Irish Continental Group, the shipping company, has reported a pretax profit of €1.7 million for the first six months of the year.

This was a marked improvement on the pretax loss of €500,000 recorded in the same period in 2004. Turnover from continuing operations rose to €140 million, compared to €136 million in the same period in 2004.

The company's chairman John McGuckian said the improved results were due to the absence of industrial disruption in the period. He said some cost-reduction measures had also taken effect.

However, he warned about rising fuel costs: "Many of the cost savings have been offset by increases in fuel costs which, for the group, were €3.4 million higher than in the same period in 2004."

The company said the passenger market was weaker, but the freight market was stronger last year. "Given the changing patterns of travel behaviour and the new sustained higher level of oil prices, we are developing proposals to bring our cost base to the levels applying internationally," said Mr McGuckian.

The company said competition from airlines was a significant impediment to growing its Irish Ferries business. Revenue in the period (€72.5 million) only increased slightly from the same period last year (€71.5 million). However, the absence of industrial strife helped operating profits rebound strongly to €2.3 million from €1.8 million in 2004.

According to industry statistics, the tourist car market to Europe declined by about 5 per cent during the half year. ICG said its total passenger numbers were also hit by a fall in foot passenger traffic.

NCB said it was revising its 2005 and 2006 forecasts for ICG downwards by between 5 and 6 cent following the interims.