Small-cap movers: More accounting headaches for AIM as Staffline suspended over payroll and invoicing concerns

A look back at some of the more interesting stories from the junior market over the past week

Accounting difficulties
Staffline said if its fears were confirmed the issues could have “a material impact” on profitability

It seems a theme has developed across AIM in recent months involving firms of all stripes uncovering issues with their accounts.

The latest company to join the list was employment agency Staffline Group PLC (LON:STAF), which was suspended from the junior market on Wednesday amid concerns over invoicing and payroll practices.

Eyebrows were first raised that morning when the group delayed the publication of its results but did not cite a reason at the time.

This was followed by a suspension notice at 3.50pm, although this didn’t stop the company’s shares plunging 34%, or 350p, to 670p in the intervening period.

After the close, Staffline said that if its worst fears are confirmed it could result in “a material impact” to its profitability but could not assess the scale at this time.

While the announcement wasn’t quite on the league of Patisserie Holdings, which warned last October of “potentially fraudulent accounting irregularities”, it won’t do much good for AIM’s reputation as yet another constituent finds itself with a question mark over its figures.

At the other end of the scale, energy supplier Yu Group PLC (LON:YU.) shot up 67%, or 45p, to 112.5p this week for bringing some clarity to its finances.

In a trading update, the firm confirmed its adjusted pre-tax loss was still expected to be between £7.35mln and £7.85mln, having previously gone through an accounting review after miscalculating its revenue.

In the oil and gas sector takeover talk was rife as Ophir Energy Plc (LON:OPHR) agreed to be bought out by Indonesian rival Medco Energi, sending shares up 15%, or 7p, to 54p.

Medco agreed to buy Ophir in a 55p per share deal, totalling around £390mln, after a previous bid of £362mln was rejected earlier in January.

For the marketing companies, it was all mergers with Taptica International Ltd (LON:TAP) and RhythmOne PLC (LON:RTHM) confirming discussions around a possible tie-up.

The news boosted Taptica’s shares by 20%, or 33.5p, to 201p although RhythmOne’s shareholders were less pleased as its price dropped 9.5%, or 18p, to 168p.

Over the week the AIM All-Share was up 1.2% at 923 points, while the FTSE 100 ran up 2.9% to 7,009.

Meanwhile, maritime surveillance systems seller SRT Marine Systems PLC (LON:SRT) was torpedoed by investors after it announced a share placing at 30p each on Thursday, an 18.5% discount to its Wednesday close price. The shares sank 12%, or 4.5p, to 32p in response.

Compliance services provider The SimplyBiz Group PLC (LON:SBIZ) jumped 7%, or 11.5p, to 173p over the week after it clinched a deal with housebuilder Taylor Wimpey for its Zest employee benefits platform.

Food technology group BigDish Plc (LON:DISH) was serving up a tasty morsel as it launched its restaurant booking app in Bristol on Wednesday, causing shares to rise 9%, or 0.15p, to 1.8p.

It was more of a sour taste for Nu-Oil and Gas Plc (LON:NUOG) at its AGM on Monday after opposition from shareholders over its director’s remuneration report saw 40mln of the 173mln votes cast against the resolution, with shares dropping 10%, or 0.08p, to 0.72p over the week.

Elsewhere, engineering firm Redhall Group PLC (LON:RHL) saw its shares turn the same colour as they plunged 30%, or 1.1p, to 2.6p after announcing a wider pre-tax loss for 2018 of £4.41mln compared to £1.1mln in 2017.

Brain health specialist Cambridge Cognition Holdings PLC (LON:COG) gave investors good vibes with shares surging 16%, or 12.5p, to 91.5p after unveiling its first partnership in India with a major pharmaceutical company that carried an upfront payment of over £200,000.

Electronics firm Solid State PLC (LON:SOLI) also charged up 16%, or 59p, to 424p after it said its full year results would “comfortably exceed” market expectations.

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