Clothing group William Baird remained firmly in the red last year but said it had taken the action needed to revive its fortunes.

The firm said the recent simplification of its product range would spearhead a return to profitability.

Baird recorded a pre-tax loss of £11.8 million in the 13 months to February 2, compared with the previous year's loss of £19 million when figures were hit by an extra £15.3 million-worth of exceptional items.

Group operating profits of £1.2 million were substantially lower than the £11 million profits achieved a year earlier.

Baird said its trading performance in the last four months had fallen significantly below original expectations.

Chairman Sir David Cooksey said a number of disposals, including Van Gils menswear and Baird corporate wear, would help the company.

He said: "The turnaround to restore profitability is under way."

The company, which sells its clothes in a range of department stores, will now focus its efforts on brands including the womenswear ranges of Windsmoor, Planet and Precis Petite.

The division achieved an eight per cent improvement in sales for the 13-month period, although like-for-like showing in the last quarter of last year was described as disappointing after six years of continuous growth.

Sales in the active and casualwear division, home to Lowe Alpine, Melka and Tenson, were 11 per cent down on a year earlier.

With most of Lowe Alpine's sales and profit generated in the UK, the foot-and-mouth outbreak had a significant impact on the division.

The group incurred £16.5 million of exceptional items, including a further £4.5 million relating to the loss of its contract with Marks & Spencer.

Baird was forced to cut thousands of jobs and shut factories after the retailer terminated an agreement in 1999.

The group tried to sue the retailer but was defeated last year.