Expenditure has been authorised for new exhibits and general upgrading, particularly at North Queensferry

Alastair Ritchie, chairman

Deep-Sea Leisure said on Thursday that a share placing earlier this month had put the operation back on an even keel and allowed more normal trading conditions.

However, it warned that the problems had an impact on its interim results, and would also affect its full-year figures.

Chairman Alastair Ritchie blamed the cash-flow problems on a project overspend at the Blue Planet aquarium.

He said this had left the company unable to meet scheduled debt repayments with its former bankers.

Mr Ritchie added that the weakness of the euro had also caused tourist numbers to drop in recent months.

But he predicted visitor numbers would increase next year after the removal of the cash restraints.

Period of stability

"Expenditure has been authorised for new exhibits and general upgrading, particularly at North Queensferry," he said.

"We can look forward to a period of stability, which will allow your board to concentrate on profit enhancement."

In the six months to 31 August, the company's turnover stood at �3.2m - compared with �3.4 million last year.

Operating profits before exceptional items fell from �1.3m to �933,000.

However, a one-off �2m borrowing agreement lifted Deep-Sea Leisure's pre-tax profits to �2.4m, compared to the �907,000 posted in the same six months of 1999.