Profit warnings reach 10-year high

Profit warnings from British companies jumped more than 70% in the final three months of 2011 — the biggest quarterly rise for a decade — as markets were rocked by economic uncertainty, said Ernst & Young yesterday.

Companies quoted on London’s main list and junior AIM market issued 88 profit warnings in the final quarter, up from 51 in the third quarter, the accountancy firm said.

“As evidenced by the sharp jump in the number of warnings, 2011 wasa tough year for many companies and this year is likely to continue in the same vein, with the gap between the winners and losers widening,” said Alan Hudson, head of Ernst & Young’s British restructuring practice.