The FTSE 250 firm said difficult trading conditions had persisted in its construction services division, which accounts for around 30 per cent of Balfour’s business.
As a result, profits for this year will be lower than expected, it said.
The group said that a dearth of large-scale construction projects in its core British market has meant that it is now relying on smaller projects for its business.
The order book was slightly down to £14.4bn at the end of September, compared with £15bn at the end of June.
Shares were trading more than 15 per cent down in lunchtime trading today.