The Interconnect business remains adversely impacted by industry conditions and delayed network roll-out, principally in India and China.

Favourable commodity prices and progress in cost-saving programmes have delivered further modest quarter-on-quarter improvements in gross margins.

Revenue for the third quarter to January 3 was £58m, up 3% on Q2 but down 11% on same period last year at constant currency.

Gross margin of 21.4% was 1.3 points up on H1 2010 and 6.4 points ahead of the same period last year.

Operating profit from continuing operations was £3.4m, up 9% on Q2 and 10% on last year.

Net debt was £11.3m, in line with management expectations, ahead of traditionally strong cash generation in the fourth quarter.

The company was confident of meeting or exceeding its previous guidance on the trading outlook for the year to April 4.

Story provided by Business Financial Newswire