Mouchel Group chief executive Richard Cuthbert has tendered his resignation with immediate effect, as the firm said profits would be lower than expected.
A trading update said the group had been informed that, as a result of an actuarial error, a one-off gain, forecast in an earlier management statement, would be £4.3m lower than expected.
This has an immediate and corresponding impact on the profits the group will report for the year to 31 July 2011, the statement said.
In addition, as part of the year-end audit process, Rod Harris, the new finance director, has reviewed contract risks and project claims, taking into account the continuing challenging business environment.
As a result, the group has decided to increase provisions in respect of these contract risks and project claims by a similar amount to the reduction in the one-off gain.
In June, Mouchel Group had said underlying trading was in line with expectations. Higher costs were being offset by a significant one-off gain on a long-term contract.
Chairman Bo Lerenius will become executive chairman until a new chief executive has been appointed. Mr Cuthbert is expected to work with the Group for a short period to ensure an orderly handover.
Mr Lerenius said: “I would like to express the board’s gratitude to Rich for his many years of service and his continuing belief in and commitment to the business. The board will focus on maintaining Mouchel’s position in its core markets in the interests of all its stakeholders.”