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Nature withers

Nature Group's new chairman has thrown the kitchen sink into a profits warning and the shares are no longer worth buying
December 11, 2012

Maritime and offshore waste treatment specialist Nature Group (NGR) says that contracts it had expected to sign before the end of the current financial year have slipped, prompting a profits warning and a withering downgrade to forecasts by its own stockbroker.

IC TIP: Hold at 22p

Recently-appointed chairman Nigel Sandy has undertaken a thorough review of the business over the past month and concluded that, although enquiries and orders are growing well, delivery of contracts is taking significantly longer than expected and the additional costs incurred in the ramp-up phase are starting to bite. Contracts for 'compact treatment units' in the oil and gas business have been the biggest source of delay, although the maritime waste division has also seen volumes decline.

Broker WH Ireland has drastically cut its forecasts for 2012, slashing 77 per cent from its earnings forecasts and 60 per cent from next year.