PRICE increases in the UK are helping to keep Nestl on track to meet its full-year targets.

The Swiss group, which owns the Nestl Rowntree chocolate factory in York, said a 1.6 per cent rise in prices offset a 0.9 per cent fall in European sales between January and last month.

Overall, sales grew by 4.6 per cent in the quarter, with price rises offsetting higher raw material costs.

Chairman and chief executive Peter Brabeck-Letmathe said: "While the first quarter, as expected, still showed some upward pressure in raw material prices, we were able to compensate this through price increases."

He described the start to the year as solid, helping to maintain a full-year growth target of between five and six per cent. Growth in Europe so far stands at 0.7 per cent.

Sales in the first quarter were up 0.3 per cent at £9.04bn, but were once again affected by foreign exchange rates.

Its drinks business had a good start to the year, with growth of 4.7 per cent, helped by strong performances in instant coffee and ready-to-drink beverages.

Sales of milk, nutritional and ice cream products rose by 4.1 per cent, while chocolate and confectionery sales grew by 1.9 per cent, held back by a weak performance in sugar confectionery and distribution issues in Russia. The group's petcare division saw growth of 6.4 per cent, mainly driven by US sales.

The results follow a relatively poor performance in the sector last year. In October, Nestl blamed poor weather and rising costs in Europe for flat profits, although rivals, such as Unilever, experienced, similar conditions.

Nestl makes products ranging from instant coffee, evaporated milk and Ski yoghurt, to Rolos, Kit Kats, Vittel mineral water, Buitoni pasta and Polo mints.

The group is based in Vevey, in Switzerland, and has a UK head office in Croydon, south London.

Its factory in Wiggington Road, York, produces brands that include Smarties, Kit Kat and Aero.