The abolition of duty free shopping and the cost of closing a kitchen at a Paris airport sent airport retailer and caterer Alpha Airports into the red.

The group said in the six months ended July 31 it made a pre-tax loss of £2.2 million, compared with a £12.4 million pre-tax profit for the corresponding period in 1999.

Alpha said it had suffered after many travellers had wrongly thought all tax and duty-free shopping had been abolished from July 1999, rather than just for intra-EU flights. Figures were also hit by a £8.3 million charge relating to closing its kitchen operation at Orly airport in Paris, after a major customer shifted its flights to Charles de Gaulle airport.

Alpha Airports -- which runs 80 beauty, gift and newsagent shops at 24 airports around the UK - said a concerted education and marketing campaign was intended to inform people. Sales this summer had picked up ten per cent on the same period last year, when confusion was at its peak.

Partly in order to recover lost profits, the company has diversified away from airports, signing a ten-year deal with RoadChef to operate at its motorway service stations in the UK. RoadChef operates at 28 separate outlets, and has 27 per cent market share of the UK motorway services market.

Alpha Airport's chief executive, Kevin Abbott, said: "With strong core UK service networks and credentials, European development opportunities with partners such as Servair, and international opportunities in our target markets, we are confident of recovery."

Group turnover was down from £311 million to £213 million, although £70 million of the fall was attributed to the discontinued operation at Paris Orly. Interim dividends of 1p per share were announced, the same as last year.