Leather goods firm Pittards said it had succeeded in breaking even in the first half after being hit by export taxes imposed by the Ethiopian government.
Exports from Ethiopia represent 93% of the company's sales and the government there has put a 150% tariff on crust leather exports.
Despite this, Chairman Stephen Boyd said the firm's "commitment to accelerate the realisation of the benefits from manufacturing more products in a low cost economy remains strong".
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The firm also said raw material prices had remained stubbornly high at its tannery in Ethiopia but there were signs of prices easing which should contribute to improved gross margins in the second half.
Revenue dropped to £18.3m in the first half, compared to £20.3m the year before.
There were no profits, but Pittards avoided making a loss. This compared with a £1.1m profit the previous year.
Boyd said work to restructure the company's balance sheet to enable the payment of a dividend was progressing well.
"We expect to give notice of a general meeting to seek approval for this change shortly," he said.
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