A downturn in consumer spending has contributed to a disappointing year at houseware and industrial products maker Metalrax.
The firm, which employs 1,100 people in the Midlands saw pretax profits drop from £4.7 million to £3.97 in the six months to the end of June.
Turnover for the half-year was £48.83 million, up from £44.87million, while the company said it was keeping its interim dividend at 1.65p per share. The group said it had been hit by the downturn in retail spending which has coincided with reduced levels of demand in the motor sector.
It said it had responded rapidly to the swift deterioration in market and was pursuing profitable growth and the restoration of margins.
Chief executive Richard Arbuthnot said: "It has been very disappointing really. We were expecting a significant fall in retail that everyone has gone on about.
"Our homeware products, things like wine racks and kitchen tools and gadgets, can only be bought by people when they are out at the shops and footfalls have been down.
"People don't go out specifically to buy our products, and have been thinking they can hang on for another month."
The company's links with MG Rover, which previously generated £ 2 million of business, had ended with the demise of carmaking at Longbridge.
It had been involved in making gear selector mechanism and body-in-white products and exhaust trims, but had lost £225,000 in bad debts from Rover.
Mr Arbuthnot said: "We have written off the £ 225,000. We had been bracing ourselves for the loss, but it is still quite hard when it happens." The firm was now concentrating on niche products which could be such as airbag cylinders and windscreen wiper motor units which could be used in many cars.
He added that the firms' engineering support services division had enjoyed a very good year, especially in providing warehousing and extra storage for retailers.
Mounting uncertainty in raw plastic material prices as they track the rising oil price levels has confirmed the group's decision to exit injection moulding. Metalrax said it had now sold the trade and assets of MRX Plastic Moulders to its management.
Chairman John Crabtree said: "The implementation of the group's strategic review of group operations will lead to further consolidation of businesses in both divisions as we act to restore margins and pursue profitable growth in what is proving to be an extremely difficult trading climate."