UPDATE 1-PZ Cussons buys Covent Garden Sanctuary

(Adds deputy chairman and Sanctuary comments)

By Mike Elliott

LONDON, Jan 29 (Reuters) - British soap and home products maker PZ Cussons Plc (PZC.L) said it had acquired the Sanctuary Spa in London's Covent Garden as it unveiled an 8 percent rise in first-half profits on Tuesday.

PZ Cussons, the maker of Imperial Leather and Carex soaps, said pretax profit was 32.5 million pounds ($64.4 million) in the six months to Nov. 30, up from 30.2 million a year ago, on revenues up 7 percent at 299.5 million pounds.

"We have had a good half year and we've indications that that should continue in the markets that we operate," Deputy Chairman Graham Calder said in a telephone interview.

PZ Cussons, which started life as a West African trading post in 1879, now earns about a third of its money in Nigeria where it sells everything from powdered milk and washing powder to fridge freezers and televisions.

Alongside its first-half results, the company said it paid 75 million pounds to acquire The Sanctuary, the spa and beauty products business, from private equity firm HgCapital.

"Sanctuary is a very strong brand and has managed extremely well in recent years. The fit for the UK business is excellent," Calder added.

The women-only Sanctuary Spa attracts around 64,000 visitors a year, while the premium range of beauty and body-care products sold under the Sanctuary brand represent around 70 percent of revenue, which in the year to Aug. 31 was 26.3 million pounds.

The Sanctuary business saw strong trading in the run-up to Christmas, its key trading period, with retail sales rising by 11 percent in the period Sept. 1 to Dec. 31.

"Despite more challenging consumer trading conditions, we had another successful Christmas," Alice Avis, chief executive of The Sanctuary Spa, said in a statement.

"PZ Cussons has an excellent reputation in the industry and we look forward to working with them to develop The Sanctuary Spa further, both in the UK and internationally," she added.

Shares in PZ Cussons, which have outperformed the personal goods sector .FTASX3760 by around 38 percent in the past 12 months, were untraded in early business having closed at 192.75 pence on Monday, valuing the company around 734 million pounds.

PZ Cussons said the outlook for the year remained positive despite rising raw material costs and the weak dollar.

According to Reuters Estimates, the company is expected to report full-year pretax profit of around 75.5 million pounds, up from 68.3 million the previous year.

"We're around there," Calder said when asked whether he was comfortable with the forecasts for the full-year.

The company proposed an interim dividend of 1.075 pence a share, up 7.5 percent from the same period last year. (Editing by Quentin Bryar)