Trim supplier Tag-It Pacific Inc increased new business by 22 per cent in the second quarter, and said its overall sales jumped by more than 45 per cent compared to the first quarter.

The company, which provides an outsourced trim management service for manufacturers of fashion apparel, said net sales for the three month period ended 30 June were $14.9 million, a 28 per cent decrease compared to $20.7 million for the same quarter last year.

Gross profit for the second quarter was $3.9 million compared to $5.5 million in the year ago period, yielding gross margins of approximately 26 per cent in each respective quarter.

The company is in the process of restructuring certain business operations, including reducing its reliance on Tarrant Apparel Group and Azteca Production. Last year Tarrant exited its Mexico operations and Tag-It has since been trying to replace the lost revenue from this move.

Colin Dyne, chief executive officer of Tag-It Pacific, said: "We made continued progress in our transition strategy during the second quarter.

"Recent orders for our full package offerings, from Levi and Talon has helped to diversify our customer base - a key strategy during this transition period - and we continue to see broad based market acceptance of our Oracle-based ERP system, TrimNet.

"We are no longer reliant on a single customer for the majority of our sales and we continue to replace a significant portion of our revenues with multiple new customers."

For the six month period, revenues dropped 28.5 per cent to $25.1 million from the $35.1 million reported in the first six months of 2003.