Textile services and facilities management firm Johnson Service Group increased its interim dividend despite profits falling in the first half.

Revenues were up 7.7% at £126.3m, while pre-tax profits fell by the same proportion to £6m.

Earnings per share sneaked up slightly to 1.9p, while net debt was £7.8m higher at £57.5m, reflecting acquisitions made in the first quarter.

Johnson's board proposed an interim dividend of 0.36p, representing an increase of 9.1% over the same period last year.

Executive Chairman John Talbot said challenging market conditions had affected each of his firm's divisions.

But he added he was confident the firm would perform well in the second half as the benefits of acquisitions and restructuring were realised.

The company said its textile rental business had performed admirably with profits up by 5.2% to £8.1m.

Integration of newly acquired Cannon Textile Care contracts was progressing ahead of schedule, it added.

The restructuring of its dry-cleaning division, which was announced in early July, is proceeding to plan with 103 branches now closed.

The tough trading environment for dry-cleaning was reflected in profits at the division, which fell to £7.7m, from £8.4m the year before.

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