Q2 2024 Ambev SA Earnings Call Transcript
Key Points
- Ambev SA (ABEV) reported consistent performance in Q2, with volume growth led by Brazil and pack, offsetting declines in Argentina and Canada.
- EBITDA grew by double digits with margin expansion, and free cash flow performance improved compared to last year.
- Brazil NABs (non-alcoholic beverages) saw an 8% volume growth, with the non-sugar portfolio growing by 15%, and the company was awarded the Best Pepsi bottler in the world.
- The company's focus brands, including Corona, Budweiser, and Brahma, showed strong performance, contributing significantly to overall growth.
- Ambev SA (ABEV) has been investing in sustainability, with significant progress in reducing Scope 3 carbon emissions through partnerships with suppliers.
- Normalized net profit was impacted by higher income taxes, which totaled almost BRL1 billion in Q2, equivalent to an effective tax rate of nearly 29%.
- Argentina's beverage industry continued to suffer, with volumes declining by over 21% due to challenging consumption environments and significant EBITDA reduction due to currency devaluation.
- Canada experienced a tough industry environment, leading to a 2% EBITDA decline despite disciplined cost management.
- The company faces ongoing tax headwinds in Brazil, which are expected to continue impacting performance in the second half of the year.
- Despite improvements, the working capital in Brazil and Argentina, as well as cash taxes in Brazil, negatively impacted cash flow from operating activities.
Good morning. Good afternoon and thank you for waiting. We would like to welcome everyone to Ambev's 2024 second quarter results conference call.
Today. With us, we have Mr. January flagship and that CEO, and Mr. Lucas leader, CFO and Investor Relations Officer. As a reminder, a slide presentation is available for downloading on our website at ir dot dot com dot b. r., as well as through the webcast link of this call, we would like to inform you that this event is being recorded and all participants will be in a listen only mode during the Company's presentation.
After their remarks are completed, there will be a Q&A section when we kindly ask that each participating sell-side analysts ask only one question. Before proceeding, let me mention that forward-looking statements are being made under the Safe Harbor of the Securities Litigation Reform Act of 1996.
Forward-looking statements are based on the beliefs and assumptions of Ambev's management and on information currently available to the Company. They involve risks, uncertainties and assumptions because they relate to
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