Analysts are predicting strong profit growth for the Brazilian-based Latin American brewing force, AmBev, for the second quarter in spite of sluggish volume growth.

An average of six analysts' forecasts puts AmBev's second quarter net profit at R$190.7m ($61.5m) though estimates ranged from R$151.6m to R$212.5m. The forecasts are all well ahead of the R$127.5m which the company recorded in the second quarter of 2001.

Analysts are predicting that the brewer may still reap benefits from the merger in 2000 Brazil's two leading drinks companies, Companhia Cervejaria Brahma and Companhia Antarctica Paulista, but margins are expected to suffer after the 17.5% Brazilian currency depreciation which has raised costs of materials. The exact estimation of the impact of the currency devaluation varied as analysts are divided as to whether AmBev has hedged its currency position.