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Common sense is key.

NORTH-EAST plcs are weathering the credit crunch better than any other region in the first quarter of 2008, as profit warnings dropped by 25%, according to latest research.

Profit warnings in the North-east and Yorkshire dropped from eight, issued in quarter four 2007, to six in the three months to the end of March, while other regions were posting increases, said accountants Ernst & Young.

The number of warnings is well below the region's four-year average of 10.

Hunter Kelly, restructuring partner at Ernst & Young, said: "Despite the global credit crunch, the North-east is reacting well.

"It is impossible to be certain, but I would put it down to good old 'common sense' from experienced business managers."

The most common reasons for issuing a profit warning in the North-east were increasing costs and overheads; sales short of forecasts; and difficult trading conditions.

Profit warnings were recorded across six sectors in the North-east and Yorkshire including chemicals, food producers and support services.

Meanwhile, UK plcs as a whole saw no respite in the first quarter of 2008 as profit warnings reached 114, the highest first quarter figure since 2001 and up 11% from Q1 2007.
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Title Annotation:Business
Publication:Evening Gazette (Middlesbrough, England)
Date:Apr 14, 2008
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