Thursday, May 05, 2016

AmBev: 8.5% volume falls Brazil

Leader in the Brazilian market of drinks lost sales in the first quarter, but expansion in operations in other countries helped to compensate for shrinkage
Sao Paulo-the Ambev''s sales volume fell 8.5% to 26.8 million hectoliters in the first quarter against a year earlier. The giant lost market share spot and attributed the movement to the price increase in the period.
"We have confidence in our business platforms and we expect this trend [of loss of participation] has been short term," said the Vice President financial and investor relations officer of Ambev, Ricardo Rittes, in a teleconference with reporters yesterday.
The Executive said the company doesn''t plan to change its policy of high taxes and inflation run through to prices. However, acknowledged that the rate increase has contributed to the loss of market share in the quarter.
"As we predicted in the last quarter, we had a tough year in Brazil. But when we look at the coming quarters of the year, we see a basis of comparison weaker, "he said.
The net revenue of the company in Brazil retreated 4.0 percent to 6.26 billion in the quarter, R$ influenced by the downturn in volumes. Ebitda (earnings before interest, taxes, depreciation and amortization) totaled 3.22 billion R$ adjusted from January to March, down 5.5% compared to same period in 2015. The company does not disclose net profit from operations in the country.
Despite the weak performance, the Chief Executive Officer of Ambev, Bernard P, kept the projections to 2016. The expectation is to improve the generation of net revenue and Ebitda in coming quarters, especially in Brazil.
"We''re operating more efficiently in this scenario and we hope to continue having good results. Costs are only one component in our business, we have a great team that seeks efficiency and elaborate ideas implemented quickly to improve the operation, "said Paiva, in a teleconference with analysts.
The supply of returnable packaging of glass also is among the strategies to keep sales this year. The participation of returnable bottles of beer in Brazilian markets increased from 4% in 2014 to 14.4% last year, commented Rittes. "We see a trend of acceleration of this packaging, with consumers seeking [the product] because it''s more accessible," said he.
The cost per product sold (COGS) of returnable glass containers is also lower, with better margins for the company.
The company consolidated operations-including other countries of Latin America, Caribbean and Canada-ended the first three months of the year with retraction of 7.5% in the volume of sales reported a total of 36.96 million hectolitres. Net sales advanced 7.4 percent to 11.56 billion R$ in the quarter against the same period in 2015.
I''ve adjusted net income totaled R$ 2.90 billion Ambev, indentation of 2.4% against the previous year and adjusted Ebitda grew 3.8%, totaling 5.26 billion R$.
DCI - 05/05/2016
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