Australian Tech Firm Targeted by Short-Seller Plunges on Outlook

(Bloomberg) -- WiseTech Global Ltd., an Australian software firm recently targeted by a short-seller, tumbled the most on record after it slashed its forecasts amid concerns over the coronavirus.

The Sydney-based company lowered its full-year earnings and revenue guidance and flagged potential delays in new product launches on the expectation that a virus-induced manufacturing slowdown will obstruct logistics activities. Its shares slid 27% to the lowest level since May.

Travel curbs and longer delivery times have hampered the logistics industry amid the virus outbreak. WiseTech said the sluggish conditions may cause some business transactions to shift into the next reporting period.

The company’s flagship CargoWise One software is based on a usage-driven revenue model. WiseTech clients include third-party logistics providers and freight forwarders such as DHL and United Parcel Service.

The outlook downgrade comes after two negative reports from short-seller J Capital Research sent the stock plummeting in October. J Capital’s Anne Stevenson-Yang alleged the company may have overstated its profit and organic growth, and questioned its acquisitions. The company has refuted the claims, but its shares haven’t recovered to levels seen before the reports.

WiseTech isn’t the only Australian firm that’s feeling squeezed because of the virus. Crown Resorts Ltd. said it experienced softer trading conditions due to travel restrictions and “general community uncertainty,” particularly over the Lunar New Year period. Mall operator Vicinity Centres cut its full-year earnings forecast due to a drop in foot traffic that began in late January. Shopping centers with a high proportion of international tourists have been most affected.

To contact the reporter on this story: Jackie Edwards in Sydney at jedwards160@bloomberg.net

To contact the editors responsible for this story: Lianting Tu at ltu4@bloomberg.net, Kurt Schussler, Naoto Hosoda

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