A tech firm with one of the rockiest share prices on the FTSE 250 got a lift today after it batted away short-seller speculation over financial reporting inaccuracies.
Cybersecurity business Darktrace, whose shares fetched a giddy price tag of 945p in 2021 before tumbling to below their 250p IPO price earlier this year, today saw its stock soar 19% to 350p after it said an external investigation by auditors EY did not produce findings that would “change their belief that those financial statements fairly represent Darktrace’s financial position.”
However, the report, which Darktrace has refused to publish, did identify several areas where “systems, processes or controls could be improved” including “a small number of errors and inconsistencies.” Darktrace did not say if EY agreed that its accounts should not be amended.
Quintessential today called for EY’s investigation to be published, adding: “Darktrace’s announcement of EY’s findings does little to mollify our concerns.”
“It is noteworthy to mention that the decision on the materiality of these errors and inconsistencies, as well as the decision not to proceed with accounting restatements, appear to be the sole judgments of Darktrace and its board, rather than recommendations from EY.”
The firm told the Standard: “The report should be made public for all to assess. We even wrote an open letter to EY urging them to do so.”
But a Darktrace spokesperson said there was “a lot of commercially sensitive information in there and [it] was never intended for wider dissemination,” adding that the report had been shared with the Financial Conduct Authority.
The share price lift gave a multi-million pound boost to the wealth of CEO Poppy Gustafsson, who is now worth £27.5 million according to the Evening Standard Tech Rich List.
