Groundworks giant faces “very difficult” trading in Asia-Pacific
Shares in groundworks giant Keller slumped more than a quarter yesterday after posting a profit warning.
The FTSE 250 firm said yesterday morning its underlying profit for 2016 would be about 15% lower than market expectations, mainly due to losses in the Asia-Pacific region.
Its share price fell more than a quarter in trading yesterday, closing at £6.50, down from £8.84 the previous day. The firm’s share price rallied marginally in trading this morning, trading around £6.70.
Keller said its North America and EMEA divisions - which together account for 70% of group turnover - were on course for “steady results” in line with expectations.
But in Asia-Pacific the firm said “very difficult market conditions” meant the division incurred further operating losses over the third quarter.
The firm added: “We continue to experience some contract softness and the pricing environment remains challenging.
“The recovery in this division is likely to be more gradual and protracted than previously thought.”
Keller also told investors it will incur £10m of restructuring costs in its second half as it further downsizes.