Shares in Bellwinch tumbled 6p to close at 22p yesterday, a fresh low for the year. Some trades in the shares were struck as low as 19p during the day.
Investors' reaction could have been worse but for a promise by the company that there would be a final dividend payment, although it declined to say if it would be cut.
The company, chaired by Stuart Crossley, said that profits before tax for the 1994/95 financial year, which ends this month, would be substantially below analysts' forecasts at between pounds 650,000 and pounds 750,000.
Hoare Govett's forecast in March, which sent the shares to the then low of 27p, was cut sharply from pounds 1.7m to pounds 1.4m.
Bellwinch issued an unusual statement following that move, saying that it "has not and is not making a forecast". Hoare Govett declined to comment at the time.
The housebuilder said yesterday that unit sales during the year would reach only 280, considerably less than planned, due to a lack of consumer confidence. Profit margins have also come under pressure.
Bellwinch's statement conforms with those made recently by other housebuilders, who have made repeated calls for the Chancellor to hold fire on interest rates or risk further damage to an already fragile market.