Proportion of UK listed firms issuing profit warnings highest since lockdown months

The number of profit warnings from listed companies in the UK has fallen to its lowest in twelve years, with 274 firms issuing them in 2024. However, shrinkage in the number of UK-listed companies means that that is still proportionally the third-highest number since the turn of the century.

2024 was a year of transition for the UK economy. With the general election yielding a decisive change in government prompting a period of moderately increased state spending, and inflation finally showing signs of slowing, the number of UK listed businesses issuing profit warnings fell for the second straight year.

Having climbed to over 300 in 2022, the number of UK profit warnings fell to 294 in 2023, and over the last 12 months it sank further to 274, according to new research from EY-Parthenon. This was the lowest number of warnings since 2013, when only 255 British businesses flagged up concerns about their financial performance. In the interim, Brexit, a hung Parliament, the Covid-19 pandemic, international conflict and record inflation have meant businesses have never returned to those levels of security.

However, the picture may not be as rosy as it appears, when taken proportionally. A UK listed company is a business which has any class of its securities admitted to the official list, as well as admission to trading on a Recognised Investment Exchange (RIE). And with a range of issues – from fears around AI not delivering on investment, to the US elections – resulting in volatility across stock exchanges, fewer firms seem to be listing than previously, which may partially account for the fall in warnings.

Even though the overall number fell, then, proportionally, 19% UK-listed companies issued a profit warning – the third-highest annual proportion in 25 years. That places 2024 behind only the 2020 pandemic, where 35% of listed firms issued profit warnings, and the impact of the dot-com bust and 9/11 in 2001, when 23% did the same.

According to EY, the leading factor behind profit warnings in 2024 was contract and order cancellations or delays, cited in 34% of warnings. That includes 39% in the fourth quarter, the highest quarterly percentage for this reason in more than 15 years. Increasing costs also still triggered 18% of warnings in the last 12 months.

Jo Robinson, EY-Parthenon’s UK&I turnaround and restructuring strategy leader, commented, “2024 was also an exceptional year for global geopolitical uncertainty and policy upheaval, with a record level of profit warnings linked to contract and spending delays as businesses held back from recruitment and investment. While the pace of profit warnings has eased slightly in early 2025, we’ve seen the recruitment sector continue to grapple with a downturn in activity across key geographies and sectors. Across the board, the road ahead remains rocky with challenges around trade, geopolitics, interest rates, and more.”