Mitie warns again on profits, blaming Brexit uncertainties

* Warns FY underlying earnings to be lower than previous estimte

* High-margin businesses hit as clients limit discretionary spend

* H1 operating profit falls to 35.4 mln stg

* Books 117.2 mln of writedowns on home healthcare business

* Shares (Berlin: DI6.BE - news) fall back (Adds comments by CEO and analyst, updates share price move)

By Esha Vaish

Nov 21 (Reuters) - British outsourcing services firm Mitie issued its second profit warning in two months on Monday, saying the uncertainty amongst its customers after Britain voted to leave the European Union had resulted in fewer new orders.

The provider of pest control to property cleaning, security and healthcare services, said rising labour and other costs had hit its ability to win new business at a time when clients were looking to cope with the prospect of their own costs rising and budgetary pressures, particularly in the public sector.

As a result the company said it had decided to withdraw from the low-margin home healthcare services market, causing it to report a pretax loss for the six months ended Sept. 30 of 100.4 million pounds ($125 million) after writing off 117.2 million pounds from the value of the healthcare business.

Operating profits also fell by a worse than expected 39 percent to 35.4 million pounds, on revenue down 2.6 percent at 1.1 billion pounds, and the company said it expected underlying earnings for the full year would also be below its previous expectations.

The half-year dividend payout was cut by 25.9 percent to 4 pence on a 44 percent drop in underlying earnings, before exceptionals, to 6.2 pence a share.

The shares were down 7 percent at 194 pence by 1350 GMT, losing the gains made since the company gave its first profit warning in September, when the shares plunged by nearly 30 percent to 194 pence.

While most British support services firms have reported resilient trading since Britain voted to leave the European Union, Mitie and rival Capita (LSE: CPI.L - news) have issued warnings, with Mitie saying customers were proving particularly hesitant in areas of higher margin discretionary spending.

Analysts say Mitie could underperform rivals in uncertain markets as it had not anticipated the additional costs from new labour laws on pay and training, as others had done last year, and discretionary spending in higher-margin businesses such as catering services were more vulnerable to clients seeking to cut their own costs.

"I think their costs are out of sync and their margins have always been very high relative to other people and that's the issue," Howard Seymour of Numis Securities told Reuters. "The market is not good, but it's not (bad) to the same degree that (Mitie is) saying by any stretch of imagination."

Chief Executive Ruby McGregor-Smith, who steps down on Dec. 12 after 10 years at the helm, said the company would be further reviewing its cost structure.

"Everyone is looking differently at their cost base in this environment ... I don't think that this is (like during the financial crisis of 2007-09) which was a much more dramatic change. I think it's much more softer, but everyone is preparing for a tougher economy going forward," she told Reuters.

Liberum analysts expect the new chief executive, Phil Bentley, a former head of British Gas, will take up to six months to formulate a new plan, which they expect will include more investment in IT to help reduce the cost base.

Liberum cut full-year earnings before interest and tax forecast to 90.7 million from 110 million pounds. Canaccord Genuity cut its rating to "hold" from "buy" and target price to 195 pence from 218 pence. ($1 = 0.8025 pounds) (Reporting by Esha Vaish in Bengaluru; Editing by Greg Mahlich)