‘Mixed’ signals from profit warnings

‘Mixed’ signals from profit warnings

E&Y analysis reveals uncertainty in the City

Profit warnings issued in the UK for the first quarter of 2006 have fallen
11% compared with the last quarter of 2005, according to research by Ernst
& Young.

This would indicate that confidence is growing, but over the last 12 months,
profit warnings have increased by a massive 24% – increasing from 307 to 381 –
when compared with the previous 12 months, making it harder to paint a clear
picture of the health UK plcs.

Keith McGregor, corporate restructuring partner at Ernst & Young, said
the outlook remained uncertain for both corporate and consumers.

‘The picture for the last quarter is very mixed. Confidence is clearly
growing and warnings are falling. However, the warning level for the last 12
months is still high, and the proportion of companies warning continues to give
cause for concern,’ he added.

Eighty-five profit warnings were issued by UK quoted companies in the first
three months of the year, with nearly half citing ‘sales short of forecasts’
followed by ‘difficult market/trading conditions’ and ‘increasing costs and
overheads’ as reasons for the market announcements.

The sector which recorded the most warnings was software and computer
services with 12 warnings, followed by general retailers with ten, support
services with six, and food producers, healthcare equipment & services and
travel & leisure with five warnings each.

Share

Subscribe to get your daily business insights

Resources & Whitepapers

Why Professional Services Firms Should Ditch Folders and Embrace Metadata
Professional Services

Why Professional Services Firms Should Ditch Folders and Embrace Metadata

3y

Why Professional Services Firms Should Ditch Folde...

In the past decade, the professional services industry has transformed significantly. Digital disruptions, increased competition, and changing market ...

View resource
2 Vital keys to Remaining Competitive for Professional Services Firms

2 Vital keys to Remaining Competitive for Professional Services Firms

3y

2 Vital keys to Remaining Competitive for Professi...

In recent months, professional services firms are facing more pressure than ever to deliver value to clients. Often, clients look at the firms own inf...

View resource
Turn Accounts Payable into a value-engine
Accounting Firms

Turn Accounts Payable into a value-engine

3y

Turn Accounts Payable into a value-engine

In a world of instant results and automated workloads, the potential for AP to drive insights and transform results is enormous. But, if you’re still ...

View resource
Digital Links: A guide to MTD in 2021
Making Tax Digital

Digital Links: A guide to MTD in 2021

3y

Digital Links: A guide to MTD in 2021

The first phase of Making Tax Digital (MTD) saw the requirement for the digital submission of the VAT Return using compliant software. That’s now behi...

View resource