Sanne Group's shares dive as earnings and margin guidance slashed

Sanne Group's shares plummeted on Monday as it slashed full-year earnings and operating margin expectations after the business failed to deliver on operating efficiencies that it had highlighted back in 2018.

The alternative asset and corporate services provider said underlying operating margin in the first half of the year is expected to be approximately 26%, leading it to slash full-year expectations to between 28% and 30%, having previously expected to improve on last year's margin of 31.1%.

The FTSE 250-traded company said the drop in margins stemmed from elevated overhead spend and a lack of delivery of operating efficiencies in the central operations teams that were highlighted last year, though it added that action has been taken to address these issues and continue to implement initiatives to improve the full year outturn.

As a result of the changes to underlying operating margin, Sanne now expects to report underlying earnings per share for the full year below its previous expectations.

However, the company also reported record levels of new business from both new and existing clients, which came in at approximately £16.0m, while revenue grew by 13% when factoring in the impact of the prior year acquisitions.

Overall, Sanne said it remains on track to meet revenue targets after a strong performance from its Alternatives business, which achieved global revenue growth of approximately 22% on a constant currency basis as the company continued to invest in building a leading, sustainable, global, Alternatives platform.

Martin Schnaier, chief executive of Sanne, said: "We remain committed to investing in the significant growth opportunities that we are delivering on in our core markets and products. Although this investment is impacting our margin guidance for the current year, the priority is to ensure the group is well positioned to deliver sustainable growth in the medium and long term."

Sanne Group's shares were down 33.38% at 501.00p at 0818 BST.