Early last week Brambles (BXB) downgraded its sales and EBIT guidance to +5% and +3% respectively for 1h17 (on a constant currency basis). This compares to previous full year FY17 guidance of 7–9% sales and 9–11% EBIT growth, affirmed as recently as November. Management has pinned the downgrade to issues in the North American pallets business, namely; 1) Retailer de-stocking in the back-end of 4Q, resulting in slower pallet issues and accelerated collection and repair costs. 2) Deferral by prospective new customers of decisions to convert to pooled pallets. 3) Pricing pressure in recycled (white wood) pallet operations due to excess supply.