Compaq Computer last night reported a 55 per cent increase in fourth-quarter profit, less than had been expected before the foremost personal computer maker warned last month that weakening consumer demand in the US was hitting sales growth.

The firm, which employs up to 2,200 people in Belfast, Dublin and Galway, reported fourth-quarter net profit of $515 million (€550 million), or 30 US cents per share, excluding a charge.

Including the $1.8 billion charge for the write-off of investments, Compaq reported a net loss of $672 million, or 39 cents per share.

A year ago, Compaq earned $332 million, or 19 US cents per share, a year earlier on turnover of $11.5 billion compared with $10.48 billion in 1999. The latest figure beat the lowered analysts' consensus estimate of 28 US cents.

Analysts had lowered their expectations from 36 US cents per share after Compaq said in December that demand in the US consumer, small and medium-sized business and dot.com markets dropped off in the course of the quarter.

Sales in Europe in the fourth quarter were up 3 per cent against 10 per cent in the US and 26 per cent in the Asia Pacific region.

The firm said it was comfortable with forecasts of growth this year of 20-25 per cent.