The firm expects to make a high loss this year and in the first six months its sales fell 20% to 475.5m (euro677m), while new orders fell 9% 496m.

MAN Roland also made a loss of 26m for the period, compared to pre-tax earnings of 7.7m in the first half of 2002.

MAN Roland said the economic environment in the graphic arts sector remained extremely unsatisfactory.

Sales of sheetfed systems fell 9% to 201m, while sales of web-fed systems were a third lower at 202m. Sales from distribution and services fell 5% to 72.4m.

However, second-quarter sheetfed sales improved by 44% compared to the first quarter to 118.7m.

MAN Rolands headcount was 6% lower at 10,025, and that will fall by another 4% in the next six months.

The lions share of the losses have been at the companys sheetfed works, where the workforce will have been reduced by 1,300, or 30%, between mid-2001 and the end of 2004.

The company also said that its cost-cutting programme, which should save around 90m by 2005, would not entirely offset falling earnings caused by the tough market.

However, MAN Roland does expect profits to improve in 2004 with the launch of new equipment and the Drupa effect.