Profits at Kerry airport topped €500,000 last year, the company said yesterday.

However, chairman Denis Cregan warned that the company was facing the loss of a Government grant this year and would have to tighten costs.

Kerry Airport plc, which operates the facility at Farranfore, said that revenues grew 6 per cent to €7 million in the 12 months ended October 31st, 2006. Profits before tax increased by 4 per cent to €515,680. Passenger numbers grew by 2 per cent to 392,960.

During the year the company spent €804,546 on new car parking/traffic management facilities, navigation aids and fire-service equipment.

Commenting on the results, Mr Cregan said that 2006 had been a year of solid if unspectacular growth.

"Our cost base continues to expand at rates equal to, or greater than, our revenue growth, which is unsustainable and will require action," Mr Cregan said. "The loss of a Department of Transport revenue grant for 2007 will have an impact on financial performance for the coming year.

"On a positive note, we were successful in our application for funding under the Transport 21 programme, securing €17.7 million in funding towards the future development of our facilities. We are currently putting together the processes and structures to enable us to progress with the detailed design of this development, the plans for which are currently at an early design stage."