THE troubled textile industry was again hit by uncertainty as clothing supplier William Baird revealed that trading conditions remained difficult, despite turning in a half-year profit.

The company is currently fighting for compensation from Marks & Spencer over the loss of a 30-year contract which forced it to lay off 4,500 staff and close 14 factories.

It still retains a warehousing operation in Hartlepool and a corporate clothing factory in Skelton, East Cleveland employing around 300. Both are separate to the contract clothing business and are not believed to be under threat.

In February Baird dived £93.5m into the red because redundancy costs, and a one-off restructuring costs of £2.9m. But an improved performance in its womenswear business helped pull the supplier back into the black.

Pre-tax profits for the six months to June 30 were £1.6m, against a loss of £13m at the same point last year.

William Baird's women's clothing ranges saw strong growth during the six months, with its Planet and Precis Petite brands growing at 12 per cent and 35 per cent respectively and seeing improved margins.

But menswear continued to see tough times, with margins in its men's suits division suffering from heavy discounting, the company said.

Corporate businesswear also faced increased margin pressure, although sales were up five per cent.

Chairman Sir David Cooksey said: "The market has not become easier. We continue to outperform in womenswear but we have suffered from difficult conditions in menswear."

William Baird's £53m compensation battle with M&S is set to go to the Appeal Court in January after the High Court ruled against William Baird's claim that there was an implicit contract between the two parties which M&S broke.