In­ter­serve shares plunge 50pc as it is­sues ma­jor profit warn­ing on spi­ralling costs

The Daily Telegraph - Business - - Front Page - By Rhiannon Bury

SHARES in In­ter­serve halved in value in the space of a morn­ing’s trad­ing fol­low­ing a dis­as­trous up­date in which the sup­port ser­vices and con­struc­tion group is­sued a mas­sive profit warn­ing on the back of spi­ralling costs.

Shares in the firm plunged by 51.6pc to 73.75p as the scale of the com­pany’s trou­bles was laid bare.

Just last month, Adrian Rin­grose, In­ter­serve’s for­mer chief ex­ec­u­tive, as­sured in­vestors that the group’s con­struc­tion divi­sion was prof­itable, and would scale back its ac­tiv­i­ties in or­der to get back on track af­ter mak­ing a £2m loss in the first six months of the year.

“Com­pared to some, our prob­lems are rather more nar­rowly de­fined and con­trol­lable,” he said at the time. Mr Rin­grose left his role at the be­gin­ning of this month and was re­placed by for­mer Sodexo boss Deb­bie White.

But the firm said yes­ter­day that trad­ing in July and Au­gust had been “dis­ap­point­ing” in both the sup­port ser­vices and con­struc­tion divi­sion, hit­ting its ex­pec­ta­tions for the rest of the year.

Ad­di­tion­ally, costs for ex­it­ing a prob­lem­atic en­ergy-from-waste con­tract will “sig­nif­i­cantly ex­ceed” the £160m al­ready put aside, In­ter­serve said.

Howard Sey­mour, an­a­lyst at Nu­mis, said he ex­pected costs to be be­tween £15m and £30m higher.

This could dent prof­its this year by 25pc, he said.

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