THE economic slowdown has failed to hurt paint and chemicals giant ICI as much as City analysts had feared.

The company, which employs more than 1,000 people on Teesside, turned in pre-tax profits of £210m for the six months to June 30, six per cent down on the same time last year. Turnover was £3.3bn.

But ICI bosses hailed the figures as a "robust performance" in the face of tough economic conditions, particularly in the US.

There were mixed performances from two of the chemical giant's business on Teesside.

Catalysts business Synetix, which has its global headquarters at Billingham, employing 400 staff, saw sales increase by 12 per cent.

The company makes catalysts for use in a range of products, such as chocolate and ink.

But Uniqema, which makes products that go into a range of items including paint and lipstick, saw sales fall.

Between them, the two businesses, part of the performance specialities business, saw half- year trading profits rise to £39m, from £38m at the same time last year.

ICI chairman, Charles Miller Smith, said: "Our businesses performed relatively well in the second quarter, in spite of the difficult conditions in the US."

He predicted the group would continue to outperform the rest of the industry during the remainder of the year.

ICI said the economic slowdown had been most keenly felt in North America, where sales fell by two per cent.

But that dip was countered by sales growth of one per cent in Europe and four per cent in Asia.

Last year, the group completed a massive three-year transformation programme, repositioning itself from a high-volume bulk chemicals business to a speciality products and paints business.

That left the company with 7,000 UK staff out of a total workforce of 40,000.

As well as sites on Teesside, its UK operations include sites at Slough, High Wycombe and Ashford in Kent.

ICI's paints operation in Europe posted a return to sales growth, helping profits for the second quarter to lift one per cent and match last year's return.

However, the economic downturn hit ICI's starch business, with profits down 21 per cent on a year earlier.

About 400 US staff - equivalent to four per cent of the division's workforce - are due to lose their jobs.

ICI's Quest fragrances business delivered another strong performance, with sales up by six per cent over the half-year.

Mr Miller Smith said: "In a very tough external environment ICI improved sales and cash flow, and profits were slightly lower, but in line with expectations."