Shares in recruitment and tech consultancy Parity Group PLC (LON:PTY) plunged in late-afternoon trading Friday as it issued a profit warning for the full year after a delay in the extension of a large contract continued into the second half.
The group added that even if the contract was eventually approved, its scope would be “reduced” and despite progress in revenues, adjusted pre-tax profits would be around breakeven for the second half of the year.
READ: Parity shares gain as it expects double-digit growth in first-half profits
Considering the pressures on the business, the firm said it had initiated several actions including a review of project profitability and staff utilisation with cost reductions which would benefit 2019 as well as a restructuring of its Parity Consultancy Services (PCS) division to focus on “new Data consultancy opportunities”.
Parity also said it was re-prioritising its pipeline and relationship management process to “ensure appropriate engagement” on fewer but more likely and more profitable projects.
As a result of the initiatives, the company expected to incur around £300,000-£400,000 of non-recurring costs in restructuring the PCS division.
Shares were down 29.4% at 6.9p.
-- Adds share price --
