Profit warnings for second quarter at 2003 low

The number of profit warnings issued by UK companies in the three months to the end of June fell to the lowest level since the same period in 2003, a report shows.

There were 63 UK-listed firms that warned profits would be lower than expected in the second quarter, 36% fewer than last year, according to the accountancy firm Ernst & Young (E&Y). But E&Y warned against viewing the drop as evidence of the end of the recession. “Many companies have withdrawn profit guidance due to a difficult forecasting environment, while three successive quarters of negative growth have diminished market expectations,” says Keith McGregor, restructuring partner at Ernst & Young. This will naturally reduce the number of profit warnings without necessaril...