FDM Group (LSE:FDM) shares plunged 31% to 195p after the IT staffing and training group posted half-year results that highlighted a tougher market than expected, with no clear signs of improvement.
In a note, Shore Capital said the difficult conditions flagged at the company’s AGM in May have persisted, leading management to warn that full-year results for 2025 will be “significantly” lower than previously expected.
Revenue for the first half fell by 31% compared to the previous year, with adjusted pre-tax profit almost halved.
The group cut its interim dividend by 40% to 10p, reflecting the challenging environment.
FDM’s North American arm was hit hardest, with consultant numbers down nearly 40% in six months as clients delayed or paused projects across sectors.
Shore Capital noted that all regions are struggling, with consultant numbers down year-on-year everywhere FDM operates.
Despite the bleak outlook, Shore Capital pointed to FDM’s strong cash position and efficient operating model as positives for any eventual recovery.
The note also said FDM is making efforts to adapt to the growing use of AI, but stressed that project delays, not AI, are the key reason for weaker trading.
For now, Shore Capital sees performance as “materially constrained” until demand returns.
The shares fell 61.11p to 133.89p.