'Margin was the problem', explained finance director John Sutcliffe, as profits came in lower in line with an earlier trading statement at the gold and silver jewellery manufacturer and distributor. For the year to 28 February, sales jumped 12.4% to £78.8m, but pre-tax profits eased off by 13.6% to £4.5m as higher raw material prices, caused by the strong dollar, impacted 'purely' on its fixed price supply contracts in the UK. One positive to emerge was 42% sales growth in the Far East, where Dynamic Creations in Hong Kong and Essex International in Thailand contributed a first full year profit of £1.48m on £16m of sales. Sutcliffe predicted a 'cautious' pre-tax profit of £5.5m for the current year on sales of between £85m and £90m. He admitted that one area of concern was the effect that the US slowdown might have on the group's Thailand operations, although he was confident that diamond prices 'had stabilized'. The shares jumped 14.5p to 102p on the news. Earnings per share fell to 12p (16.6p).