(Alliance News) - Cap-XX Ltd shares plummeted on Wednesday, after it said its working capital position has "continued to deteriorate".

Shares in the Sydney-based company were down 81% to 0.075 pence each in London on Wednesday morning. Over the past 12 months, the stock is down 96% from 1.80p.

The manufacturer of supercapacitors for portable electronic devices warned that its "working capital position has continued to deteriorate".

Cap-XX explained that this is due to a combination of higher-than-anticipated legal costs associated with the company's patent infringement litigation, as well as revenue and cash receipts over the first eight weeks of the year being weaker than expected.

As a result, Cap-XX said it is exploring raising additional financing but believes some sort of debt and sale/leaseback structures will not be possible.

It is considering equity financing but warned that this process is taking longer than expected.

Cap-XX added that it is now in a "highly constrained financial position" and additional financing is needed by the end of this month.

"There is no guarantee that an equity financing will be achievable and, in the absence of any additional financing being available, the board would have to take steps to preserve and maximise value for its creditors and should the company fail to achieve a solution in the short-term, the board would have no option but to place the company into administration. In this eventuality, it is not known how much, if any, value would be returned to shareholders," Cap-XX said.

On Tuesday, the company had announced that Chief Financial Officer Mike Taylor has decided to retire after 16 years and will leave the company on Friday.

Cap-XX said Ruvina Dissanayake, who joined the firm on Monday as financial controller, will assume CFO responsibilities.

By Sophie Rose, Alliance News senior reporter

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