Swiss specialist chemicals supplier Lonza reported better than expected profits on Thursday and said it expects a further increase in sales and profits this year on the back of new technologies and products.

The Basel-based firm, which supplies ingredients to drugmakers such as GlaxoSmithKline, said earnings before interest and tax (EBIT) rose 28.4% last year to 335 million Swiss francs ($361 million), up from 261 million francs in 2011.

This was ahead of the average forecast given by analysts in a Reuters poll of a 26.1% rise to 329 million francs.

The company, which also makes the active ingredient used in anti-dandruff shampoos, believes it is well placed to benefit from pharmaceutical companies' efforts to make their manufacturing processes more efficient as they face patent expiries.

However, it has also been hit by volatility in that sector, and sought to shield its margins by buying U.S.-based specialty chemicals maker Arch Chemicals in 2011, its biggest ever acquisition.

Excluding Arch, EBIT rose 14.7%, at the top end of its 2012 target to grow profits by between 10 and 15%.

Faced with low-cost competition, a strong Swiss franc and higher raw material prices, Lonza said last October it would cut 500 jobs, including 400 at its main plant in Switzerland.

Chief Executive Richard Ridinger, who took over the helm in May last year after the ousting of his predecessor Stefan Borgas, said Lonza would adjust its manufacturing footprint and carry out further structural changes in 2013.

Lonza confirmed its 2015 targets for mid-single-digit percentage growth in annual sales and an EBIT margin of at least 20%.

The company said it would pay a dividend of 2.15 francs per share, unchanged from last year.