InBev, brewer of Beck’s and Stella Artois beers, predicted a better second half after a fall in Brazilian beer sales and higher commodities costs hit first-quarter results.

Net profit slipped to €249m, against €280m in the same period last year, the group reported on Thursday. The median of six analysts’ estimates was €323m, according to Bloomberg.

Shares in InBev, which are listed in Brussels, declined by 5.9 per cent after the results but recovered some ground on Friday, trading €0.28 higher at €50.17.

The group was hit by rising prices for malting barley. Matthew Webb, analyst at Cazenove, said there had been “widespread regional shortages” of malting barley, and InBev seemed to be suffering more than other brewers.

The Belgium-based group’s so-called “cost of sales” per hectolitre rose 10 per cent in the quarter and it had been unable to recover the full increase simply by raising prices.

Total volumes fell by 0.4 per cent year-on-year.

Poor bad weather, food price inflation and an early carnival holiday season – which cut the summer holiday period – were behind a decline the Brazilian market, InBev said.

Latin America accounts for more than half of the group’s earnings, and InBev believes that the key Brazil market will return to growth over the coming quarters.

In Russia, which has been an important growth market, performance was also weak. Suppliers there bought stock before a price increase in January, and the group saw lower demand for its cheaper “value” beer brands, which account for nearly half of its Russian business.

There would be “greater challenges” to overcome in 2008 than in the past three years, Inbev added, though it was confident that it would deliver ebitda margin expansion in the second half.

Earnings per share were €0.41 against €0.46 last time.