“No new substantive issues” raised in latest VGI report.
Corporate Travel Management has just released a market update, in the form of a targeted response to a second report by hedge fund VGI Partners which saw the company’s shares once again suspended from trading earlier this week.
CTM noted that VGI holds a substantial short position in the company “and has acknowledged that it can only profit from its investment if there is a decline in CTM’s share price…VGI has a significant vested interest in promoting market uncertainty”.
“At the core of VGI’s conclusions is a fundamental misunderstanding of the corporate travel sector and the CTM business model,” the update says. CTM confirmed that last week it engaged accounting firm EY to provide ongoing support and respond to certain matters by VGI and its “continuing attempts to discredit CTM’s financial disclosures”.
Today’s further response includes a preliminary assessment by EY which addresses VGI claims relating to impairment testing of goodwill, cash flow and working capital as well as interest income. CTM said it saw no need to comment further on many of the points repeated in VGI’s latest report.
“VGI may continue to make mischievous and misleading claims about issues that CTM believes have no consequence for the financial performance of the business and execution of CTM’s successful business model,” the company said, adding that management continued to focus on running the company for the benefit of clients, staff and shareholders.
More in today’s issue of Travel Daily.