PROFIT warnings from Scottish companies have surged as global economic uncertainties, market instability and the slump in the oil price put pressure on listed businesses.
Six alerts were issued by firms headquartered north of the Border in the third quarter, representing 60 per cent of the current total for 2015, according to the latest EY profit warnings report, published today.
Across the UK, quoted companies issued 79 warnings in the three months to the end of September, a third more than the previous quarter when there were 57 – marking the biggest percentage increase in almost four years.
Profit warnings from the FTSE travel and leisure sector hit their highest level for almost eight years, according to the accountancy giant’s report.
Global growth concerns and market instability hit earnings forecasts this summer as China wrestled with its economic transition and US interest rates moved back onto the agenda, EY noted.
Many industries are also being buffeted by “disruptive forces”, leaving businesses struggling to generate returns from the new digital economy.
Colin Dempster, head of restructuring at EY in Scotland, said: “Six is a significantly high number of profit warnings in one quarter compared to historical averages. As well as the factors affecting the UK, the slowdown in Scotland’s north-east, for so long a real engine of growth, is starting to impact the broader Scotland picture.
“The key word here is confidence and when that starts to erode, consumers vote with their feet.”
He added: “The outlook for Scotland is mixed. We can expect a continuance of the low oil price to have a wider effect in 2016.”