CONSTRUCTION group Mowlem warned that full-year profits would be at the lower end of expectations after tough trading forced it to write down the value of some contracts.

The group, which has a strong foothold in Hampshire and is building the £25m Spinnaker Tower in Portsmouth (pictured above), saw its shares slump eight per cent after saying it would take a £15m hit due to shortfalls at its construction services division.

The tower, at 170m high, will be the tallest public viewing gallery in Britain, and is set to become a national landmark when it opens in the spring.

Mowlem said its support services and construction divisions were in good trading positions with strong order books, and that it believed the right action had been taken.

Before the update, analysts had been expecting pre-tax profits of between £27m and £30m before the £12m exceptional cost.

Profits before exceptionals last year came in at £37m.

Mowlem was behind the £3.5m project to design and build the Rose Road Centre in Southampton, providing sheltered accommodation for severely physically and mentally handicapped children for the Rose Road Association.