Stella Artois firm's profits fall

Inbev has a global presence

The world's biggest brewer by volume, Inbev, has blamed soaring raw material costs for a surprise 11% profit fall.

Admitting it had had a "difficult start" to the year, the firm saw net profit for the first three months of 2008 fall to 249m euros ($382m; £195m).

This compares with the 249m euros profit that Inbev, whose brands include Stella Artois, made a year earlier.

The fall in profit came despite the Belgian-Brazilian giant reporting a 4.8% increase in sales.

Its sales for the first quarter totalled 3.2bn euros, despite declines in Brazil and Russia.

InBev's profits have been squeezed by substantial increases in the price of key beer ingredients - barley malt and hops.

These have increased in price alongside most other food crops, because of a combination of poor harvests and higher demand, fuelled by increased Chinese and Indian prosperity.

'Right programmes'

The fall in profit surprised analysts, who had been expecting a slight increase.

Inbev chief executive Carlos Britos said the company expected to report better results as the year progressed.

"We believe that we have the right programmes in place to deliver stronger results in the following quarters," he said.

Inbev was founded in 2004 following the merger of Belgian company Interbrew and Brazil's AmBev.

The company's other main beer brands include Becks and Brahma.

Shares in Inbev were down 2.9% to 50 euros in Thursday trading.