Flare Group shares plunge as it revises forecasts downwards

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The Independent Online
SHARES in Flare Group lost about a quarter of their value yesterday after the building materials company said it was revising its estimate of pre-tax profit for the year ended 31 December downwards from pounds 750,000- pounds 1.25m to between pounds 100,000 and pounds 200,000.

It said the group's position has continued to be affected by the economic situation in Asia and by the strength of sterling in the last quarter of 1997. The shares fell 10p to close at 30p.

"The warm winter adversely affected the group's heater brick business and reported results from others in the ceramics industry are evidence of difficulties being experienced by many of our principal customers, which similarly affected our business adversely in the last quarter," Flare Group said.

It said it had already taken active measures to reduce costs in all areas of the business. The strategy of concentrating on specific non-Asian markets has begun to take effect and the group is seeing an encouraging level of potential business, it said.

It said it expected, later in the year, to launch several new consumable products which have considerable potential both in terms of market size and revenue in 1999 and beyond.

Last November, shares in Flare fell sharply when it issued a profits warning, saying that because of "exceptional" economic conditions in Asia, it had revised down its expectations for pre-tax profits in 1997 to between pounds 750,000 and pounds 1.25m.

The group will report its results late next month. The company's shares have collapsed from a recent peak of 149.5p last April.