The red ink is flowing across Fletcher Building's balance sheet and outgoing chief executive Mark Adamson says he is "disappointed" to finish his time now.
Full-year operating earnings guidance has been sliced from a top range of $760 million earlier this year to just $525m now and a $220m impairment hit is being taken on two big business units.
That is a $415m change in Fletcher's fortunes, combining the top of the earning's range guidance with the slide and the value writedowns although the company says the latter will not affect cash earnings.
The stock dropped 8.4 per cent to a 16-month low of $7.41.
Joost van Amelsfort, NZX head of market supervision said the NZX would look into Fletcher's announcements today.
"NZX will be making enquiries into today's disclosures, given FBU's continuous disclosure obligations under the listing rules. This is in addition to NZX's ongoing investigation into the disclosure of FBU's previous earnings downgrade in March," van Amelsfort said.
"Separately, and in accordance with NZX's routine surveillance processes, trading ahead of today's announcement will be assessed in detail."
Fletcher's surprise NZX announcement this morning also sees British-born chief executive Mark Adamson replaced on Monday.
"I am disappointed to finish my tenure on the back of a challenging result in the construction division, however I am proud of what has been achieved over the last five years - most notably the turnaround of Formica, double-digit earnings growth in distribution, our acquisition of Higgins and the significant progress in our residential development division," Adamson said.
Fletcher was expected to make $720m-$760m for the June 30, 2017 year but in a surprise March move shortly after its half-year result out in February, that was downgraded to $610m-$650m, due mainly to two big building projects.
"Operating earnings expected to be approximately $525 million, down from previous guidance of $610-$650m" the company has just told the NZX.
But it also announced big writedowns at two big business units, citing a likely impairment up to $220m on Iplex Australia and Tradelink business units.
Francisco Irazusta has been appointed the interim CEO from Monday.
"Fletcher Building has today announced it expects operating earnings before interest, tax and significant items ('EBIT') to be approximately $525 million for the year ended 30 June 2017.
"Trading in the building products, international, distribution and residential and land development divisions, as well as three of the four business units in the construction division (infrastructure, Higgins and South Pacific), are in line with the company's expectations, previously provided at the time of the interim results on 22 February 2017.
"However, as work on major projects in the building + interiors ('B+I') business unit has progressed, it has become apparent that losses in B+I will exceed those previously estimated," it said.
Fletcher chairman Ralph Norris said: "It is very disappointing to see further losses being reported in our B+I business, particularly when the vast majority of the remaining Fletcher Building business units have performed so well during the year. I know our people in B+I are working incredibly hard to deliver a number of projects for our clients and I would like to acknowledge their efforts."
Due to standard practice at the end of each financial period, Fletcher reviewed the balance sheet carrying values of its business units.
"This review has indicated that the value of two business units, Iplex Australia and Tradelink, are likely to be subject to an impairment charge of approximately $220 million, when the company finalises its financial statements in August," the company said.
That would have no impact on cash earnings, however it said, and was only 3 per cent of the group's total assets.
On Adamson's sudden departure, Norris said: "The board believes it is the right time for Mark to leave the company, to allow a new CEO to lead Fletcher Building through this period and into the next phase of its strategy. The board would like to thank Mark for his work and we wish him the best in his future endeavours."
While Adamson will receive his contractual entitlements, Fletcher Building said that all of his share options will lapse and he will forfeit all shares in its long term incentive scheme.
He would not be paid a short term incentive relating to the 2017 financial year.