Northern Recruitment Group (NRG) shares slumped more than 15% after the company issued a profit warning.

The Newcastle-based company said contracts it had won recently - in NRG Connect and NRG Call Centre Solutions - would not generate as much as revenue in the current financial year as originally forecast. It added: “In addition, revenues from temporary recruitment have remained depressed.”

As a result, profit for the year to 30 June 2006 will be “materially lower than expectations”.

Chief executive Lorna Moran, who founded NRG in 1976 told Recruiter there were “no excuses” for the revenue shortfall this year. However, she said there would be a strong start to the next financial year. This was partly due to revenue that was expected this year falling into next year.

NRG has seven offices across the North East, Yorkshire and Scotland.

For the six months to December, it reported a pre-tax profit of £1.14m, down from £1.64m a year earlier. Revenue was £9.3m, down from £11.1m.

At the time of the first-half results in February, NRG warned that current trading was below budget.