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Australia’s Nuix slumps another 15% as regulator probes financial statements

The Nuix software company logo can be seen in its office in central Sydney, Australia on April 5, 2016. REUTERS / David Gray / File Photo

June 30 (Reuters) – Software provider Nuix (NXL.AX) said on Wednesday that some financial reports and a prospectus for its IPO are being investigated by an Australian regulator for potential corporate law violations, causing its shares to fall 15%.

Nuix said the Australian Securities and Investments Commission (ASIC) is investigating the financial disclosures for the period between the end of 2018 and 2020 and is investigating its former CFO Stephen Doyle and two of his family members.

“We are really concerned about the allegations against Doyle,” said chairman Jeffrey Bleich in a statement, without giving details of the allegations.

Doyle did not immediately respond to messages sent on LinkedIn.

Nuix said it was unaware of the exact nature of the investigation and had not received a formal notification from ASIC, adding that it would cooperate with any investigation.

The stock, which has plummeted more than 70% since it was listed late last year and hit multiple record lows due to earnings downgrades and criticism of its financial balance sheet, fell to a new all-time low on Wednesday.

The probe followed news earlier this month that two of Nuix’s top bosses would leave the company, including Doyle, whose contract with Nuix was terminated amicably. CEO Rod Vawdrey is retiring.

“ASIC obtained an ex parte travel restriction on June 23, 2021 to ensure Ross Doyle remains in the jurisdiction to aid ASIC’s investigation,” the regulator said, referring to the former CFO’s brother.

“These orders were extended yesterday by the Federal Supreme Court until October 25, 2021. As the investigations of the ASIC are still ongoing, we do not propose any further comments, ”added the supervisory authority.

Reporting by Nikhil Kurian Nainan and Shashwat Awasthi in Bengaluru; Editing by Himani Sarkar and Uttaresh. V.

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