Profit warnings in the Midlands double

Listed companies in the East Midlands recorded the highest number of profit warnings in the first quarter of 2019 for three years, according to new figures.

Twelve profit warnings were issued by listed companies based in the Midlands in the first quarter (Q1) of 2019 – double the number recorded in the same quarter of 2018 (6) – according to EY’s latest Profit Warnings Report.

The twelve warnings – down one compared to the last quarter of 2018 (13) – were made across ten sectors, including the Electronic & Electrical Equipment; Household Goods & Home Construction; and General Retailers. Q1 2019 also represented the highest number of warnings recorded in the region in the first quarter, since 2016 when 13 were issued.

Mirroring the regional picture, profit warnings across the UK increased year-on-year in Q1 2019 to 89 – 22% higher than the same quarter in 2018 (73) and the highest number issued in the first quarter since the global financial crisis a decade ago.

Dan Hurd, EY’s head of restructuring in the Midlands, said: “Protracted uncertainty is taking its toll. The ‘no deal Brexit’ countdown was especially disruptive for businesses exposed to blows to consumer, corporate and investor confidence – as well as those reliant on cross-border EU supply chains and regulation.

“However, it is hard to split out Brexit stresses from mounting global trade and growth concerns, including the recent weakening of the global economic outlook, and rising concerns over US-China trade relations.”

The UK FTSE sectors issuing the most profit warnings in Q1 2019 were General Retailers (12), Financial Services (10) and Travel & Leisure (8).

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