Pepsi Bottling Group Inc

reported a higher-than-expected quarterly profit and raised its full-year earnings forecast on Wednesday, helped by price increases and cost cuts.

The company also said its board had appointed a special committee of independent directors to evaluate this week's unsolicited takeover bid by PepsiCo Inc

, its largest shareholder and supplier.

PepsiCo has offered to buy its two largest bottlers, Pepsi Bottling and PepsiAmericas Inc

, as it seeks to secure more control of its distribution in North America, where sales have been suffering amid a recession and changing consumer tastes.

Pepsi Bottling said it would respond to PepsiCo in due course.

It said net income rose to $57 million, or 27 cents per share, in the first quarter, ended March 21, from $28 million, or 12 cents per share, a year earlier.

Excluding restructuring charges and a benefit from settling tax audits, the company earned 10 cents per share, double analysts' average forecast of 5 cents, according to Reuters Estimates.

Sales fell 5 percent to $2.51 billion, hurt by the weak global economy and the stronger U.S. dollar, which reduces the value of overseas sales. Revenue fell 1 percent in the United States and Canada.

The company said total sales by volume fell 5 percent as the later Easter holiday pushed holiday-related sales into the second quarter this year from the first quarter last year.

Volume fell 3 percent in the United States and Canada, 7 percent in Mexico and 16 percent in Europe.

Revenue per case, excluding the impact of currency fluctuations, rose 5 percent as the company was able to increase prices across its markets, which include Greece, Spain and Turkey in addition to North America.

Pepsi Bottling raised its 2009 earnings forecast to a range of $2.20 to $2.30 per share, from a prior forecast of $2.15 to $2.25, citing its strong first-quarter results and confidence in its plans for the rest of the year. Both forecasts include a hit of 18 cents per share from currency.

Analysts on average were expecting $2.20 per share for the year.

(Reporting by Martinne Geller; Editing by Lisa Von Ahn and John Wallace)

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