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Plastics manufacturer Victrex booked a 1% fall in first-half profit and scrapped its interim dividend after rising sales were offset by margin pressure.
Pre-tax profit for the six months through March fell to £49.9m, down from £50.2m, even as revenue rose 4% to £151.5m.
Gross margin contracted 270 basis points to 57.3%, which the company pinned on under-recovered overheads from lower production, special grade campaigns and new parts programmes.
Victrex said it had made a 'solid start' to the second half, but with 'emerging headwinds' in its forward order book due to the Covid-19 crisis.
The company also said it had deferred a £15m debottlenecking investment in the UK to the 2021 financial year.
'Overall, we delivered a solid first half which was in line with our expectations,' chief executive Jakob Sigurdsson said.
'We saw good growth in automotive and medical, a stable performance in aerospace, electronics and value added resellers, offset by the weaker performance in energy, as oil prices, rig count and activity levels reduced compared to the prior year,' he added.
'Geographically, some more normalised demand returning in Asia could prove supportive, although the demand outlook in Europe and the US is becoming more challenging.'