Midland Realty saw profit surge 75 per cent for the six months to June 30, thanks to increased property transactions in the first quarter. Profit attributable to shareholders was HK$28.47 million compared with HK$16.31 million in the same period last year. Turnover in the first half rose 35 per cent to HK$454 million while operating profit increased 57 per cent to HK$41.3 million. Basic earnings per share were 4.78 HK cents, against 2.75 HK cents a year ago. An interim dividend of 0.5 HK cent per share was recommended. The company reported a HK$6.12 million deficit arising from the revaluation of investment properties. Last year a similar item was HK$5.95 million. Midland expects the effects of falling interest rates and the Government's suspension of sales of subsidised flats could be felt in the fourth quarter, chairman Freddie Wong Kin-yip said yesterday. Mr Wong said terrorist attacks on the United States last week would dampen Hong Kong's property-market confidence and pressure home prices in the short-term. He said home-buying confidence was being affected by job insecurity and the global economic slowdown. He expects home prices to drop 5 per cent for the full year while total transactions would be about 85,000. Meanwhile, Midland would continue expanding in China's property market. Mr Wong said its mainland business contributed about 4 per cent to the group's annual income. The company would explore other revenue sources including referrals of household-related business such as insurance and renovation.