Econocom’s share price has tanked by more than a third after a profit warning issued by the reseller on Friday.
Share value for Econocom Group SE plummeted by 36.82 percent since the beginning of trading on 3 July. The tailspin was sparked after the firm posted its preliminary H1 results last week, which made grim reading for investors.
Econocom has revised down its expectations for the second half of the year. FY2018 annual operating profits are now forecast to be €120m, down from €154m in 2017.
Econocom CEO Robert Bouchard blamed weak results down to a slower leasing business, “a low point” in profitability for its French market, €10 million in provisions for “dispute and risk contracts” and €20 million in restructuring efforts.
It’s almost four months since Bouchard took over as CEO from his dad Jean-Louis Bouchard.
“We have already decided to implement an action plan designed to reduce costs across the group and across all our business lines”, he added.
“These decisions will affect our short-term profitability but will enable us to achieve the ambitions of our strategic plan, which are to generate strong growth and a significant improvement in our profitability.”
Meanwhile, the Belgium-based VAR’s complete first-half results will be published on 19 July.
