Waterford Wedgwood, the crystal, earthenware and fine bone china group, has recorded a 17.5 per cent rise in pre-tax profit to €13.4 million (£10.6 million) from €11.4 million in the six months to the end of June 1999.

The impetus to growth has again come from Waterford Crystal. There was a static performance from Wedgwood, the British earthenware and china subsidiary, and from Rosenthal, the German porcelain manufacturer.

The group "continued its track record of sustained profitable growth during the first six months of 1999", said chairman, Dr Tony O'Reilly. Noting the group had shown substantial growth despite some difficult conditions in several of its world markets, he said this "demonstrates solid progress on our strategic path towards becoming one of the world's foremost luxury lifestyle brands".

Group sales grew by just 5.5 per cent from €324.7 million to €342.6 million (£270 million) in the first half.

A breakdown shows a 21.9 per cent improvement in crystal sales to €145.8 million from €119.6 million, but Wedgwood had a marginal decline to €123.4 million from €128.6 million as did Rosenthal, to €73.4 million from €76.5 million.

Waterford Wedgwood no longer gave a profit breakdown of the different companies because it was now a "very different company" and "more integrated", said Mr Redmond O'Donoghue, chief executive of Waterford Crystal.

Reflecting real growth, earnings per share (before goodwill) grew by 13.8 per cent to 1.73 cents from 1.52 cents. The operating profit margin improved from 5.48 per cent to 6.22 per cent. Shareholders will benefit with a 12.5 per cent rise in the interim dividend to 0.5714 cents from 0.5079 cents.

Operating profit rose by 19.7 per cent to €21.3 million from €17.8 million, reflecting good underlying growth.

Interest costs, however, rose to €7.4 million from €6 million, due to the cash outflow from the Rosenthal acquisition, restructuring and capital expenditure. These reduced the growth at the pre-tax level. The North American market now accounts for 40 per cent of group sales.

Waterford increased its sales by 26 per cent in the US and now has more than 50 per cent of the US premier crystal market. Wedgwood's sales in the US recorded double digit growth, up by 11 per cent, said Dr O'Reilly.

The group appointed Sarah Ferguson, Duchess of York, as Wedgwood's official ambassador in the US. The fee is understood to have been about £500,000.

"As her programme of events begins in Fall 1999, we expect further growth arising from this exciting alliance," said Dr O'Reilly.

Rosenthal's sales rose by 5 per cent in the US. There was no contribution from All-Clad, the US cookware group, which was acquired at the end of the first six months.

Wedgwood's sales in Britain and Ireland were described as "steady". Product lines such as Sarah's Garden, Variations and Weekday Weekend "enjoyed steady sales increases". Waterford Crystal's sales grew by 18 per cent in Britain and Ireland.

The John Rocha range has continued to grow strongly and is generating annual sales of £6 million.

The performance in mainland Europe, particularly Rosenthal in Germany, "reflected difficult market conditions there". Nevertheless several product introductions were said to be successful. The Bulgari collection from Rosenthal was singled out as a "fantastic success", notching up sales of €2.6 million in three months.

In Australasia, group sales fell by 3.6 per cent.