NORTH-East housebuilder Bellway last night set its sights on a profits milestone after increasing its order book by more than 25 per cent.

The Newcastle group said it was on track to deliver its 13th year of sales growth after pre-tax profits grew 35.6 per cent to £77.4m in the six months to January 31, thanks to rising prices in the housing market.

Optimism was fuelled by orders of £631m, while the group expects to take the number of homes it has completed past the 100,000 mark this year.

With 98 per cent of annual sales secured six months early, Bellway said it was lifting the half-year dividend by 50 per cent to 9.3p to reflect its excellent trading performance.

The company said it expected to increase the total dividend by about 20 per cent in the absence of unforeseen circumstances.

Chairman Howard Dawe said: "Despite the recent increases in interest rates, we continue to enjoy buoyant market conditions and have reserved 1,000 more homes than at the same time last year."

Bellway focuses on affordable middle market properties across the North-East and most of the UK.

Its operations in Scotland will begin trading as two separate divisions in August. Its North Thames Gateway operation has bought its first site and will contribute to the group's performance next year.

Bellway sold 2,728 homes during the six months at an average price of £156,900 - an increase of 10.4 per cent and 8.6 per cent respectively on the same period last year. Turnover grew 20.5 per cent to £436.5m and the company increased its bank of land with planning permission from 17,800 to 19,600 plots.

The company was confident of meeting its target of selling 10,000 homes a year by 2010.