THE world's biggest food and drinks company, Nestl, reported a 32.4 per cent rise in first-half net profits yesterday.

The rise came despite rising costs and tough trading conditions.

The Switzerland-based group - best known for Nescaf coffee and Kit-Kat chocolate bars - met its own expectations with net profits of 3.68bn Swiss francs (£1.62bn).

It said net income had climbed to 3.86bn Swiss francs from 2.78bn francs a year earlier.

Nestl, which employs more than 4,000 people at its factory in York, was helped by growth in the UK, while price rises and cost-efficiency programmes offset higher costs.

Nestl also manufactures about 35,000 tonnes of confectionery, including brands such as Rolo, at its Newcastle factory, where it employs 540 people.

High costs of commodities such as milk, coffee and sugar as well as oil, which makes packaging and transportation more expensive, have weighed on the food industry, Nestl said. Chairman Peter Brabeck-Letmathe said the half-year results demonstrated "the strength and depth" of Nestle's brand portfolio.

The company achieved worldwide sales growth of 5.2 per cent, of which 1.8 per cent was due to price rises.

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