Chief executive Alan Walker said the results confirmed the companys restoration to profitability.

Inveresk is now in a position to focus on its chosen market as never before, he said.

Walker admitted that if anyone had said to him in 2002 that the company would be back in profit by mid-2005, he would have said in your dreams.

The resurgence now means Inveresk can move forward, and Walker said this could include the possibility of future acquisitions.

Greater emphasis was being placed on product development, which includes a 500,000 investment in productivity and training announced for its Carrongrove mill in February this year.

The results for the year to 31 December 2003 show a rebound from pre-tax losses of 34.3m for the previous year.

Turnover for the year was 39.7m, a fall of 11% on the previous year, mainly due to falling demand and difficult market trading conditions.

The resurgence in the Fife papermakers business follows completion of its restructuring and refinancing carried out last year (PrintWeek, 11 April 2003).

This included an equity issue that raised some 8.2m, which was underwritten by 17 institutional and other investors.

In a pledge of confidence for the future, Inveresk has also restored its dividend of 0.25p per share for the first time in five years.

A major redevelopment is planned for its former mill at Caldwells, which closed last year after being leased to Klippan. This should allow the company to clear its 16m net debt.

Inveresk is currently in talks with Scottish Enterprise Fife and the planning department of Fife Council over a proposed redevelopment of the site.

Story by Andy Scott