Recruitment consultancy Nakama (AIM: NAK) saw its stock fell by up to 28% at one point on Friday.
Operating across the web, interactive, digital media, IT and business change sectors, the company embodied its previous Covid-related announcement in September, discussing the “immediate and significant impact” that the pandemic had on trading activities.
On Friday, Nakama said it had relied on many government initiatives, including job retention schemes in the UK, including state support in Hong Kong and Singapore. He said his purpose in participating in these schemes was to preserve cash and “maintain the business ability to continue trading.”
A statement on Friday said the deal was in line with management expectations, but that was adjusted after the pandemic’s practicality became fully effective. However, the market situation remained at a disadvantage, “particularly in light of the second wave,” prompting a new state lockdown and continued uncertainty.
Speaking about the defted situation, the company finds itself, Nakama Statement reads:
“As the various government support schemes end, the board’s view remains that the company faces many transaction and cash flow challenges and that the group’s working capital situation could worsen without access to additional capital. The company’s biggest shareholders have made it clear to the board that they will not support funding and will vote against the shareholder resolutions needed to issue new shares.”
“In this way, noting that the UK Government support scheme is expected to close in the first quarter of 2021, the Board is currently exploring many options for the company and its business, with further announcements being made as needed.”
Following the announcement, the company’s shares fell 28% from 20% on Friday, falling about 22% at lunchtime. This still surpasses the lowest point of March’s annual 0.23p, but represents climbing from the recent rise in the company’s stocks moving between 0.75p and 0.80p during October.
