Krones AG, a maker of bottling and packaging equipment, reported a 34 percent increase in first- quarter profit and said annual revenue will be at the upper end of its range of forecasts.

Net income gained to 30.7 million euros ($48.1 million) from 22.9 million euros a year earlier, Neutraubling, Germany-based Krones said in a statement today. Sales rose 18 percent to 595.2 million euros.

Krones said its order book swelled 9 percent to 607.3 million euros. The German machinery maker is benefiting from investment in new beverage factories in eastern Europe, South America, Asia and Africa. It's also upgraded its bottling range so that machines are more flexible and able to cope with different shapes as consumer trends change.

``In view of a good first quarter and auspicious prospects, the board anticipates sales growth in 2008 will lie towards the upper end of the forecast corridor,'' Krones said in the statement.

Full-year revenue growth will be at the top end of a 5 to 10 percent range after a ``good'' first quarter, probably exceeding 2.3 billion euros, the company said today. The world market is growing about 5 percent a year, Chief Executive Officer Volker Kronseder said on Oct. 29.

The company aims to improve its pretax profit margin from 7.1 percent last year and net income will grow at a faster pace because of changes in Germany's tax law, it reiterated today. Earnings were equivalent to 98 cents a share, up from 72 cents a year earlier, the company said.

Analysts surveyed by Bloomberg News had predicted net income of 30.5 million euros, sales of 577.9 million euros and orders of 605 million euros, according to the median of six estimates.

Krones has lost 1.8 percent this year in Frankfurt trading, giving the company a market value of 1.7 billion euros.

To contact the reporter on this story: Sheenagh Matthews in Frankfurt at smatthews6@bloomberg.net.