Ambev Reports 2017 First Quarter Results Under IFRS

SÃO PAULO, May 4, 2017 /PRNewswire/ -- Ambev S.A. [BOVESPA: ABEV3; NYSE: ABEV] announces today its results for the 2017 first quarter (1Q17). 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^st, 2017 filed with the CVM and submitted to the SEC.

Operating and Financial Highlights

Top line performance: Top line was up 8.0% in the quarter, driven by growth in all operations: Brazil (+0.6%), Latin America South (LAS) (+27.4%), Central America and the Caribbean (CAC) (+5.5%) and Canada (+2.3%). Consolidated volumes were up 2.4%, growing in most regions, and net revenue per hectoliter (NR/hl) increased by 5.3%. In Brazil, volumes grew by 2.6%, while NR/hl was down 1.9%. In CAC, while organic volumes were up 1.2% with a NR/hl growth of 3.4%, reported volumes increased by 27.3%, as a result of the swap of assets carried out with ABI and our operations in Panama. In LAS, volumes increased by 3.1% and NR/hl was up 23.3%, reflecting the high inflation in the region. In Canada, volumes were slightly down (-0.9%), with a solid 3.3% NR/hl growth. 

Cost of Goods Sold (COGS): Our COGS increased by 26.4% in 1Q17 while, on a per hectoliter basis, it grew by 23.1%, mainly due to inflationary pressures and unfavorable currency in Brazil and LAS.

Selling, General & Administrative (SG&A) expenses: SG&A (excluding depreciation and amortization) in 1Q17 was up 6.4%, with efficiency gains in non working money and cost savings in working money.

EBITDA, Gross margin and EBITDA margin: Normalized EBITDA reached R$ 4,356 million (-7.6%) in 1Q17 with gross margin of 59.8% (-580bps) and EBITDA margin of 38.7% (-670bps).

Normalized Net Profit and EPS: Normalized Net Profit was R$ 2,316 million in 1Q17, 20.1% below 1Q16, driven mainly by a lower EBITDA and currency translation due to the appreciation of the Brazilian Real. Normalized EPS in the quarter was R$ 0.14.

Operating Cash Generation and CAPEX: Cash generated from operations in 1Q17 was R$ 3.1 billion versus R$ 2.3 billion in 1Q16 (+37.7%). In the quarter, CAPEX reached R$ 559 million, 20.9% lower than in 1Q16.

Other cash gains: We have recorded in our Equity a cash gain of R$ 159 million, related to the recovery of restricted funds, to be received in 36 installments as of January, 2017.

Pay-out and Financial discipline: In 1Q17, we returned approximately R$ 1.1 billion to equity holders in dividends. As of March 31^st, 2017, our net cash position was R$ 2,106 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 2016 (1Q16). Values in this release may not add up due to rounding.

SOURCE Ambev S.A.