CEMENT giant Blue Circle said it was looking forward to working with its new parent, French building materials group Lafarge, as it reported a 20 per cent jump in profits for the full year.

Blue Circle, which has a plant at Eastgate in Weardale, was finally snapped up by Lafarge in January after a year-long pursuit.

Lafarge agreed to pay 495p a share in a deal to create the world's largest cement producer.

It first launched a bid to snare Blue Circle in February 2000, offering 420p-a-share.

Blue Circle chief executive Rick Haythornthwaite said the group registered pre-tax profits of £325.4m in the year to December 31, before exceptionals, an increase of 20 per cent on the year before.

He said the performance "underlined the strength" Blue Circle would bring to the new group.

"The group is looking forward to working with Lafarge. There is now a recognition that a lot is possible as the world's number one."

Mr Haythornthwaite will take on a non-executive post when Blue Circle becomes part of the Lafarge empire.

He said he expected the £3.1bn deal would be cleared by the regulatory authorities by the summer at the latest.

Blue Circle saw strong growth in the UK last year, with operating profit before one-off costs rising to £106m from £84.8m the year before.

The group's Asian business was boosted by a 25 per cent increase in demand for cement in Malaysia which helped Malayan Cement turn in an operating profit of £28.7m, compared with £1.7m in 1999.

Cement volumes and prices were slightly down in North America, and Mr Haythornthwaite said there was no doubt the market in the US was growing at a slower rate than last year.

He said, however, the impact of the slowdown would be offset by the benefits of a highway programme put in place by the Clinton administration to improve the state of America's highways and bridges.

Blue Circle had already secured a number of orders related to this programme.

Overall group turnover rose to £2.3bn, compared with £2.2bn in 1999.

Mr Haythornthwaite said Blue Circle's Operational Improvement Programme was still on course to save the group £116m in its first three years.

The programme was announced at the end of 1999 and then became part of Blue Circle's defence from Lafarge last year.

This defence contributed £35.7m to the group's £79.5m exceptional costs in 2000.

After exceptional items, Blue Circle recorded a pre-tax profit of £245.9m, up from £194.6m the year before