Bermuda-based insurance broker Stirling Cooke Brown Holdings Ltd. has warned its full-year profits will be 25 percent lower than last year.

And faced with the dwindling profits, plummeting stock and a potentially costly lawsuit Stirling Cooke announced yesterday it has signed up consultants Donaldson, Lufkin & Jenrette Inc. to sell or restructure the company.

In the last 11 weeks the company's stock has lost 75 percent of its value.

Included in the company's just-released first quarter results for the period ending March 31, Stirling Cooke chiefs admitted its expected costs for hiring legal and financial advisors would bite into 1999 results.

And increased competition in its US programme business was also expected to hurt the company's bottom line.

Less than a month ago Stirling Cooke revealed its plans to hire a financial advisor to explore ways to boost shareholder value with options including going private through a tender offer or cost cuts.

It also filed a motion for early dismissal of a lawsuit against it. In March, Odyssey Re London Ltd. -- which is a unit of Toronto-based Fairfax Financial Holdings Ltd. -- slapped the suit alleging fraud and racketeering on Stirling Cooke.

The results released after the close of trading on Friday forecast full-year earnings would hover around $12 million -- about 25 percent lower than the $16 million earned last year. For 1999's first quarter net income was $3.6 million or 38 cents a share, compared with $3.9 million or 40 cents a share for the same period in 1998. But revenues climbed 18 percent to $23.6 million from $19.9 million in last year's first quarter. The company blamed reduced volume and margin and unanticipated additional costs related to its British brokerage subsidiaries for eating into quarterly net profits.