Shares in cleaning, catering and maintenance provider Spotless have plunged by 40 per cent after it stunned investors with a profit warning.
Spotless in late October flagged that it expected its full year financial results would "materially exceed" the previous year's.
However on Wednesday, Spotless warned that underlying earnings would be flat for fiscal 2016, with net profit down by 10 per cent.
For the first half alone, net profit is forecast to fall by between 15 and 20 per cent.
Spotless linked its woes to costs associated with the slower-than-expected integration of some of its recently acquired businesses.
"Spotless business (excluding acquisitions) continues to perform well with margins being maintained," the company said in a statement on Wednesday.
"However, the profit growth from new business wins experienced in the second half of FY15 has slowed, reflecting tighter economic conditions and tender decisions being delayed or deferred."
Shares in Spotless dived by as much as 42 per cent in early trade. The stock was 87.5 cents, or 39.8 per cent, lower at $1.325 at the close.
The company bought several businesses in 2014/15 and has added 6,000 staff since it re-listed on the share market in May 2014.
At the Spotless annual meeting in October, chairman Margaret Jackson reaffirmed the company's forecast from August that its financial results will "materially exceed" the previous year's, subject to economic conditions.
But it now faces a series of one-off costs that will eat into its bottom line, pushing net profit for 2015/16 10 per cent below the $142.8 million recorded the previous year.
The costs are related to restructuring, particularly within its laundry business, IT, and the acquisitions.
Spotless says that while revenues for the year are expected to materially exceed those in 2014/15, annual earnings before interest, tax, depreciation and amortisation will be flat, with net profit down about 10 per cent.
Excluding the one-off charges, earnings are expected to rise by about five per cent, with net profit flat.
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