Shares in FTSE 250-listed components maker Essentra PLC (LSE:ESNT) plummeted to a 15-year low after warning on profits as market conditions in Europe were weaker than expected.
The Oxfordshire group, which manufactures plastic plugs and caps, metal locks and hinges, and electronic components, said the expected modest improvement in demand in the second half had not arrived as it had anticipated in its half-year results in July.
Through August and into September, market conditions in Europe have softened, Essentra said, with a slower recovery than expected in the Americas region too. Asia Pacific remains "broadly" in line with expectations, which is normally coroorate speak for slightly lower.
With management now more cautious about the likely timing of market improvements, and a predicted £2 million currency hit, expectations for the full calendar year are now for adjusted operating profits of £40-42 million, down from a range of £48.5-50.6 million range at the interims.
"Management remain confident in the business model and that the company is well positioned, supported by a right-sized cost base and robust operations, to benefit from high levels of operational leverage when normalised growth returns," Essentra said, noting that its balance sheet remains "robust".
The shares fell 25% to 126p in early trading, the lowest since 2009.