The Port of Dover made record profits last year - boosted by increases in both lorry freight and drive-and-sail holidays.

The port’s 2007 annual report recorded a profit before tax of £20.6 million, up by 38 per cent on the previous year.

Revenues were boosted by an extra 40,000 lorry freight journeys through the port.

And drive-and-sail holidays saw a revival, with the number of tourist car journeys up by 7.2 per cent to more than 2.8 million - the highest since 1999.

The cruise ship trade is also lucrative for the port. It is the UK’s second busiest cruise port and made £3.8 million from the 132 cruise ships that visited its docks during the year.

The report said the port, one of the world’s busiest, was now operating at almost its maximum capacity with "forecasts for growth set to continue".

It is currently planning a £400 million expansion programme to build a second ferry terminal with four ferry berths. Studies are underway and planning permission has yet to be applied for.

Bob Goldfield, chief executive, said: "With significant projected growth in the freight business and increases in tourist markets, we need to look to expanding the port’s capacity.

"We finished 2007 in a strong financial position, and are poised to realise our longer-term investment aspirations to develop the port to capitalise on this growth."