 Jarvis is hoping its work in schools will be less high profile |
Shares in Jarvis have slid by more than a quarter after it said cost overruns had hit a key part of its business. Its accommodation services arm is now expected to make a loss of �5m, instead of an expected �5m profit.
The firm added it would be reviewing its dividend policy following the recent performance.
Jarvis also said finance director Robert Kendall had resigned, and that it would take a �40m charge after exiting rail maintenance contracts.
It announced that Alistair Rae would become acting finance director until a permanent replacement for Mr Kendall could be found.
At the close of trade, Jarvis shares were down 47.75p, or 26.9%, at 130p.
Investor worries
The profit warning is the second from the company in the past 12 weeks and comes after Jarvis looked at costs related to sub-contractors.
The company said it had encountered "complexities" with a number of large contracts, while delays in awarding new work would hit its earnings by around �12m.
The problem contracts, however, were now almost finished and the division has been restructured, the firm said. In future, Jarvis "will be a great deal more selective in picking contracts", chief executive Kevin Hyde said.
Before the recent problems, investors had already raised concerns about plans to boost profit by moving into new areas.
Branching out
Last year, Jarvis pulled out of its railway maintenance contracts after its record came under the microscope following the crash at Potters Bar and derailments in London and Rotherham.
The company is still involved in the railways, however, and last month it announced it had won three contracts from Network Rail to renew track at two sites in the UK.
Jarvis is also involved in building and maintaining schools, hospitals and roads.
On Thursday, Jarvis said it was preferred bidder on four schools projects in northern England and Wales.
The company also has a stake in Tube Lines, the consortium responsible for upgrading London Underground's Piccadilly, Northern and Jubilee lines.
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Last year has been a challenging year for Jarvis in many respects 
