- Colefax Group expects full year operating profits to be around £3.9m - up from £2.7m in 2009 but down on the £6.1m in 2008.

The firm says trading conditions have been better than we expected, especially in the UK market, since its interim results in January.

In the fabric division, UK sales for the three months to 30 April were up by 13% compared to the same period in the previous year.

The stronger than expected UK market has also benefitted trading in our decorating and furniture divisions.

Sales in the US, which is its largest market accounting for approximately 46% of fabric division sales, were up by 1% in the three months to April 2010 and there are some signs that this market is finally starting to recover.

The group has made a decision to close its Manuel Canovas beachwear activity in France and this will result in an exceptional cost of approximately £800,000 for the year ended 30 April. It adds: "Although we have experienced good growth in the UK over the last three months, we are cautious about trading prospects after the general election and believe that the year ahead will remain challenging in most of our major markets."

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