Troubled china maker Royal Doulton today arrested a prolonged sales decline following an overhaul that included the closure of its last UK factory.

Doulton said like-for-like revenues were down only 1% in the six months to June 30 after burgeoning overseas demand offset lower wholesale volumes.

Operating losses narrowed to £5.7 million from £7.8 million, benefiting from a restructuring that led to 1,100 job cuts and the closure of 42 shops.

Doulton announced in March that it would shut its Nile Street factory in Burslem, Stoke-on-Trent, by mid-2005 after "staged" redundancies affecting 525 workers.

Unions attacked the decision, which followed stiff competition from lower cost overseas producers in recent years.

However, Doulton said it would set up a new 20,000 sq ft factory and visitor centre in Festival Park, Stoke, to make limited edition and high value Minton and Royal Doulton brands.

Chairman Hamish Grossart said industry overcapacity was likely to remain in the second half and this would put prices and margins under pressure.

Rising interest rates, slow growth in salaries and a potential fall in consumer confidence could also deter shoppers from buying its goods.

But Mr Grossart added: "Royal Doulton expects to be in a strong competitive position by early 2005."

Friday September 17, 2004