CONSERVATORY maker Ultraframe has rocked investors with a fresh profits warning after a disappointing start to its key summer season.

Shares slumped more than 31 per cent after the Clitheroe-based firm said full-year profits were likely to be a third lower than hoped.

The group has been forced to cut prices in the UK to protect its market share, while being hit by unexpectedly high production costs at the same time.

Ultraframe said it now expects annual profits to be around £12million, down from an expected £18million.

Sales in the UK during July were eight per cent lower than forecasts as households worried about rising interest rates, stock market volatility and pensions.

Chief executive David Moore reported no pick-up in spending among its target customers, the over-50s, who traditionally buy "big-ticket" sunrooms.

But sales of budget conservatories to younger families were starting to build momentum, he said.

Ultraframe, which employs 700 staff in the UK and 500 in North America, generates much of its business between July and September.

Full-year sales in the UK were so far 18 per cent lower than in 2003 - in line with previous guidance from the company.