ASSOCIATED British Ports showed investment in its ports business was paying off after half-year profits in the division steamed ahead.

AB Ports, which operates 23 ports around the UK including Whitby, said the seven per cent growth in operating profit at its ports and transport division was "particularly encouraging".

Chief executive Bo Lerenius said the boost reflected organisational changes put in place last year, a new management team and years of investment.

"The continued implementation of our growth strategy should ensure that we make good progress over the year as a whole," he said.

Overall, the group said pre-tax profits for the half-year to June 30 were £60.9m against £52.7m last time. Turnover was £193.6m against £164.3m.

The group added its strategy to focus on its core ports business had also seen it sell off non-core assets and over the last three years it had returned £143m to shareholders, out of a planned £150m.

It has also put its Southampton-based Red Funnel ferry and towage business up for sale and today said there had been a "number of expressions of interest" in the business. It will now enter into talks with a limited number of interested parties, AB Ports said.

The comments come four months after AB Ports confirmed it had received an ''informal'' takeover offer for the group, rumoured to be Japanese investment bank Nomura.

AB Ports's finance director Richard Adam yesterday said the group had not had any discussions since that time with any parties.

Commenting on whether the group would consider another offer, Mr Adam said ''We would always have the interests of our shareholders at the forefront of our minds.''

Shareholders in AB Ports will pick up an interim dividend of 5.5p, up from 5p last time