DTZ issues warning of 'significantly greater losses'

DTZ has warned that its losses for the year to end-April 2009 will be 'significantly greater' than previously anticipated. The profit warning comes as the property adviser struggles to re-orientate its business and revenues in light of the market downturn.

Former Barclay's executive Paul Idzik has been appointed CEO to lead the restructuring, which included a fund raising that led to French family-owned group SGP taking a major stake in the group. Idzik had warned that DTZ could face administration if the fund raising deal was not completed successfully.

The London-listed property adviser said in an interim statement on Friday that the continuing deterioration in the market, particularly the decline in investment activity, was further pressuring its performance. 'These weakening market conditions are reflected in the group's trading position, alongside that of our peers worldwide. Accordingly, the group is achieving lower than expected revenues and maintains a cautious outlook for 2009-10.'

The company said that it was carrying out a review of the carrying value of goodwill and intangibles of businesses it has acquired and that it was likely that 'further significant non-cash impairment charges will be reported in the current financial year'.

DTZ's share price was down 20% at 31.75p in morning trading on Friday.

The company also confirmed that Killian O'Higgins, Robert Peto, David Gray, Dag Detter and Les Cullen have resigned from the board, as previously announced, and SGP nominees Frank Piedelievre, Pascal Derrey and Francois Tardan have been appointed as non-executive directors.

As signalled on 17 February, DTZ finance director, Colin Child, is stepping down 'to seek new challenges outside the company'. Bob Rickert, chief operating officer, has been appointed to the additional post of CFO, supported by James Thomson as deputy CFO.