The airports operator BAA was yesterday forced into a damage limitation exercise after ill-founded fears that it was about to issue a profit warning wiped more than 10 per cent from its share price.
After a social dinner between BAA's chief executive Mike Hodgkinson and analysts on Tuesday night, reports emerged that the group could be hit harder than expected by the abolition of European duty-free sales.
Analysts warned that BAA might not be able to recoup as much of the £100m losses from increased airline fees as had been expected.
After BAA shares fell 60p to 372.5p - a fall of 14 per cent - the group rushed out a statement saying there was no question of it issuing a profits warning, saying it "confidently expects this year's results ill satisfy investors".
The statement added that traffic growth was healthy, its property strategy was proving a success and the recovery from the loss of duty free last June continued. It said that City forecasts, which predict profits this year of round £460m, did not need to be changed.
The shares, which fell to a seven-year low of 342p earlier this month, recovered nearly half the lost ground to close at 394.5p, down 34p.Reuse content