One of the UK’s largest independent paper merchants has reported losses after the demise of some large printers and “fierce” price cutting in its sector.

Denmaur Independent Papers suffered pre-tax losses of £249,000, having made profit of £1.9 million the previous year, in what its chairman described as a “difficult period”.

The company, which has its headquarters in Sittingbourne, revealed in its latest accounts that underlying earnings were down 86% to £346,000 in the year to the end of April 2017.

It contended with three “high profile bad debts” and was affected by the collapse of magazine group Polestar in April, which saw many magazine titles move production overseas.

Turnover was down 9% to £116.5 million but it has invested in updating its IT systems which will improve security and response times.

A major reorganisation means nearly all stock is held in one location in the Midlands and led to transport efficiencies and improved stock turn. It also reported growing sales of packaging and digital products.

In his company report, chairman John Mason said: “The financial year to April 2017 can only be described as a difficult period.

“However, every year in the paper industry produces challenges that require management to adapt and change and this year has been no different.”

Denmaur’s results come amid a decline in consumption of graphic papers in the UK and Europe.

Mr Mason added: “Brexit, whilst hard to quantify, certainly has had a negative effect on confidence and growth across the industry.

“In summary, it has been a year of mixed fortunes.

“However, our market share has been stable and with the introduction of new value added products to our range and the investment programme now firmly in place and working well, I expect our next year to be positive as we reap the benefits of our investments.”

Denmaur, which employs about 110 people, was founded by brothers Mike and Nick Gee in Rochester in 1983.

It moved to Sittingbourne two years later and has grown to have four other UK offices and a central distribution centre in Coalville.

Managing director Mike Gee said: “Whilst external factors will always play some part in the final results, we see the changes made during 2016/17 to the management, efficiencies and costs of our business resulting in a return to a profitable outcome for the year ending 30th April 2018.”