LONDON (Alliance News) - Redde PLC on Friday said it has not been successful in securing the renewal of a hire and repair contract with an undisclosed insurer.
The stock was trading 28% lower on Friday at 99.00 pence a share.
The support services company said its existing contract with the insurer runs through into the next
financial year and there will be no impact on adjusted operating profits in the current financial year, which ends on June 30.
Redde said it expects that the impact on existing consensus market expectations for the financial 2020 would be a net reduction in sales of GBP111.9 million, representing 18% of consensus expectations.
In terms of adjusted operating profit, the company expects to post a GBP4.7 million decline, representing 8.7% of consensus expectations.
Looking ahead, Redde said it is "disappointed" not to have secured the renewal of this contract after ten years of partnership. However, the company noted that the pipeline of new business remains encouraging, with a number of live prospects.
"We are obviously disappointed not to have retained this contract," said Chief Executive Martin Ward.
"We will however concentrate our efforts on continuing to support our existing partners as well as winning new business to mitigate the effect on earnings in the next financial year," added Ward.