Bad news keeps flowing for HR software vendor Workstream.
In late September, Workstream said it received—and since has appealed—a delisting notice from the Nasdaq Stock Market related to the firm’s failure to file its annual report for the year ended May 31.
Ottawa-based Workstream already faces the possibility that its shares will be taken off the Nasdaq exchange in the near future for trading at too low of a price. The company has until November 17 to regain compliance with the $1 minimum bid price set forth in Nasdaq Marketplace Rule 4310(c)(4). To regain compliance, the Nasdaq exchange generally requires that the closing price of the company’s stock must be at least $1 per share for a minimum of 10 consecutive business days.
Workstream stock has been trading at less than 40 cents a share since early June and closed Monday, September 29, at just shy of 10 cents a share.
The company did not say in its September 23 press release why it had not filed its annual report on Form 10-K. A Workstream official did not return a call seeking comment.
Workstream’s Nasdaq troubles come on top of a failed merger earlier this year with payroll software provider Empagio. That deal fell apart in June and resulted in litigation between the companies.
Workstream clients include Chevron, Kaiser Permanente and Wells Fargo. Besides owning 6figurejobs.com, a career site for executives, Workstream is part of the fast-growing talent management software market. That market refers to tools for key HR tasks such as recruiting, employee performance management and compensation management.
Talent management vendors tend to pitch their wares as integrated suites of software, which can allow organizations to gain greater insight into their workforce and reduce the complexity of their software systems. Research firm Bersin & Associates estimates spending on talent management software will rise 20 percent in 2008 to $2.3 billion.
In July, Workstream said it was seeing growth in its business. In a statement of preliminary results for the fourth quarter and year ended in May, the company reported fourth-quarter revenue of $7 million, up 13 percent from the third quarter. It also said annual bookings grew 50 percent year-over-year, to $11.5 million.
This article has been revised to reflect the following correction:
Correction: June 17, 2009
Because of a miscommunication with research firm Bersin & Associates, Workforce Management reported that spending on integrated talent management suites would grow 20 percent in 2008 and would reach $2.3 billion last year. In fact, the estimates for 20 percent growth and a $2.3 billion market were for talent management software spending generally—including purchases of separate talent management components such as performance management software.