A return to profit is confidently forecast for the Moygashel linen business in Northern Ireland, owned by the Lamont Holdings textile group. Last year Moygashel collapsed with losses of around £1 million on turnover above £20 million. Sales of linen fabric to apparel-makers increased by 10 per cent in the first half of this year and are expected to continue to grow during the second half, inducing a return to profitability. A new "Irish Heritage" brand of Moygashel furnishing fabrics is being introduced in the US. Prospects of improving returns at Moygashel have prompted Lamont to invest around £3 million in modernising its Ballievey finishing plant at Banbridge, Co Down.

The emerging turnaround at Moygashel was reported by Lamont in comment on interim figures showing an improvement in pre-tax profits from £2.12 million to £3.03 million, on turnover reduced from £58.9 million to £44.9 million. The profit upturn mainly reflects absence of losses from discontinued activities, notably Shaw Carpets in Yorkshire. Group profitability continues to be undermined by sterling's revaluation. Directors warn that full year results will suffer a £1 million hit on currency translation alone.

Lamont shares improved 4p to 134p on the first-half figures. The interim dividend is unchanged at 3.65p.