Cape dives on profit warning as its chief financial officer departs

SHARES in energy support service provider Cape plunged yesterday as it issued a profit warning, prompting the departure of its chief financial officer.

Finance director Richard Bingham stepped down with immediate effect. It is understood he was close to the former chief executive, and the latest profit warning was a catalyst to his departure.

Cape, which also issued a profit warning in May, has been struggling with slow progress at a project in Algeria, and worsening margins at its Australian business.

The company was also hit by a £1.5m bad debt provision in the Middle East, relating to a potential bad debt with a Saudi Arabian customer.

The group’s operating margin was impacted by a “substantial deterioration” in the performance of the onshore Australian division, causing some uncertainty over the full-year performance for this business, Cape added.

The company, which is reviewing its Australian business, added that it had identified a number of issues related to the valuation of certain balance sheet items in the division. The review will be completed by the end of the year.

Shares closed down 29.01 per cent yesterday at 186p as investors reacted badly to the warning.