Ukrproduct has said that it expects to report a 25% increase in first-half revenue despite a challenging economic environment.

The Ukrainian dairy company said today (7 July) that ite expected rise in sales was an "encouraging step foward".

In a trading update for the first half of 2011, the London-listed firm said it had strengthened its "leading position" in the butter segment, increasing market share by approximately 1.5%.

Sales of processed cheese are expected to have fallen on the same period of 2010 but Ukrproduct said that volumes remained stable and added that it increased its markets share by around 2% due to a contraction in market capacity. The company said that it recovered its leading position in the cheese channel, despite "extreme price competition at the lower end of the market".

Ukrproduct expects sales of packaged and bulk spreads to increase significantly in the first-half as the "product offering has been improved in this segment.

The company also launched processed cheese private labels with two major Ukrainian chains. "We believe that, going forward, sales under private label projects will become a mainstream mass market product and will therefore reinforce the group's position in a highly price competitive environment," said the company.

It plans to announce its first-half results in September.