LSL PROPERTY Services, the York-based estate agency and surveying business, has increased its dividend to shareholders by 12 per cent – despite recording a dip in profits.

The group invested £2.6 million in management and a call centre to increase market share in its estate agency division.

This put underlying profit at £11.8 million for the six months ended June 30, down from £13.4 million in the first half of 2010.

Pre-tax profit decreased from £19.7 million in the first half of 2010 to £6.5 million, because of an exceptional gain of £13.4 million in 2010 related to the acquisition of Halifax Estate Agencies.

The group increased revenue by two per cent to £103.4 million, with an 11 per cent increase from its estate agency division offsetting a nine per cent decrease in surveying.

Roger Matthews, chairman, said market conditions remained “extremely challenging”, with volumes at less than 50 per cent of historic norms. He said the business retained a cautious view of the market for 2011, given the continued shortage of available mortgage finance and the general economic uncertainty.

But even without recovery in market transaction volumes, he said the group was well positioned to increase shareholder value through organic growth initiatives and acquisitions.

The business declared an interim dividend payable of 2.8 pence per share.