(Corrects date in sixth paragraph)
* H1 pretax profit 6.9 million sterling vs 10.1 million
* Order book 25 percent up to 2.5 bln sterling
* Shares 0.7 percent down by 0730 GMT
(Adds company comment, shares, details)
By Rhys Jones
LONDON, Aug 26 (Reuters) - British construction company Costain Group Plc said its first-half profit fell a third but its order book had grown 25 percent over the last year, adding support to growing confidence in the sector.
Costain, which works across the transport, retail, education, oil and gas industries, posted a pretax profit of 6.9 million pounds ($11.3 million) on revenue 8 percent higher at 508.2 million pounds for the six months to the end of June.
"We're focusing on areas such as waste, energy, nuclear power and water, which we see a priority spend for the nation, and we currently have more opportunities than we have resources to tender," Finance Director Tony Bickerstaff told Reuters.
"We're comfortable with this year and are in a better position for 2010 than we were 12 months ago."
Costain is expected to report a pretax profit of 18 million pounds on average for 2009 and 19 million for 2010, according to a Reuters Estimates poll of four analysts.
Costain's shares, which have gained 73 percent since the start of the year after slumping to an all-time low in 2008, were 0.7 percent down at 34 pence by 0730 GMT, valuing the group at around 220 million pounds. The stock on Tuesday hit its highest since September 2007.
The group, which has recently won contracts with the Sellafield nuclear power plant and London's Crossrail transport project, said its order book increased in value by a quarter during the year to stand at 2.5 billion pounds at the year-end, thanks to its retention of many existing customers.
Costain, which increased its dividend by 10 percent to 0.275 pence a share, said it had already secured 690 million pounds of its expected 2010 revenue, supporting signs of recovery emerging in the UK economy.
Earlier this week British housebuilders Persimmon and Bovis Homes said sales rates had improved in recent months, confirming signs of stabilisation in the UK house building market.
Irish building materials group Kingspan said on Tuesday demand for its products had steadied. (Editing by Mark Potter and David Holmes) ($1=.6103 Pound)