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(Sharecast News) - Shares in APQ Global were sliding on Friday morning, after it warned that policy shifts under the new Donald Trump administration in the US had created a challenging environment for its core business, Delphos, which relies heavily on international aid and foreign assistance.
The AIM-traded firm said that, while it still expected to meet its obligation to repay 26.1m to holders of its convertible unsecured loan stock (CULS) by 31 March, the risk to achieving the target had increased.
It said it was pursuing a combination of cash flow generation and partial refinancing to meet the repayment, adding that it remained in discussions with multiple parties regarding a full or partial refinancing.
Delphos was currently executing 44 capital raising mandates, down slightly from 47 in December.
However, 75% of its pipeline revenue depended on US government agencies, with recent policy changes in Washington casting uncertainty over the timing of expected cash flows.
While no explicit policy changes had been implemented, execution had slowed, and two-thirds of Delphos' transaction advisory contracts, worth around $5m, had already been cancelled due to executive orders signed by the new administration.
The company said it expected the remaining contracts to be cancelled in the coming weeks.
In response, Delphos had shifted its focus from official financing sources to private sector funding over the past six weeks, anticipating meaningful cash generation in the near term.
However, the broader US policy environment and global reactions to the changes continued to present significant challenges.
Cash inflows for December and January were significantly below previous estimates, with realised inflows of $0.614m in December compared to an expected $2.7m, and $0.49m in January against an expectation of $16.2m.
However, the company still projected total inflows of $87.4m through September 2026, albeit lower than the $113.6m projected in its November update.
Despite short-term uncertainty, APQ said it remained optimistic about its medium-term prospects.
It said it expected a rebound in its transaction advisory business once US government priorities stabilised, and anticipated that borrowers would accept higher financing costs, allowing for greater private sector capital involvement.
At the end of January, the group held $3.2m in cash, down from $4.4m at the end of November, reflecting payment delays and seasonal factors.
The company said it would publish its book value as of 31 December by the end of February.
At 0821 GMT, shares in APQ Global were down 84.62% at 1p.
Reporting by Josh White for Sharecast.com.