Law firm Slater & Gordon has had another tumultuous day on the stock market after withdrawing its earnings guidance for the year.
The group’s shares, listed in Australia, closed the day down 17.2% at A$0.89. The shares have lost nearly 90% of their value since April, when they traded as high as A$7.85.
Slater & Gordon shares fell by 50% last month when the UK government said it would consider limiting compensation for whiplash claims.
Andrew Grech, Slater & Gordon’s managing director, said: “We have previously advised the market that the performance of our UK operations during the first half has not been in line with expectations. It is now clear to us that the slower rate of case resolutions in the first half has had a larger impact than previously thought, and that this may well flow through to a reduced profit for the full year.
“For this reason, we have withdrawn our full-year guidance and we are conducting a review of our forecasting methods so that we can provide the market with greater clarity moving forward.”
Slater & Gordon’s UK operation is one of the country’s biggest law firms, with solicitors in 27 locations across England, Scotland and Wales. It has expanded aggressively, especially in no-win, no-fee personal injury claims. It increased its presence in the UK – and its exposure to controversy – by buying the professional services arm of Quindell earlier this year. Quindell is under investigation by the Serious Fraud Office over its “business and accounting practices”.
