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Photo-Me warns on profit after Japanese ID card disappoints
Photo-Me International shares plunged as it warned this year's profit would miss expectations because a new Japanese ID card failed to attract enough customers to the country's photo booths.
Japan has the most photo booths per person in the world and the number of booths jumped after the government launched its My Number ID card. But the non-compulsory scheme did not take off as hoped, leaving booths under-used, Photo-Me said.
Photo-Me is reorganising its Japanese business to improve profitability from 2019. The cost of the revamp means pre-tax profit for the year ending April 2019 will be at least £44m - below market expectations.
The company said it had not made a decision on its dividend for this year but that the board's current expectation is it will maintain the existing dividend policy for this year.
Photo-Me shares fell 23% to 116.3p at 11:14 BST. For the year that ended on 30 April, pre-tax profit will be broadly in line with market expectations.
"The photo identification business continued to perform well except in Japan, which has remained a very difficult market due to an oversupply which has put pressure on commissions across the industry," Photo-Me said.