Christopher Cliffe, chief executive, said that recent allegations from animal rights groups which had led to criminal proceedings against several employees and a Home Office investigation into the group's working practices had proved seriously disruptive: "Considerable management effort has been devoted to keeping clients informed and to retaining clients' confidence," he said.
Glaxo Wellcome and Zeneca have recently stopped awarding new drug testing contracts to Huntingdon pending an investigation into a disturbing TV documentary which showed scenes of cruelty to animals at its Cambridgeshire laboratory. SmithKline Beecham and Zeneca are awaiting the Home Office report.
Shares in the company fell from 121p following the programme. Huntingdon said yesterday that recent monthly new orders of pounds m-pounds 5m were below expectations and that marketing programmes to increase new orders had been "negatively impacted by the allegations".
Mr Cliffe said Huntingdon would incur a small loss in the first half after providing pounds 1m for additional costs relating to allegations. He expected the group to return to profit in 1997.