UPDATE 1-Toll Holdings profit from ongoing operations up 24%

(Recasts with profit from continued operations)

SYDNEY, Aug 26 (Reuters) - Toll Holdings Ltd (TOL.AX), Australia's top logistics group, reported a 24 percent rise in profit from continuing operations on Tuesday and flagged strong profit growth in fiscal 2009.

The company reported an overall net loss of A$695 million ($600 million) after writing down the value of its stake in airline Virgin Blue Holdings Ltd (VBA.AX), which has been hit hard by soaring fuel bills.

Toll last month decided to offload its 63 percent stake in Virgin Blue to shareholders as a special dividend and flagged a charge of A$1.3 billion to reflect the lower value of the stake.

It said its profit after tax from continued operations totalled A$258 million.

"Results to date for the June 2009 financial year have remained solid and tracking well ahead of last year," the company said in a statement.

"Based on current trading conditions, the outlook for the full year is for strong earnings and cashflow generation to continue across the business," it said.

Toll faces a challenging environment with the economy slowing down amid high borrowing costs and soaring fuel prices. The company gets about 50 percent of its revenue by from retail and consumer goods companies which are sensitive to economic growth.

Toll said high fuel costs were a challenge, but did not expect the domestic economy to deteriorate markedly. Toll, which earns about 7 percent of its revenue from Asia, said the major economies in the region remained strong.

It also gets about 13 percent of its business from Australia's mining industry, which is enjoying boom driven by surging demand for raw materials from the fast-growing economies of China and India.

Toll shares were down 0.6 percent at A$7.01, slightly less than the 1.0 percent drop in the benchmark S&P/ASX 200 index .AXJO by early afternoon trading. ($1=A$1.16) (Reporting by Denny Thomas; Editing by James Thornhill)