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Warnings over profits up by 17%.

PROFIT warnings in the North East and Yorkshire increased by 17% in 2017, a new report says.

A total of 28 companies in the region issued profit warnings in 2017, a 17% increase on the previous year.

Across the UK, the number of profit warnings and investor reaction increased significantly in the second half of the year, with companies citing cost pressures, delays and contract uncertainties.

EY's Charles King said: "Companies that issue profit warnings are now under greater scrutiny and investors are reacting with less patience, especially in sectors where shareholders view warnings as a sign of deeper issues rather than a one-off event.

"In 2018, inflationary pressures may ease, but new challenges are emerging and some existing concerns - most notably Brexit - are likely to come to a head.

"There are still many opportunities to capture growth; but the cumulative impact of rising costs, slowing growth and increasing competition will continue to expose weaknesses in any company struggling to understand this changing economy."

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Publication:The Journal (Newcastle, England)
Date:Jan 31, 2018
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