Profit warnings issued by listed Midlands companies down in first half of the year

Companies in the region issued seven warnings in the second quarter, the same as Q1 and one more than Q2 2024, when six warnings were issued.

Nationally, the number of profit warnings issued by UK-listed companies in Q2 2025 rose by 20 per cent to 59 compared to the 49 issued during the same period last year. Over the last 12 months, nearly a fifth (19 per cent) of UK-listed businesses have issued at least one profit warning.

The FTSE sectors with the highest number of profit warnings in the Midlands during Q2 2025 were industrial support services – which includes business service providers, industrial suppliers, and recruitment companies – and construction and materials, with two warnings each.

Construction and materials also had the highest number of warnings in the Midlands for the first half of the year, with three in total.

Dan Hurd, EY-Parthenon turnaround and restructuring strategy partner in the Midlands, said: "These latest figures present a complex landscape for profit warnings among listed companies in the West Midlands. While the region experienced a slight decrease in total warnings in the first half of 2025 compared to last year, the consistency of seven warnings in Q2 signals persistent volatility.

“The fact that the construction and materials sector led the warnings in the Midlands, with three in total, highlights the specific challenges facing these industries. This trend reflects a broader national narrative, where a significant rise in profit warnings indicates that many UK-listed companies are navigating turbulent waters.

“The concentration of warnings in sectors such as industrial support services and construction underscores the diverse pressures businesses are facing. This mix of performance suggests that while some companies are adapting to the current economic conditions, others are still struggling to find their footing.

“As we look ahead, it is crucial for businesses in the West Midlands to stay alert and proactive in addressing the underlying issues contributing to these warnings. Emphasizing strategic flexibility will be vital for those seeking to maintain growth and manage risks in an increasingly challenging market environment.”

Policy change and geopolitical uncertainty were the leading factors behind profit warnings during the second quarter and cited in nearly half (46 per cent) of warnings - a significant increase from just four per cent in Q2 2024, and the highest percentage recorded for this cause in more than 25 years of EY’s analysis.

The proportion of profit warnings to cite contract and order cancellations or delays in Q2 remained at a record 40 per cent. One in three warnings (34 per cent) cited tariff-related impacts, including weaker demand, supply chain disruption, and exchange-rate volatility.

Jo Robinson, EY-Parthenon partner and UK&I turnaround and restructuring strategy leader, added: “The latest profit warnings data reflects the scale of persistent uncertainty and how heavy it continues to weigh on UK businesses. While this uncertainty has been a recurring theme since mid-2024, it has intensified so far this year – driven largely by geopolitical tensions and policy shifts – compounding pressure on both earnings and forecasts.



“While the announcement of global tariffs has clearly played a part in amplifying uncertainty, they are just one factor among broader geopolitical and policy upheaval. These pressures are often interlinked and, combined, they are having a significant effect on companies’ confidence, decision-making and spending.



“Whether the rise in profit warnings is cyclical or structural remains to be seen, and we still expect earnings pressure to ebb and flow with the macroeconomic backdrop. As companies operate in a risk and forecasting environment that is challenging to navigate, they must adopt a measured, scenario-based approach that balances both agility and strategic clarity.”