The social housing, repairs and maintenance firm Connaught has taken a new blow, as its Chief Executive and Financial Director quit following the firm's shock profit warning.
The Company has seen its share price devastated after warning two weeks ago that spending cuts could blow a £200 million hole in revenues over this year and next.
Shares plunged a further 6% in one day on news that founder Mark Tincknell is stepping down immediately on health grounds - less than six months into his second spell as chief executive.
Mr Tincknell, who has been with Connaught for 28 years, will continue in a new role. But Finance Director Stephen Hill will depart in October, as the Company's accounting practices come under scrutiny.
Connaught chairman Sir Roy Gardner has launched an independent review of accounting policies on mobilisation costs for contracts - currently recognised over the lifespan of contracts rather than upfront - which could deliver a blow to profits.
Exeter-based Connaught has seen shares tumble by more than two-thirds since it said it had identified 31 projects where spending will be delayed as a result of the spending clampdown, wiping £80 million off revenues and £13 million from underlying profits in the current financial year.
If the squeeze continues into 2011, sales and profits will fall by a further £120 million and £16 million respectively.
Sir Roy insisted today the outlook for the Group "remains positive" with a £25 million cost-cutting programme in place, although its social housing order book has been reduced to £2.6 billion.