Higher interest rates and a strong dollar kept Arcon in the red for the first half of the year despite an improvement in operating profits. The resources company, which owns the Galmoy lead and zinc mine in Co Kilkenny, said that zinc prices were higher than expected in the six months to the end of June and this compensated for lost production due to scheduled maintenance and a plant break down.

"We were in production for only four out of the six months," said the chief executive Mr Tony O'Reilly yesterday. The plant processed 272,000 tonnes of ore, compared to a target in excess of 300,000 and shipped 51,000 tonnes of concentrate, he said.

Turnover - sales less smelting costs - was £10.6 million compared to £9.6 million last year. Operating profits were $495.000 (#523,000) compared to break even last year. The strength of the dollar has pushed up both the size and cost of servicing the company's debt in Irish pound terms and this, combined with higher interest rates, had a negative impact on the figures.