Giovanni Benedetti said his slimmed-down Benedetti International business should make a profit in 2008, although accounts show the remaining operations in the group made a loss last year.

Giovanni Benedetti said his slimmed-down Benedetti International business should make a profit in 2008, although accounts show the remaining operations in the group made a loss last year.

The Scots-Italian entrepreneur said the Wallace Cameron first aid operation and a design business owned by the group were on track to make a combined profit of around £500,000 in 2008.

Following the £21m sale of its cling film and dispenser business to a management buy-out team that included himself in November, Benedetti said the finances of the group had been transformed.

The deal allowed Benedetti International to clear its debts and buy out 3i's stake. The group has been relieved from the hefty interest charges that weighed on its bottom line. With more than seven months of the current year completed, Benedetti said he was confident the group would be cash generative this year.

Benedetti said both arms of the business had been boosted by significant business wins.

Wallace Cameron is producing a range of baby monitors for another firm which should be on the market by the end of the year and also designing a new range of first aid kits. The design arm is working on projects including high-tech breathing apparatus for clients.

"We have got so many things going on," said Benedetti. The confident predictions come after Benedetti International made a pre-tax profit of £16.2m in calendar 2007, after losing £307,000 in the preceding year.

Excluding the £17.5m gain made on the the cling film business sale, the group made a loss of £1.3m.

The accounts show that the discontinued wrap film business made an operating profit of £2m. Continuing operations made a gross profit of £5.8m but, net of distribution costs and administrative expenses, made an operating loss of £3m.

Benedetti told The Herald the continuing operations made a profit before interest was charged.

The accounts indicate the operating loss was calculated before charging £1.4m interest payable, compared with £1.7m in the preceding year.

However, Benedetti said: "It's all good news. Please don't make it into bad news, there isn't any."

The accounts, signed off on August 5, include a note on the accounting policy adopted regarding the company's financial status, which is headed "going concern".

This includes the statement: "The directors consider that the remaining proceeds (of the wrap film disposal) after the settlement of bank debt, together with the group's existing cash and new bank facilities will be sufficient to cover its operating activity and other demands through the period ending 31 December 2008.

"At this time the directors have forecasted that the group will return to profit, generating sufficient cash to meet all future obligations. On this basis, directors consider it appropriate to prepare the financial statements on the going concern basis," it read.

Benedetti International had £114,000 shareholders' funds at December 31, compared with negative funds of £16.3m at December 31 2006.

The group recorded turnover of £35.5m in 2007 and £37.3m in 2006.