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DeepMatter Group PLC on Thursday said its board decided that as a private limited company it would have greater prospects to raise additional capital.
DeepMatter shares fell 58% to 0.050 pence each in London on Thursday morning in response to the announcement.
The Glasgow, Scotland-based digital chemistry data company predicted it will need £1 million prior to any delisting to fund its long-term growth ambitions. It would seek an additional larger capital rise in 2023 as a private limited company.
‘Any delisting would be conditional on shareholder approval, and there can be no certainty that proposals for a delisting will be approved. The board intends to continue discussions with key stakeholders on the delisting and a further announcement will be made in due course,’ DeepMatter cautioned.
In its most recent earnings release, DeepMatter posted a widened pretax half-year loss to £1.9 million from £1.5 million a year prior for the six months to June 30, due to increased costs. While revenue edged up to £678,000 from £649,000, research & development costs increased to £1.1 million from £856,000. Further, administrative expenses widened to £1.2 million from £1.0 million.
However, a month ago the company said it expected 2022 revenue to rise by at least 50% to £1.5 million from £1.0 million in 2021, an estimate which it reiterated on Thursday. DeepMatter explained the revenue rise with a recently signed licensing agreement with Germany’s Merck KGaA that could become one of its largest deals so far.
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