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APQ Global sees equity holdings rally in fourth quarter after coronavirus impact

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  • Emerging market-focused investment company
  • Portfolio now largely cash and equities

What APQ Global does

APQ Global PLC (LON:APQ) is an emerging markets-focused investment firm with interests across Asia, Latin America, Eastern Europe, the Middle East and Africa

How it’s doing

On 31 December 2020, APQ’s unaudited book value was 40.19c (29.4p) and in a statement said: it had ended the quarter with ‘robust positioning’ in equities.

The company returned 52.8% to its shareholders in the fourth quarter of 2020, measured in US$, resulting in a performance for calendar 2020 of minus 55.9%.

The book value per share was US$0.40 (equivalent to £0.29) at quarter-end.

During the final quarter, the company’s largest exposure was to equities with a cash position of 43.7% of the liquid market portfolio assets.

“During the quarter under review, exposure to equity markets made 48.2%, whilst local currency bond exposure returned -0.8% and FX exposure contributed 5.4%. There was no exposure to credit during the quarter,”

“Following a challenging period in Q1 driven by extreme market volatility due to the initial onset of the COVID-19 pandemic, the company continues to focus on rebuilding its Book Value, which increased by $10.9m, from $20.6m to $31.5m, during the quarter.

“The performance attribution of the equity portfolio is shown below by sector. The largest contributor to the performance of the equity portfolio on the quarter was Consumer Cyclicals (31.1%).”

In November, APQ disposed of all of its holding in City of London Investment Group with net proceeds from the sales £7.2mln (.US$9.6mln).

The company said it intends to partially redeploy the proceeds in the near future and to bolster its cash position.

What the boss says: Bart Turtleboom, chief executive

“This has been the most challenging environment in my career and an exceptionally difficult environment for the company.”

“We have focused on maximising liquidity in the balance sheet, which was recently achieved. Having stabilised the company’s finances, management is now fully committed to exploring further opportunities in line with the company’s business strategy and investment policy.

“Western economic systems are not really designed for an overnight collapse of 20% of GDP.

“Unlike the crisis of 2008, which was really a crisis of the financial sector in the US and Europe, we are now looking at a truly global crisis that has a very significant impact on pretty much on all sectors. That is going to have a lasting impact.”

Inflexion points:

  • Emerging markets recover from hammering at the start of 2020
  • More direct acquisitions, keeping the emerging market focus
  • NAV at end December 40.19c

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