The firm has made another 400 people redundant since July on top of 800 lay-offs in 2009/10 which has seen the number of employees drop to around 10,000.

The latest cull included a radical shake-up of management which has seen a swathe of bosses leave the business.

Figures for the year to July 2010 show Mouchel made a pre-tax loss of £14.7m compared to  £13.5m last time on turnover down to £632.6m from £740.6m.

Mouchel has seen a fall in small scale school building work and local highways projects following the election in May.

But the company is confident it will pick up more work as the government looks to outsource public services.

Richard Cuthbert, Chief Executive, said: “Mouchel has faced some challenges in recent times. We have taken the tough decisions needed to ensure that we are operating appropriately in the current business environment and that we can maximise the benefits of a return to growth.

“Trading in the current year has started more slowly than expected and the immediate outlook remains uncertain. Whilst we expect to see some improvement in the second half of 2010/11 as cost savings impact, in these circumstances it is right that the Group takes a more cautious approach to performance through 2011 and perhaps beyond.

“However, the Coalition Government’s policies together with our focused business strategy, our reliance on long-term contracts and our leading role in transforming essential services and in sustaining vital infrastructure all give us confidence in the medium- and long-term prospects for the Group.”

Mouchel’s share price fell 30% during morning trading following the result announcement.