Profitability deserts UK firms

The number of UK firms issuing profits warnings has quadrupled in the first six months of the year, a report has said.

In the first half of 2001, 325 listed UK firms told investors that earnings would not be as high as previously expected, a survey by business information service Hemscott has said.

The total compares with 89 in the same period last year, the report, quoted in the Sunday Telegraph, has found.

The number of firms issuing multiple profits warnings has shown an even sharper rise, from four in the first half of 2000 to 52 between January and June this year, the report said.

Listed companies are obliged by stock exchange rules to tell investors if profits are likely to fall significantly below forecasts.

Hemscott's findings further highlight the impact the slowdown in the global economy is having on UK firms, and come days after Barclays revealed that the number of people starting their owns businesses has fallen to its lowest rate since 1992.

Worst offenders

Twenty companies have published three warnings since January 2000, the survey found.

These companies include north of England brewer Jennings Brothers, whose takings have been hit by the impact of the foot-and-mouth outbreak, and music publisher Boosey & Hawkes, which found accounting irregularities at a US division.

Five firms have issued four warnings, including sugar firm Tate & Lyle and beleaguered technology company Bookham Technology.

Bookham is one of the three firms among the most frequent warners to appoint a new chief executive, with two companies leaving bosses in place.

Among companies issuing three warnings over the 18-month period, retailer Iceland and chocolate maker Thornton are among firms to replace chief executives.