Biffa shares today tumbled more than 10 per cent after the waste management firm warned about a Chinese ban on importing recycled rubbish.
While trading in the second half of the year was due to be in line with expectations Biffa said it faced "price headwinds arising from the recent changes in Chinese regulations for the import of recycled commodities".
"In the near term, we expect these headwinds to persist, impacting divisional performance. Nevertheless, Biffa remains strongly positioned over the medium and long term due to its investment in recycling operations and focus on high-quality products," the firm said.
Analysts from Numis downgraded slashed its target price by 30p in response.
Meanwhile, Peel Hunt analyst Andrew Shepherd-Barron said he "had taken the view that this would be temporary as in the case of many previous such actions, but this looks to have been too optimistic".
"The ban now increasingly looks permanent and will have an effect in 2019. Whilst 50 per cent of the loss of income can be passed through in a higher collection price under risk-sharing arrangements with municipalities, the other 50 per cent has to be borne by Biffa. This is being mitigated as far as possible through better sorting and the finding of alternative outlets, but these can have only a partial effect."
Biffa returned to the stock market with a 2016 initial public offering.
The firm has grown both organically and by acquisition, snapping up two new businesses since November.