Yates shares slide 22% after disappointing summer trading

Click to follow

Shares in Yates, the pubs and wine warehouses group, yesterday lost 22 per cent of their value after a shock warning that this year's profits "were unlikely to exceed" last year's.

Shares in Yates, the pubs and wine warehouses group, yesterday lost 22 per cent of their value after a shock warning that this year's profits "were unlikely to exceed" last year's.

In a trading statement, the company said it had experienced a good start to the early summer. But, it added, this performance "has not been sustained in the face of competitive market conditions". The shares plummeted 49.5p to 179p.

Graeme Eadie, an analyst at Deutsche Bank, said: "Yates is generally regarded as being one of the top retailers in the sector, so this just shows you how tough the conditions are."

The group, which owns the Ha! Ha! Bar & Canteen chain as well as its core Yates Brothers Wine Lodges, has been forced to reduce its prices in response to aggressive discounting by rivals such as JD Wetherspoon. Peter Dickson, Yates's chairman, said the company had dropped its policy of charging more for drinks on Friday and Saturday nights. He estimated that the cash impact would be £1m.

In June, Yates reported full-year profits up 10 per cent at £14.1m. Analysts had expected a 15 per cent uplift in earnings for the current year, but have now slashed forecasts to either the same or lower than the previous year.

Comments