Tool manufacturer Oglesby and Butler has reported a 20 per cent fall in first half pre-tax profits to ¤348,000 (£274.072). In uncertain trading conditions, with 50 per cent of its sales in the US market, the company has cut its interim dividend to 0.57 cents per share from 1.59 cents in the previous first half.

Chairman Mr Nevin Dowling described this as a prudent move "in the context of the current world trading situation and the cash requirements of the group, particularly in anticipation of the increased costs of marketing the new glue gun and new product development". He said the situation would be reviewed at the end of the financial year in the light of the results and the trading outlook.

Mr Nevin said current orders were strong and the company would soon review the three-day working week implemented in December. Oglesby and Butler employs 120 people. In addition to the US, its markets include the UK (20 per cent), mainland Europe (15 per cent) and the rest of the world (15 per cent).

"Third-quarter sales have held up well and the order book is encouraging but we are very vulnerable to changes in US consumer confidence. We are a small company and we have to act prudently," he explained. Oglesby and Butler had taken all the steps within its power to trade effectively in the current environment and to maintain a competitive position for the future through its investment policy and cost control, he said.