Havelock Europa, the Fife-based shopfitting-to-school-furniture group, said trade was bearing up despite tough times for the key retail and banking sectors.

Havelock Europa, the Fife-based shopfitting-to-school-furniture group, said trade was bearing up despite tough times for the key retail and banking sectors.

Unveiling a 1% increase in underlying first-half profits to £1.2m, Havelock said that the retail and educational businesses both had solid order books and the company expected to make good progress during the year.

Based in Dalgety Bay, Havelock said the retail interiors division had a "solid" first half. Revenues increased by 1%, to £22m, in the six months to June compared with the same period last year, when retailers were enjoying the tail-end of the consumer spending boom.

Orders increased 36% by value on the first half last year. Hew Balfour, chief executive, said Havelock had benefited from a focus on well-capitalised retailers, including Marks & Spencer and Boots, that had demonstrated they would invest through downturns.

The largest customer this year will be the House of Fraser department store chain. First-half takings were boosted by work on the refurbishment of the Fraser's store in Glasgow and new outlets in Belfast and High Wycombe.

The company signed new framework agreements with banks Lloyds TSB and HBOS. Business is holding up for the accommodation division.

The point-of-sale operation, which produces marketing material, grew revenues 20% to £12m, driven by new customers. Balfour said Havelock had benefited from the fact a number of rivals had failed.

The company expects the division to benefit from efforts by retailers to increase marketing spend in some areas to help them weather tough conditions. This is what happened in 1990-92.

However, it decided to offload the small Showcard Display arm to free-up resources, generating £300,000 cash.

The company's educational interiors business has benefited from continued heavy investment in schools by the government. Sales increased 9% to £20m, helped by the acquisition of the Stage Systems business last February.

Havelock is working on 21 Private Finance Initiative-funded programmes in Scotland and another 28 under the Building Schools For The Futures policy south of the border.

Total turnover was £53.4m, up from £50m. Pre-tax profit rose 10% to £968,000. The board proposed an interim dividend of 1.2p, up from 1.2p last time.