Gold and silver jewellery play Abbeycrest was hit by troublesome new systems at its core UK operation 'G&A'. New systems, plus a business process re-engineering project, failed to run smoothly, forcing it to employ about 80 more staff and consultants. 'We've had serious teething problems which are ongoing', explained finance director John Sutcliffe, 'and we've had to retrain our entire workforce'. Interim figures to 31 August showed marginally lower pre-tax profits of £509,000 (£523,000) as higher financing costs bit, on sales 25% higher at £37.4m. Financing costs took the sparkle out of a strong commercial performance in the UK, where demand for jewellery remains buoyant. Brown & Newirth, bought for an initial £4.25m last December, posted excellent results while elsewhere, Abbeycrest's Far East businesses enjoyed mixed fortunes. Hong Kong-based Dynamic Creations (DCL) traded strongly but Thailand-based Essex International found its US markets tough. Abbeycrest paid £2.5m to acquire minority interests in these businesses and now owns 99% of Essex and 75% of DCL. When its troubles are put to bed the future looks good. Analysts at house broker ABN Amro predict pre-tax profits of £3.8m, giving earnings of 10.7p for the current year, with £5m and 14.4p to follow in 2003. Abbeycrest shares are trading on just 7.6 times earnings. Not expensive, if you can live with the (hopefully short-term) operational risks.