Continuing customer caution drags on Cosalt revenues

However the Grimsby-based company, which provides safety equipment and services for the offshore oil and gas and marine industries, remains confident of its prospects in the long term.

In June, the company said it had seen a reduction in client spending on capital projects, particularly in its North Sea division which has hit volumes.

Group revenues for the four months between from May 3 and August 29 were 32.5m, down from 35.7m the previous year.

The decline was also attributed to weak sales of its workwear equipment within the marine division.

The company said its cost base has been reduced to a level more in line with current activity levels.

Cosalt's net debt at the end of the third quarter on July 31 was 21.5m.

The group said that activity in certain areas of the North Sea has increased and there has been renewed focus on investment in oil exploration, but key customers in the North Sea remain cautious.

Over the period Cosalt won a new framework contract worth in excess of 30m over eight years for the supply of personal protective equipment and associated services to 12 Fire and Rescue Services in South East England.

As a result of this contract, Cosalt will provide services to approximately 46 per cent of all the Fire and Rescue Services in the UK, giving the group clear market leadership in this sector.

Following management changes in the Offshore Division, group chief executive Mark Lejman is now interim chief executive of the division in addition to his group responsibilities.