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Profit warnings from UK businesses at five year high

Jan 14 2008

Profit warnings from publicly listed British businesses are at their highest in five years, according to new research.

The findings from Ernst & Young reveal that almost 400 warnings of disappointing profits were issued, the highest annual total since 2001.

In the fourth quarter alone there were 107 warnings, 22 per cent higher than in the same period in 2006.

Keith McGregor, corporate restructuring partner at Ernst & Young, says: 'The UK economy will slow in 2008; the only question is how much.'

'By the end of 2007, the question whether the impact of the credit crunch would spread beyond the financial sphere was answered by a wave of 'credit crunch' profit warnings from non-financial corporates,' he adds.

The retail sector reported 12 profit warnings for the fourth quarter of 2007 and taking the total number to a record-breaking 47.

This is the highest number since Ernst & Young began recording profit margins in 1999.

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