United Drug, the pharmaceutical distribution company, has announced a 35 per cent increase in first-half pre-tax profits to £4.4 million driven by strong sales and profit growth in its wholesale division.

The figures were also enhanced by a five-month contribution to operating profits from Dublin Drug, acquired in November 1997, while a reduced tax charge allowed after tax profits to advance by 49 per cent to £3.17 million.

Chairman Mr Martin Rafferty said he was confident United Drug would have another successful year. "We have made a good start to the second half of 1998 and trading is continuing the pattern of the first six months," he said.

Earnings per share grew by 25 per cent to 12.85 pence in the six months to end-March. The company has increased its interim dividend by 10 per cent to 3.3 pence per share. The share price did not trade yesterday, holding at 560p.

Turnover rose by 40 per cent to £201 million as the company benefitted from a buoyant economic environment, an improvement in its market share and a £19.8 million sales contribution from Dublin Drug. Overall operating margins remained broadly unchanged at around 2.5 per cent.

Chief executive Mr Jerry Liston said the integration of Dublin Drug was going very well and United Drug had retained more than 90 per cent of Dublin Drug's business. He also said there would be just 15 full-time redundancies in the group from the acquisition.

The company has no borrowings and could spend up to £30 million on an acquisition if it wanted to, Mr Liston said.