Gentrack was something of a novelty when it came to the NZX in 2014 - a software company that was already making money and paying dividends.
Unfortunately, the initial public offering was followed by a profit warning just six weeks later, attracting a stiff rebuke from the Financial Markets Authority. While directors hadn't misled investors, they could've been clearer about the revenue risks of lumpy project contracts.
To Gentrack's credit, the directors and management took that on board for the next four years, successfully managing shareholders' expectations as a series of acquisitions gave it greater exposure to British utility providers, an area seen as ripe for expansion since Gentrack went public.
Those deals gave Gentrack deeper penetration in those markets and accounted for much of the firm's revenue growth. By the end of September 2019, annual revenue was $111.7 million, three times the $38.5m reported five years earlier.
However, the shares peaked in May 2018 at around $7.50 and started tapering off later that year as Gentrack made rumblings that Brexit was weighing on what had become an increasingly important market for the company.
Then came 2019. Gentrack wrote down a dud investment in airport software developer CA Plus. British utilities also faced greater regulation as the question of Brexit loomed large on everyone's minds.
When pro-Brexit Boris Johnson swept aside the threat of widespread nationalisation in a landslide victory at last year's election, investors seemed to think good news was just around the corner for Gentrack.
Unfortunately, it wasn't.
The UK energy market was tough last year. At least eight suppliers went to the wall in 2019 and one of the big six providers – npower – was absorbed by its bigger rival E.ON. Stricter audit rules and a requirement for suppliers to pass renewable energy subsidies on to customers triggered the collapse of firms that in hindsight were marginal operations.
Gentrack had made inroads into the small end of town. At September 30, 6.3 million UK energy meters – about 12 per cent of the market - were billed through its system. That was up from 4 per cent when it went public.
It's the market leader with 40 per cent of UK independent energy suppliers but knows consolidation is coming. It wrote off $1.8m of bad debts from failed suppliers in the September year and it wasn't expecting any earnings growth in the current financial year.
In fact, things were worse and Gentrack earlier this month made an unexpected update at a time when investors, brokers and analysts didn't have much else to focus on.
Topping things off, Gentrack's plan to roll out its billing system at E.ON and npower was suspended while npower was rolled into the larger business. Now it just has EDF lined up as one of the top five still planning to introduce its billing system.
Unsurprisingly, the shares tanked, shedding more than 40 per cent during the past week and a half. They were near a four-year low of $2.23 on Friday afternoon and below the $2.40 IPO price.
It's hard to see relief on the near horizon.
After the Conservative Party won the election, KPMG said Brexit would dominate Cabinet's workload, leaving little chance for any movement on the price caps facing retailers.
Greg Smith, Fat Prophets' head of research, reckons the stock could test $2, given the NZX50 is near all-time highs and investors have little appetite to chance their arm with underperformers.
Little-known Dutch investor Swann Hill BV may disagree given it's emerged as a substantial shareholder this month, building up a 9.7 per cent stake and paying an average price of $3.46.
That investment should be enough to give the board some confidence, and Smith still sees a solid business underneath Gentrack's recent problems.
Arie Dekker, head of research at Jarden, cut his target price for the stock to $2.70 given the lower earnings outlook, and kept his rating on "neutral" saying there are far too many questions hanging over the company.
Given the sweeping changes in the UK market, he wants to see management come up with strategy that reflects the new paradigm and acknowledge that it won't improve any time soon.
Chief executive Ian Black won't rush any decisions, instead pruning low-hanging costs. He aims to update shareholders at next month's annual meeting but has stressed the need to do more for existing customers.
A number of investors, advisers and analysts have expressed sympathy for Gentrack. The firm made a rational decision seeking growth in British utilities and the downturn is largely out of its hands.
One thing it does control is how it responds, and that same cohort of pundits spent the past year complaining of Gentrack's multiple earnings downgrades.
Gentrack is on the hunt for a new chief financial officer. Let's hope they find someone who doesn't rejig the spreadsheet so often.