Scancell Holdings (LON: SCLP) shares are down 5% this morning. This isn’t their fault and it seems almost unkind that SCLP shares have fallen as a result of this technical problem. But if it’s a problem that lasts for a couple of weeks - of which we’ve no indication as yet - then this could be more serious. As well as provide an interesting little speculative opportunity.
The particular problem is this: “Scancell Holdings plc (AIM: SCLP), the developer of novel immunotherapies for the treatment of cancer and infectious disease, provides the following update in relation to the publication of its results for the year ended 30 April 2023. The Company's auditor, BDO LLP, has requested additional time to complete their standard audit due to unforeseen circumstances impacting the audit engagement team. Scancell's Board has been advised that the audit is substantially complete and has not been advised of any material audit issues. Accordingly, the Company is targeting the publication of its audited financial results as soon as the auditor completes their final processes.”
Well, OK, except Scancell is on AIM. which means the accounts must be published within the next 10 days - or the SCLP shares will be suspended.
Scancell Holdings share price from Google Finance
Now Scancell is interesting, the drugs seem to be working, at least at this stage of testing. But this isn’t about a valuation of Scancell Holdings here.
Rather, this is something we saw at Altyn Gold. Which we recommended, and people did make 20% on Altyn Gold. The accountants couldn’t get the accounts done on time, the shares were suspended. But the very act of the suspension drove them down 20%. A fall that was almost immediately reversed when the accounts were published and the suspension lifted shortly afterwards.
Now, of course, trades like this depend upon our belief in it really being the accountants having a problem, not that there is a problem with the accounts. But it is going to be worth keeping an eye on Scancell this next 10 days or so. If those accounts don’t appear then there should be a suspension. And it might well be worth playing that game - buy after the price drop over the suspension, but before the actual suspension, then see what happens when the accounts are out. As long as it is just the accountants having problems this could work.