Ciba specialty chemicals has reported a seven per cent increase in first quarter net profits to SFr118 million ($68.88 million) on sales of SFr1.93 billion.

Sales were up only one per cent in local currencies in what the company described as a challenging business environment. The figures, however, were at the top end of analysts' forecasts.

Ciba on Thursday said it expected further sales and earnings growth for the rest of the year.

"These forecasts are based on both a moderately softer macroeconomic environment, including an improvement in conditions in the United States as well as the assumption that currency exchange rates will not materially change from their current positions," said the company's statement.

Ciba is Switzerland's second largest producer of high-end chemicals, colours and additives. Its shares have fallen around 4.8 per cent this year in line with other big chemical companies.

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