They used to say that profit warnings came in threes. The theory was that it took that many goes for the management team to spot a problem, start getting a handle on the scale of the issue and then solve it. Or, if you were being cynical, you might say that the executives preferred to ration the bad news so as not to spook shareholders too much. Cobham, the Dorset-based defence and aerospace company, has now managed five profit warnings in 15 months. The latest bad news is that trading profits for 2016 will be £225m, which is £20m less than it thought they would be just last month. The company also said it can’t be sure that 2017 will be any better.
This suggests that the management team has found it particularly hard to get its arms around the company’s problems or is being especially parsimonious with the bad news. Either way, shareholders have made their displeasure clear with the value...
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