Matthew Sharp reports on the latest announcement from the training provider

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Carter and Carter successfully suspended their shares on the London Stock Exchange this morning after admitting it was unsure of its financial position ahead of results to be released this month.

A major provider of government funded vocational learning programmes; the announcement has fuelled speculation that the company is to be sold.

Amid its third profit warning since June, the company has seen its shares crumble from £12.27 to 82.5p since its founder Philip Carter was killed in a helicopter crash as he returned home from a Liverpool-Chelsea football match in May.

In a statement this morning, Nottingham-based Carter and Carter said: “It has now come to the companys attention that its results for the year to 31 July 2007 are likely to be materially lower than previously expected.

“However, at the current time Carter & Carter cannot accurately assess its financial position and is therefore unable to provide the market with an informed update of its position.

In light of this uncertainty the Company has therefore requested a temporary suspension. The Company is currently in discussion with its banks regarding its financial position and is renegotiating its bank facilities to reflect its revised level of profitability.”

The announcement follows months of turbulence for the company following the death of Mr Carter. Although shares in the company were initially marked down after his death, they took a significant hit in June when the company announced that it was experiencing a “period of change and significant underperformance”.

Shares crashed in July when it failed to win any of the 15 contracts it bid for from the Department for Work and Pensions under the Pathways to Work project. The scheme, offered since 2003 provides support for people claiming incapacity benefit to get back to work

Adding to its woes, the company announced that it had failed to sign up enough trainees to its own apprenticeship programmes and that it had failed to meet expectations from the government-sponsored Train to Gain scheme. Providing support for businesses to improve their productivity and competitiveness, the Train to Gain scheme had a slow start before announcements that advertising and funding were to be increased.

A cost-cutting programme in August brought the company much needed relief after it announced that it had been successful in the last round of tenders from the Learning and Skills Council, getting £10 million worth of work a year from the £140 million on offer.

The company’s sharp decline has led some financial commentators to question whether its aggressive acquisition projects over the past couple years, including a takeover bid for chief rival BPP, had caused the company to overextend its resources.

Though the company’s share suspension is inviting plenty of commentary in the financial world, the full impact on Carter and Carter’s finances and its on-going business has yet to be revealed.

Matthew Sharp