Profit warnings reach 65, the highest since 2024, as policy uncertainty weighs on listed companies

UK listed companies issued 65 profit warnings in the three months to the end of September, the highest quarterly total since the final quarter of 2024, according to EY-Parthenon’s latest Profit Warnings report, published on Sunday.

The total rose from 59 warnings in the second quarter, and remains below the 71 recorded in the last three months of 2024. Almost a fifth of listed companies, 17 per cent, have issued at least one profit warning in the past 12 months.

Photograph: Kaihsu, via Wikimedia Commons (CC BY-SA 3.0)

Policy change and geopolitical uncertainty was the leading cause in the third quarter, linked to 54 per cent of warnings. The conflict in the Middle East was referenced by 38 per cent of warnings, and rising costs by 35 per cent, pointing to inflationary pressures and higher business costs weighing on firms.

This is not a conventional economic cycle.Jo Robinson, EY-Parthenon partner and UK&I financial restructuring leader

Housebuilders were among the hardest hit. The highest sector totals in the quarter came from construction and household goods, with listed housebuilders citing cost inflation and weaker sales.

Photograph: Diliff, via Wikimedia Commons (CC BY-SA 3.0)

Jo Robinson, who leads financial restructuring at EY-Parthenon in the UK and Ireland, said the figures showed the range of pressures bearing down on companies. “The latest figures show the variety of structural changes and challenges that companies are currently navigating,” she said. She added: “This is not a conventional economic cycle. For much of the post-war period, the economy followed a familiar demand-led boom-and-bust pattern but, since the pandemic, supply-side disruption including material and labour shortages, energy shocks, tariffs and wider geopolitical disruption has become far more significant.”

The figures land in the run-up to the autumn Budget, the first since Andy Burnham became Prime Minister, and industry groups have called on ministers to leave business taxes alone after the cost pressures of recent budgets. Ms Robinson said warnings tied to policy change and uncertainty once clustered around fiscal events or elections, but now recur throughout the data. “Businesses have shown considerable resilience, but the pace of policy change is making forecasting, investment and capital allocation much harder,” she said.