Datalex’s chairman of almost four years, David Hargaden, snapped up a further €90,000 batch of shares in the airline retail software company since it reported financial results late last month.
This means that the chairman, who was brought in as part of a turnaround team assembled after an accounting scandal, has spent almost €382,600 acquiring stock in the company since his appointment – the equivalent of more than 90 per cent of the estimated gross fees, before income tax is paid, he has received from Datalex to date.
Mr Hargaden, an accountant and former head of corporate finance at BDO Ireland, sold his Unity Technologies, a cloud services company, last year for an undisclosed sum to Ekco, an IT services firm. He continues to run the business.
His latest Datalex shares purchase, disclosed to stock exchange filing this week, is seen by market observers as a clear signal of confidence in the group, even as it reported last month that its net loss doubled to $6.2 million (€5.9 million) in the first six months of the year and it required a high-cost top-up loan from its main shareholder, businessman Dermot Desmond.
The new €5 million facility from Mr Desmond’s Tireragh vehicle, which also owns more than 40 per cent of Datalex’s stock, had been drawn down by the time the interim results were reported on September 22nd and were in addition to €10 million of outstanding loans from Mr Desmond. The rate on the loans ratcheted up to 18 per cent last weekend from 15 per cent, previously.
While Datalex said in the earnings statement that it continues to explore fundraising options to replace the Tireragh loans, an equity share sale is widely considered to be off the table as the stock remains at depressed levels.
Datalex saw its revenues grow by 24 per cent to $12.9 million in the first of the year amid a strong recovery in airline activity across all geographies. However, its earnings declined as it invested upfront on delivering on key new contracts with airlines before they go live.
The company has this year renewed contracts with key existing customers JetBlue, Air China and Air Transat; and signed a deal with LatAm Airlines.
However, Virgin Australia, which signed Datalex up in 2021 to help overhaul its retail offering, decided last month to cancel the entire project, affecting the Irish company and other parties that were involved.
