The impact of the £9m loss on Cooper Clegg was mitigated by the sale of the Scarborough-based print group's directories division, Pindar Set, to its major customer Yell, following the latter's invocation of its right to purchase the business.

Commenting on the sale of the directories division to Yell, the company said: "While disappointed in parting with a long- standing customer, it did mean that the group's net debt was significantly reduced."

As a result, the company was able to post a modest pre-tax profit of £934,000, significantly down on the £5.8m it posted in the previous year, on an operating profit of £6.2m, down from £7.4m in 2007.

Pindar highlighted pricing in the "fiercely competitive" UK web offset sector as one of the main challenges to the company, together with the general economic situation.

In the directors' report, group chairman Andrew Pindar said: "The print sector does remain a fiercely competitive arena, with some key players adopting, we believe, unsustainable pricing tactics.

"Our response to this is to be ever more resourceful with cost control and production efficiencies, combined with optimising customer loyalty by continuing to deliver excellent service."

Meanwhile, it emerged that the group, which sold Cooper Clegg on 31 October for no charge to Cooper Clegg Acquisitions, is also liable for £2.65m of outstanding finance leases owed by Cooper Clegg for which it remained the guarantor.

The company is currently in discussions with the finance provider around the settlement of any shortfall from the £2.65m guarantee and the subsequent sales proceeds realised.

In addition, the group has a £1.5m finance lease repayment relating to certain surplus non-core plant and machinery currently being marketed to be sold, which is due on the 30 September 2009, or the sale of the assets – whichever is earlier.

For more see next week's PrintWeek.