SHARES in East Kilbride-based Goals Soccer Centres hit a record low after the company admitted accounting errors and issued a fresh profits warning.

Goals, which operates 50 five-a-side football centres across the UK and the US, sent shockwaves through the City when it admitted it was working with auditors to “resolve certain accounting errors” and reviewing some of its accounting practices and policies.

And while the company said the majority of the adjustments are of a “non-cash nature”, it flagged that it will have exceeded one of its banking covenants at December 31. Goals, which appointed new auditors and overhauled its board in the last 12 months, said it was now holding talks with its bank over renegotiating its facilities.

Analyst Paul Hickman at Edison Investment Research said the breach of banking covenants was an “issue that shareholders thought it [Goals] had put behind it.” And he added: “Forced negotiations with banks in this situation invariably result in punitive terms.”

The unscheduled statement sent shares in Goals tumbling by 32 per cent, wiping £13.5m from the company’s stock market value.

It came shortly before Goals was due to report its results for the year ended December 31 on March 12. The company said the publication of its results for 2018 would now be delayed.

Goals said in the statement: “As part of the review of the results for the financial year ending 31 December 2018, the board, together with the auditors, are working to resolve certain accounting errors, and are reviewing some accounting practices

and policies.

“It is likely that the board will take a more prudent approach both for 2018 full year results and going forward.

“As a result, the board now expects the 2018 full year results will be materially below expectations”.

The admission presents a headache for the new board at Goals, assembled in the last 12 months and led by former Disney and Manchester United executive Andy Anson, as the company battles fragile consumer confidence in the UK and looks to expand across the Atlantic.

It is the second profit warning to be issued by Goals in as many months, with the company admitting, in a post-close trading update in January, that a material rise in costs and slower growth in the US would lead to lower profits in its current financial year. Goals also revised its profit guidance for 2019 down by £600,000 “in light of the current economic and political uncertainty”.

At that time, analysts were

guiding on Goals achieving profits before tax of £4.3 million for 2019. The company made a pre-tax profit of £8.2m in 2017.

While it expects profits to be lower Goals yesterday said that trading in the first two months of the year has been strong.

The company declared it had seen an increase in like-for-like sales, in both the UK and the US, compared with the same period in 2018.

Goals signed a joint venture with City Football Group, owner of Manchester City, in 2017, under which the football giant committed to providing $16m to drive Goals’ expansion across the Atlantic. It recently opened a fourth club in the US, in Covina, Los Angeles, and plans to launch anacademy product with Manchester City across the Atlantic in the second quarter of this year.

Goals announced in January that long-standing chief financial officer Bill Gow, who was one of the firm’s founders in 2000, had resigned to join his family business.

Mr Gow is now group chief financial officer at Thomas Tunnock, the Uddingston-based teacake maker.

Martin Johnson, a former chief financial officer of Great Rail Journeys, has replaced Mr Gow on an interim basis.

Shares in Goals closed down 32%, or 18p, at 38p.