Profit Warnings Issued By Yorkshire Businesses Fall

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Listed companies in Yorkshire issued three profit warnings during the first quarter of 2025, less than half the number issued in the same period last year (seven), according to EY-Parthenon’s latest Profit Warnings report.

Yorkshire’s Q1 profit warnings total was also the region’s joint-lowest quarterly figure since Q3 2021.

Nationally, UK-listed companies issued a total of 62 profit warnings in Q1 2025, marking an 11% year-on-year fall. However, the proportion of UK-listed businesses to issue a warning in the last 12 months remains high, at 18%.

More than a quarter (26%) of warnings across the UK cited policy change and geopolitical uncertainty as key drivers, while 18% cited labour market issues.

Tim Vance

Although the UK is facing a volatile economic outlook, businesses in Yorkshire continued to display encouraging resilience in the first quarter of 2025, with profit warnings down by more than 50% year-on-year. Given heightened levels of global trade disruption it is crucial that companies in the region are agile and prepared for a range of eventualities going forward.

Scenario planning, stress testing, as well as building operational and financial resilience will be a critical priority over the coming months. On a positive note, it looks increasingly likely that interest rates will fall steadily across the remainder of 2025, which should provide a source of support to an otherwise uncertain business landscape.Tim Vance, EY-Parthenon UK&I Turnaround and Restructuring Partner in Yorkshire

Impact of tariffs already clear in April

EY-Parthenon’s latest Profit Warnings report found that the leading factor behind profit warnings in Q1 was contract and order cancellations or delays, cited in 40% of warnings – the highest percentage recorded for this cause in 25 years of EY’s analysis.

Looking beyond the first quarter, half (50%) of the profit warnings issued by UK-listed businesses in April cited the direct or indirect impact of tariffs and resulting recent global trade disruption. The average share price fall on the day of warning also climbed, up from 13% in Q4 2024 to 17% in Q1 2025 and almost a fifth (19%) in April 2025.

Nationally, the FTSE sectors with the highest number of profit warnings in Q1 2025 were Software and Computer Services, with 10 warnings issued, and Industrial Support Services – which encompasses business service providers, industrial suppliers and recruitment companies – with nine. FTSE Construction and Materials companies issued five profit warnings during the first quarter.

Claire Gambles, EY-Parthenon Turnaround and Restructuring Strategy Partner, added:
“UK companies have faced many challenges in recent years, but ongoing global trade disruption has the potential to bring even more substantial and far-reaching repercussions. Demand and supply shocks from the pandemic and geopolitical events were significant but primarily cyclical disruptions, whereas major changes to international trade policy may have more enduring effects.

“Naturally, these changes won’t happen immediately, and companies will need to balance immediate responses, such as strengthening financial resilience, with strategic shifts, whether by reassessing supply chains and pricing models or exploring new global partnerships, to help respond to further uncertainty over the coming months.”

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