This contrasts strongly with the UK picture where the number of profit warnings jumped to 68 – two more than the previous quarter, but 11 fewer than the same period in 2015 – according to EY’s latest Profit Warnings report.
The worst hit region was London and the South East where companies issued 38 warnings in the third quarter of 2016 – more than half the total number of warnings issued across the UK.
Brexit led the reasons for UK profit warnings this quarter, with 20 warnings citing the fallout from the vote. Nevertheless, the initial Brexit impact has been mixed and the negative effects have been focused on sectors most exposed to business uncertainty and the weaker pound. The FTSE sectors with the most Brexit-related warnings so far in 2016 are: Support Services (6), Travel & Leisure (4) and Real Estate Investment & Services (4).
Most companies also blamed other factors, including falling sales and difficult conditions in their own sector. Overall, the FTSE sectors leading profit warnings in Q3 2016 were: Support Services (12), General Retailers (6), Travel & Leisure (5), Household Goods (5) and Industrial Engineering (5). The two profit warnings in East Anglia came from the Electronic & Electrical Equipment and Technology Hardware & Equipment sectors.
Nick Gomer, EY’s Office Managing Partner in Cambridge commented: “Companies in East Anglia are contending with a daunting level of uncertainty. The fallout from Brexit has impacted profit warnings nationally, but the region continues to weather the storm. For some companies it has been business as usual and for some, the falling pound has been a help rather than a hindrance.
“Sluggish, disrupted and competitive markets don’t provide companies with the luxury of standing still – whatever the outlook. Companies will need to remain agile in their operations and capital structures to ensure they are resilient in the face of new challenges – and to grasp opportunities.”
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Hannah Forrester
Media Relations Manager
0121 535 2997
07931491342
hforrester@uk.ey.com
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Number of profit warnings in East Anglia remains low despite Brexit uncertainty
31 October 2016
Quoted companies in East Anglia issued two profit warnings in the third quarter of 2016, the same number of warnings issued in the previous quarter and the same quarter of last year.
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