Struggling fibre-optics company Bookham Technology showed its cost-cutting drive was paying off as it pared back losses for the first half.

The group laid off nine per cent of its workforce earlier this month following a wave of job cuts last year as it battled against the economic slowdown.

Chief executive Giorgio Anania said cash burn in the second quarter was 43 per cent below the same period a year ago at £13.7 million.

While revenues for the six months to June 30 were down 20 per cent, pre-tax losses were £33.2 million, £23.2 million less than last year.

Mr Anania said Bookham was now on course to hit its target of bringing cash burn down to between £10 million and £12 million in the fourth quarter.

He added revenues were set to show a modest improvement in the coming months despite the challenging market conditions.

Revenues in the second quarter were 27 per cent ahead on the first three months at £7.1 million with Marconi accounting for more than half the group's sales.

Marconi has agreed to buy products from the optical components arm it sold to Bookham last December but the group has also sold more non-telecom products.

Aerospace and defence equipment group BAE Systems accounted for 18 per cent of second quarter sales, buying fibre optics for lasers and modulators.

Bookham's production is now centred at two plants near its base in Abingdon in Oxfordshire and recent cuts will bring its workforce down to 750.

Earlier this month the group announced it was closing sites in Swindon and Maryland in the US.

A former stock market darling, Bookham's shares have tumbled from £55 in 2000 to just 75.5p.