PROMOTIONS group Landround says it is set to return to profitability this year, after seeing its losses narrow and reporting a 25% rise in revenues.

The Chester group saw its operating loss for the year to January fall 77% to £377,000 from £1.64m the previous year.

A £1.13m write down on the value of subsidiary Travel Offers meant that pre-tax losses fell 14.6% from £1.96m to £1.68m.

But with revenues up from £5.3m to £6.6m the company’s chief executive Colin Gibson said it was well-placed for a return to profitability.

He said he was optimistic about the coming year, despite the consumer slowdown, but said England’s failure to qualify for the Euro 2008 football tournament would hit sales as Landround clients axed plans for tie-in promotions.

Landround shares closed up more than 7% yesterday, at 15p.

Mr Gibson said: “We’re pretty much on track and where we expected to be, which is pleasing. “The market has the expectation that we will get back to profitability in the current year.

“We have got writedowns in there, but most of the market will look through that.”

Landround operates international reward and promotional schemes, including Air Miles rival Buy and Fly.

Mr Gibson said the rewards programme growth was driven by new contract wins with Citigroup, its strong partnership with the Goldfish credit card business and the launch of a new card and associated rewards programme by Sweden’s Resurs bank.

He said the economic decline and subsequent fall in consumer confidence would affect Landround’s business, but said the company’s European geographical reach and broad portfolio of products would reduce the effects.

He said: “Overall credit card spending reducing will hurt us because we won’t sell as many reward points to clients if their customers aren’t spending.

“The absence of a Home Nation in Euro 2008 is a negative for us. There would have been a lot of promotions based around that. A lot of plans have been canned on the back of that disappointment.”

alistairhoughton