Brazil: AmBev 2Q 2006 net income increased to R$483.3 million compared to R$305.2 million a year before

Companhia de Bebidas das Americas - AmBev, the world's fifth largest brewer and the leading brewer in Latin America, announced August 14 its results for the second quarter 2006.

AmBev's consolidated results are the sum of the three following business units:

1. Brazil: comprised of (i) Beer Brazil; (ii) CSD & Nanc (Carbonated Soft Drinks and Nanc - Non-Alcoholic, Non-Carbonated beverages); and (iii) Malt and By-Products Sales;

2. Hispanic Latin America (HILA): comprising (i) AmBev's average 59.8% economic stake in Quinsa; and (ii) HILA-ex (which corresponds to AmBev's controlled operations in Northern Latin America); and

3. North America: representing the operations of Labatt Brewing Company Limited ("Labatt").

Comparisons, unless otherwise stated, refer to the second quarter 2005 (2Q05).

According to RTTNews release of August 14, AmBev 2Q2006 net income, excluding goodwill and amortization, stood at US$0.55 per ADR, compared to US$0.39 per ADR in the same quarter last year. Including items, the earnings per ADR for the quarter was US$0.34 compared to US$0.19 in the year-ago quarter.

Net income for the second quarter of 2006 was R$483.3 million compared to R$305.2 million in the earlier year quarter. Earnings per thousand shares, ex-items, was R$11.98 compared to R$9.74 in the prior year quarter. Including items, earnings for the period rose to R$7.44 per thousand share from R$4.65 per thousand share in the 2005 quarter.

Quarterly net revenues were R$4.04 billion, up from R$3.70 billion in the previous year quarter.

Consolidated EBITDA reached R$1,586.3 million (+11.9%). EBITDA margin reached 39.3% (+100 bps).

Beer Brazil EBITDA's grew 17.3%, achieving 46.8% margin; AmBev market share reached 68.8% during 2Q06, and sales volume increased 4.4%.

CSD & Nanc sales volume rose 8.6% in Brazil; EBITDA amounted to R$125.7 million, up 3.6% reaching 31.4% margin.

Quinsa total EBITDA grew 25.2% in US dollars, and AmBev's average stake in Quinsa during 2Q06 reached 59.8% (2Q05: 55.2%).

Labatt EBITDA increased 11.3% in Canadian dollars, and the EBITDA margin reached 38.2% in North American operation. Net earnings per thousand shares rose 59.9%; excluding goodwill amortization, we observed a 23.0% increase in earnings per thousand shares.