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Unilever has reported that underlying sales grew by 6.1 per cent during the fourth quarter, and 5.5 per cent for the full year, beating forecasts.

The sales result is the consumer retailer's best in five years despite concerns of a slowdown in the retail sector.

Sales grew by 2.8 per cent in Europe for the year, 4.1 per cent in the Americas, with the US growing 3.2 per cent.

Unilever, which acquired Russian ice cream maker Inmarko this week, said it expects sales growth to be at the "upper end" of its three to five per cent target range as the company continues plans to cut 20,000 jobs over four years to ward off rising material costs.

"The re-shaping of the business and the acceleration of our change programme are bringing real benefits," said Unilever chief executive Patrick Cescau.

"They make Unilever a more flexible and resilient company, better placed to meet the challenges of operating in a tougher economic and cost environment."

Operating profit fell three per cent during the year due to the restructuring costs, disposals and one-off items which set the maker of Lynx body spray back €568 million (£426.41) according to Unilever's update.

Operating profit during the fourth quarter showed a three per cent gain compared to 12 months ago, while net profit fell to €721 million (£540.32 million) down from €2.03 billion (£1.52 billion) during the same period last year.

The group's operating margin fell 0.5 percentage points lower compared to a year ago.

Looking ahead, Mr Cescau said: "The fourth quarter was a strong finish to a good year. 2007 marks the third successive year of accelerating sales growth and came with an underlying improvement in margin."

Shares of the London and Rotterdam-headquartered consumer-goods producer have trimmed off 2.48 per cent to 1,614p in the morning's trading in London.