Cashmere firm Dawson International on Wednesday blamed tough trading conditions in the luxury goods market and the depressed price of cashmere as a raw material for wider first-half losses.

The cashmere yarn supplier and owner of the Ballantyne brand posted a pre-tax loss of £6.1 million for the first six months of 2002 compared to a pre-tax loss of £2.3m in the year-ago period.

Dawson said sales slumped to £24m from £37.5m due to falling cashmere prices and warned the cost of a new Italian design team, new yarn range and action to improve operations at its two plants would affect its short-term results.