Engineering and agriculture company Carr's has warned that its financial performance is set to be "significantly below" expectations.

The firm - which has its headquarters in Stanwix, Carlisle - blamed a contract delay in its manufacturing business and a slow recovery in American cattle prices.

It reported the news in a trading update to the London Stock Exchange this morning, ahead of the publication of its annual results next month.

A spokesman said: "The engineering division had a slower than expected start to the current financial year as a result of a significant contract delay in the UK manufacturing business that was expected to impact upon production activity throughout this financial year."

As a result the company's managers have taken three courses of action - cutting costs, winning new work and speeding up other orders - but these have not had the desired effect.

"While progress has been made with cost-cutting, winning sufficient new work in the short term and accelerating the existing order book has been challenging, especially in the oil and gas market," the spokesman added.

"Consequently, despite some success, the level of new work secured has been insufficient to mitigate the impact of the delay."

He added that the company's remote handling business - which produces tools for working in hazardous environments - is performing well. Managers have also spotted opportunities in defence, nuclear and aerospace.

The spokesman said the slow recovery of American cattle prices was affecting its feed block business in the USA.

He said: "This pressure continued for a longer period than originally forecast and although cattle prices have begun to increase, the recovery in that market is now expected to be slower than anticipated. Consequently, this will result in significantly reduced profitability in our USA feed block business as the market recovers in the short to medium term."

The spokesman added that the British agriculture market was performing well and that the company had identified opportunities in South America.

Carr's will report its results on April 12.