(Reuters) - British industrial lighting products maker Dialight Plc (L:DIAL) warned that this year's underlying operating profit would be significantly below expectations, hurt by a fall in orders at its key lighting unit from the United States and Europe.
Shares in the company, which was once part of the Dutch giant Philips (AS:PHG), slumped nearly 40 percent to their lowest since December 2010. The stock was the top percentage loser on the London Stock Exchange on Wednesday.
Dialight said it expected a shortfall in full-year revenue due to a delay in orders at its lighting unit largely by oil and gas customers and that results for the first half would be lower than a year earlier.
Dialight reported an underlying operating profit of 18.1 million pounds on revenue of 159.8 million pounds for the year ended Dec. 31.
The lighting division, which makes energy-efficient LED lighting for industrial and hazardous markets, accounted for nearly 63 percent of the company's 2014 revenue. A quarter of the division's revenue came from the oil and gas industry.
Oil and gas companies, hurt by a price rout, have cut spending budgets by an average 10-15 percent, put projects on hold and are hesitating to seal new contracts with product and service providers.
"A slowdown in orders since April in the key lighting division is clearly unnerving, given that the benefits of their lighting products haven't changed and the highlighted connection with the oil and gas sector slowdown is hardly new," N+1 Singer analyst Trevor Griffiths wrote in a note.
Griffiths put his forecast and recommendation under review.
Dialight said the newly-appointed CEO Sutsko would lead a strategic review of the business to evaluate the company's operations, supply chain and product development, and provide an update in the Autumn.
Dialight shares were down 35 percent at 485 pence at 0828 GMT.