Shares in contractor WDS have plunged after it cut its profit forecast and its CEO said it was time to step aside.

Mining services contractor WDS is replacing its chief executive after a drastic downgrade of its earnings forecast.

The news sent its share price plunging, dropping 68.5 per cent to 25.5 cents, wiping out about $79 million in shareholder value.

WDS, which services the mining and energy sectors, has reduced its profit forecast for 2014/15 to between $1 million and $3 million, less than two months after forecasting profit growth from the previous year’s $13.3 million.

Chief executive Terry Chapman has agreed it is time to transition to new leadership, but will stay on until a replacement is found.

The reasons for the company’s profit downgrade include the death of a workers at Origin Energy’s Australian Pacific LNG project in Queensland, which forced work at the site to be suspended.

WDS has also failed to win a contract extension at a coal seam gas project, and has had operational problems at the Eagle Downs coal mine in Queensland.

The adverse impacts totalled $13 million.

The company said would now commission an independent review of its business strategy and operations.

WDS is also relocating its head office from Sydney to Brisbane to save costs.

“We would like to reassure our shareholders that WDS remains in a strong position – our balance sheet is sound, we have a solid order book and a robust opportunity pipeline that will support future sustainable growth,” chairman Ross Wolfe said.