Almost two-thirds of listed companies sponsoring defined benefit funds issued a total 249 profit warnings last year, accounting for 43% of all U.K. profit warnings made in 2020.

The latest EY quarterly analysis of profit warnings found that 10% of those firms with a DB fund issued their third consecutive profit warning in 2020 — often a precursor to insolvency. EY analysis shows that, typically, 1 in 5 firms issuing three warnings within 12 months will become insolvent within the following year. By comparison, 62 of a total 1,198 listed U.K. companies issued three warnings in 2020 over 12 months, representing 5% of all companies.

The number of profit warnings issued by all U.K. listed firms in 2020 also reached a new annual high at 583, with more expected due to lockdown restrictions and continued market uncertainty, EY said. A comparison for 2019 was not available.

Of the U.K.’s 1,198 listed companies, 23%, or 280, sponsor a DB fund. Among all listed companies, 35% issued a warning in the first three quarters of 2020, vs. 62% of those running a DB fund. Among those issued by DB sponsors, 90% were COVID-19 related.

Companies sponsoring DB funds and with the highest number of warnings were from the travel and leisure sector, at 30; industrial support services, at 23; construction and materials, at 19; retailers, at 18; and household goods and home construction, at 14.

“The market pressures of 2020 were no small feat to overcome, and given how 2021 has started, the outlook isn’t likely to improve in the short term,” Gareth Mee, U.K. actuarial leader at EY, said in a news release.

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