After the update, analysts slashed earnings estimates by as much as two-thirds to just 4.5p in the 2015 calendar year.
Retail and facilities management customers were some of the weaker sectors for HSS, according to chief executive Chris Davies, speaking on a results call this morning.
Even within sectors, there is a wide range of performance, Davies admits.
‘We work with national retailers and some of them are up and some of them are down,’ says Davies.
‘It is not one complete sector which is dragging on performance – as an overall sector, retail is probably a bit lower. We’ve seen that also within facilities management where we didn’t expect it.
‘Film production has been positive but in our core areas of what we see as our sweet spot we continue to see a lot of varilability: half growing and the other half going backwards. Those in the middle are just bobbing around.’
Adjusted earnings before interest, tax, and amortisation (EBITA) was £4.5 million for the six months to 27 June, as higher investments in fleet led to a larger depreciation charge.
This excludes around £3.8 million of exceptional costs relating to the IPO. Underlying finance costs of £8.3 million means the business was loss making in the first half even an on adjusted basis.
Management says earnings and cash flow tend to be naturally skewed to the second half, and chief financial officer Steve Trowbridge expects net debt to remain flat or slightly lower by the year-end given current guidance.
Analyst earnings forecasts have been falling steadily since IPO and were slashed today.
Julian Cater at Numis shows forecast underlying earnings per share (EPS) is now just 4.5p in 2015. That rises to 7.6p in 2016.
HSS trades 37% lower at 81p.