief executive to replace the departed Rob Terry, who quit last year, is imminent.
Commenting on the FCA probe, Rose said: "Given the intense public speculation on this subject, the launch of this investigation was not a surprise and we will, of course, co-operate fully with the FCA. We intend to set up internal structures to separate the FCA investigation from our operating businesses to ensure we can deliver shareholder value without the distraction of reviews of the past.
Revenue for the year came in at £72m for 2014, up on the revised £61m a year previously, and it holds £535m in cash on deposit in addition to £55m in escrow which it expects to be released in November 2016.