Vesuvius Plc (LSE:VSVS) shares tumbled 8.5% to 355p after the molten metal engineer warned that weak trading conditions are persisting for longer than expected, with full-year profit likely to be softer than expected.
The FTSE 250-listed group said it had seen "a continuation of the challenging market conditions" first flagged in May, "with the wider uncertain macroeconomic environment and subdued global industrial activity persisting, leading to a continuing weakness in our end markets".
First-half trading profit is seen at £77 million, roughly in line with market expectations, but the group now expect a similar outcome in the second half, having previously anticipated a pickup later in the year thanks to pricing actions.
The "pricing environment remains difficult" in Europe and China, limiting the company's ability to push through price rises to cover labour cost inflation.
Vesuvius said it is accelerating cost reduction measures, aiming to exceed its £45 million savings target, and look for improvement in core trading performance into 2026.
Analysts at Stifel said they will review forecasts as it was "clearly a weak update, although it is not a huge surprise that price increases are proving challenging currently".
"Vesuvius is tightly run and well-positioned in its industry, but the shares will now probably need to see proof of demand inflection before they can recover."