TT Electronics shares plummet following profit warning

TT Electronics said it expected full-year earnings to be at the low end of market forecasts and significantly lower in 2015, as the firm is set to implement a review of its business.

Despite a decline in order intake in Europe, underlying revenue, excluding currency movements and the effects of new acquisitions, in the 10 months to October grew 3% compared with the same period last year.

The company, however, said its performance remained affected by delays in implementing improvements to its operations.

TT said it was transferring some operations from Germany to Romania in an attempt to lower cost sites and to improve competitiveness and lower overheads. The decision is expected to cost £24m, slightly less than the £25m originally forecasted, leading the firm to save around £3.5m.

Group chief executive Richard Tyson announced it was conducting a thorough review of the business and said the firm had identified a number of issues that are hampering its performance, particularly in its Sensors business.

TT added product portfolio and investment levels, including research spending, were also under review and that it expected an improvement in working capital in the second six months of the year.

TT shares plummeted 30.77% to 112.50p at 16:12 on Tuesday.