Jeweller Theo Fennell has issued a profit warning and revealed that it has been approached by a party interested in buying a stake.

The retailer said it will not make a profit in the first half of the year, although it expects to make a “small profit for the full year”.

Theo Fennell chairman Richard Northcott said: “Trading this year began satisfactorily but is being increasingly impacted by the current recession and collapse in the financial markets, which has affected consumer confidence.”

The jeweller said the interested party is considering making a “significant investment” in the business.

Although Theo Fennell said its expansion plans are under review because of the economic turbulence and decline in consumer confidence, it will go ahead with plans to open a new concession in Brown Thomas, Dublin in November, as well as standalone Theo Fennell stores in Emirates Towers, Dubai, and Kuwait City. It will also open smaller concessions in Jeddah, Saudi Arabia, and Qatar in the first quarter of next year.