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You can find the current article at its original source at https://www.theguardian.com/business/2016/jun/27/foxtons-and-easyjet-issue-profits-warnings-eu-referendum
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| Foxtons and easyJet shares slump after profits warnings | Foxtons and easyJet shares slump after profits warnings |
| (35 minutes later) | |
| Shares in Foxtons and easyJet have tumbled after warnings from both that damage to consumer confidence from the Brexit vote will hit profits this year. | |
| The London-focused estate agent lost 25% of its value on the stockmarket on Monday after it said the vote to leave the EU would depress London property sales for the rest of the year. | The London-focused estate agent lost 25% of its value on the stockmarket on Monday after it said the vote to leave the EU would depress London property sales for the rest of the year. |
| The short-haul airline’s shares fell 24% after it warned wary consumers would rethink their travel plans. | The short-haul airline’s shares fell 24% after it warned wary consumers would rethink their travel plans. |
| Foxtons shares reached a record low of 101p – more than 56% lower than their 230p float price in October 2013. EasyJet shares dropped to £10, their lowest for more than three years. | |
| Foxtons said: “While it is too early to accurately predict how the London property sales market will respond, the upturn we were expecting during the second half of this year is now unlikely to materialise.” | Foxtons said: “While it is too early to accurately predict how the London property sales market will respond, the upturn we were expecting during the second half of this year is now unlikely to materialise.” |
| Its profit warning underlines the effect of the referendum on the UK property market, which had slowed sharply before last week’s vote. The run-up to the vote created uncertainty that hit house sales and Foxtons said on Monday it expected the downturn to last at least until the end of this year. | |
| The Royal Institution of Chartered Surveyors reported this month that concerns over the impact of leaving the EU had caused the biggest fall in inquiries from potential buyers since the financial crisis. | The Royal Institution of Chartered Surveyors reported this month that concerns over the impact of leaving the EU had caused the biggest fall in inquiries from potential buyers since the financial crisis. |
| Foxtons had a busy start to the year as property investors and sellers rushed to complete deals before stamp duty on second homes increased at the start of April. Since then, higher stamp duty and increasing uncertainty had caused people to sit on their hands, it said. | Foxtons had a busy start to the year as property investors and sellers rushed to complete deals before stamp duty on second homes increased at the start of April. Since then, higher stamp duty and increasing uncertainty had caused people to sit on their hands, it said. |
| City analysts said more companies would warn on profits in coming weeks, reflecting the impact of the referendum result on their business or taking the chance to soften up expectations and blame Brexit for weak trading. | City analysts said more companies would warn on profits in coming weeks, reflecting the impact of the referendum result on their business or taking the chance to soften up expectations and blame Brexit for weak trading. |
| Clyde Lewis, an analyst at the broker Peel Hunt, said Foxtons’ real problem was competition from online agents undercutting its 2.5% seller fees – but the Brexit vote had made things worse. | Clyde Lewis, an analyst at the broker Peel Hunt, said Foxtons’ real problem was competition from online agents undercutting its 2.5% seller fees – but the Brexit vote had made things worse. |
| “That softness was there before but the chances of them recovering in the second half of the year has gone out of the window. If you are thinking of buying a house and are now possibly worried about your job then people will defer that decision.” | “That softness was there before but the chances of them recovering in the second half of the year has gone out of the window. If you are thinking of buying a house and are now possibly worried about your job then people will defer that decision.” |
| EasyJet’s warning followed its statement on Friday in response to the referendum result when it said performance would not be damaged in the long run, but failed to mention short-term trading. | EasyJet’s warning followed its statement on Friday in response to the referendum result when it said performance would not be damaged in the long run, but failed to mention short-term trading. |
| On the same day, British Airways’ owner, International Airlines Group, warned that annual profits would be less than expected because of weak trading caused by the referendum. | On the same day, British Airways’ owner, International Airlines Group, warned that annual profits would be less than expected because of weak trading caused by the referendum. |
| In Monday’s update, easyJet said the leave vote had added to existing problems such as cancelled flights and that it would concentrate on cutting costs to support profits. | In Monday’s update, easyJet said the leave vote had added to existing problems such as cancelled flights and that it would concentrate on cutting costs to support profits. |
| Robin Byde, an analyst at the stockbroker Cantor Fitzgerald, said: “A lot of companies are being very cautious on the outlook at the moment and I think we will see a lot more of that. A couple of days ago easyJet were talking about how robust their business model is and today they are effectively downgrading numbers for the full year so it’s slightly at odds but you can’t fault them for being prudent.” | Robin Byde, an analyst at the stockbroker Cantor Fitzgerald, said: “A lot of companies are being very cautious on the outlook at the moment and I think we will see a lot more of that. A couple of days ago easyJet were talking about how robust their business model is and today they are effectively downgrading numbers for the full year so it’s slightly at odds but you can’t fault them for being prudent.” |
| EasyJet said trading was difficult for European airlines in May and June and that strikes by French air traffic controllers, congestion at Gatwick airport and bad weather caused more than 700 cancellations for easyJet in June. | EasyJet said trading was difficult for European airlines in May and June and that strikes by French air traffic controllers, congestion at Gatwick airport and bad weather caused more than 700 cancellations for easyJet in June. |
| Pre-tax profit in the three months to the end of June will be £28m lower than expected and revenue per seat will be below the guidance given last month because of disruption and the effect of last month’s Egyptair crash. | Pre-tax profit in the three months to the end of June will be £28m lower than expected and revenue per seat will be below the guidance given last month because of disruption and the effect of last month’s Egyptair crash. |