(Reuters) - Britain's financial watchdog is investigating outsourcing company Mitie Group (L:MTO) over the "timeliness" of its profit warning in September and the preparation and content of its financial information, the company said on Tuesday.
Mitie said the Financial Conduct Authority had informed it about the investigation on Aug. 25, which will also look at the manner of preparation and content of its financial information, position and results for the year ended March 31.
"The company is fully cooperating with the (Financial Conduct Authority) but does not intend to update the market until completion of the investigation," Mitie said in a brief statement.
Pressure has been piling up on the provider of pest control, cleaning, security and healthcare services, which last month said that accounting body, the Financial Reporting Council, was investigating Deloitte's auditing of its books.
British outsourcing companies such as Mitie, Capita (L:CPI) and Carillion (L:CLLN) have been hit this year by rising labour costs and expenses related to unplanned changes to contracts which were taken on during the financial downturn, often with paper-thin margins.
A failure by some clients to renew or commission new contracts has compounded the problem.
Mitie, which employs 53,000 people to work with central government, the National Health Service and across the transport network, warned on profits three times last year, blaming uncertainty around Britain's decision to leave the European Union and the higher costs.
It appointed Phil Bentley, formerly of British Gas, as chief executive in October last year and the new management team commissioned KPMG to review its accounts. Mitie has since predicted a return to modest growth in underlying profit, citing new contracts and cost cuts.
On Tuesday, representatives of the FCA and Mitie declined to comment on the matter.