UPDATE 2-Mexico’s FEMSA 2nd-qtr net jumps on beer unit sale

* Beer unit sale boosts results

* FEMSA sold its beer unit to Heineken
(Adds revenue details, CEO comment, stock quote)

MEXICO CITY, July 26 (BestGrowthStock) – Mexican beverage and
retail company FEMSA on Monday posted a surprising
second-quarter profit (Read more your timing to make a profit.) surge as it recorded a gain from the sale
of its beer business to Dutch giant Heineken (HEIN.AS: ).

FEMSA’s net profit in the second quarter soared to 29.22
billion pesos ($2.26 billion).

Six analysts polled by Reuters last week were looking for
earnings of 2.654 billion pesos in the April-to-June period
this year. Net profit in the year-ago period was 2.5 billion
pesos.

Monterrey-based FEMSA (FEMSAUBD.MX: ) (FMX.N: ) closed the sale
of its FEMSA Cerveza beer unit to Heineken in April in exchange
for a 20 percent stake in the Dutch giant.

Under the terms of the transaction the Mexican company will
not receive the whole stake for several years.

“The gain in the Heineken transaction was 26.465 billion
pesos in the second quarter, reflecting the difference between
the market value of the Heineken shares at the close of the
transaction and the book value of the beer business for the
same period,” FEMSA said in a filing to the stock exchange.

FEMSA’s second-quarter profit (Read more your timing to make a profit.) from continuing operations
rose 29.7 percent from a year earlier to 3.8 billion pesos, a
figure that included a two-month estimate of its 20 percent
share in Heineken’s net profit during the first quarter of
2010, the company said.

Second-quarter revenue, which excluded beer operations,
came in at 41.6 billion pesos, up 8 percent from year-ago
results of 38.7 billion pesos. FEMSA also stripped beer results
from the April-June 2009 period for comparative purposes.

Its Coca-Cola FEMSA (KOF.N: ) unit, one of the biggest
Coca-Cola bottlers in the world, drove results in the quarter
although its Oxxo convenience stores posted very strong results
again.

FEMSA’s Chief Executive Jose Antonio Fernandez said in a
statement that most macroeconomic data seemed to indicate that
the worst of the economic crisis has passed in Mexico.

“The consumer is gradually becoming more bullish, which is
reflected in robust revenue trends at Coca-Cola FEMSA’s Mexico
division as well as at FEMSA Comercio, even against tough
comparison bases from last year.”

FEMSA shares added 0.26 percent to 58.44 pesos in morning
trading.

Stock Report

($1 = 12.94 pesos as of end-June)
(Reporting by Cyntia Barrera Diaz and Robert Campbell, editing
by Maureen Bavdek)

UPDATE 2-Mexico’s FEMSA 2nd-qtr net jumps on beer unit sale