Shares in Lamprell were down 14.07 percent at 87.87 pence at 0812 GMT, underperforming the FTSE All Share Oil Equipment & Services Index.

The company, which mainly focuses on contracts around the United Arab Emirates, said it expected 2017 revenue to be between $400-$500 million, with the current market pointing towards the lower half of the range.

Analysts at Investec expect 2017 revenue to be $405 million.

The rig builder said in a statement on Monday that while it recognises the likelihood of stronger product pricing in 2017, most of its customers already have their 2017 capital budgets in place, leaving "little expansive flexibility".

"The company continues to believe that 2017 will prove a particularly cautious environment, and will continue to maintain tight control over expenditure and expenses," Executive Chairman John Kennedy said.

Oil services and equipment companies have suffered from contract cancellations as explorers and producers fetched lower prices since the fall in oil prices in mid-2014.

Lamprell also said it expected full-year 2016 revenue to be about $700 million, lower than the $871.1 million it reported in 2015.

Analysts at Investec had expected 2016 revenue of $750 million, with the market consensus at $775 million.

The brokerage, which has a "buy" rating on the stock said it expects full-year 2016 profit to fall broadly in line with the revenue shortfall.

2016 saw lower levels of walk-in work than a year earlier, Lamprell said adding that most of the rigs stacked in its facilities remained inactive, having generated only limited refurbishment revenue.

Lamprell, which has taken on cost-reduction activities to address the expected fall in revenue for 2016 and 2017, cut its overall headcount by 4,000 people at the end of 2016.

(Reporting by Noor Zainab Hussain in Bengaluru; Editing by Sunil Nair)