But falling share price, 40% down, fell a further 11%
Lloyd’s claims processor Xchanging’s attempt to counter “unfounded rumours” about its accounting practices that have seen its share price fall by 40% provoked a further 11% fall, the Times reports.
Xchanging issued a warning on full-year profits this month because of a lack of new business on the horizon. But it said it had to counter rumours that its treatment of revenue from contracts acquired through the £146m buyout of Cambridge Solutions could be used to raise future profits.
Misconceptions
David Andrews, chief executive, said: “We needed to respond to these unfounded rumours. The right thing to do was to communicate and be transparent so there was no possibility of further rumours.
“It is clear that the accounting problems at Connaught and ROK, which triggered share price meltdowns at those companies, influenced the company’s decision to treat the rumours very seriously. There was no point just denying the rumours. We needed to correct these misperceptions about our accounting.”
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