NWF Group PLC (AIM:NWF) shares slid 19% to 128p on Friday after the distributor warned that full-year results will fall “significantly below” market expectations, with an unseasonably warm autumn hammering its fuels division.
The company said its fuels business has faced a “disappointing” trading period since September, with domestic heating-oil volumes down 25% in the three months to August, according to official data.
Those weak volumes have persisted into the autumn, as higher-than-average temperatures cut demand. Commercial fuel sales have also dropped, with gas-oil volumes, typically a higher-margin product, nearly 30% lower on the same measure.
Lower demand has led to tougher competition and pressure on prices, squeezing margins at the very moment NWF is bedding in a new nationwide operating model for the division.
Management expects a seasonal rebound as winter sets in, but concedes it will not be enough to make up the first-half shortfall.
There was better news elsewhere. Food performed ahead of last year after securing new contracts and delivering cost savings from a June restructuring.
Feeds continued its positive momentum, helped by stable milk prices encouraging farmers to boost output.
NWF said its balance sheet remains strong and reiterated confidence in its medium-term growth strategy despite the setback.