The All Ordinaries Index (ASX: XAO) is down 0.2% on Wednesday, and it's not getting any help from this plunging ASX All Ordinaries stock.
The company under pressure today is automotive cooling solutions company PWR Holdings (ASX: PWH).
PWR shares closed yesterday trading for $9.08. In morning trade, shares are changing hands for $6.94 apiece, down 23.6%.
Here's what's got investors favouring their sell buttons today.
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ASX All Ordinaries stock tumbles on eroding profits
The ASX All Ordinaries stock is in retreat following the release of a disappointing trading update.
PWR reported that it now expects net profit after tax (NPAT) for the first half of the 2025 financial year (H1 FY 2025) to be in the range of $3.2 million to $3.7 million. That's a big pullback from NPAT of $9.8 million achieved in H1 FY 2024.
The new profit guidance includes expenses for PWR's new headquarters at Stapylton of around $276,000.
On the revenue front, the ASX All Ordinaries stock forecasts H1 FY 2025 revenue of $61.89 million, down 3.6% year on year.
The biggest hit comes from an expected 44.2% decline in revenue from PWR's OEM [original equipment manufacturer] customers to $7.88 million.
The company said that three niche OEM EV programs are not proceeding in FY 2025 despite having received purchase orders in FY 2024 for the work program. There are several new programs in various stages of discussion. However, PWR noted that "the volatility of the EV market" is creating unpredictability.
With production costs up from the prior year amid lower-than-expected volumes, the company said this will disproportionately impact forecast earnings for H1 FY 2025.
On the positive side of the ledger, revenue from aerospace and defence customers is forecast to surge by 67.1% from the prior corresponding half to $12.96 million.
And PWR's Motorsports revenue is expected to be broadly in line with H1 FY 2024 at $30.96 million.
What did management say?
Commenting on the reduced profit outlook dragging the ASX All Ordinaries stock lower today, PWR managing director Kees Weel said:
We are reducing our cost base to be more aligned to the current trading environment while balancing the opportunities we are pursuing in our Aerospace & Defence business, which continues to give us confidence in this market.
Weel said that, as previously mentioned, "FY 2025 will be a transition year for PWR which we believe is crucial to successfully positioning the business for future growth, as we move to our new headquarters in Stapylton."
He concluded:
The investments in Aerospace & Defence capability, factory space, equipment and systems are necessary to prepare PWR to deliver on our medium and long-term growth objective and is consistent with our approach to invest now and collect later.
With today's intraday losses factored in, shares in the ASX All Ordinaries stock are down 28% in 2024.
