Shares of Triterras (TRIT -21.05%), which provides a blockchain-enabled trade financing platform, fell a dramatic 30% on Tuesday. The big news behind the decline actually came after the close on Monday, when the company announced that it wouldn't be able to meet a Nov. 1 exchange deadline for filing its annual report for the year ended February 2021.
There is a lot going on with Triterras. Early in 2021, the company was confronted with a short-seller report that highlighted potential problems at the company. The list of issues included potential conflicts of interest and the possible inflation of user metrics. Triterras defended itself vigorously. That said, the board set about examining the issues, as is appropriate. On Oct. 28, just a few days ago, the audit committee announced that it found nothing wrong. The stock rallied massively on that news, likely assuming that the issue had been put to rest.
However, thanks to the board's efforts, Triterras, a foreign company, had delayed the filing of its annual 20-F. It had until Nov. 1 to complete the filing, but missed that deadline. It is seeking a delay until Dec. 1, but there's no guarantee that Nasdaq will grant its request. Investors were not pleased, as it suggests that things aren't as sanguine as the audit committee release on Oct. 28 might have indicated. Clearly, this could just be a legitimate delay (big audits can be complicated), but investors don't like uncertainty, and the news yesterday muddies the waters rather than clearing them.
What a difference a couple of days can make on Wall Street. Although the company is using buzzword-worthy technology to help update the way companies interact with one another, there are clearly potential risks here that are hard, if not impossible, to handicap. Most investors will probably want to wait until the audited financials are available before making a commitment.