THE Campbell Bewley Group has reported a substantial improvement last year, recording profits of £1.65 million against losses of £800,000 in 1994.

Figures for last year show the group's sales rose to £57.329 million, from £52.9 million in 1994. Operating profits moved sharply ahead to £1.64 million over the year from £180,000.

Campbell Bewley's chairman and chief executive, Mr Patrick Campbell, said yesterday the group had benefited from the many "difficult" management decisions in the previous year. Trading so far this year was well ahead of 1995, indicating a positive outcome for the group in 1996.

He said a positive cash flow last year had allowed the hotel and catering group to retain £2.9 million for reinvestment in the business.

Much of this money has been spent on opening new cafes in Ireland and Britain, and to make improvements at its Dublin cafes, according to Mr Campbell.

He said the group's first hotel, which opened at Westmoreland Street in Dublin last August, had shown "very positive" results.

Last year's long, hot summer affected its cafe's but a sharp improvement in business over the winter ensured heavy trading over the year.

The contract catering business had won a number of new contracts in 1995, while sales of tea and coffee made a significant contribution to the improved results.

Its presence in the North has been dramatically reduced with the ending of franchises in Derry, Portadown and Belfast.

In recent months it has also ended a franchise agreement for a cafe in Dundalk, Co Louth. Mr Campbell said this was for "commercial reasons". The group currently operates 25 franchises.

It now intends to focus on expanding internationally, concentrating on British and European markets, he said.

In anticipation of another hot summer, he says the group is to introduce air conditioning to its cafe's, to improve the "ambience" for customers.

A new Bewley's ice cream will be launched next month.