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| Statement |
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| Preparedness in Argentina made the difference with more cash flowing dollars being generated and profitability came back in a big way with gross and EBITDA margin expansion pretty much across the board, while ROIC also improved |
| But when you look at what the team managed to do in terms of cash flow performance, last delivered better cash flow, CAC deliver better cash flow and Canada delivered better cash flow year-over-year |
| Gross margin expanded 240 basis points and EBITDA margin 430 basis points |
| And our market share is very well positioned for the start of the year |
| It didn't impact the full Q4, it will impact fully the Q1 of this year, and we are super excited about how it is performing |
| So the combination of the journey of really volumes up, strong top line and then recovering margins in 2023, that it was our priority |
| It was time for us to reignite margins, and it was a year of 500 basis points of margin expansion that was very solid |
| Ze Delivery in Brazil expanding coverage and awareness, reaching 5.7 million monthly active users and growing GMV by 8% and effective decisions around optimizing our business |
| So there, if the team succeeds in improving volume performance, maintaining net revenue per hectoliter growth and deliver operational leverage, perhaps we'll be able to deliver better performance in Canada for the full year |
| If you look at kind of other geographies as compared to Brazil, I think Canada in 2023, we managed to deliver despite the tough Q4, we managed to deliver EBITDA growth, right, 2.7% for the full year, which for Canadian standards was much better than past performance |
| In Q4, premium volumes grew in the mid-20s and we estimate having gained market share in the segment for the fourth consecutive quarter, with brand health indicators continuing to improve |
| Corona was the highlight, once again proving the effectiveness of our strategy |
| Net revenue per hectoliter performance continued with momentum in the quarter, while cash COGS and cash SG&A grew below net revenue, leading to 27% EBITDA growth coupled with gross and EBITDA margin expansions |
| We grew almost 3 million hectoliters in premium volumes, coupled with brand health improvement, EBITDA margin expanded 500 basis points to 32% resulting in EBITDA of R$ 12.5 billion, the highest in our history |
| Volumes grew over 6% in the quarter, driven by the consistent implementation of our commercial strategy, increasing both the number of buyers and number of SKUs per POC |
| Our diet light zero portfolio grew over 22% with a highlight to the new Guarana zero and the continued success of Pepsi Black |
| Cash COGS per hectoliter and expenses, however, declined, supporting an EBITDA growth of 15% and EBITDA margin expansion |
| So we are very happy with the Brazil beer performance |
| And another thing is that even though despite all the noisy and the changes in the hyperinflation and the discussion on the tax side, free cash flow generation is something that we stepped up in 2023, and it will stay solid into 2024 |
| But then when we look at the prices, it was quite a positive surprise to see the 7.2% net revenue per activity to increase |
| As for the other operations in last full year EBITDA grew in the mid-teens with margin expansion, resulting in the highest nominal EBITDA in history |
| CAC volumes grew 7.7%, led by the continued recovery in the Dominican Republic this quarter |
| A positive industry supported volume growth as Presidente brand family continued to recover and premium brands grew ahead of total volumes |
| So somehow excited about the category, I mean, excited about the brands and the products that we developed in the last years |
| Volumes top and bottom line were back to growth with margin improvement |
| So 2024 volumes and cash, I'm really -- we are really confident on that |
| This year, we want to deliver consistent results with operational performance being the driving force behind our sustainable value creation path, being able to translate this commercial momentum into more free cash flow generation and to illustrate why we are confident in our strategy |
| So when you add to that the performance in Brazil, that's how we got to the record operational cash flow performance for the company as a whole |
| So Budweiser there is another brand that really reunited in the previous year and a strong growth |
| First, to improve financial discipline, focusing on liquidity as well as cost and expense management while reinvesting for growth; Second, to improve profitability by increasing our return on invested capital but also expanding margins; Third, to further our value creation agenda, grow economic profit as well as free cash flow; and Fourth, returning excess cash to shareholders over time |
| Statement |
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| In Argentina, volumes in the quarter declined, driven by an industry that was impacted by macroeconomic conditions |
| And as for Canada, volumes declined on the back of a continued tough industry performance in the quarter in a growing cash COGS per hectoliter affected by the lower volumes really impacted our EBITDA growth |
| Other segments, however, led total volumes to decline 1.1% as we faced a tough comparable from FIFA World Cup last year |
| All this while challenged by tough industries in Canada and Argentina, a tough comp on tax credits in Brazil and a steep effect devaluation in Argentina |
| And then if you go to Canada, I think Canada had a very difficult year |
| And so as far as volumes are concerned, the big drag was the industry, unfortunately, not only beer but also beyond beer |
| And despite seeing that delivered, we're still hearing lots of questions regarding the volumes coming lower than expected just to get your feeling on that |
| We have important headwinds indeed |
| The 0.5% decline in net revenue per hectoliter was explained mostly by increased VAT taxable base for carbonated soft drinks and some general mix, with the increasing of the third-party distribution in our mix |
| We started by the end of last year, and it's really surprising us |
| You mentioned the decrease in volume for the fourth quarter because there's a hard comps due to the World Cup in 2022 |
| So what we are seeing so and then when you go to Q4, specifically, so we had a tough comp of the World Cup |
| Lucas Lira I think the challenge here is like Argentina, obviously, right, where we made the comment around organic revenue being capped |
| I think, of course, there was a big headwind from FX |
| And third, perhaps our main challenge relates to taxes in Brazil |
| to work down in Brazil |
| And what we're going to see in Argentina now, it is that a correction overall in the industry in volumes as the price follows what's going on in the inflation |
| And not all is bad news, though |
| And all this while dealing with looming headwinds in Brazilian taxes and Argentina |
| This reaction to the lower volume in Brazil seems that the most investors are kind of expecting something different than what you've been disclosing for the last few quarters |
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