HOUSEBUILDING and property group Abbey could experience a £3 million setback in annual profits if there is no improvement in current market trends in the construction industry in Britain. Half year results this week to the end of October last show a 35 per cent decline in interim profit to £3 million.

Executive chairman Charles Gallagher attributes the slippage to "competitive" business conditions and falling house prices in Britain. Group turnover contracted £2.3 million to £22.4 million during the period.

Hard hats were required in the Abbey boardroom in the latter half of its previous full financial year when profit growth first became undermined. Mr Gallagher says that, despite the difficulties in Britain, the Irish property market was "encouraging" and would become increasingly important to the group.

Abbey hopes to cement shareholders' loyalty with an unchanged 2.1p a share interim dividend.