Analysis of UK Profit Warnings: Sector Insights
Every quarter, we provide the latest sector insights from our Profit Warnings analysis, delving deep into two specific sectors and the challenges facing the companies and stakeholders alike.
For Q3 2019, we look at the FTSE Retail sector as well as the FTSE Industrial Transportation sector, analysing the headwinds facing both.
Bracing for a tough Christmas
FTSE Retailers issued 28 profit warnings in the first three quarters of 2019, with 31% of the sector warning in the last 12 months.
The odds are heavily stacked against retailers as they go into the all-important final quarter. Retail sales are under pressure, whilst structural changes continue unabated.
Differentiate to create value
It’s vital that retailers can differentiate their offering and create value for their customers in a tight and highly competitive market.
FTSE Industrial Transportation companies issued three profit warnings in Q3 2019, with 36% of the sector warning in the last 12 months.
The sector’s correlation with the economic cycle is underlined by its previous profit warnings peaks. In 2019, the sector faces further economic upheaval as a downturn in trade and investment weigh on the global economy.
Trouble beyond trade
Beyond Brexit, there are further economic and structural challenges ahead as companies and consumers make increasing supply chain demands.
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