At the same time the company announced that its deputy chairman, Robert Leonard, would no longer be a director.
The company blamed the revised profit expectations on stock accounting difficulties.
It is understood that its stock of timber was overvalued, which meant profits were over-reported in the management accounts.
The company had been acquired by Swithland Estates at the end of last year when the Walker family sold its 25.26 per cent holding.
Adam Page, managing director, said the company thought it was necessary to put out a warning because the previous management had given the impression that JO Walker had seen a profits turnaround after several years of poor trading.
In a statement to the Stock Exchange, the company said the problems were "due to a number of internal accounting and cost estimation errors".
Mr Leonard had been brought in by the previous management to act as a consultant and turn the company around.
Mr Page said: "He had been brought in as a company doctor and we felt we could get along without him."