THE Teesside division of chemicals group ICI put in an "unsatisfactory" profit performance last year.

Uniqema, which makes ingredients for toothpaste and soap, saw profits fall 67 per cent. The division employs 400 staff on Teesside.

It did not stand alone in the underachievers category, high raw material costs were blamed for a nine per cent fall in profits at ICI's National Starch operation.

Overall, the group said annual pre-tax profits before goodwill and one-off items fell 15 per cent below last year at £341m, with fourth quarter profits two per cent below last time at £86m.

ICI said its key paint division did well, delivering 15 per cent growth in profits, and trading profit in its Quest food flavourings business was in line with last year.

It said that overall, trading had improved in the fourth quarter relative to the first nine months and the demand outlook appeared more encouraging, particularly in North America.

John McAdam, chief executive, said good cost controls and successful execution of its restructuring plans would continue to be essential.

He said: "We remain committed to improving trading margins and profits and to making progress in 2004 towards our strategic plan targets."

ICI, whose brands include Dulux paint, has a workforce of about 36,000 and employs 5,000 people in the UK at sites including Teesside, Slough and High Wycombe.

In July, it announced plans to cut 1,400 jobs - 300 of them in the UK - as it said first quarter profits had fallen 21 per cent to £98m.