VDM Group has cut more than 10 per cent of its workforce in the aftermath of being kicked off a BHP Billiton project site.
The struggling contractor said 40 people had been made laid off under a review of staffing levels and overhead costs. Further redundancies were expected.
VDM had about 350 employees at the end of June.
BHP last month removed VDM's crew from the Jimblebar iron ore project, where it had been building infrastructure under a $25 million contract. It is understood VDM was replaced by Kerman Contracting.
VDM said most of a $24 million second-half loss stemmed from the company deciding not to recognise revenue from the disputed project.
Chief financial officer Samantha Drury said the people made redundant included overhead, project and consulting staff. The cuts occurred in WA and the Eastern States.
"We've had the impact of the removal from one of our sites and there's a knock-on impact associated with that," Ms Drury said. "We need to streamline our costs and our overheads."
She said it was not yet clear how many more jobs would go. "We don't know exactly what those numbers will be."
Ms Drury said the job cuts were not a result of former CITIC Pacific Mining boss Dongyi Hua this week taking the reins at VDM. Dr Hua became managing director after striking a $6.4 million investment deal that will give his investment firm a controlling stake in VDM.
The restructured VDM, which suffered an $84 million loss for the past financial year, will specialise in engineering, construction and mining. VDM has previously said it wanted to sell its consulting division.
VDM said it needed to change and improve the way it worked, how it managed contracts and how it wanted to differentiate itself from its competitors.