Teather hit as retail share-buying slumps

Teather & Greenwood, the City stockbroker, yesterday warned that profits would be below expectations because of a drop in business from private investors who have run scared from the mayhem in global stock markets.

Teather & Greenwood, the City stockbroker, yesterday warned that profits would be below expectations because of a drop in business from private investors who have run scared from the mayhem in global stock markets.

Teather said it had been hit by "significantly reduced demand" for its retail financial services since the downturn in the markets in January, leading to expectations that its full-year profits for the 12 months ending in April would be less than last year's £9.7m.

The company's shares fell 11 per cent to 142.5p, valuing the company at £39m. Yesterday's fall took them to their lowest share price since October 1999. Teather's shares peaked at 349.5p at the height of the technology boom a year ago.

Teather, which is the eighth- largest broker in the UK, is one of a handful of independent brokers whose shares have dropped an average of 27 per cent this year, as stock markets in the US and Europe fell amid concern about slowing economic growth.

Teather's warning came after the rival broker Brewin Dolphin said last week that its first-half profits would be lower than last year because of a drop in trading volumes.

In the US, the giant broker Charles Schwab reported that volumes had fallen by more than 30 per cent in February and even more in March, leading to plans to slash 3,400 jobs.

Teather traditionally does most of its business in the second half. But yesterday it said that it would be very unlikely to make up the levels of business done in 1999 by its year end, which is 30 April.

Teather is, however, still expected to make a profit, as demand for its corporate finance and equities research business has remained "strong". The company expects to pay a dividend at least equal to the 1.3p paid last year. Analysts now expect Teather to make a profit of around £7m for the year, from earlier forecasts of £9.5m.

A spokesman for Teather said the company was "confident in the medium term" and expected the fall in retail business to be the low point of the cycle.