In a statement this morning Britain’s biggest contractor admitted the situation at its UK construction business now looks worse than it did a month ago when full year-end results were unveiled.

The firm said it now expected to deliver significantly lower profits from operations for 2013 and chief operating officer Andrew McNaughton would now personally oversee the UK construction operation.

Balfour Beatty blamed the impact of its previous business shake-up and continued challenging trading for poor performances at its regional operations.

“Andrew McNaughton, CEO, has started implementing an immediate action plan, taking charge of the UK construction business personally, to address the operational issues,” said the company statement.

“The group’s latest monthly business reviews highlighted some poor performance in the UK regional construction business, and to a lesser extent the building part of the major projects business, which led to an internal review.

“This internal review has concluded that the combination of a difficult external environment and internal reorganisation has resulted in specific instances of poor operational delivery.”

Balfour Beatty said its balance sheet remained strong taking full account of the cash impact of the £50m profit shortfall.

The remainder of the business remains on track to meet expectations.

Balfour’s share price fell by 11% in early morning trading.