Serko is offering no explanation for a 17.8 per cent surge in its share price after the New Zealand sharemarket regulator sent it a 'please explain' notice.
The business travel booking software developer "confirms it is satisfied that it continues to comply with its continuous disclosure obligations under the NZX Listing Rules, including Listing Rule 3.1.1," chief financial officer Susan Putt said in a statement in response to a letter from NZX Regulation last Friday. The regulator noted Serko's share price had risen from $4.44 to $5.23 in the course of four days.
• US giant Booking.com buys into NZ's Serko
A sudden share price movement can be an indication that some investors are aware of information relevant to the company's future that others have not been made aware of.
Under continuous disclosure requirements, NZX-listed companies are required to tell the market if there are material matters that shareholders should be aware of, although there are exceptions in cases where "a reasonable person would not expect the information to be disclosed and where the information is confidential and where its confidentiality is maintained and where one of five safe harbours applies."
All three conditions must be met.
Serko last month announced that the Nasdaq-listed company that owns the global travel website Booking.com had taken a 4.7 per cent stake in the Auckland-based firm, which first listed on the NZX in 2014 at $1.13 a share.
Booking.com came onto the register as part of a $40 million capital raising in October, which was over-subscribed. On Nov.20, Serko announced a $900,000 net loss for the six months to Sept. 30 and a $5 million cash burn in the same half-year as it pursues growth in the "northern hemisphere markets.
"This cash burn will continue in the second half as development work is accelerated to support new market expansion," chief executive Darrin Grafton said at the time. The capital raising will finance the ongoing losses.
Serko's most important metric, annualised monthly revenue, reached a peak of $26.2 million during the period, up 35 per cent from $19.4 million in the same period a year earlier. Total recurring revenue rose 38 per cent to $13.3 million from $9.6 million in the previous half-year.
"Serko confirms that it is aware of its obligations to keep the market informed of material information (subject to certain exceptions)," Putt's statement to NZX Regulation said.
Serko shares have risen 68.9 per cent in the past year, or $2.04 per share, to Friday's close at $5, giving the company a market capitalisation of $460.4 million.
The company's chair, Simon Botherway, is a member of the board overseeing the New Zealand Superannuation Fund, a former member of the Securities Commission and he chaired the establishment board for the Financial Markets Authority.
Other heavy-hitting directors include expatriate LA-based tech entrepreneur Claudia Batten.