Shopfitting and interiors business Havelock Europa has described 2016 as a “challenging” year despite returning to profit following a restructuring exercise.

The Fife-based firm, which laid off around 100 staff members during the 2015 financial year and has been streamlining its business processes ever since, reported a pre-tax profit of £400,000 for the year to the end of December 2016.

That profit is ten times bigger than the £40,000 profit the business made in 2014 and represents a turnaround from the £800,000 loss it made in 2015.

Revenue was £60.8 million, which was down from £73.1m, largely due to the loss of a major financial client, believed to be Lloyds Banking Group.

Chairman Ian Godden said 2016 was a challenging year due to the significant reduction in revenue.

“Nevertheless,” he said, “we have made considerable progress in realising the benefits from the restructuring of the business with a substantial improvement in margins and a return to profitability.

Godden added that the business continued to concentrate on simplifying its structure and processes and on improving its commercial skills to make it more agile and to generate more operating profit and cash flow.

In trying to diversify its clients away from a few large banks and education refurbishments during academic holidays, the company is seeking to secure more clients from the health sector and student accommodation.

It is also looking for a wider range of retail clients, which have so far included big high street names such as Marks & Spencer, Primark, Accessorize and House of Fraser.

Havelock Europa employs 300 people at its Fife factory and marketing base, with offices also in China and Mansfield in the English Midlands.

The company’s shares fell 12% in the hours after the annual results were published.