NEW YORK All efforts by Club Mediterranee (Club Med) to regain investor confidence were wiped out last week following a profit warning by the company s Chief Executive, Philippe Bourguignon. At the annual General Meeting, investors were informed that trading during the first half of the fiscal year was disappointing. Consequently, while growth in revenue and profits is still expected, Club Med can no longer confirm the double-digit growth it recently promised.
Political unrest in the Middle East and disappointment in the U.S., Japanese and Australian markets were cited as reasons for slower than anticipated growth. Bourguignon is now pinning all hopes on a strong second half and is taking action to limit costs. The market did not take kindly to news, the second profit warning in six months. With analysts losing confidence in the management, Club Med could become a takeover target. (3/16/01)
SOURCE:HVS International