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Hellaby Holdings has slashed its half-year profit forecasts in half, saying both its retail and industrial businesses have performed poorly.
The company said it expected earnings for the six months to December last year could be as little as half of the previous year's $9.3 million.
However, it expected second-half sales to recover to last year's levels.
"But it is unlikely that this will be sufficient to offset the extremely difficult start to the year, and Hellaby's directors advise that group underlying profitability for the full year may be down by around 20 per cent on the previous year," the company said.
Hellaby Holdings earned $23.1 million in the year to June 2006.
Shares in the company fell 13c to $4.54.
Hellaby Holdings is a diversified investment company, with investments in the retail sector - such as the BBQ Factory and Number 1 Shoe Warehouse - and the industrial sector, particularly the importation and distribution of automotive parts.
Both divisions underperformed.
"In line with other companies in the fashion sector, trading in the crucial December period proved very difficult and as a consequence the group's retail division sales for the six months to December 31, 2006 were below budget and below last year on a same store basis," the company said.
"The group's industrial businesses also had a disappointing first half to the year due to lower equipment sales, competitive pressures on margins, and the downturn in the rural sector, and accordingly the profit from the industrial division will be significantly down on the first half last year."
At last November's annual meeting, Hellaby Holdings reported a drop in first quarter sales, but stuck to its full-year forecast, blaming the drop on slow starts from its retail businesses.
The company last year said it was moving from retail businesses to concentrate on industrial businesses and was looking for acquisition targets.
