iiNet has reported a net profit of $32 million for the six months to December, a 122 per cent increase from the previous corresponding period, on the back of higher revenues and better margins following its Internode and TransACT acquisitions last year.

Shares were up 1 per cent to $4.96 in afternoon trade.

The internet service provider declared an interim dividend of 8 cents per share, fully franked.

iiNet's managing director and chief executive, Michael Malone, said his company had "grown to a scale where the earnings and cash flows it generates can be reinvested to ensure we continue to meet customers' needs going forward".

The company also reported a 30 per cent increase in revenue to $474 million for the first-half of the 2012/13 financial year.