Shares in Mitie (MTO.L) fell by 28 percent on Monday after the British business and public services outsourcing group warned on profits this year, saying some large new contracts had not come through as the vote to leave the EU had surprised some customer firms, causing them to put off new investment decisions.
The shares were down at 194 pence by 1513 GMT (4.13 p.m. BST), down from 308 pence at the beginning of the year, and 270 pence on the eve of the Brexit vote.
The pest control to property cleaning, security and ancillary healthcare services provider said it had seen a slowdown in new work in the run-up to and after the Brexit vote, as clients deferred new outsourcing decisions and instead renewed or extended large contracts with their existing service providers.
Some big customers such as Lloyds Banking (LLOY.L), Vodafone (VOD.L) and Sky (SKYB.L) had extended contracts with Mitie by several years, the company said, adding that it was confident of a better second half as new orders pick up.
Nevertheless the company said it also faced a number of other "significant economic pressures" including lower growth rates, public sector budget constraints and a new minimum wage law that took effect from the beginning of the year.
"We entered the year in somewhat unusual circumstances with so much uncertainty around so many areas and clients are just taking their time to rebase where they are," Chief Executive Ruby McGregor-Smith told Reuters.
Mitie's negligible overseas exposure had left it more vulnerable than some of its peers to Brexit shocks and the higher minimum wage but they were not immune, analysts said.
"A lot of the issues that they described are going to impact others as well," Liberum analyst Joe Brent said.
Most of Mitie's rivals have so far only reported results for the period ended June 30, taking in just a few days after the Brexit vote.
Analysts said that support services and construction company Interserve Plc (IRV.L) could also be affected by the slowdown in decisionmaking on new outsourcing contracts.
However, building support services company Carillion (CLLN.L) which derives less than 5 percent of its revenue from the UK housing market, said last month it was on track to meet expectations for its results in 2016.
Meanwhile housing and social care services provider Mears (MERG.L) also said last month its trading performance remained on track with respect to this year's results.
On Monday Mitie warned it now expected to make an operating profit in the year ending March 2017 which would be "materially below management's previous expectations". It reported an operating profit last year of 128.9 million pounds.
Liberum analysts said management was now guiding towards a 10-20 percent fall in EBITDA from 146 million pounds last year, cutting its forecast for full-year earnings per share by 8 percent to 20.6 pence. The company reported earnings last year of a comparable 24.7 pence.
Mitie also said it had seen some recovery in trading conditions in August and September but the benefits would not come through soon enough to help offset negative factors which would cause a "very significantly" lower first-half operating profit and modestly lower revenue.
However, the company said to improve margins it would have additional "organisational change" costs totalling up to 10 million pounds this year which would involve cutting some managerial jobs but would lead to cost savings of up to 15 million pounds.
It also said it was reviewing its options regarding its healthcare business, which provides local authorites with a range of services such as home care for the elderly, as trading conditions in the sector remained challenging.
Mears Group has already indicated its intention to exit "unsustainable" care contracts.
(This story has been refiled to remove adverb 'however' in fourth paragraph)
(Reporting by Esha Vaish in Bengaluru; editing by Jason Neely, Greg Mahlich)