Plastic and rigid box designer and manufacturer Robinson reported a 6% improvement in first-half revenue on Wednesday, to £13.5m, which its board said was lifted by "favourable exchange rates" and higher resin prices being passed on to customers.
The AIM-traded firm said allowing for those effects, sales volumes in the six months to 30 June were very similar to 2016.
It said increased costs, including some resin costs not yet passed onto customers, had reduced gross margins, and operating expenses had been increased primarily by the company's action to strengthen the sales team.
"The resulting profit before tax was £0.3m lower than the same period last year at just above break-even for the first six months," the board explained in its statement.
"In addition to the largely temporary effect of resin prices, the lower margins are also as a result of sales mix factors such as consumers trading down from premium branded products in some sectors.
"As we have reported previously, new business gains have been secured but have taken longer to bring to fruition."
Robinson said that, with the amortisation of intangible assets and depreciation together amounting to £1.1m, the cash generated from operating activities of £0.9m was "sufficient" to cover the final dividend for 2016 and the loan repayments, but not all the net capital reinvestment,
It said that, at £0.8m, was mainly equipment associated with new business yet to come on stream.
"Net debt therefore increased by £0.3m to end the period at £5.2m," the board added.
"A final dividend, with respect to 2016, of 3p was paid to shareholders on 1 June."
Looking at its property portfolio, Robinson said the sale of surplus properties in Chesterfield was "progressing", and developments for the Walton Mill and Boythorpe Works sites were being discussed with potential tenants and buyers.
That process was likely to take several more months, but the company did expect some realisations in 2018.
"We do expect to see sufficient new business coming through in the second half to achieve growth in revenue for the year as a whole and we expect to continue to build the pipeline for further growth in 2018," the board said of the firm's outlook.
"Re-organisation of manufacturing to achieve efficiencies and investments in capital equipment to improve capacity and capability are being carried out to support this growth and help to recover margins."
The board said it approved an interim dividend of 2.5p - precisely in line with last year - to be paid on 2 October to shareholders on the register at 1 September.