Toys and giftware distributor Character Group returned to profit in the full year after strong demand for its brands and distributed lines.Following several years of a tough retail environment the group, whose brands include ZhuZhu Pets, Peppa Pig, Doctor Who and Postman Pat, posted a pre-tax profit of £7.55m for the year ended 31 August 2010 compared with a loss of £2.17m a year earlier. Sales were up 24% at £85.23m. International sales grew in line with UK sales.Chairman Richard King commented, "We remain well positioned to further develop our business both at home and internationally."King added that the group is working on a new offering which will extend its current footprint within the industry. "We are expecting to announce some of these in the New Year to coincide with the London Toy Fair. We are confident that these developments and initiatives will take the business to a new level once again," he said.Character has recommended a four-fold increase in its full year dividend to 4p with final of 2p proposed.