A top director at Oxford Instruments has revealed the company could scale down its interest in a joint operation to concentrate on its core operations.

The company has a 49 per share in Oxford Magnet Technology (OMT) with Siemens taking the rest, but chief executive Andrew Mackintosh indicated the situation could change by September 2004 when the initial term of the deal is up.

OMT employs about 600 people at Eynsham and supplies magnet systems for medical scanners.

Dr Mackintosh said: "There is an opportunity in the agreement for a review.

"Siemens' preference is to take over a greater share of that business."

Dr Mackintosh was speaking after Oxford Instruments revealed its pre-tax profits had tumbled £2m to £2.3m for the six months to the end of September compared with the same period last year.

The OMT business saw operating profit drop to £1.2m from £2.7m.

Dr Mackintosh added the emphasis was to concentrate on the businesses which it wholly owned such as Superconductivity at Tubney Woods, which has turned an operating loss of £0.9m into a profit of £1.9m.

He said: "The big story for investors is the recovery at Superconductivity."

Superconductivity's technology includes a magnetic system that could help scientists develop new drugs.

Dr Mackintosh said: "We know there is a very strong business underneath, so we have been investing heavily to return it to profitability."

Profits at the company's Analytical business also fell back to break-even point with 60 job losses made since March, but with little impact locally.

The medical division made a loss of £0.7m, a slight improvement on last year.

Dr Mackintosh said: "We have taken action in both businesses to reflect market conditions."

Oxford Instruments also announced the appointment of Bernard Taylor to the board as a non-executive director.