Conduit, the directory services provider, has reported a pre-tax profit of €1.1 million for the first quarter of 2002, compared with a loss of €4.7 million during the same period in 2001.

The Dublin-based firm, which operates the 11850 directory inquiries service in the Republic, also said it had been allocated an access code by the Spanish telecoms regulator and was carefully evaluating whether to launch a service in Spain.

Mr Liam Young, chief executive of Conduit, said the firm had been allocated 11850 - the same code Conduit uses here - for when the market opens to competition sometime around April 2003.

Conduit's results, which beat expectations, were helped by lower administrative and marketing costs, and a 40 per cent increase in call volumes compared with the first quarter of 2001.

Earnings before interest, tax, depreciation and amortisation rose to €2.7 million during the first quarter, compared with a loss of €3.5 million in the first quarter 2001. Earnings per share were 0.05 cent per share compared with losses per share of 0.23 cent last year.

Revenues rose 41 per cent to €15.3 million from €10.8 million. Gross margins increased to 45.6 from 19.2 per cent, ahead of analyst expectations of 43.1 per cent.

"Conduit's gross margin improvement over the last four quarters... is the result of a relentless focus on cost improvement and better efficiencies during the period," said Mr Young.

Conduit shares remained unchanged at €2.75 on the Irish Stock Exchange yesterday.