Own label goods maker McBride has reduced full year profits guidance as the rate of decline in its contract manufacturing business has accelerated.
The firm, which last month announced an unexpected cut in its dividend last month, indicated trading profit in the year to the end of June 2013 will be about £2m lower than previously expected. This is because the group has seen a 7% year-on-year decline in revenue in constant currency terms on the second half of 2012, which, along with the faster than expected decline in the contract manufacturing business, has hit profits.
"As we indicated at the full year, our financial performance this year will be second-half weighted as some contract manufacturing business is wound down, allowing us to grow our Private Label business in the second half and beyond," Chief Executive Chris Ball told shareholders at the firm's annual general meeting (AGM).
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"Although our contract manufacturing business has declined more rapidly than expected in the first half, I remain very encouraged by the progress being made by the business overall," he added.
Shares in the company, which had been trading close to a 52-week high of 138.25p, fell 4.75p to 125.25p in the first hour of trading after details of the AGM statement were released.
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