Gold Coast’s BPS Technologies has value wiped, directors leave and financial statements incorrect

THE value of this ASX-listed Gold Coast company has tanked, its founding director and chief financial officer have left and financial statements have been revealed as inaccurate.

The company has notified the ASX of the issues.

GOLD Coast company BPS Technology has lost more than a third of its market value and two directors, including its chief financial officer, have resigned after questions were raised over the company’s financial reporting for the past three years.

The listed Southport company, which operates Bartercard and Entertainment Publications, told shareholders they expected to post an eye-watering $33.2 million loss for the first six months of the financial year.

The bulk of the loss springs from a $30.1 million writedown in the value of its assets, after an auditor found five multimillion-dollar disparities in accounting practices.

Founding director Tony Weise, who was also CFO, and Brian Hall, who was CEO of Bartercard Group, resigned last Thursday from all their positions.

BPS Technology listed on the Australian Stock Exchange in 2014, after Trevor Dietz Brian Hall and Tony Wiese bought Bartercard's Australian arm in 2007. All three have left the company in the past two months. Photo: Oscar Vallejo from Vogue Studios

In a statement to the ASX, the company said the resignations were part of its ongoing restructure, prompted last year when a minority shareholder group attempted to oust the board.

An audit of financial statements for the past three years found consultancy fees totalling $262,260 had been paid to a company run by Mr Wiese and Mr Hall, Broni International, but the fees had not been included in the company’s director remuneration reports.

BPS lost more than $23 million of its share value in the wake of the announcement, diving from 48.5c on Wednesday to a year-long low of 29c by Friday. The price had rallied to 34.5c this morning.

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The company, which recently partnered with Chinese e-commerce giant Alipay, has yet to declare the final shareholdings of the outgoing directors.

BPS CEO Iain Dunstan and George Lawson from Alipay at the partnership’s launch at Skypoint. Picture: Glenn Hampson

BPS also slashed its expected earnings for the fist half of the financial year to $2.7 million, down from a previous guidance of $4-$4.5 million.

Their final results will be reported on Wednesday.

The company has reissued its director remuneration reports, which had excluded consultancy fees paid over three years paid to Broni International — a company operated by Mr Wiese and Mr Hall.

Former chief financial officer Tony Wiese. Picture: Mike Batterham

New CEO Iain Dunstan has been appointed to the board as managing director, while newcomer Darius Coveney has taken on the combined role of CFO and COO.

Laura Newell of Boardroom Pty Ltd has commenced as Company Secretary, replacing

Mr Wiese.

In its statement to the ASX, BPS said the performance compared to previous guidance was due to a “delay in the realisation of forecast costs savings”.

It said the $30 million write-off included: $6.5 million in previously capitalised business development costs; $8.9 million of the carrying value of Bartercard franchises either held for sale or company owned; $7.5 million of the carrying value of international Bartercard operations; $4 million writedown of Goodwill related to the Bartercard business; and $3.2 million of other balances, mainly related to inventories and receivables.

There will also be other one-off expenses in the half year of about $1.3 million, the company said.

As previously announced, the company also expects to book a restructuring provision of $4.5 million in the first-half result.

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