Strong sales rise boosts Nestle

Infant nutrition has become a key part of Nestle's business.

Nestle, the maker of KitKat and Perrier water, has said it will beat its annual profit forecasts after a strong rise in sales in the first six months of 2007.

But it warned that increases in the cost of raw materials, such as coffee and cocoa, had led it to raise prices, which meant sales may slow.

The world's largest food company said that half-year profits grew 18.4% to 4.9bn Swiss francs ($4.1bn; £2.03bn).

Nestle added that it had no plans for major acquisitions.

Chief executive Peter Brabeck said the firm, which has made recent purchases of medical and child nutrition brands including the American baby food firm Gerber, was now looking to consolidate its position.

"We do not see any major acquisitions coming up," he said.

The company added that there had been a "notable performance improvement" at its UK Nestle Rowntree confectionery business whose brands include After Eight mints, Smarties and Rowntree's Fruit Pastilles as well as KitKat.

Overall sales rose 8.4% to 51.1bn Swiss francs in the first six months of the year.

The company also unveiled a $21bn share buyback programme.