Cia. de Bebidas (ABV:US) das Americas, the Brazilian unit of Anheuser-Busch InBev NV (ABI), headed for a two-week high after reporting that third-quarter profit jumped as the company raised prices before a tax increase.
Shares of AmBev, as Cia. de Bebidas is known, gained 1.1 percent to 84.15 reais at 11:51 a.m. in Sao Paulo after earlier rising as much as 2.3 percent. A close at that level would be the highest since Oct. 18. The benchmark Bovespa index slipped 0.4 percent.
AmBev’s third-quarter adjusted net income jumped to 2.51 billion reais ($1.24 billion) from 1.69 billion reais a year earlier, above the 2.28 billion-real average estimate of eight analysts, according to data compiled by Bloomberg. Revenue advanced 26 percent to 8.04 billion reais as the company raised prices ahead of a tax increase on beer sales in Brazil.
“The company’s results continued to benefit from an aggressive pricing strategy,” Alexandre Miguel and Felipe Cruz, analysts at the investment bank Itau BBA, wrote in a note to clients today.
On Sept. 28, Brazil postponed until April 2013 an increase on beer taxes that had been scheduled to take effect this month. Carlos Alberto Barreto, the country’s tax agency secretary, said at the time that the delay was intended to avoid layoffs.
The company reported third-quarter net income of 2.52 billion reais, according to a regulatory filing. Adjusted net income was 2.51 billion reais when including one-time items.
AmBev rose 31 percent from this year’s low on Jan. 10 through yesterday, while the Bovespa dropped 3.5 percent.
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