Shares in security giant G4S slid further on Tuesday as widespread criticism of its Olympic debacle set the tone ahead of an appearance by its chief executive before what is expected to be a hostile parliamentary committee at midday.
G4S, which has ignited a political storm in Britain that raises questions over the government's approach to outsourcing key work, saw its shares slump 9% on Monday as mass downgrades followed the news that its failure to deliver 10,400 Olympic security guards would cost it up to 50 million pounds ($78.09 million).
Shares in the world's biggest security company slipped a further 2.8% in London on Tuesday, wiping about 650 million pounds off its value since it first admitted problems with the contract last Wednesday.
On Tuesday HSBC and Panmure Gordon added to the downgrades which have come in their droves as fears rise that the company's damaged reputation will affect its ability to win new government work. Analysts have also questioned how long its chief executive, Nick Buckles, can survive at the company.
Panmure analysts cut their forecast for G4S's 2012 adjusted pretax profit by 13% to 425.7 million pounds.
G4S and Buckles are likely to endure more public humiliation on Tuesday when he faces an influential Home Affairs Committee at 1100 GMT, where he will be asked to explain how the shortfall in security guards was allowed to happen so close to the Games.
The debacle is an embarrassing blow to the world's second-largest private employer, which told Reuters only 11 days ago that it was so confident that it could stage another similar-sized event to the Olympics at the same time if needed.
On Monday it emerged that, as well as the 3,500 extra troops drafted in by the government to help to deal with the crisis, nine police forces had been called on to help to man venues after some G4S staff failed to show up.
The chairman of the Police Federation of England and Wales, Paul McKeever, said that the G4S debacle should be a wake-up call for a government actively pushing private sector companies to take on public sector services to help to tackle austerity cuts.
"Can they trust the policing of the country to private companies, as was their plan through cutting policing by 20%? That has to be looked at very carefully post-Olympics," McKeever told Sky News.
"We hear G4S are recruiting 10,000 staff for 300 million pounds — the same amount that could get you 15,000 police officers — so we are looking with raised eyebrows at what is going on at the moment."
Last week the Surrey police force suspended its participation in a joint venture with West Midlands forces, which had looked to outsource a range of services worth up to 1.5 billion pounds.
