UPDATE 1-Toll Holdings H1 tops estimates, boosts shares

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SYDNEY, Feb 21 (Reuters) - Australian transport group Toll Holdings Ltd (TOL.AX: Quote, Profile, Research, Stock Buzz) beat expectations with a 10 percent profit rise on Thursday on strength in its domestic transport business, and forecast strong growth, lifting its shares as much as 8 percent.

Toll, which spun off its infrastructure and ports assets last year, also said it expected to complete a review of its 63 percent stake in airline Virgin Blue Holdings Ltd (VBA.AX: Quote, Profile, Research, Stock Buzz) in the next few weeks.

The transport and logistics firm plans to reduce its investment in Virgin Blue, which it acquired with the takeover of rival Patrick, and said it had received a number of expressions of interest.

Toll, which has pushed strongly into Asia in recent years, reported a net profit of A$237 million ($217 million) for the six months ended December, from A$215 million a year earlier.

This was about four percent above an average forecast of A$228 million in a Reuters poll.

Shares in Toll jumped as much as 8.4 percent to A$10.18, although the stock is still down about 11 percent so far this year, slightly ahead of a 12 percent decline in the overall market. The shares stood 6.4 percent higher at A$9.99 at 0249 GMT.

Chief Executive Paul Little said that despite uncertainties on the global growth outlook, the company did not expect a significant downturn in its major markets.

"Across the core transport and logistics businesses, the outlook for the June 2008 year and beyond remains positive, and the company expects ongoing strong earnings and cashflow growth," he said in a statement.