Rok to slash contracting jobs

By Malcolm Locke

LONDON (Reuters) - Shares in Rok (ROK.L), the building services company, halved after it warned on Wednesday the credit crunch would severely hit its contracting arm, leading to job losses and sharply lower profits in 2008 and 2009.

Group Chief executive Garvis Snook told Reuters that the downturn in trading had been very rapid and that group sales for the final three months of 2008 were unlikely to exceed 200 million pounds.

"It's like someone just switched off the lights and walked out," he told Reuters in a telephone interview. "Contracting work has just stopped dead, especially in the private sector."

He said it was unlikely that there would be any recovery in trading until the second half of next year, and no "meaningful recovery in contracting margins" until 2012.

He said group revenues for 2009 were likely to fall by 25 percent to around 750 million pounds, compared to previous market estimates pitched around 1.0 billion pounds.

He added that analysts would also be revising down their 2009 profit estimates, and forecast a range of 22 million to 25 million pounds compared to previous estimates of around 36 million.

At 10:36 a.m., shares in Rok were down 51.3 percent at 35.75 pence.

(Reporting by Malcolm Locke; editing by John Stonestreet)