The chief executive of Fife-based interior refurbishment firm Havelock Europa believes better days lie ahead despite a difficult six months.
David Ritchie was commenting on group revenue from operations being down 5.2% at £28.9 million for the half year to June.
The performance reflected subdued demand in retail and financial services sectors in the UK by the firm that also serves education and health sectors.
The 5.2% reduction in pre-tax loss to £1.8m was achieved despite the lower turnover, and included exceptional costs and discontinued activities.
Earlier this month Havelock, based at the John Smith Business Park in Kirkcaldy, announced 50 redundancies 10% of its workforce after running into debts of £3.1m.
The jobs cut followed a review of the group and the need to make annual savings of £3m.
Many of the 50 jobs to go in the reorganisation are at the Kirkcaldy base.
In his report on the last six months, Mr Ritchie said: “Whilst the short-term trading outlook is challenging, I am confident the business reorganisation plan announced on September 1 will enable the business to deliver sustainable profits in the future.”
The Havelock Group net debt rose from £2.6m to £3.1m due to an £800,000 increase in finance lease obligations.
The pension deficit before deferred tax fell from £3.7m to £2.4m, but the firm said the position remains volatile.
The customer base significantly broadened under the diversification strategy, and international retail sales are on target for growth.
A sum of £1.358m was netted from the sale of the Teacherboards subsidiary which supplied display boards and presentation equipment to the education market.
The head office move from Dalgety Bay to Kirkcaldy was carried out on time and within budget, and a new management team was in charge.
The company was developing its presence within the premium office fit-out market.
The business reorganisation was on track for full implementation by the end of this year, and Havelock was also on target to achieve annual cost savings of £3m by next year.