Volex Group has reported a sharp fall in operating profits but said its Irish operation was performing very well. Operating profit fell to £2.9 million sterling (€4.7 million) from £18 million, on turnover down 26 per cent to £159.9 million, for the six months to the end of September.

Volex, which produces electronic cable assemblies and electrical power cords in several countries, employs 460 people in Volex Interconnect Systems in Castlebar, Co Mayo. The Irish company is "doing very well", according to a group spokesman.

Profit before tax and goodwill amortisation of £400,000 was £1.1 million, compared with £16.1 million last year, and headline earnings per share were 3.2p.

The half-year results were broadly as anticipated following the downturns in business experienced in the final quarter of last year, according to chairman, Mr Bill Goodall. "Markets generally have been very difficult across all regions and sectors of our business, with our industry experiencing the worst conditions in recent memory. The hardest hit of our markets have been the infocom businesses in Europe and the Americas," he said.

The group had worked hard to optimise all business opportunities, in particular by broadening its base with existing and target global customers, he added. It had concentrated on two basic business objectives - to generate cash and so reduce borrowings, and to reduce and, where possible, eliminate costs.

Borrowings had been reduced by £10.4 million to £48 million. Employees had been reduced from 13,500 in November to fewer than 9,000. A restructuring of operations would cut the group's fixed overhead expenses by around £9 million on an annualised basis.