The diversified agribusiness blamed higher interest rates and a slowdown in sales of its managed investment schemes (MIS) in forestry for the downgrade.

In afternoon trading Futuris stock slipped almost 25pc, or 33 cents, to $1.005 as investors dumped the stock.

Futuris said its earnings before interest and tax (EBIT) for fiscal 2008 would no longer be at the "higher end of the range of market forecasts" of $154 million to $183 million.

However, they were still forecast to fall within the range of current market expectations of $166 million to $182 million.

Futuris also blamed the downgrade on an expected negative contribution from beef producer, Australian Agricultural Company Ltd (AACo).

Last month Futuris abandoned its attempt to offload its 43pc stake in AACo.

Futuris said assuming that MIS sales fell within the forecast range of $35 million to $45 million, the company's underlying profit would rise in fiscal 2009 to between $85 million and $90 million.

At June 30 Futuris' net debt is expected to be around $600 million, with a gearing of around 32pc, a higher rate than usual for the agribusiness firm.