FireAngel Safety Technology Group PLC (LON:FA.) shares plunged in lunchtime trading Thursday after the smoke alarm maker confirmed its full-year profits would be below expectations.
In a trading update, FireAngel said sales for the year ended 31 December 2018 would be £37.6mln, down from £54.3mln the year before, while also forecasting a swing to an underlying loss of around £2mln from a £4.7mln profit in 2017.
READ: FireAngel raises the alarm over annual profit dip, shares plunge
The company had previously raised the earnings alarm in November as its earnings took a hit from the cost of its transition into an independent technology-led business.
Looking ahead, the firm said while output was expected to meet forecast demand for 2019, there were still challenges around the levels of utilisation and efficiency in its manufacturing process which was impacting product costing in the short term.
Also, while the company was still confident that its revenue growth expectations were “achievable” and gross margins and profitability were forecast to grow, the higher current product costs had caused a “reduction in the overall level of profitability expected in 2019”.
John Conoley, chairman of FireAngel, said the company had had a “difficult year in 2018” but had been active in addressing the issues faced.
“The opportunity presented by growing demand for connected home solutions is significant and I look forward to contributing to the Company during this next phase of growth."
Shares were down 23.5% at 30p.