Key facts
- UK-listed companies issued 59 profit warnings in the first half of 2026, an increase from 55 in the prior year.
- Over half of these warnings were attributed to policy changes and geopolitical uncertainty.
- The Iran war, which began in late February, has been cited as a contributing factor in two in five profit warnings.
- Housebuilders, retailers, and leisure firms are identified as the most affected sectors.
- London-listed housebuilding and construction firms issued eight profit warnings in the first half of 2026, the highest number since the pandemic.
- The travel and leisure industry recorded seven profit warnings, the most of any FTSE sector.
The ongoing Iran war has significantly impacted London-listed companies, leading to a notable increase in profit warnings, particularly within the housebuilding, retail, and leisure sectors. According to a report by EY-Parthenon, UK-listed firms issued 59 profit warnings in the first half of 2026, up from 55 in the same period last year. More than half of these warnings were attributed to policy changes and geopolitical uncertainty, with the Middle East conflict being a contributing factor in two in five cases since its start in late February.
Housebuilders have been severely affected, issuing eight profit warnings in the first half of 2026, the highest number since the pandemic. This surge is driven by rising building costs and a slowdown in demand from first-time buyers. Companies like Vistry and Crest Nicholson have reported significant first-half losses. Tim Vance, a restructuring partner at EY, noted that expectations for a gradual recovery were dashed by higher energy and input costs, weaker consumer confidence, and diminishing hopes for further interest rate cuts.
The travel and leisure industry has also taken a substantial hit, recording seven profit warnings, the most of any FTSE sector. Firms like Easyjet have warned of impacts from lower bookings and escalating jet fuel costs, raising concerns about their viability as publicly listed companies. The UK's high street is also under pressure, with retailers issuing five profit warnings in the second quarter alone, each citing the Iran war. Silvia Rindone, retail lead at EY, highlighted that geopolitical disruption has exacerbated existing pressures on costs, supply chains, and consumer confidence, with headline sales often boosted by promotions rather than underlying demand.