TT Electronics' stock took a nosedive following a warning that it could face a financial blow of up to £35m in the US, due to plummeting demand and persistent operational difficulties.

The Woking-headquartered firm is bracing for a significant write-down, citing a "previously disclosed downturn in components demand and operational execution challenges in North America".

Additionally, the company announced a £6m correction to prior year figures linked to its Cleveland facility. Shares plummeted by as much as 16% during Tuesday morning's trading session but later stabilised to a 10% drop.

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TT Electronics stated: "We will provide further details on the outlook for 2025 at the time of our results announcement. We continue to expect good adjusted operating profit progress relative to 2024 but expect the outturn to be in the range of £40m to £46m."

In November, the company had already cautioned that its annual earnings for 2024 were likely to hit the lower spectrum of its forecast, ranging from £37m to £42m. TT Electronics, which engineers and manufactures components for industries including healthcare and aerospace, counts BAE Systems and Thales among its clients and operates facilities across the UK, North America, and Asia.

This profit warning follows shortly after an unsuccessful acquisition bid for TT Electronics by Lord Nat Rothschild's Volex group, known for supplying power products to various sectors such as hospital ventilators, electric vehicles, and laptops. Volex had put forward two takeover proposals last November.

Volex abandoned its takeover bid for TT Electronics after the latter rejected the offer, which valued the company at £248.6m or 139.6p per share, as too low. This move came in the wake of a significant drop in TT Electronics' share price, which reached its lowest point since around 2014 last November.

In September, TT Electronics alerted shareholders about production issues at its US factories that are expected to impact annual sales and profits. The company revealed that several orders in its American components business had been deferred to 2025 instead of 2024 delivery, affecting earnings in its North American division.

On Tuesday, it announced that the improvement plan for Cleveland was in progress but warned that the benefits would take longer to materialise than initially anticipated.