Martin cuts payout after losing pounds 2m

MARTIN International, the Nottinghamshire clothing manufacturer, which supplies 45 per cent of its garments to Marks and Spencer, plunged into the red last year, forcing a sharp cut in the dividend, writes Nigel Cope.

Following October's interim statement, which caused a precipitous drop in the share price, Martin announced a loss of pounds 2.25m for the year ended 31 December, compared with a pounds 1.2m profit the year before. The dividend is being cut from 4.4p to 1p.

The chairman, Michael Kidd, blamed depressed trading around the world and exceptional costs of pounds 1.7m for the loss. The group closed two clothing factories during the year - a blouse factory in Nottingham and Annabelle International, an importer of low-cost leisurewear. A sportswear licensing agreement that had been persistently loss-making was also terminated.

The closures, which meant 250 job losses, did not involve the group's leisurewear and underwear trading with Marks and Spencer, which remains profitable.

Operations in Sri Lanka performed well, but the unexpected loss of volume in the United States and Dubai contributed to the loss. Group sales were up 10 per cent from pounds 75.7m to pounds 83m.

Mr Kidd said trading was patchy, but he expected to see an improvement in the second half. The shares closed up 1p at 36p.