We demonstrate that WiseTech is using uniquely confusing accounting strategies to exaggerate growth and income. In this first report, we take investors through two steps: we show that, even if you accept the revenue and profit figures WiseTech reports, slowing the management spin reveals that growth is significantly exaggerated. Next, we present evidence that we believe shows WiseTech's figures can't be relied upon and that the company's profit may have been overstated by as much as 178% cumulatively since FY 2016.

Weak response: WiseTech’s response to our first report follows a well-worn playbook by cherry picking immaterial points to refute, remaining silent on major points, and taking a high moral tone about “short sellers.” Tellingly, the company failed to provide any information on the abrupt resignation of the head of the Audit Committee, and it confirmed that, indeed, key subsidiaries with the majority of profit are not individually audited

We do not buy WiseTech’s claim that coronavirus is messing with company results. The recent H1 2020 report shows problems in H1 2020, before anyone in Wuhan was diagnosed with coronavirus. NPATA is down 14% HoH in H1 2020. Acquisitions are not performing, and growth in organic and acquisition revenue is flagging.

WiseTech frantically rid itself of 40% of the earn-outs from 17 poor-performing acquisitions in May. In a series of scathing interviews with former executives, customers, and competitors of the company’s largest acquisition to date, Containerchain, we have learned that more bad news is about to come out. Containerchain is bleeding accounts, and most of the $87 mln in associated goodwill will have to be written off. This is the first major “auditing” event, for KPMG since serious questions have been raised about WiseTech’s acquisitions performance. We expect the auditors to test goodwill for impairment. It is time for WiseTech to come clean with investors.