Lower cost of sales and administrative expenses contributed to the improvement.

“In my 2012 statement last March I described 2012 as a year of transition following major structural changes in the business. I am pleased to report that these changes have yielded benefits in the first half of 2013 with a return to more normal levels of profitability,” said Chairman Stephen Boyd.

“We intend to complete this before the current year end with a view to paying a dividend within the next twelve months if the recovery continues and in the absence of unforeseen circumstances,” he said.

Shares in leather producer Pittards leapt on August 26 after the group pleased investors with a return to ‘more normal’ levels of profit and a rise in net assets following a successful period of transition last year.

Net assets rose to £17.1 million ($26.5 million) in the period with higher inventories and debtors as all the production units had a busy June period, while net debt accordingly rose from £5.7million ($8.84 million) to £6.7 million ($10.39 million) in line with the usual seasonal pattern, although gearing remained at a creditable 39% (2012:40%), well within the group’s target range.

The firm was planning to carry out a share consolidation of the 463 million shares in issue in order to make payment of dividends more practically achievable, something it intended to complete before the current year-end, with a view to paying a dividend within the next twelve months if the recovery continues.

Looking ahead, the group added: “Global uncertainty is still a concern for many businesses but there are signs of recovery in some sectors and geographical areas of the world. We remain committed to our core strategy of investing in and building on our brand in both leather and finished products and our enthusiasm for growing the business and seizing any new opportunities which present themselves remains undimmed.”