Carter & Carter has adjusted its estimates for annual profits after poor take up with its Government-backed Train to Gain scheme.

Adjusted profit before tax for the year ending July 31, 2007, was reduced to £15.5 million. Analysts previously expected pre-tax profits to reach £22m.

Shares plummeted from 781 pence per share on July 28 to 239p per share today, its lowest share price since floating in February 2005.

“During the second half of the year Train To Gain has continued at disappointing levels. As a new Government initiative, employers have taken longer to engage in it than originally anticipated,” said Carter & Carter in its trading update.

The training company said profitability from automotive apprenticeships would be adversely impacted next year by recent changes to Government funding levels, as well as lower than anticipated growth in profitability from branded manufacturer programmes.

The Carter & Carter board expects adjusted profit before tax for the year to July 31, 2008 to grow between 15 - 20% compared to the current financial year. The company hopes to do this with the help of new tendering contracts which are expected to come to fruition later this month.

The search for Carter & Carter's new CEO, after the death of founder Phillip Carter, is still underway and ‘remains a priority’.

Rodney Westhead, chairman and interim chief executive, said: “Although we are disappointed with the slower than anticipated take-up of Train To Gain and the impact this will have on the group's profitability, we continue to focus on the numerous opportunities available to the group in the UK skills environment.”