Profit warning sparks share price collapse at online electrical retailer

The share price at Leicester online retailer Marks Electrical has collapsed on the back of a second profit warning in just three months.

Almost a quarter of the firm’s value has been wiped out after the firm’s share price plummeted by 21.5p to just under 70p at the close of trading on Wednesday.

Earlier on Wednesday morning, Marks Electrical issued a profit warning after revealing that margins were below levels forecasted.

It warned against a “challenging” trading environment where customers remain “highly price-conscious”. The company added: “Our gross product margin did not increase to the levels we expected, and despite proactive action on other controllable costs, the impact of this in the peak trading period has had a material impact on our full year profit guidance.”

Marks now expects full year revenue to be between £115m and £118m, with EBITDA in the range of £5-6m.

It is the second downgrade in a matter of months; in October, the company reduced its EBITDA forecast from £8.9m to £8m.