Abbey, the house building group, continues to record strong growth but warns that margins from its British operations may be weaker in the second half. Nevertheless, profit growth is anticipated for the full year, though at a slower rate than previously.

Pre-tax profit rose by 31 per cent from £7.56 million (9.6 million) to £9.91 million (12.58 million) in the six months to October 31st, 1998. Sales grew from £39.8 million (50.5 million) to £44.7 million (56.8 million). Its house building division completed 344 sales; 217 in Britain and 127 in Ireland. While the British housing market started on a good note, it "gradually weakened through autumn" said chairman, Mr Charles Gallagher. "In this environment, margins may come under pressure in the second half".

He told The Irish Times the British market was very dull in the last three months of 1998. However, there was a bit of a move this year. The drop in British interest rates could result in a "rebound".

The Irish market continued in a robust fashion, "with strong volumes and good prices being achieved on all our developments", said Mr Gallagher. Around 300 houses are expected to be sold in the full year, the same number as the previous year, but the houses are bigger and will generate larger income. Abbey had more than 1,000 plots available for its Irish operations. It could build around 350 houses in 2000, he said. Abbey's British plant hire business, operated by M&J Engineers, continues to make "further progress". Operating profits grew from £850,000 (1.08 million) to £1.06 million (1.35 million) on a "significantly higher turnover of £8.65 million (10.98 million)". The group's rental income rose from £330,000 (419,000) to £440,000 (558,685). Earnings per share increased from 13.08p (16.61 cents) to 17.56p (22.30 cents). Reflecting the growth, the interim dividend is being increased by 16.67 per cent to 3.5p (4.4 cents) per share.