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LONDON (Alliance News) - Driver Group PLC saw its shares drop by more than a quarter early Wednesday, after Chairman Alan McClue warned that contract delays and cancellations meant that its performance in the current financial year will fall short of the board's expectations.
In a statement ahead of the company's annual general meeting, McClue also said he would resign at the AGM, handing over the reigns to non-executive director and former Conservative Member of Parliament Steve Norris.
Late last year, the construction and engineering consultancy appointed a new chief operating officer for its Africa, Asia and Middle East operations. He has been undertaking a review of that business.
However, the unit has now been hit by a "slight delay" in a number of anticipated projects. Some projects, particularly in Oman but also to a lesser extent in Hong Kong and Singapore, were delayed or suspended and in a small number of instances, cancelled, the company said.
It said most of the delayed contract have now started, and management is expecting revenue growth through the second half of the financial year and into next year. It also said its African operations are performing towards the top end of its expectations.
"However, in the short term, given the combination of increased costs and the delay in the commencement in certain projects, it seems sensible to carefully manage expectations and take a more prudent approach to the expected performance of our business in the Africa, Asia & Middle East region and the group for the current financial year which the board now expects to be below management expectations," McClue said.
Driver Group shares were down 30.7% at 53.00 pence early Wednesday, making it one of the worst-performing stocks on the AIM All-Share index.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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