Marks & Spencer is primed for a fresh attack on the Irish market, with the addition of 10 new stores in the next three years to provide a significant boost to annual sales of more than €500 million.

As the iconic British retailer reported its highest interim profits in nine years and a 31 per cent dividend increase, the chain's Ireland executive Neil Hyslop said they aimed in the period to 2009 to repeat the increase in floorspace that brought the number of outlets here to 13 from four only three years ago.

"Every month for the last three years, we've created 25 new jobs in the Republic. I'd see another 10 or so stores in the next three years. The increase in square footage in the next three years will be comparable to the last three years. That's more of the measure than the 10 stores," he said.

M&S declared its medium-term expansion plan for Ireland, where it has spent more than €100 million since 2003, as it prepares for further investments in Russia and India. The chain is also investing up to £800 million (€1.19 billion) to increase its total owned space in the UK by 15-20 per cent in the next five years, a higher expenditure than previously indicated.

Now in the final stretch of a recovery programme engineered by chief executive Stuart Rose, M&S is driving profitable revenues. While Mr Rose said that while competition "remained intense", total sales in the six months to September rose by 11 per cent to £3.93 billion, while operating profit on continuing operations rose by 23 per cent to £448.8 million.

M&S does not provide separate figures for its Irish business. However, the division delivered strong sales growth "reflecting good underlying like-for-like performance, the opening of new stores in Drogheda and Newbridge, and the full-year benefit of stores opened in the previous year".

Mr Hyslop said the growth of food sales on like-for-like basis was "performing ahead of the UK", where sales rose 5.3 per cent. "I think we've had a good strong performance in terms of homeware and kids wear in terms of like-for-like," he said.

Sales in the Irish coffee shop business were up 40 per cent in the first half, while sales of Irish-supplied product grew by more than 40 per cent. Mr Hyslop said prices in the Irish business were set at a uniform currency conversion rate with sterling, a factor that prompted a "challenge" on its profit margin when combined with higher trading costs here. Staff costs and costs such as insurance and power were dearer in Ireland, he said.

The chain will open a new store in Tallaght soon, while the refurbishment of the Liffey Valley store in west Dublin will start in January. The refurbishment of its landmark store at Grafton Street in Dublin will also start in January.

In spite of its international ambitions, Mr Rose tried to downplay the significance of the group's activities outside Britain saying that the company was not "about to turn left" and that any increase in its footprint abroad was only a part of its broader growth strategy.

This has involved new products and services such as electrical goods as well as hot takeaway food and "eat-over" deli cafe formats. The interim results yesterday saw Mr Rose delivering growth, but he remained coy about calling a recovery until after Christmas. - (Additional reporting Financial Times service)