Private label household goods firm McBride's shares leapt nearly 10 per cent after it posted record annual sales and profits and said the rise raw material costs this financial year are likely to be towards the lower end of forecasts.

Shampoo to mouthwash maker McBride, which employs 538 people at its main factory and UK headquarters in Middleton, Greater Manchester, and a further 368 in Burnley, saw its shares gain 13.7p to 154.5p after it delivered a 33 per cent hike in pre-tax profits to £29.6m for the year to June 30, up from £22.2m.

McBride - which also makes products such as own-label laundry liquids and toothpaste - said it had overcome a tricky period of prolonged price slashing from branded manufacturers in the UK before volumes recovered towards the end of the period.

The company added that the current squeeze on household budgets also underpinned prospects for its market.

UK sales in the year grew by three per cent with overall revenues up by two per cent, from £792.4m to £812.2m.

Profits were lifted by operational efficiencies, a better product mix, improved procurement and margins as well as higher volumes, the company said.

A final dividend of 4.8p makes a total of 6.8p for the year, up 13 per cent on 2009.

McBride reduced its net debt by £22.4m to £60m during the year. "There is no doubt that in the current economic climate consumers are more value conscious then ever and the environment therefore continues to remain positive for private label growth," it  said.

McBride added it was well-placed to cope with the short-term pressure of rising raw materials costs through supply chain efficiencies and passing on increases to customers.

McBride, led by chief executive Chris Bull, said in June that it expected raw material costs to climb by eight to 10 per cent this year but yesterday said the figure would be towards the lower end.

The group also announced the acquisition of Dermacol, a privately-owned manufacturer of skincare products such as face creams and body lotions, based near Brno in the Czech Republic.

McBride expects to pay £8m for a 70 per cent stake and has agreed to buy the remaining 30 per cent in late 2017, with a total consideration of up to £21.7m.

Panmure Gordon analyst Damian McNeela said: "The tone of the outlook statement is more positive with promotional activity easing and input cost increases now likely to be at the lower end of expectations."