BKI Investment Company Ltd (the old Brickworks Investment Co) yesterday revealed a 5.2% lift thanks to higher dividends from its half a billion or so dollars of listed investments.

The listed investment company said it increased its interim net profit to $16.42 million for the six months to December 31, 2011, thanks to a 12.4% rise in ordinary dividend income to $14.3 million.

Operating income jumped 10.5% to $14.1 million.

Chief executive Tom Millner attributed the result to the company's focus on investing in stocks with yield and value characteristics, and a fully-franked special dividend of 15c per share from New Hope Corporation.

BKI's shareholders will pocket an interim fully-franked dividend of 3.2c per share, up 6.7% from on a year earlier.

BKI's $528 million investment portfolio made a net return of negative 2.3% for the 12 months to December 31, 2011, outperforming the S&P/ASX 300 Accumulation Index by 8.7%.

Despite mixed global economic data, BKI says the Australian market will continue to track sideways until there is clarity on how Europe will manage its sovereign debt crisis.

BKI spent around $16 million to buy shares in Westpac, National Australia Bank, Telstra, Commonwealth Bank, Wesfarmers, Fleetwood Corporation and QUBE Logistics during the first half.

It sold holdings in BlueScope Steel, Echo Entertainment, Suncorp Metway Preference Shares and Westpac Preference Shares.

The company's top stockholding is $81 million worth of shares in associated company New Hope Corporation and Mr Millner said the company liked the growth prospects of the local mining and mining services sector.

New Hope is examining possible takeover offers from a number of coal industry groups. New Hope is controlled by Washington H Soul Pattinson, which controls Brickworks, which in turn controls BKI.

Mr Millner said in yesterday's statement: "We continue to like the growth prospects of the Australian mining and mining services sector with our exposure through New Hope Corporation, BHP Billiton, Woodside Petroleum, Campbell Brothers, Fleetwood Corporation and UGL Limited.

"We do remain cautious however of companies exposed to retail, media and manufacturing."

BKI's shares rose 1.5c to $1.20 in a market that was off 15 points.

Copyright Australasian Investment Review.
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