Sales in the six months to 30 September fell 4.6% to 59.5m while operating profit prior to exceptionals and goodwill write-offs fell 33% to 3m. Exceptional costs of 830,000 included a 340,000 bad debt caused by clients going into receivership.

The group also cited increased competition from facilities management companies and the loss of two substantial commercial contracts to a French competitor among its woes.

Wyndeham has won a number of new contracts in its magazine division, which makes up 64% of turnover. Sales in this area grew 7.6% to 38.1m, but direct mail sales fell 20.6% to 5.4m and the commercial arm was down almost 10% at 16m.

Pre-tax profit slumped by 36% to 1.9m. The group maintained its interim dividend so it finished with a retained loss of 46,000.

After facing City analysts for the first time in his new role, group managing director Paul Utting said: A number of one-off issues affected the commercial business but there were a number of positives as well.

Weve made huge investment in capital equipment, computerisation and good people.

Utting is establishing a central sales and marketing team to maximise opportunities to cross-sell.

Wyndehams share price rose 6.4p to 98.9p on the news. The 52-week high is 156p.

Wyndeham chief executive Bryan Bedson has paid tribute to Albert Gait, the former managing director of Grimsby-based Albert Gait, who died last week.

Wyndeham bought the firm in 1992 and Bedson said that Gait, whose funeral took place yesterday (26 November), was a very close friend and will be sorely missed by all. Gaits great grandfather set up the eponymous business in 1860.

Story by Jo Francis