Shares in Sportsworld Media Group, the TV programme producer, lost more than half their value yesterday after the company warned that sponsorship income had dried up.
The producer of extreme sports and entertainment programmes, such as Popstars and Search for a Supermodel, said it expected to report a profit before tax and goodwill of between £9m and £10m for the year ending 30 June.
However, the first half had seen a loss of £2m, the company said. Analysts had previously forecast full-year profits of £16m. The company's shares plummeted by 60 per cent to 65p, their lowest level since late 1998, despite Sportsworld's claim that income would rebound in the second half.
The company said the market had proved "tougher" than anticipated in its last trading statement in November. Its shows depend on sponsorship by other businesses, such as consumer brands looking for promotion, which had not come through.
Geoff Brown, the chief executive, said: "In over 20 years of working in the sponsorship and advertising markets, I have never seen such a dramatic slowdown in sponsorship spend as over the last couple of months."
Sportsworld said that its performance in the second half would partly rest on income from its collectibles business, making up for a lack of sponsorship earnings. This venture, which is being taken to North America and will benefit from the football World Cup later this year, runs promotional campaigns.Reuse content