A major story from the small caps this week came from ad agency M&C Saatchi Plc (LON:SAA), which on Tuesday saw its co-founder and executive director Lord Saatchi lead a boardroom exodus following news last week that the company had discovered a black hole of £11.6mln in its accounts.
Saatchi was followed through the exit door by three non-executive directors, Lord Dobbs, Michael Peat and Lorna Tilbian, all of whom have stepped down.
The shares, however, seemed to respond positively, rising 13% to 111p, although this is still below the 147p level the stock was at just before the accounting problems came to light.
The AIM All-Share rose 0.5% over the week to 913, while the FTSE 100 was up 1.6% at 7,355.
Smoke alarm maker Fire Angel fell to earth after it warned that it a surge in top-line growth was, somewhat counterintuitively, causing “stress” to the business. The shares plunged 23% to 9.8p in response.
Language support services firm RWS Holdings PLC (LON:RWS) sent out the wrong message to investors, sliding 4% to 643p as it said a higher pound to dollar exchange had been “clearly unhelpful” for its current performance, although trading in the first two months of its current year had been in line with expectations.
Elsewhere, Futura Medical endured a bitter-sweet week following a surprising result from a phase III clinical trial of its erectile dysfunction gel.
In a nuanced read-out from the trial, the companys MED2005 treatment showed strong efficacy, safety and rapid speed of onset.
Surprising was the fact the placebo produced a “highly statistically significant” impact on the men in the control group, beyond that normally observed as a result of the placebo effect.
The outcome meant that while MED2005 scored well on most trial elements it failed to meet its clinical endpoint against the placebo gel, a result that sent Futuras shares tumbling 66% to 10p this week.
However, that isnt the end of the story. The placebo gel that worked so well was a Futura-developed delivery technology called DermaSys.
This, Futura reckons, should make it easier to win approval from regulators.
Analysts at Liberum agreed, saying the “commercial outlook is unchanged” despite the setback and maintained their target price on Futura of 60p (current price around 9p).
Among the risers, SDX Energy PLC (LON:SDX) flowed up 6.8% to 24p as its South Disouq gas field in Egypt managed to reach its targeted production rate three months ahead of schedule.
Miner Erris Resources PLC (LON:ERIS) climbed 16% to 4p after it agreed to acquire 80% of the Loch Tay project in Scotland, an area which contains two targets identified as having excellent gold potential.