Spice issues profits warning

SUPPORT services group Spice has issued a profits warning just weeks after a new interim chief executive was appointed.

Martin Towers commenced a strategic review of some of its operations as soon as he was appointed, it has also been revealed.

An interim management statement released by the Leeds-based company also makes it clear that its gas division is under particularly “close scrutiny”.

It also anticipates that it will undergo some restructuring in the coming months.

The company has experienced mixed fortunes in its overall trading with the bad weather taking a toll.

However, it has experienced a boost from the growing green energy sector while also seeing is drop in its utilities division due to the snow.

Today’s statement said: “The facilities business has been restored to modest profitability with improving month on month performance during the second half.

“The gas business remains unprofitable as a result of a number of loss making contracts remaining in place and despite ongoing restructuring.

“The extreme weather has also adversely impacted the performance of the gas business which is expected to report a sizeable loss this year.”

Martin Towers was appointed interim chief executive on February 9 when Simon Rigby stood down.

The statement adds: “Spice is moving forward into a new era that will allow the positive features of its core businesses, in particular exposure to markets which have strong underlying regulatory and environmental drivers, to come to the fore.

“The board now believes that the group’s profit before tax, amortisation and exceptional items will be at a level less than the board’s previous expectations but which is slightly higher than £32.3m recorded in 2009.

“Adjusted EPS will be lower than that reported in 2009 after taking account of the full year effect of the number of shares in issue following the group’s share placing in September 2008.”