Arki Busson’s hedge fund LumX posts $8.7m loss
Firm also delays its annual report and warns on value of goodwill
The investment firm run by Arpad “Arki” Busson, once one of the hedge fund industry’s most influential figures, has revealed a large loss and delayed publishing its annual report in the latest sign of its fading fortunes.
Swiss-listed LumX Group reported unaudited figures stating it had made a net loss of $8.7m — a ninth consecutive year of losses — on gross revenues of $8.2m in 2018. The group has a market capitalisation of SFr11.4m ($11.2m).
The firm, citing “planned recapitalisation measures”, said the Swiss stock exchange had granted it an extension until the end of May to publish its audited results. If it fails to do so, it will risk its shares being suspended.
LumX added that its audited financial statements would be available “when the agreements relating to this restructuring have been concluded”. It provided no additional detail.
Mr Busson, LumX’s executive chairman, co-founded the children’s charity Ark and is well known for his philanthropic work and previous relationships with Hollywood actor Uma Thurman and model Elle Macpherson.
LumX also warned that it could not confirm the value of goodwill — the amount one company pays for another over and above the value of the target’s assets — and said there was “a risk of full or partial impairment, which would have a further impact” on its net results.
In its last semi-annual report, which related to the first six months of last year, the firm reported goodwill of $21.1m and said it had not seen any signs of impairment from the acquisition of Mr Busson’s former business EIM Group.
Disclosure rules on the Swiss stock exchange require listed companies to present results within four months of the end of their annual reporting period. LumX was originally expected to report annual results on April 29 according to its own website. It said it would confirm the date of its annual meeting with shareholders “in due course”.
LumX, which has offices in London and Switzerland, has been cutting staff in recent years as its assets have shrunk. In March it announced further job reductions, citing “investor trends and headwinds” and gave up its mutual fund licence in Switzerland. It remains regulated by the UK Financial Conduct Authority.
The group provided no update on its assets under management. It had $7.1bn in fee-earning assets at the end of June last year, compared with the $18bn it managed when it was known as Gottex at the end of 2007. The group provides risk analysis services and a managed account platform as well as investment management.
LumX declined to provide additional comment. Its 2018 loss and the delay to the publication of its financial results were first reported by Financial News.
The firm’s shares have fallen 65 per cent during the past two years and closed at SFr0.105 on Tuesday. The Swiss exchange is closed for a national holiday on Wednesday.