More doom looms in 2009

Profit warnings in IT sector are continuing to rise, according to Ernst & Young

The channel needs to keep its chin up despite another gloomy forecast for the UK economy from consultancy Ernst & Young, industry players have asserted.

Figures released last week claimed UK profit warnings in the first quarter of 2009 were the highest since 2001, with 117 warnings issued. It was also the third consecutive quarter that UK plc issued more than 100 profit warnings.

Among the hardest-hit sectors were electronic and electrical equipment, which saw 22 per cent of FTSE-listed firms issuing warnings in the quarter, as well as software and computer services.

Keith McGregor, restructuring partner at Ernst & Young, said the worst is yet to come.

“The prospects for 2009 appear as uncertain and gloomy as at any point in the crisis,” he said.

Keith Warburton, chief executive of the PC Association, said: “A lot of companies in our sector are working very hard to secure business. There are opportunities if people are willing to go and find solutions to all the problems out there.”

Eddie Pacey, director of credit at Bell Micro, said: “Firms should be managing expectations better and also trying to take advantage of the opportunities out there.”