March 21 (Reuters) - Shares in Moss Bros Group Plc shed a third of their value in early trade on Wednesday after the formalwear specialist said it expected profit for the year ending Jan. 2019 to be materially below market expectations.
Moss Bros’ shares fell as much as 33.5 percent to 39 pence, their biggest intraday percentage drop in over nine years.
The profit warning was due to supply chain issues that led to a reduction in stock availability, challenging hire sales and reduction in store footfalls, the company said.
“The more cautious consumer environment and the effect of short-term weather impacts, have led to a readjustment of our profit expectations,” Chief Executive Officer Brian Brick said.
The company, however, said its does not expect its results for the year ended Jan. 27, 2018 to deviate from expectations.
Moss Bros also cut its full-year 2017/2018 dividend by 32 percent to 4 pence per share.
Brokerage Peel Hunt cut its rating on the stock to “hold” from “buy”, but said Moss retains a strong balance sheet.
“The issue here has been largely down to stock availability rather than online disintermediation or consumer collapse,” Peel Hunt said in a note to clients. (Reporting by Radhika Rukmangadhan in Bengaluru; Editing by Sunil Nair)