Yorkshire listed firms see big increase in profit warnings in 2018
LISTED COMPANIES in Yorkshire and North East issued 37 profit warnings in 2018, a 32 per cent increase on the previous year, as companies prepare for the worst.
This follows a fourth quarter when 10 companies in the region issued profit warnings, according to EY’s latest Profit Warnings report.
This is up from eight warnings in the third quarter and an increase on the region’s performance in the final quarter of 2017 when seven firms issued warnings.
Of the 10 warnings made in Yorkshire and the North East, a number of technology companies issued warnings.
Hunter Kelly, EY’s head of restructuring for Yorkshire and the North East, said: “It is particularly significant that we have seen more ‘new’ companies warning in 2018. It demonstrates that there are more wide-reaching pressures and that the rising uncertainty on confidence and demand is having an impact.
“The average fall in share price indicates that investors, like many businesses, are positioning for the worst. Recent events have created further uncertainty and with no obvious end in sight for some of them there is no let-up in the factors that could derail a business plan.”
Rising uncertainty wasn’t the only reason why profit warnings spread in 2018.
The weather and regulatory issues were to the fore, such as the changes to diesel regulation in the automotive sector and increasing gaming regulation. China’s slowdown also particularly hit automotive and technology sales. EY said that rising uncertainty has exacerbated these. Nationally, one in six quoted companies issued profit warnings in 2018.