Construction and services group Alfred McAlpine today warned investors it would take a £27 million hit in exceptional costs this year.

The London-based firm, which employs 8,500 people, said it would be affected by costs incurred through a recent restructuring, as well as worse-than-expected losses on two completed contracts.

However, it said underlying trading was in line with market expectations and that it expected to return to double-digit growth in the next financial year.

Shares fell 5% after the update, in which McAlpine also revealed that the managing director of its infrastructure arm, Peter Carolan, would be leaving at the end of the year.

McAlpine has restructured its businesses over the last two years, moving out of house building and making acquisitions to establish its infrastructure services and business services operations.

It said costs linked to this reorganisation would amount to £6 million, while £21 million was also needed to deal with old contracts started in 2000 and 2001 and issues linked to the acquisition of a utility firm.

The exceptional charges will not affect the group's cash position at the end of the year or its dividend policy.

McAlpine also said today that it had recently won £285 million of new contracts, taking its business wins in 2004 to more than £1 billion.

Recent wins included a 10-year contract to manage an energy centre for Airbus at its site at Broughton, Flintshire, and two five-year contracts with Severn Trent and Northumbrian Water worth £130 million.

Chief executive Ian Grice said he was confident about the future, saying all of McAlpine's businesses were positioned in strong markets and that it was enjoying an "encouraging flow" of new contract wins.

Support services now account for two-thirds of the company's activities.

Mr Grice said the exceptional charge related to "historic" issues in the infrastructure and capital projects operations, although no further detail was given.