Writing in its August monthly update, the Saville Capital Emerging Companies fund said it has exited its position in former small cap market darling Axsesstoday (ASX:AXL).
The company is a leading specialist lender to small and medium businesses.
Early in August, Axsesstoday provided its unaudited headline results for FY18, as well as FY19 guidance with was ahead of consensus estimates. The Axsesstoday share price responded by surging to a record high of $2.60, up from $1.50 at the beginning of 2018.
All seemed good, until…
On release of its detailed results towards the end of August, Axsesstoday announced its Chief Financial Officer (CFO) had resigned, with no specific reasons provided.
Saville found this very disconcerting given Axsesstoday is a fast growing finance company where risk control, a key domain of the CFO, is critical.
As such, given the uncertainty of the CFO’s departure, Saville took the decision to exit its position in Axsesstoday shares with an average selling price of $2.11.
The Axsesstoday share price was hammered on the news of the CFO’s departure, falling 16 per cent on August 27 and a further 15 per cent on August 28. Saville says it does feel somewhat vindicated by selling at $2.11, given Axsesstoday shares trade today at $1.60.
In May the Bennelong Emerging Companies Fund named Axsesstoday as one of its top 3 positions. In its most recent August 2018 report, Axsesstoday had dropped off list of the Bennelong fund’s top 5 holdings. It is not declared if the fund has any holding in the company.