The problems of the sector were further underlined when Owen & Robinson, another troubled jeweller, reported doubled pre-tax losses of pounds 2.4m.
John Sutcliffe, Abbeycrest's finance director, said the company has returned to profit in the first few months of the traditionally stronger Christmas half. But he warned that the sterling crisis seemed to have quashed the improvement in sales that jewellery retailers had been beginning to see in August. 'The problems with the closure of the mines may also have a negative impact, but it's too early to say,' he said.
Sales to Ratners have fallen from 30 per cent to 15 per cent of reduced group turnover of pounds 14.5m ( pounds 16.1m). Aside from its business with Ratners and other multiple retailers, Abbeycrest managed to increase sales. It maintained its interim dividend at 1.2p a share.
Full-year sales are expected to be little more than pounds 45m, from pounds 60m last year.
Abbeycrest has spent about pounds 130,000 taking out credit insurance on its sales. Mr Sutcliffe said this move was caused by general economic conditions rather than specific concerns about Ratners or any other customer.
The company has cut its debts to pounds 7.25m, or 40 per cent of shareholders' funds, through a 'concerted attack on working capital'. This has included the disposal of pounds 1.5m of stock at clearance prices.
Owen & Robinson, where Alan Gaynor, the former boss of the Underwood chemists chain, has taken over as chief executive, said gross margins were improving but Christmas remained critical.
Foothold, Owen's sports shoe chain, 'should make a satisfactory profit in the second half,' the firm said. There is no dividend.
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