Today’s RNS from Arria (LSE: NLG) tells it’s own story:
The Board of Arria announces that the Company’s contract with Shell Exploration & Production Company (“Shell”), which was announced on 23 May 2014, has been terminated by notice given by Shell in accordance with its terms. Shell has confirmed that the cessation of its relationship with the Company does not reflect the value it sees in Arria’s technology, to which Shell has responded positively and which is demonstrated by the significant development work done to date. The directors of Arria understand that when Shell is better placed to exploit the benefits offered by Arria’s technology, Shell will consider re-establishing the relationship with Arria..
…the termination of the contract will have a material adverse impact on the Company’s trading and revenues for the year ending 30 September 2015, which are now expected to be significantly below market expectations
The RNS continues:
Furthermore, as stated in the Director’s Report in the audited financial statements for the period ending 30 September 2014, there existed a material uncertainty on the continuing financial viability of the Company pending a successful agreement for additional funding. The Company was until yesterday in advanced discussions with a number of institutional and other investors for a substantial equity fundraising at a share price significantly below the current market price, which it was targeting to conclude within a matter of days. This fundraising was predicated on revenue expectations which included the continuation of the Shell contract and, therefore, the Company has suspended these discussions.
The rest of the RNS explains how management are continuing negotiations for funding as a matter of urgency but really, the writing is on the wall.
Today’s bargepole stock.