SHARES in SpaceandPeople, the shopping centre marketing firm, have fallen after it warned the closure of joint venture S&P+ will hit the group’s 2016 results.

The Glasgow-based company said S&P+, which operates in a niche sector outside the parent group’s core shopping mall business, pulled the plug on the venture after “substantial” business deals slated for June were “delayed and cancelled entirely by clients”.

The loss of those deals resulted in “considerable cash flow constraints for S&P+, leading the board to conclude that it was no longer prudent to continue funding the venture beyond that already provided”.

SpaceandPeople, which has a 51 per cent stake in S&P+, said it will write off a £425,000 loan it has provided to S&P+, as well as an inter-company debts of £50,000, resulting in a one-off loss of around £275,000. In addition, the £180,000 of pre-tax profit S&P+ had been expected to contribute will now be a loss of around £200,000.

Matthew Bending, chief executive of SpaceandPeople, noted that there would be an impact on jobs but did not specify how many roles would be affected. He said in a statement: “Obviously, we are very disappointed about this outcome and understand the impact this will have on the employees of S&P+, however, the core UK and German promotions and retail businesses are trading in line with our internal expectations.”

He added: “We do not see the decision on closing S&P+ as having any negative effect on the core business.”

Shares in S&P+ closed down 1.5p, or 3.3 per cent, at 43.5p.