Dublin-headquarted travel software group Datalex has announced an interim profit of $1 million (€807,000) for the first six months of the year despite slightly lower sales.

The Dublin-listed company returned to the black in the second half of 2004 after posting a loss of $500,000 in the first half of last year.

The company attributed the improved performance largely to a reduction in operating costs to $5 million from $6.4 million in the first half of last year. The gross margin also improved to 39.4 per cent from 37.2 per cent in the year ago period.

Datalex's e-business unit contributed the bulk of revenues with $11.5 million, although this was down on the $11.7 million recorded a year earlier despite what the group described as "some notable contract successes".

Revenues from the new contracts are based on a percentage of transactions put through Datalex's system by customers so they have not yet contributed to the accounts.

Consulting revenues at the firm continued to shrink and fell to $2.9 million from $3.8 million a year ago.

Datalex chief executive Cormac Whelan also announced that Datalex "have successfully and amicably settled our dispute with Worldspan". Worldspan claimed Datalex had not met its performance obligations. The companies went to arbitration to settle the dispute over billings worth $1.6 million to Datalex.

This was the first set of results from Datalex using the new International Financial Reporting Standards (IFRS). Under IFRS guidelines the group's net worth grew to $39.7 million from $38.7 million at the end of 2004.

Datalex customers include Aer Lingus, American Express, Best Western International, Emirates, KLM and United Airlines.