- Colefax posts pre-tax profits of £1.98m for the six months to the end of October - down from £2.98m last time - and it warns full year results will be significantly below current forecasts.

The group - an international designer and distributor of furnishing fabrics and wallpapers and which owns a leading interior decorating business - saw sales fall to £35.14m from £36.69m a year ago,

The group - which trades under the brand names Colefax and Fowler, Cowtan & Tout, Jane Churchill, Manuel Canovas and Larsen - reports a weak performance from its decorating division and says recovery in its core US market was slower than expected.

Earnings per share fell to 9.9p - down from 12.4p - but the interim dividend is being maintained at 1.85p per share.

Chairman David Green said: "Since the half year end trading conditions in the UK and Europe have deteriorated and we expect trading to become more difficult.

"In the US, which is our major market, we expect the recovery to continue but at a slower pace than we previously anticipated.

"There are still three important sales months left in this financial year but, as a result of current trading conditions, the board now believes that this year's pre-tax profits will be significantly below current market expectations.

"The group has a strong balance sheet and we continue to invest in our portfolio of brands but until we have evidence of a return to growth our focus will remain on managing cash flow and controlling costs."

At 8:11am: [LON:CFX] Colefax Group share price was -43p at 185p

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