Strong market conditions helped push house-builder Abbey to increase pre-tax profits by 45 per cent to €21.2 million in the six months ending in October.
The company completed 379 sales over the period, up from 251 in the same months of 2001. Irish sales accounted for 27 per cent of the total, with the remainder coming from England.
Company chairman Mr Charles Gallagher told shareholders that the forward sales position was sound in both markets but pointed to signs that housing demand would not be "as exuberant" as in recent months.
The likelihood of a price correction is stronger in England than in the Republic, he said, describing the Irish market as "very firm".
If a decline in demand does become apparent this year, Mr Gallagher believes it will not do so before the summer.
The main risk affecting the company's Irish business lies in a rising unemployment level and its damaging influence on confidence, according to Mr Gallagher
Abbey's Irish activities are concentrated in the Dublin commuter belt, which extends as far as Laois.
For the second half, Mr Gallagher is forecasting 150 completions in the Republic, with the annual total rising above 300 next year.
Initial trends for January are positive in England, with demand holding up well, Mr Gallagher said.
He highlighted the low interest-rate environment in both markets as a boost to house building, acknowledging that a further fall in rates would be "very supportive" of Abbey's activities.
Since October, the company has spent €20 million on 273 new plots in both markets in order to maintain its stock of land.
In his chairman's statement, Mr Gallagher warned that rising land prices and a harsher regulatory backdrop, particularly in England, are making the house-building business more capital intensive.
Operating profits for the group rose by 47 per cent in the first half, from €13.9 million to €20.4 million.
More than 90 per cent of this came from housing, with about €1 million generated by Abbey's UK plant-hire business, M&J Engineers.
Group turnover increased by 36 per cent to €88.1 million.
Abbey has declared an interim dividend of 7.5 cents per share.
The stock rose by 10 cent yesterday, up 2 per cent in Dublin yesterday, closing at €4.98.
