SHARES in SpaceandPeople have plunged by 34 per cent after the shopping mall marketing specialist said trading had been more subdued than expected in the weeks since the Brexit vote.

The Glasgow-based company also said it did not plan to propose a dividend in 2016 as a result of the costs of closing the S&P+ advertising support business and investing in mobile kiosks.

Announcing that it fell around £170,000 into the red in the six months to 30 June, SpaceandPeople said it would have its work cut out meeting full year expectations given recent developments.

“In common with many retail related businesses, trading across the Group in the period since the half year end has been more subdued than we had anticipated,” said chief executive Matthew Bending in a statement.

He added: “We will need to perform strongly over the remainder of the year in order to meet our expectations.”

SpaceandPeople did not elaborate on the comment about subdued trading. The company, which helps firms run promotional activities in shopping centres, has operations in the UK, Europe and Asia.

The statement may stoke fears the vote for the UK to leave the European Union in the referendum held on 23 June has prompted consumers to cut spending amid uncertainty about the potential impact on the economy.

Total retail sales fell by 2.2 per cent annually in Scotland in August.

However, figures from the UK Office for National Statistics showed retail sales volumes fell just 0.2 per cent in August after growing strongly in July.

Analysts said the ONS numbers indicated the economy had fared better than expected following the June referendum.

Aim market-listed SpaceandPeople said it had made progress in the first half with efforts to gain new clients and to develop higher value services to offset the termination of some contracts concerning traditional merchandising units. It had expected these contracts to be terminated.

The new services include mobile promotional kiosks (MPKs) and Pop Up facilities.

However, the company said: “As a result of the one off costs of closing S&P+ and the need to invest further in the growth of the MPK programme next year, for the first time since being admitted to AIM in 2005, we do not intend to propose a dividend during the 2016 financial period. This is intended to be a one year pause.”

It had 75 kiosks installed in 56 UK venues compared with 37 at the same point in the preceding year.

The average number of merchandising units fell to 123 in the first half, from 128 last time.

SpaceandPeople said: “The movement away from the long term minimum guarantee business model by some clients has been as a result of them wanting more dynamism on their malls and retailers wanting more flexibility in duration and location for their operations.”

The company has been offering Pop Up kiosks on short term rentals in response to this shift.

But the core UK promotions business performed well in the first half helped by taking high profile campaigns for Renault and Dubai Tourism into rail stations.

In September last year SpaceandPeople clinched a five-year deal with Network Rail to promote brands in 18 stations across the UK, including Edinburgh Waverley and Glasgow Central.

The company booked a £252,000 charge after the decision to close the London-based S&P+ advertising support business launched in 2013. The venture did not develop sales to a level that would allow it to be self sustaining.

SpaceandPeople made a £174,000 loss before tax in the six months to June, compared with £62,000 profit last time.

Revenues fell to £4.6m from £4.7m.

Shares closed down 13.5p at 26p.