After narrowing all this down it turns out our software provider hasn't informed us of an update on there extractor tool that we use in our app.

Thanks for...

If i run the restore headeronly i get a similar error.

Msg 3241, Level 16, State 0, Line 1
The media family on device **************************.Lts.bak' is incorrectly formed. SQL...

So i have tried to restore via the GUI and receive this error now.

The media family on device '**********************.Lts.bak' is incorrectly formed. SQL Server cannot process this media...

The earlier database backup restores fine but if i run the ALTER database in single user mode i get this error.

Msg 5052, Level 16, State 1, Line 1