SHARE OF THE WEEK: Darktrace’s Poppy Gustafsson faces questions about the company’s financial health as she announces half-year results
Darktrace boss Poppy Gustafsson will be in the spotlight next week as it publishes its first set of results since it was attacked by a short-seller and forced to launch an investigation into “key financial processes and controls.”
The 40-year-old will be asked questions about the company’s financial health when she announces half-year results on Wednesday.
The cybersecurity firm has downgraded its revenue expectations, recently forecasting year-over-year growth of 29.5 percent to 31 percent instead of its previous forecast of 30 percent to 33 percent.
The firm has since hired Ernst & Young (EY) to review its finances, after New York hedge fund Quintessential Capital Management said it was “highly skeptical” of financial statements and warned the group may have “overstated sales and profits”. ‘.
Quintessential, led by former Israeli paratrooper Gabriel Grego, even accused it of doing business with “shell companies in offshore jurisdictions staffed by individuals associated with organized crime, money laundering and fraud.”
Darktrace shares hit a record low of 210p, well below the 250p they recorded last year.
Gustafsson said the allegations were “baseless inferences” and launched a £75m share buyback.
Darktrace called in EY for a review. Chairman Gordon Hurst said the board “fully believes in the robustness of Darktrace’s financial processes and controls.”
But David Vignon, vice president of equity research at Stifel, said the assessment wasn’t enough to reassure investors.