Compania Cervecerias Unidas, S.A.

Before we begin, please take note of our cautionary statements. Statements made in this call that relate to CCU's future performance or financial results are forward-looking statements which involve known and unknown risks and uncertainties that could cause actual performance or results to materially differ. These statements should be taken in conjunction with the additional information about risk and uncertainties set forth in CCU's annual report, in Form 20-F filed with the U.S. Securities and Exchange Commission, and in the annual report submitted to the CNF and available on our website. It is now my pleasure to introduce Mr. Patricio Jotara.

Thank you, Claudio, and thank you all for joining us today. We are facing a challenging and volatile macroeconomic scenario. In this context, we need to focus on maintaining business scale and recover our margins. On the positive side, In terms of business scale, in spite of a decline in our consolidated volumes in the second quarter, considering a high comparison versus 2021, we reported double-digit growth when compared with pre-pandemic volumes. This is the second quarter of 2019. Thus, our business scale remains strong through a constant improvement in brand equity and excellence in sales execution. On the negative side, Regarding margins, these were negatively impacted by strong external effects coming from higher price and commodities, a sharp depreciation in our main local currencies against the US dollar, and higher inflation levels impacting our costs and expenses, partially offset by price increases in all our categories and geographies. In summary, during the second semester, We will decidedly continue with our revenue management efforts along with efficiencies to recover our profitability sustained on a solid business scale. Regarding our consolidated results, our revenues expanded 18.8%, boosted by 22.4% rise in average prices in Chilean pesos, while volumes contracted 2.9%. The better average prices in Chilean pesos were mainly explained by revenue management initiatives and price increases. EBITDA reached 32,471 million Chilean pesos, down 47.3%, and EBITDA margin decreased from 13.1% to 5.8%. The weaker financial results were mainly associated with, one, higher costs from raw and packaging materials. Two, the depreciation of our main local currencies against the U.S. dollar impacting negatively our U.S. dollar denominated costs partially compensated with export revenues. And three, costs and expenses pressures associated with an accelerating inflation in our main geographies and higher oil prices. The price efforts mentioned above were definitely not enough to offset these external effects. Hence, the need to strengthen our revenue management initiatives in the coming quarters. Regarding net income, we totalized a loss of 10,465 million Chilean pesos versus a gain of 18,968 million Chilean pesos last year, caused by the lower BGA mentioned above, and a higher loss in non-operating results, the latter mostly driven by higher net financial costs owing to a larger debt. In the Chile operating segment, our top line expanded 3.7% due to 7.3% growth in average prices while volumes declined 3.4%. The higher average prices were explained by revenue management initiatives partially offset by a negative mixed effect in the portfolio. Lower volumes were caused by a high comparison base and a less favorable consumption environment. Gross profit contracted 19%, mostly as a consequence of cost pressures, and a 17.6% devaluation of the trillion peso against the U.S. dollar, affecting our U.S. dollar denominated costs. MSDNA expenses grew 5%, and as a percentage of net sales, increased 43 basis points, where efficiencies helped us to offset expenses pressures coming from higher inflation and oil prices. In all, EBITDA reached 23,711 million trillion pesos, decreasing 59.1%. In the international business operating segment, which includes Argentina, Bolivia, Paraguay, and Uruguay, net sales recorded a 70.9% rise as a result of an increase in average prices, while volumes contracted 1.7%. The better average prices were mostly explained by revenue management initiatives in all the geographies. In terms of our geographies, volumes in Argentina and Paraguay expanded versus pre-pandemic levels, while Uruguay was flat and Bolivia declined. Work profit expanded 73.7%. MSD&A expenses as a percentage of net sales improved by 235 basis points. Efficiencies compensating higher inflation and other cost pressures. Altogether, EBITDA reached 1,072 million chilean pesos versus a loss of 2,223 million chilean pesos last year. The wine operating segment revenues were up 16.7%, explained by a 17.4% growth in average prices, while volumes decreased 0.5%. The higher prices in Chilean pesos were mainly explained by a positive impact on export revenues from depreciation of the Chilean pesos versus the U.S. dollar, and revenue and mixed management initiatives in the Chile and Argentina domestic markets which permitted us to partially compensate higher costs in packaging materials and inflationary pressures. Consequently, gross profit expanded 13.6%, MSD&A expenses grew 17.9%, and the percentage of sales increased 26 basis points. In all, EDBA reached 11,788 million chilean pesos, a 9.1% rise. In terms of our main international joint ventures, in Colombia, volumes remain growing double digits in the second quarter, given by beer and malt. In terms of financial results, our increase in business scale together with revenue management initiatives allowed us to improve last year's profitability levels in spite of cost pressures and the recent devaluation of the Colombian peso against the U.S. dollar. In Argentina, our debut with Aguas Danone de Argentina S.A. showed strong top-line growth led by volumes and prices. Now I will be glad to answer any questions you may have. After repeating that our main challenge during the second semester will be decided to continue with our revenue management efforts along with efficiencies to recover our profitability sustained on a solid business scale.

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