5th Sep 2019 14:34
(Alliance News) - Retail and logistics firm FIH Group PLC on Thursday said annual earnings are set to be lower than that achieved in the previous financial year, partly due to Brexit and geo-political uncertainty.
The company, which ends its financial year in March, said operating costs and the absence of one-off credits received in financial 2019, will also impact its earnings.
"With the costs of strengthening the operational management teams across the group, the absence of the one-off credits reported last year, plus the uncertainty caused by Brexit and wider geo-political instability, the near term outlook, in line with analysts' forecasts, is for a consolidation of earnings in the current year at a level below that seen in 2018-19," the company said.
FIH said Brexit "has already negatively impacted trading in the current financial year and may cause some further slow-down in activity at least in the immediate autumn period", especially if there is disruption at ports or if the UK and EU's custom and tax arrangements change.
Chair Robin Williams said: "Of the group's companies, Momart is the most exposed but with careful planning we are seeking to mitigate potential disruption to the movement of art works in and out of Europe however, it will not be possible to ensure complete insulation from the expected short-term negative impacts of a disorderly Brexit."
The company said Momart's trading has started slowly this financial year, reflecting a more subdued commercial art market. The unit's large exhibitions order book for the rest of the year is ahead of financial 2019 however.
FIH also updated shareholders on the trading of its other units, ahead of the company's annual general meeting on Thursday.
Its Falklands Islands Co Ltd unit has been trading in line with expectations so far this year and in addition, it has built "a record order book for houses to be built in the current year".
FIH's government and military infrastructure projects in the Falkland Islands are also progressing, though slowly and in a competitive market, the company said. Development of oil in the region remains uncertain however, due to a weaker outlook for the price of the commodity, FIH added.
The company also said its ferry business in Portsmouth has been broadly in line with last year.
Williams said: "Once through the choppy waters we foresee in the near term, with its strong balance sheet and embedded market positions across its diverse trading companies, the board remains confident that the group remains well placed to deliver growth over the medium-term."
Shares in FIH were 7.9% lower at 300.20 pence each in London on Thursday afternoon.
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