"EXCEPTIONALLY wet weather" has been blamed by Baggeridge Brick for a sharp fall in half-yearly profits, the first in five years.

The firm saw pre-tax profits up to March 31 tumble by more than a third, from £2.3 million to £1.5 million, as wet weather hit housing developments. Earnings per share also fell by 36 per cent, from 4.13 pence to 2.64 pence.

Turnover at the Sedgley-based company, which has factories at Hartlebury and Waresley, declined from 12 per cent to £19.2 million.

As a result of the slump in building activity, housing completions in 2000 were at their lowest for any calendar year since 1921, apart from the Second World War years.

However, while the building materials division fared badly, the landsource division, which rents out air space, had a very successful half-year, improving its operating profits from £300,000 to £600,000.

Chairman Peter Ward said: "As predicted in December's statement, the exceptionally wet weather over the autumn and winter period affected construction activity and this has had an adverse effect on our results for the half year ended March 31 2001.

"Activity levels since the end of March, while still clearly affected by the weather, have shown signs of recovery.

"For the year as a whole, construction industry forecasts are for a similar level of activity to last year and this would indicate a strong recovery in the construction sector during the remainder of the year."

And he said the company would benefit from a number of capital projects and initiatives, including a new brick cladding system, and from a combination of lower interest rates and Labour's commitment to higher investment.

In his interim statement Mr Ward announced he was to retire as chairman of the company his family founded, after 48 years on the board.

Mr Ward, 74, will hand the reins to his son Alex, 40, at the end of the year, although he will retain his financial interest in the firm through his family's 22.5 per cent share holding.