InBev's 2Q Profit Surges

But it is selling less beer in Western Europe and North America, markets where discerning consumers are seeking out new beers or turning more to wine and spirits.

InBev earned 499 million euros ($680 million) in the three months ended June 30, up from 394 million euros a year earlier.

Revenue climbed to 3.7 billion euros ($5 billion) from 3.3 billion euros in the same period last year.

InBev sales grew in Brazil, where it supplies more than two-thirds of beer. It also managed to sell a tenth more beer in southern Latin America, mainly to Argentina and Bolivia.

Russians and Ukrainians also liked the taste of InBev brands, with the company posting strong growth in the region. In Asia, InBev said the Sedrin brewery it bought in China was expanding well, while also has managed to wring better results out of South Korea.

But chief executive Carlos Brito said the company "can do better," highlighting China and Britain.

It is also suffering from paying more for raw materials: the barley used to brew beer and the glass and aluminum for packaging. InBev said this is mostly offset by a cost-cutting drive that is helping to squeeze more profit in all regions.

Western Europe, the company's heartland, bought less beer, with British volumes down just over 10 percent as sales of Stella Artois lager fell. Germany was also down, although InBev claimed its more lucrative brands had grown in the quarter.

Inbev sold less beer in the U.S. and Canada as the company cut off old distributors before shifting to a new deal with the biggest U.S. brewer, Anheuser-Busch Cos., which should help them reach far more customers with premium brands in the future.

"We have higher expectations for our China and UK operations. In those operations we have been outperformed by competitors, and we must do better," Brito said.

InBev also announced a 300 million euro ($409 million) share buyback that will run until October 2008.