ESTATE agency group Countrywide Assured posted a 39 per cent fall in half-year profits because of the impact of the Iraq war.

However, the group said it expected trading to pick up during the rest of the year.

The company, which is based in Witham, Essex, said pre-tax profits for the six months to June 30 came in at £21.9m, slightly ahead of recently revised analysts' forecasts of £20m.

Countrywide, the UK's biggest estate agency group, described the figures as creditable against a sharp reduction in the number of housing transactions in the UK during the Iraq crisis.

But the group added that it appeared many transactions had simply been delayed and that it had entered the second half with a record £63m of commission on sales awaiting exchange.

Countrywide's chairman, Christopher Sporborg, said: "For the rest of the year, we expect activity to pick up despite a possible moderating of average house price increases and look forward to improved profitability."

Countrywide includes the Bairstow Eves and Mann and Co estate agency chains, as well as life assurance and surveying and conveyancing divisions.