Shares in ArmorGroup International slumped 41 per cent on Tuesday after the defence contractor parted company with its chief executive and warned that profits would be hit by the fallout from an incident involving an American security group in which Iraqi civilians were killed.

The company announced on Tuesday that annual operating profits would be below last year’s $10.6m (£5.1m). ABN Amro, its broker, had estimated $14.8m.