'When sorrows come, they come not single spies but in battalions'.

The words of the Bard are all too apt in this instance as beleagured builder Balfour Beatty (BBY) trots out its sixth profit warning on the bounce. The latest comes after a KPMG review of its UK construction business revealed £70 million hole in the company's profits. Shares in the builder, which was the target of a takeover bid from Carillion (CLLN) last year, nudge barely 1.2% lower to 203.2p, demonstrating the scale of investors lack of faith already in the business and forecasts. The stock has collapsed by more than 30% over the past 12 months.

The £1.4billion cap has announced the summary of KPMG’s independent review of UK contracts along with its year end trading statement and the upshot is that the board expects to reduce 2014 UK construction profits by a further £70 million. Breaking this down, £20 million relates to the difference between the reported contract positions, as at August 2014, compared with the auditor's assessment of the situation at the same date. A further £50 million shortfall relates to an assessment of contract forecasts and subsequent deterioration in project performance up to the end of December 2014.

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Chief executive Leo Quinn insists on putting a brave face on things: 'I was never in doubt that there was a great deal of work to be done to restore the group to strength,' he says. 'Balfour Beatty is a large organisation which had become too complex and too devolved for adequate line of sight and financial control. The key is that these issues can be put right and we now have clear action plans in hand,' Quinn believes. Investors could be forgiven for not sharing his faith.

Alastair Stewart at Westhouse Securities remains among the sceptics, continuing to recommend that clients sell the shares. His concern is that KPMG may not have revealed all the bad news, and that further woes may appear on the horizon.

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Issue Date: 22 Jan 2015