Equinti Group PLC (LON:EQN) shares sank on Tuesday after the outsourcing group said its 2019 earnings will be at the lower end of estimates despite revenues hitting the top level of forecasts.
In a trading update for the period from 1 July to 18 November, the FTSE 250 group said weakness in “higher margin UK corporate activity” meant its underlying EBITDA will be “towards the lower end” of the £136-£142mln forecast despite revenues being “at the upper end of market expectations” based on a range of between £550-£567mln.
Looking ahead, Equiniti expects “uncertainty in the macro environment to continue”, although the company stressed that it was well positioned and expected further organic growth in the UK and “accelerated growth” in the US.
That did little to reassure investors, however, with the stock slumping 8.4% to 208.4p in early deals.
In a note, analysts at Peel Hunt cut their profit forecasts for Equiniti by 7% to £77.2mln as a result of the earnings warning, however, they retained their ‘buy’ rating and 242p target price.