Increased operating costs cut pre-tax profits at utility NTR by just over 16 per cent in the six months to June 30th, the company said yesterday.

Group turnover in the first half of the year rose by almost 60 per cent to €96.2 million from €60.5 million during the same period in 2002.

But the figures show that operating costs increased by 72 per cent from €51 million last year to €86.35 million in 2003. Pre-tax profits slipped 16 per cent to €7.67 million from €9.15 million in 2002.

Chief executive, Mr Jim Barry, said the growing level of development costs carried by the company was largely responsible for the increased growth in costs during the period.

NTR was in the middle of the planning, bidding or construction stages of a number of projects, during the period, he noted. "We're carrying a level of overheads for that, and we're not getting any revenue for it at this stage," he said. "We're also carrying overheads for higher levels of business than last year."

The group's operating profits rose slightly from €9.6 million to €9.8 million. Last year's results included a one-off gain of €899,000 from the sale of land, and also benefitted from €1.1 million in interest income, almost twice the comparable 2003 figure of €605,000.

NTR's basic earnings per share were down 9.7 per cent to 28.6 cent from 31.9 cent. The board declared a dividend of 9.92 cent per share, up 10 per cent on last year's payout of 9.02 cent.

The group has a presence in toll roads, telecoms, waste recovery and wind-generated electricity through shareholdings in a number of operations. NTR operates the east link and west link toll roads in Dublin. These contributed €12.5 million to the public purse through licence fees, profit contributions and other charges during the period.

It has a 51 per cent stake in Airtricity, which signed a conract with GE in May for the construction a 25 megawatt facility on the Arklow Bank in the Irish Sea.

The company also raised €28 million in equity, with NTR taking its 51 per cent entitlement.

Greenstar, the waste management specialist in which NTR has an 88.45 per cent stake, received licences for a landfill in Co Meath and a recycling facility in Cork.

NTR is also part of the Celtic Route consortium, along with Ascon and Spanish engineering group, Dragados. The consortium is one of two final bidders for the contract to build and operate the next stage of the M1 Dublin-Belfast motorway.

The other bidder is Irish-French partnership, SIAC-Feruvial.