Ambev Reports 2015 First Quarter Results Under IFRS
SAO PAULO, May 6, 2015 /PRNewswire/-- Ambev S.A. [BOVESPA: ABEV3; NYSE: ABEV] announces today its results for the 2015 first quarter. The following operating and financial information, unless otherwise indicated, is presented in nominal Reais and prepared according to International Financial Reporting Standards (IFRS), and should be read together with our quarterly financial information for the three-month period ended March 31, 2015 filed with the CVM and submitted to the SEC.
Operating and Financial Highlights
Top line performance: Net revenues increased 14.5% in the 1Q15, driven by solid top line growth in all of our operations (Brazil +10.7%, Central America and the Caribbean +26.4%, LAS +27.8% and Canada +6.0%). This performance is explained by (i) a volume growth of 0.4%, with positive contributions in Brazil Beer (+0.4%), Central America and the Caribbean (+22.6%) and Canada (+1.4%), partially offset by a decline in Brazil CSD & NANC (-2.2%) and LAS (-1.4%); coupled with (ii) Net Revenue per hectoliter (NR/hl) increase of 14.0%, driven by our revenue management initiatives, the benefit of premium mix and the increased weight of direct distribution in Brazil.
Cost of Goods Sold (COGS): Our COGS increased 15.1%, whereas on a per hectoliter basis, costs increased 14.6%, impacted by inflationary pressures in Brazil and Argentina, unfavorable currency hedges, product mix and higher depreciation, partially offset by the benefit of procurement savings initiatives and better commodities hedges.
Selling, General & Administrative (SG&A) expenses: SG&A expenses (excluding depreciation and amortization) were up 11.9% in the quarter, mainly as a result of double digits growth of distribution expenses, driven by inflation and the increased weight of direct distribution in Brazil. Regarding sales & marketing expenses, we continue to invest behind our brands but started to benefit from the higher comparable base related to the investments associated with the 2014 FIFA World Cup event.
EBITDA, Gross margin and EBITDA margin: Normalized EBITDA reached R$ 5,073 million (+21.1%) as our Normalized EBITDA margin expanded 260 basis points to 47.1%. Gross margin was -10 basis points down to 66.4%.
Normalized Net Profit and EPS: Normalized Net Profit was R$ 2,971 million in 1Q15, up 14.1% driven by EBITDA growth, partially offset by higher financial expenses and a higher effective tax rate. Normalized Earnings Per Share (EPS) was R$ 0.18 in the quarter.
Operating Cash generation and CAPEX: We generated R$ 3,819 million of cash from our operations in the quarter, a 45.8% increase versus last year, mainly as a result of stronger operational performance. During the first quarter of 2015 capital expenditure reached R$ 720 million.
Pay-out and Financial discipline: During the first quarter, we paid R$ 4,965 million in interest on capital to shareholders, a 24.8% increase in payout versus the same period of last year (including dividends and IOC). As of March 31st, 2015, our net cash position was R$ 5,122 million.
This press release segregates the impact of organic changes from those arising from changes in scope or currency translation. Scope changes represent the impact of acquisitions and divestitures, the start up or termination of activities or the transfer of activities between segments, curtailment gains and losses and year over year changes in accounting estimates and other assumptions that management does not consider as part of the underlying performance of the business. Unless stated, percentage changes in this press release are both organic and normalized in nature. Whenever used in this document, the term "normalized" refers to performance measures (EBITDA, EBIT, Profit, EPS) before special items adjustments. Special items are either income or expenses which do not occur regularly as part of the normal activities of the Company. They are presented separately because they are important for the understanding of the underlying sustainable performance of the Company due to their size or nature. Normalized measures are additional measures used by management and should not replace the measures determined in accordance with IFRS as indicators of the Company's performance. Comparisons, unless otherwise stated, refer to the first quarter of 2014 (1Q14).
| Financial Highlights – Ambev |
% As |
% |
||
| Consolidated |
||||
| R$ million |
1Q14 |
1Q15 |
Reported |
Organic |
| Total volumes |
42.984,4 |
43.181,0 |
0,5% |
0,4% |
| Beer |
31.204,9 |
31.750,4 |
1,7% |
1,7% |
| CSD and NANC |
11.779,4 |
11.430,6 |
-3,0% |
-3,0% |
| Net sales |
9.045,1 |
10.768,8 |
19,1% |
14,5% |
| Gross profit |
6.036,8 |
7.155,0 |
18,5% |
14,2% |
| Gross margin |
66,7% |
66,4% |
-30 bps |
-10 bps |
| EBITDA |
4.044,4 |
5.065,1 |
25,2% |
21,1% |
| EBITDA margin |
44,7% |
47,0% |
230 bps |
260 bps |
| Normalized EBITDA |
4.051,0 |
5.072,9 |
25,2% |
21,1% |
| Normalized EBITDA margin |
44,8% |
47,1% |
230 bps |
260 bps |
| Profit |
2.596,8 |
2.962,8 |
14,1% |
|
| Normalized Profit |
2.603,4 |
2.970,6 |
14,1% |
|
| EPS (R$/shares) |
0,16 |
0,18 |
10,0% |
|
| Normalized EPS |
0,16 |
0,18 |
10,0% |
Note: Earnings per share calculation is based on outstanding shares (total existing shares excluding shares held in treasury).
SOURCE Ambev S.A.
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