MORE job cuts could be announced by P&O Ferries next month, it has been revealed.

Announcing a £6.1 million trading loss on the first six months of this year, P&O's chief executive Robert Woods said the results of a review into the company's business were due to be revealed on September 28.

The conclusions of the "ongoing fundamental business review" are expected to focus on achieving a major improvement in the profitability of the business.

Mr Woods blamed a 60 per cent increase in the French tax on cigarettes - resulting in fewer people using the ships to buy duty-paid goods - for the poor results up to June.

Two tax rises in the past year have resulted in a 21 per cent reduction in on-board sales of cigarettes.

But he stressed that P&O had no plans to sell the cross-Channel ferries business, although there had been rumours earlier in the summer that at least one airline had expressed an interest. Those rumours were denied.

Redundancies among P&O Ferries' 6,000 employees look inevitable, and the unions have been warned there will be some job losses.

Overall, P&O announced that the operating profit more than doubled to £113.1 million, there was a strong result for container shipping, and that other business was also up.

Mr Woods said the figures were not only a substantial improvement on 2003, which was a poor year, but also demonstrated the focus being put into the company.

"The ports results are excellent, property sales are on track and I am confident that the ferries review will demonstrate our determination to put that business right," he said.

The ferries business reported a loss of £25.1 million in what is traditionally the weaker first half of the year. This includes the Ferrymasters business and all the other ferry routes around the UK.

Vessel operating costs were reduced by £8.3 million by operating one less ship on the Dover-Calais route since April and by switching to a "lite-nights" service.

Higher fuel costs had reduced these savings however.

From January to June this year, 647,000 cars and coaches were carried on the Dover-Calais route, down from 700,000 in the same period last year, and the number of passengers dropped from 4.3 million to 4.1 million. Freight also decreased from 482,000 units to 479,000.

Mr Woods acknowledged that "significant price competition" had developed during the summer.

SpeedFerries launched a new high-speed catamaran service to Boulogne earlier in the summer, offering fares from £50. The company had the slogan "Fight The Pirates!" painted in red on the side of its craft Speed One.

Other cross-Channel operators responded with various offers of cheaper fares.

In November last year, P&O Ferries announced more than 600 redundancies, the withdrawal of one ship, and conversion of another from multi-purpose to freight.