Shares dive on Campari warning

SHARES in Campari International dived 58p to 120p after the sports leisurewear group issued a profits warning three weeks after releasing its 1992 results, writes John Murray.

The company said it expected to do no more than break even this year. It issued the warning in response to brokers' forecasts that Campari would make between pounds 1.6m and pounds 2.3m before exceptional items and tax.

The warning was the second in three months. Last month Campari announced profits of pounds 1.1m before tax for 1992, having issued a warning in March. It made pounds 5.3m in 1991.

Michael Saideman, finance director, said: 'My feeling is that some of the forecasts didn't take into account some of things we said at the time of our 1992 results. On the basis of our internal forecasts, we felt it would be creating a false market in the shares to allow the brokers' figures to stand without correction.'

He added that the three weeks since the results announcement were quite important as a lot of pre-ordering for the autumn took place then. 'As I said at the time of the last results, forward orders are down and recession is taking a grip on the Continent. Moreover, the UK is still lousy despite what others say.'

However, Lawrence Rubin, an analyst at SG Warburg, said: 'I wouldn't be suprised if they managed a small profit this year despite the warning.'

The shares, which stood at more than 400p 12 months ago, recovered slightly to 133p by yesterday's close.