Next Fifteen shares drop 24 per cent after profits warning

The share price of Next Fifteen Communications Group plunged yesterday after it issued a profits warning due to audit issues at Bite and its finance director quit.

Profits warning: Next Fifteen chief executive Tim Dyson
Profits warning: Next Fifteen chief executive Tim Dyson

Investors punished the company, sending its shares down from 92 pence at Monday’s close to 70 pence at yesterday’s close, a level that was little changed in early trading this morning.

The two-year low was reached after it announced that finance director David Dewhurst was stepping down with immediate effect.

The company is recruiting an interim finance director and while a search for a permanent replacement takes place, Dewhurst has made himself available to ensure an orderly transition.

Next Fifteen’s preliminary results will be announced as planned on 5 November.

The company, which is led by chief executive Tim Dyson, said profits would be "materially short of market expectations" but revenues would be in line.

What the company called "audit adjustments that relate to issues at Bite" could be traced back to problems that came to light a year ago.

Last October the company delayed the publication of its annual results, saying it had learned it "has been the victim of a complex fraud involving a senior member of the finance team at its Bite North America subsidiary".

In April it said the fraud case was concluded but had resulted in total charges of £600,000 in the first half of its financial year, in which it reported adjusted profits before tax of £4.5m.

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