SpaceandPeople in profit warning

SHARES in SpaceandPeople have closed up a penny at 52p after sliding to about 40p on opening yesterday, as the shopping centre marketing and promotional specialist slashed its profit forecast for the second time this year.

The Glasgow- based company, which markets retail and promotional space in shopping malls, cited challenges in its UK and German arms as it forecast pre-tax profits of £800,000 for 2014.

It comes after the firm forecast in April that profits would be £1.5 million for the 12 months to December, which at the time was £1.4 million lower than expected.

The update came as SpaceandPeople reported a fall in operating losses of £86,000 for the six months to June 30, down £743,000 on last year. Net revenues rose by seven per cent to £7.1 million.

SpaceandPeople said the first half had been challenging amid poorer trading, adding that it had sustained a number of one-off costs.

It stated a number of trading problems flagged in April had continued to weigh on its performance. In the UK, sales at its promotions arm were hit due to slower traction than anticipated in new venues, while its retail operation was affected by increased restrictions.

The c o mpa n y also repor ted challenges in Germany, where in spite of higher retail sales than last year, its expansion into new centres has slowed down.

The profit warning came as SpaceandPeople brought STV chief financial officer George Watt on board as a non-executive director.

Mr Watt bought 25,000 ordinary shares at 47p in the business yesterday, equal to 0.13 per cent of the total issued share capital.