The recently floated Internet group, Horizon Technology, almost trebled pre-tax profit from £1,078,000 (€1.37 million) to £2,860,000 (€3.63 million) in the six months to December 31st 1999. Chief executive Mr Samir Naji said the group is now in a strong position to fully exploit its position in the rapidly expanding market following the flotation and the raising of £22.6 million in a placing last month. "Based on these developments and given its proven management team, the board is confident of the group's ability to continue to deliver strong growth," he said. The focus, Horizon said, is on the development of Internet services.

This division could account for more than half of revenue by the end of the year. The group's shares were floated at €1.64 in early December 1999 and had reached €4.10 by the end of 1999. They soared to €14 last month when the company took the opportunity to place new shares at €10.10. They closed at €12 yesterday.

The group had the benefit of lower interest payments - down from £542,000 to £233,000 - but also had a restructuring provision of £490,000. If these, and depreciation, were excluded, the operating profits still showed substantial growth. Diluted earnings per share rose from 1.4 cents to 4.1 cents. No interim dividend is being paid. The Internet side of the group's business is the fastest growing. This division showed an 84 per cent increase in sales to £34.2 million while gross profit jumped by 107 per cent to £5.45 million. Margins widened from 14.2 per cent to 15.9 per cent.

This growth is attributed to the strong demand for Internet infrastructure. This, the group said, "seems set to continue in the second half of the year". The division "continues to investigate synergistic acquisitions, which have the potential to add value to the group".

The knowledge services division had a modest 8 per cent increase in sales to £6.7 million and a 12 per cent rise in gross profit to £4.3 million.

The fat margins grew from 61.7 per cent to 64.2 per cent. Revenue growth was restricted by the micro-climate surrounding Y2K, the group said. However, a return to higher growth is now anticipated. "The target market and customer base of this division is increasingly overlapping with that of the Internet infrastructure division," Horizon said.

The distribution and channel services division saw a 28 per cent rise in sales to £51.8 million and a 38 per cent increase in gross profit to £4.6 million. Margins widened from 8.3 per cent to 8.9 per cent.

This division was helped by the strong domestic economy.

However, "the significant market share now held by this division is likely to result in lower growth rates going forward". It operates under two brand names, Clarity and Gericmar. Both are to be integrated under the Clarity name.