The firm did not reveal details of the project in latest published results, but it is believed to have experienced problems with its headquarters project for Sky in west London completed several years ago.
The impact of Covid, which was still being felt last year, was blamed for a 36% fall in revenue to £36m from £56m previously.
Finance director Andreas Fegbeutel said that the fall in revenue particularly hitting the facade division saw the firm take the difficult decision to reduce staff in line with workloads.
He added that the provision for remedial work on one “significant project”, resulted in the gross loss for the year.
Lindner Prater, which has been owned by German firm Lindner since it bought Prater 11 years ago, said it still maintained a strong balance sheet of £20m and remained self-financing with no external borrowings.
He said the firm’s order book for this year and beyond remained strong with work for HS2, nuclear power and other infrastructure project providing opportunities.
The firm also recently secured the barrel cladding, roofing, glazing and lower level cladding to Everton Stadium in partnership with Laing O’Rourke.