Yell hit by sales pressure in US

See Yell Group's share price

Shares in directories firm Yell Group have fallen by more than a fifth after it said its US sales were set to grow by less than expected this year.

Yell said tougher competition meant US revenues were likely to grow by about 3% in the current financial year, against analysts' expectations of 8-9%.

The US market accounts for about half of Yell's revenues.

Yell is best known in the UK for the Yellow Pages directory and Yell.com. In the US it trades as Yellow Book.

'Shake-out'

Yell said that trading conditions in the US had "intensified" as established operators sought to protect their market share.

"In the longer term, we believe this will lead to a shake-out in the market," said Yell chief executive John Condron. "In the near term, though, it will impact the rate of our US organic revenue growth."

Yell shares closed down 124 pence, or 20%, at 488.5p in lunchtime trade.

Yell added that its expectations for the British and Spanish markets remained unchanged for the coming financial year.

It also said that it was confident of meeting market forecasts for its results for the financial year to 31 March 2007, with internet revenues continuing to show "rapid growth".