Jaegar, the middle class fashion brand which was retained during owner Coats' recent slashing of non-core business, has ambitions to go upmarket.

On Wednesday, Coats' chief executive Martin Flower pointed to its potential for success along the lines of Burberry, currently one of the most sought after luxury labels on the high street.

A new Jaeger collection by designer Bella Freud is to be launched this autumn.

Coats' fashion division includes Jaeger and Viyella. Figures released on Wednesday show the company's interim operating profits up to £1.2m from £1m. The core threads business showed little change, coming in at around £47.6. Pre-tax profits fell 72 per cent to £9.9m, after mainly reorganisation-related costs.