Shares in CT Automotive Group PLC (AIM:CTA) fell 23% to 40.6p after the car interiors supplier warned that first-half profits would come in materially below last year's level.
The AIM-listed group, which makes dashboard panels, air vents, armrests and cup holders for manufacturers including Nissan, Ford, Volkswagen and Bentley, blamed geopolitical instability for driving up operating costs and disrupting supply chains early in the period.
It responded by paying more for freight and temporarily building up stock on critical lines at its Mexican plant.
The company also incurred unplanned costs fixing inefficiencies uncovered as that facility ramped up production.
Contracts allow CT Automotive to claw back material and labour costs from customers, but time lags have pushed some of that recovery into the second half.
Revenue for the six months to 30 June rose 15% to $62.1 million, slightly ahead of management expectations.
Production revenue climbed 14% to $56.9 million and tooling revenue rose 30% to $5.2 million.
The group's plants in China and Türkiye performed in line with expectations, with cost savings already showing in Türkiye and more anticipated in China as operations consolidate into a single site.
Management expects materially stronger profitability in the second half, enough to compensate for the first, and maintained that it will meet full-year market expectations of $123.5 million in revenue and $10.2 million in adjusted pre-tax profit.
A new paint facility is now in production, which should allow stock to return to normal levels and cut reliance on imported components with long lead times.
The group is also rolling out a proprietary factory operating system that applies agentic artificial intelligence, meaning software that acts autonomously, across production, supply chain and quality functions.
It is running in Mexico and is due across the wider manufacturing footprint by the first quarter of 2027.
Chief executive Simon Phillips said the extra costs were the price of protecting customer production during global disruption and launching new work at pace in a new facility.
Interim results are due in early September.
