Pre-tax losses grew to 2.1m compared to 1.37m year-on-year, while the digital print manufacturer's operating loss was 2.2m compared to 2004's 416,000. However, it was boosted by a 14% rise in turnover to 22.6m.

But the company claimed that results for the final quarter of the year will improve.

"A superficial glance at the results gives a misleading picture," said a Nipson spokesman. "The VaryPress 400 is coming through on the market very well and Q3 is typically a bad time of year."

He added that some customers postponed their orders until the conclusion of trade shows, including September's Print 05 in Chicago.

"In the fourth quarter, both sales and margins will improve," said Nipson chairman Rimon Ben-Shaoul. "For next year, the kit pipeline is already very strong. With the benefit of sustainable and increasing recurrent revenues combined with lower operating costs, Nipson's financial performance should be greatly improved."

Results were looking strong in the first half of the year, with Nipson moving into profit on the back of strong equipment sales.

The company added that the development of its new print head was "progressing satisfactorily" and it is expected to be introduced onto equipment from mid-2006.

Nipson is also aiming to reduce costs, which it expects to affect the financial results from 2007.

Nipson results 2005 (2004)
Nine months to 30 Sept
- Pre tax loss 2.1m (1.34m)

- Operating loss 2.2m (416,000)

- Turnover 22.6m (19.8m)

- Gross profits 5.8m (6.5m)