Profit warnings from UK-listed firms at highest level in two years as Iran war drives up costs

The number of profit warnings from UK-listed companies has surged to the highest level in two years, driven by escalating costs linked to the ongoing war in the Middle East. According to consultancy EY-Parthenon, companies quoted on the London stock market issued 65 warnings in the three months leading up to the end of September.

With less than two weeks remaining before John Healey’s tax and spending statement to the Commons, business leaders are urging the chancellor to provide emergency support to mitigate the impact of soaring fuel costs and energy bills. Healey has committed to using his 28 October budget to offer households and businesses some "breathing space." However, he cautioned that the government has limited resources to intervene, as the conflict has driven borrowing costs to their highest levels in decades, further straining public finances.

It was reported on Sunday that Healey is preparing to announce measures aimed at assisting thousands of high street shops, cafes, pubs, and hairdressers facing rising costs. The budget is expected to include a cut in business rates for small companies, raising the threshold at which small firms start paying business rates from £12,000 to £18,000. This change honors a promise made by Andy Burnham during his Makerfield byelection campaign.

The EY-Parthenon analysis revealed that housebuilders have issued more profit warnings this year than during the 2008 financial crisis. Additionally, separate figures from the property platform Rightmove indicate that house prices have decreased by 0.1% over the past year.