Analysis of UK Profit Warnings
We have tracked profit warnings from UK registered companies listed on the UK’s Main Market or AIM for 20 years, giving us powerful insight into business, capital and the UK economy.
What is a profit warning?
A profit warning is an official statement to the stock exchange from a publicly listed company that says that it will report full-year profits materially below management or market expectations.
Our analysis provides you with insights into profit warning trends and key economic, sector and market issues facing UK businesses. You can delve into the latest quarter’s findings, access twelve years’ worth of data at the click of a button using our console or understand the trends of the past 20 years to identify the forces affecting your market and shape your path ahead.
Q4 2020 Headlines
UK quoted companies issued 583 profit warnings in 2020. Over a third of companies materially downgraded their profit forecasts, the highest in over two decades of EY analysis.
It was a profit warning year of two-halves. COVID-19 dealt a huge blow to earnings expectations in the first half of 2020, triggering record levels of warnings. By the second half, expectations adjusted, demand recovered, and profit warnings fell below average – even as COVID-19 restrictions increased in the final quarter.
But 2020 has left many companies bruised, existing on life support, and vulnerable to further shocks and withdrawal of government support. We start 2021 with new hopes, but also renewed challenges. Vaccines will eventually open the economy, but the UK will spend most of the first quarter in lockdown. A Brexit deal supplies certainty, but also new trade frictions.
Businesses that lack capital to restart and transform will struggle to thrive in a reshaped economy. The recovery is coming, but we expect many more businesses to fail in 2021.
UK companies issued583
profit warnings in 2020, more than double the 10-year average
In 2020, a record35%
of UK quoted companies issued a profit warning
In 2020,4 in 5
FTSE Travel & Leisure companies issued a profit warning
of profit warnings in 2020