The world's number two computer maker Dell has reported growth of 3% in its fourth quarter net profits - which came in at $436m (£270m) or 16 cents per share..

The figure was in line with expectations which were lowered following a profit warning from the company last month.

It compares with net profits of $425m or 15 cents a share in the same period a year earlier.

Dell said its profit growth was slowed by shortages of parts and by a sales slowdown caused by fears of problems caused by the advent of the new millennium.

Shares in Texas-based company rose 3 15/64 to close at 38 51/64 on the Nasdaq stock market ahead of the results, which were released after the close of trade.

Shares traded slightly lower at 38 3/8 in after-hours trade, following the announcement.

Revenue rose 31% to $6.8bn, in line with the the company's lower guidance, but far below Dell's historic rate of growth above 50% that had made the stock a must-own holding among technology investors.

Nearly 50% of sales were handled through the company's internet site during the quarter, it said.

Forecasts cut

Analysts had pared their earnings forecasts from 21 cents a share to 15 cents a share after the company warned last month that component shortages and the millennium rollover had hit sales in the fourth quarter.

Component shortages cost the company $300m in lost sales, most of which were consumer, it said.

Lower-than-expected corporate demand amid the millennium rollover reduced revenues by another $500 million, it said