Chemeq (CMQ): Loser

Submitted by Marco on 29 October, 2006 - 06:48

Chemeq (CMQ) Stock Price Chart

Chemeq (CMQ) was the worst performing stock on the Australian sharemarket this week (Loser of the week for week 43 of 2006). The CMQ stock closed the week 33 percent lower after one of its major bondholders claimed an event of default. Chemeq had been thrown a financial lifeline 18 months ago from Stark Trading, a US investment fund. They demanded immediate payment of a $50 million debt by the Perth based animal drug company which only had $19 million at the end of last month. The bondholder claimed that it has defaulted on the terms of its convertible bonds and hence the early redemption notice on the CMQ. The move has been triggered by a dispute between Chemeq and its South African distributor, Inviro, over a $1.5 million sales contract. Chemeq is claiming that because the delivery of polymeric anti-microbial has been made and accepted by the customer, then the revenue can be booked under accounting regulations. Its financial statements for the year to June 30 contained a qualified audit opinion from auditor Ernst & Young, which said if the sales did not qualify for recognition the company would be in default of the bond agreement.

Chemeq Limited is listed on the Australian Stock Exchange (ASX) under stock code CMQ. You can view their investor website here. CMQ was listed on the ASX on 25 August, 1999. Chemeq (CMQ) is in the business of developing, manufacturing and marketing its CHEMEQ polymeric antimicrobial, which replaces antibiotics for the control of disease causing bacteria in commercial animal production. Chemeq (CMQ) has maintained its Intellectual Property protection through patents wholly owned by the Company. There are over 90 patents registered in numerous countries including the United States of America and countries within Europe and Asia. There are more than 170 patents pending. Browse for Australian stockbroker recommendations. It is interesting to note that Chemeq (CMQ) was a winner of the week in April 2006. Check your charts and good luck with your share trading!