Blenheim price dives after profit warning after profit warning

Blenheim, the previously high-flying exhibition organiser, stunned the City yesterday with its fourth profits warning in 18 months. The company's shares closed 35p lower at 199p, a 15 per cent fall.

Neville Buch, chairman, said the cost of restructuring, coupled with difficult trading conditions in France and the US, Blenheim's biggest markets, meant that profits would be below previous expectations of at least £32m.

Analysts now forecast profits of £30m compared with the record £45.2m of 1993. This year is not expected to show much improvement and speculation has turned to a possible takeover of Blenheim, with Reed thought to be taking a close look.

The decline in Blenheim's fortunes has been much quicker than its relentless rise since the company was founded in 1980. Its shares, with next to no asset backing, have fallen from a peak in March 1993 of 599p.

A source close to the company said yesterday that Blenheim was paying the price for its hubris between 1991 and 1993 when a flamboyant management surprised investors with its claims to be largely recession-proof.

Analysts argue that forward bookings that characterised the exhibition and conference industry meant Blenheim entered the recession later than most businesses.

Christopher Crowcroft, finance director, said redundancies in France and the US would cost about £4m. This would be taken against 1994's results, to be announced in March.

He said there was no question of management changes. Phil Soar, the former publisher and chief executive until November 1993, took the blame for two profits downgrades immediately following a £76m fund-raising that summer, stepping down from the top job and leaving the company five months later.

The absence of any warning at the time of the issue incensed investors who had subscribed to the fund-raising. After years of growth Blenheim appeared to have come off the rails.

Competitors maintain that Blenheim has always paid premium prices for many of its exhibitions. The company is also not represented in the Far East, which provides some of the best growth markets in the industry.

Blenheim's supporters say that the fundamentals of the business remain good, with pre-tax margins on 1994's forecasts still 19 per cent. But few in the City expect the shares to recover their previous heights.

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