Newly-installed chief executive Lorraine Baldry said in a Stock Exchange announcement: 'As previously anticipated, income levels for the company's transaction-based businesses, in both the commercial and residential markets, have fallen short of those for the equivalent period last year.' And she warned that turnover in the commercial markets was unusually slow during December with a number of transactions being deferred. However, non-transactional business like facilities management is holding up better, Baldry said.

And the interim results, due out in march, 2002, are likely to be further depressed by redundancy and restructuring costs. The company expects to take a one-off hit of more than £2.5 million ($3.6 million) although long-term the steps are expected to generate annual savings of £4 million ($5.8 million).

Chesterton shares ended the day down 4p at 22p on the announcement.