A top accountancy firm has reported the number of profit warnings in Scotland increased last year, with 16 being issued by firms in the country.
The findings of Ernst & Young show this is the largest number of profit warnings since the financial crisis started in 2008. That year, there were 21 profit warnings issued. In 2011, this had dropped to just 10.
The continued worries over the US and the Eurozone, alongside the slowdown in China were said to be key factors.
A spokesman from Ernst & Young suggested that 2013 could offer a better picture, with 11th-hour fiscal deals in Europe and America lessening the concerns.
However, the Scottish head of restructuring for the firm, Colin Dempster, did warn tough conditions would continue, saying:
“According to our own Scottish Item Club, Scotland’s economy shrank for the third time in five years during 2012 and is staring at a low-growth landscape as we progress through 2013. There is no doubt that Scottish businesses are finding it tough out there. The recent retail failures highlight a lack of consumer confidence that is reflected by many corporates. Directors typically entered 2013 expecting another challenging year and a prolonged spell of widespread cold, snow and ice is the last thing most businesses wanted to see.”
Dempster went on to say that operational flexibility was key to success, with many companies recognising this, often working with an asset finance broker to deliver workable solutions.
The biggest hit sectors in the year were support services and technology, hardware and equipment industries.