Creo has returned to profit a quarter earlier than predicted, but still made a loss after restructuring and business integration costs.

The company recorded third quarter revenues of 86.33m ($131.8m), up 1% on the previous quarter, but down 22.5% on the same time last year.

The companys revenues for the first nine months of the year were 263m, down 22% compared to 2001.

However, Creos adjusted operating income of 390,000 was offset by business integration costs of 196,000 and equity loss on investments of 327,000.

Creo chief executive officer Amos Michelson said: This quarter we returned to profitability on an adjusted basis and we strengthened our balance sheet. The improved earnings are due to better gross margins from increased product sales.

He added that while business in North America had improved steadily throughout the year, the European market had showed some "instability".