The Oroton Group has defied the odds and posted a 20 per cent growth in first half profit.

The luxury handbag and accessory retailer’s net profit has surged to $12.5 million compared to $10.4 million in the same period last year.

Oroton’s CEO Sally Macdonald said its cost-cutting program, launched in 2007, had cut expenses down to 47 per cent of sales, with revenue increasing 11.4 per cent to $74.36 million, setting the company up for future growth.

The clothing and accessories company reported a net profit of $12.5 million for the half year to January 24, compared with $10.4 million in the prior corresponding period.

Revenue was up 11.4 per cent to $74.36 million.

The group’s Oroton and Polo Ralph Lauren brands’ like-for-like sales rose 20 and five per cent respectively, while like-for-like sales for the group rose 12 per cent.

Group earnings before interest and tax was up 17.8 per cent to $18 million.