The U.K.’s largest rental company, Speedy Hire, last week issued a profits warning, saying it expected pre-tax profits for the year to be between £33 million (U.S. $45.7 million) and £38 million (U.S. $52.6 million), compared with £48.1 million last year.

The company said it expects its volume for its fiscal fourth quarter to be “significantly below” last year’s level with many building projects in the private sector being cancelled or mothballed.

Shares in the Merseyside, England-based company dropped 48 percent following the statement.

Chief executive Steve Corcoran said the company expects volume for the year ended March 31 to be “broadly in line with the prior year.”

Corcoran added that Speedy has a “supportive and continuing close working relationship with its banking syndicate and a process has commenced to establish appropriate covenants for the remainder of Speedy Hire’s £325 million five-year facility, which expires June 2012.”

He remained upbeat about future prospects. “Speedy Hire continues to enjoy significant strengths in this challenging market,” Corcoran said in a statement. “The business continues to win new contracts and remains cash generative, with an ongoing target to increase further its financial headroom by reducing net debt to below the starting position of £255.6 million by the end of the current financial year.”

Speedy recently cut 500 jobs from its 5,000-plus workforce and closed 38 of its 500 branches in the U.K. and Ireland. It also reduced its vehicle fleet.

Accenting Corcorcan’s comments about the company continuing to win contracts, Speedy announced a one-year agreement, with an option to extend for four additional years, with Severn Trent Water, one of the U.K.’s largest privately owned water companies and the world’s fourth-largest privately-owned water company. Speedy will provide generators for emergencies and repairs in the Midlands and Mid-Wales areas.

“Speedy impressed us throughout the tender process,” said John Adams, a Severn Trent buyer. “As well as its own fuel management system and generators that offer outstanding fuel efficiency, the company has excellent health and safety credentials and ISO accreditations.”