SHARES in Weir Group closed down nearly seven per cent last night after challenges in its dominant minerals division caused the Scottish engineering giant to issue a profits warning, wiping around £320 million from its stock market worth based on Monday’s closing price.

Weir said “project phasing, incremental investment in growth and one-off plant reconfiguration” will mean operating profits from its minerals arm will be “slightly” lower than previously indicated. The division, which booked revenues of £1.1 billion last year, is involved in mining and minerals processing in Asia, South America, Australia, Europe, the Far East and the US.

The profit warning came in spite of Weir reporting a 12 per cent rise in order growth from minerals customers in the third quarter, as well as the continuing recovery of the North American onshore oil and gas sector.

Weir has a big exposure to the US fracking sector, and shed around 2,000 jobs following the crude price slump in late 2014. But it underlined the ongoing recovery of the sector yesterday, with oil and gas orders rising 59 per cent in the third quarter. That helped lift group orders by 21 per cent, compared with the third quarter last year.

Chief executive Jon Stanton said the company, which employs around 14,000 staff in more than 70 countries, said: “At a group level, we anticipate strong growth in full year constant currency revenues and profits.

“Minerals profits are expected to be slightly lower than previously indicated while expectations for Oil & Gas and Flow Control are unchanged.”

Shares in Glasgow-based Weir closed down 143p at £19.53.