BOSSES at a South Lakeland papermaker remain bullish about future prospects despite announcing disappointing results this week.

James Cropper plc saw interim pre-tax profits fall by £1 million to £100,000 for the first half of this year, with its largest division – papermaking – suffering a small operating loss.

However, the division, which produces specialist papers, is looking to increase sales by about one-third over the next three to four years, said finance director John Denman.

The Burneside company is aiming to exploit significant new export opportunities in both the United States and China, and it has also secured orders for luxury packaging materials in Europe in recent months.

“We have appointed a new agent in the US in the past six to nine months and whereas we have little business before, now we have the potential for £1 million worth of business,” Mr Denman told Business Gazette.

The firm was growing more confident in its ability to grow paper sales, based on the amount of significant new business secured in very difficult trading conditions, he added.

“It’s not going to be easy. We are going to have to be very resourceful and keep costs under control. We need to bring in more business at no extra cost to the organisation overall.” Cropper has seen profits eroded by the increasing costs of regulation and raw materials, coupled with higher national insurance contributions, which Mr Denman described as effectively a tax on employing people.

Meanwhile, the company has opened a further two Paper Mill shops, at Chatham in Kent, and at the Clarks Village in Somerset, taking the total number of shops to nine.

The shops, which sell excess stock, have proved to be a successful venture, and plans are in the pipeline to open further outlets over the coming months.

Shareholders will be paid a 1.9p interim dividend, and the board expects to maintain the full year dividend level.