Chairman John Kembery said long-term prospects for the company were good, but admitted at today's annual meeting that "short-term visibility" on when contracts might come to fruition was poor.

He said: "Although the company benefits from a good degree of repeat business, the lack of new contracts will produce a first half result substantially below expectations."

Belgravium said it remained committed to a growth strategy.

"We continue to examine acquisition opportunities and have developed a new high specification product which will be launched shortly," Mr Kembery said.

"Almost no contracts have been lost to competitors but, as the purchasing decision is regarded as a capital project, it is subject to the severe financial constraints prevalent in the current market.

"Our analysis leads us to believe that this situation will be remedied later in the year and those sales and profits will be restored to the expected annual running rate by the final quarter."