Profit warnings soar in East Midlands

During the first three quarters of 2020, listed companies headquartered in the East Midlands issued 59% more profit warnings compared to the same period last year, as the UK total hit an all-time high, according to the latest EY quarterly analysis of UK profit warnings.

Year-on-year the number of profit warnings in the first nine months of 2020 from companies in the East Midlands increased from 17 to 27 warnings. In 2020, the overwhelming majority of profit warnings from listed companies in the East Midlands (81%) have been attributed to COVID-19.

Dan Hurd, head of turnaround and restructuring strategy at EY in the Midlands said: “Most of the profit warnings from quoted companies in the East Midlands have been attributed to COVID-19, demonstrating the very real impact the pandemic is having on our listed companies.

“In the East Midlands, nearly half (13) of the warnings recorded so far this year were issued by listed retailers. First impacted by the closure of physical stores earlier in the year – and then a decrease in footfall and instore sales – it is unsurprising to see our regions’ biggest retailers downgrading their profit forecasts. The sector is being challenged to think differently – whilst controlling cost – and retailers which adapt quickly to changing consumer behaviours will come out stronger in the long term.”