Tandem, the maker of Dawes and Falcon bicycles, said economic uncertainty and intense competition in its markets continued throughout the five month period to 31 December 2011.
The aim-listed firm said, "We expect that 2012 will be another challenging year with further input cost pressures, high levels of macroeconomic volatility and a tough retail environment."
For the 11-month period ended 31 December 2011 turnover was around 10% lower than the same period in the prior year at approximately £29m.
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Trading at its bicycle businesses in the second half of the period was behind last year. Although turnover was similar to last year, strong retail pressure and heavy discounting in the high street resulted in a reduced margin during the Christmas trading period, it explained.
Revenue from its sports, leisure and toys business remained lower than last year as cash strapped customers held off from buying items.
Initial reactions to its new licences in this division, including Peppa Pig, Octonauts and Mike The Knight have been positive and it also expect Thundercats and Ben 10, Fireman Sam and Thomas & Friends, to perform well in 2012.
Trading in January 2012 has been strong with bicycles and accessories and sports, leisure and toys ahead of January 2011 by approximately 8% and 9% respectively.
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