The advertising agency Cordiant Communications is to axe 400 more jobs, having laid off 700 workers just four months ago.

The job cuts are part of a wider restructuring exercise under which some of the company's activities will be merged while others will be shut down altogether.

In a statement, the company blamed "exceptionally difficult" market conditions, and warned that its profits will come in 9% lower this year.

Cordiant, once part of legendary advertising agency Saatchi & Saatchi, has been hit by a slump in advertising expenditure since the onset of the global economic slowdown one year ago.

The company's extensive US interests, which include the advertising agency Bates Worldwide, have come under particularly severe pressure.

Lower profits forecast

Cordiant said on Monday that it has set aside �25m to cover the cost of this year's lay-offs, forecasting that the job cuts will save �30m next year.

City analysts are predicting that Cordiant's profits for the year to December will fall to �36m, down from �57m last year.

The company's shares were trading 19% lower at 75p early on Monday in London.

Cordiant's share price halved earlier this year when it warned that clients were axing advertising campaigns in the wake of the 11 September attacks.