A new growth strategy of focusing on expansion of the Homebase DIY franchise in Ireland, in association with Sainbury's, is beginning to be reflected in the financial results at the Hampden Group.

First-half profits before exceptional items increased by 10 per cent to £804,000 sterling (€1.26 million) in the six months to July 3rd on turnover up 3 per cent at £22.1 million sterling (€34.7 million), despite difficult trading conditions in Northern Ireland where Homebase sales fell 2 per cent.

In the Republic, sales at the three Texas Homecare outlets in Dublin (now rebranded as Homebase stores) surged by as much as 21 per cent to £6.6 million following a review of marketing strategy and repositioning of the product offer.

Sales, excluding kitchens, at the Naas Road, Nutgrove and Omni Park outlets have continued to grow strongly in the second half, increasing by 18 per cent since June.

Results are also improving at the Reid Furniture (Ireland) business, in which Hampden has a 50 per cent interest. Sales at the joint venture operation rose 59 per cent to £3.2 million, leading to a turnaround from previous interim losses of £484,000 to profits of £712,000.

The group's improved interim figures were achieved despite further declines in kitchen sales at the DIY stores. Remaining instore kitchen units are to be closed involving exceptional costs of up to £500,000, which will be included in the full-year results.

Attention will centre now on delivering the board's new strategy of expanding the Homebase franchise in Ireland. Working closely with Sainsbury's as franchiser, chairman Mr Stratton Mills says the group is looking to develop "a new large store format to exploit new and larger market opportunities within Northern Ireland and the Republic of Ireland".

Last week, the group disclosed plans for a £2.6 million 95,000 sq ft Homebase store with a 25,000 sq ft garden centre in the Blanchardstown Retail Park, Dublin, subject to planning permission.

Details of the new Dublin outlet follow recent announcements of three new stores in Northern Ireland, also subject to planning permission.

In greater Belfast, a new 100,000 sq ft store with a 25,000 sq ft garden centre costing £2.6 million is planned for the new retail park at Sprucefield, Lisburn, Co Antrim, together with another £2.6 million new store with similar selling pace sales at Newtownabbey, Co Antrim.

In Derry, plans have been announced for a 55,000 sq ft store with a 15,000 sq ft garden centre in the new retail park. The group has been granted an option on additional 15,000 sq ft extension. If the option is exercised, the new store is expected to cost around £2 million.

On the first-half results, the interim dividend is unchanged at 0.6p sterling per share.