According to accountancy firm EY’s latest Profit Warnings report, it takes the total issued in the North West during 2018 to 26, broadly on par with last the 25 warnings in 2017
Stock market-quoted companies in the North West issued 10 profit warnings in the third quarter of 2018, up from four in the previous quarter, new data shows.
According to accountancy firm EY’s latest Profit Warnings report, it takes the total issued in the North West during 2018 to 26, broadly on par with last the 25 warnings in 2017.
Across the UK, quoted companies issued 68 profit warnings in Q3 2018, seven fewer than the same period of 2017. However, the percentage of quoted companies warning in the last 12 months has increased to 15.6% (206) compared to 14.4% (191) a year ago.
In a further worrying sign for the UK economy, companies issuing profit warnings saw their share prices fall by an average of 21%, a drop comparable to figures seen ten years ago at the height of the financial crisis.
Nationally, consumer sectors still dominate, with general retailers issuing eight warnings in Q3 2018, and a third of the sector warning in the year-to-date. According to EY’s report, half of FTSE general retailers warning in Q3 cited the impact of the warm weather.
However, profit warnings are starting to spread back into industrial and financial segments of the economy. Across the UK, the FTSE sectors with the highest number of warnings in Q3 were: general retailers (8), travel & leisure (7), support services (7), and financial services (6).
Sam Woodward, EY restructuring partner in the North West, said: “Despite the tough trading conditions being reported by retailers nationally, profit warnings in the North West region were spread evenly across a range of different sectors – from aerospace to leisure to financial services.
“Looking at the national picture, retailers have contended with a year of weather extremes and the summer sun has benefited some, but burnt others. Looking ahead we anticipate one of the most demanding ‘golden’ quarters leading up to Christmas trading in many years.
“If 2018 follows the pattern of recent years, consumers will hold back spending from now until Black Friday, which could result in heavy discounting to drive sales.”