Shares in Wace more than halved at one point yesterday after the printing services group shattered market expectations with its third profits warning in 12 months. The shares plunged 40p, before recovering to end 33.5p lower at 41p, on the announcement that the group would report operating losses both at the half-year and full-year stages in 1997.
The group said the improvement in its US businesses had not come through as expected, while a range of problems had hit European operations. The terms of a supply agreement with Hallmark, continued losses at an Irish plant, a reduction in demand for spirits labels and competition in the printing market were among the reasons cited for the difficulties. In March Wace revealed losses of pounds 2.04m had replaced profits of pounds 20.5m in 1996, but said it expected a recovery in the second half of 1997, which it now says will not be achieved.