Compania Cervecerias Unidas, S.A.

Ladies and gentlemen, good day, everyone, and welcome to CCU's first quarter 2026 earnings conference call on the 7th of May, 2026. Please note that today's conference call is being recorded. I would now like to turn the line over to Mr. Claude Gibran-Heras, the head of investor relations. Please go ahead, sir.

Welcome, and thank you for attending CCU's first quarter 2026 conference call. Today with me are Mr. Felipe Duvernet, Chief Financial Officer, Mr. Diego Munizaga, Financial Planning and Investor Relations Manager, and Mrs. Catalina Burgos, Senior Investor Relations Analyst. You have received a copy of the company's consolidated first quarter 2026 urging release. The call, as usual, will start by reviewing our overall results, and then we will move on to a Q&A session. Before we begin, please take note of the following statements. The statements that we will make in this call that relate to CCU future financial results are forward-looking statements which, of course, 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 and in Form 20F, recently filed with the U.S. Security and Exchange Commission, and for the Annual Report that's also available on the CMS and our website. It's now my pleasure to introduce our CFO, Mr. Felipe Duerme.

Thank you, Claudio, and thank you all for joining the call today. We started the year 2026 with a strong set of results in Chile, our main operating segment, while we continue to face a soft consumption environment in Argentina and a particularly weak business context in the wine business. In terms of financial results, Consolidated Evita was flat versus last year, growing 0.1%. as the robust 13.7% EBITDA growth in the Chile operating segment was offset by contraction of 18.6% and 50.1% in the international business and wine operating segment, respectively. In the quarter, consolidated net sales were flat, growing 0.2% by 1.8% higher volumes, almost fully offset by 1.5% lower average prices in Chilean vessels. Consolidated volumes were driven by a 3.9% expansion in the Chile operating segment, more than offsetting the decreases of 1.7% and 5.9% in the international business and wine operating segments Poor average prices in Chilean pesos were mostly due to a negative currency translation effect in Argentina coming from the 28.7% depreciation of the Argentine peso against the U.S. dollar being partially compensated by revenue management initiatives. Gross profit grew by 1.3%. and gross margin improved 55 basis points, mainly due to lower direct cost and efficiency. MS and DNA expenses were practically flat in Chilean places, offsetting with efficiencies, other expenses pressures, and restructuring costs in Argentina. As a percentage of net sales, MS and DNA grew 23 basis points, In all, EBITDA margin was stable at 16.1%. Net income was down 6.8% from last year. In terms of our operating segment, in Chile, top line expanded 3.9%, explained by higher volumes as average prices were flat. Higher volumes were driven by high single-digit growth of non-alcoholic categories and overall market share gains in alcoholic and non-alcoholic categories. Alcohol products, which encompasses in this segment beer and spirits, decreased low single-digits, although flavored low-alcohol-ready-to-drink products volumes grew low double digits. Flat average prices were a consequence of a mixed effect in the portfolio, mainly due to the growth in non-alcoholic, particularly in water. Gross profit increased 10.2% and gross margin rose to 278 basis points compared to last year, mainly driven by lower costs, coming from the 8.1% appreciation of the Chilean peso against the U.S. dollar. impacting our US dollar denominated cost and efficiency gains in procurement and manufacturing costs, partially offset by higher aluminum prices. Amazon DNA Expansion Expansion Grounds, that says, grew 31 basis points. Altogether, EBITDA increased 13.7% and EBITDA margin was up by 173 basis points, In the international business operating segment, NetSite recorded a 6.7% decrease, driven by 5.1% lower average prices in CN pesos and a 1.7% contraction in bonds. Lower average prices in CN pesos were a consequence of a negative currency translation effect in Argentina and negative mix effect, partially offset by price actions in line with inflation on a year-to-date basis, although still lagging annual inflation in this country. Volumes in these segments were below the year explained by Argentina to emit single-digit in a stable market share scenario, partially offset by the low single-digit increase in the non-alcoholic category. As a result of the challenging scenario in Argentina, gross profit contracted 10.7% in Chilean pesos, and gross margin decreased by 218 basis points due to cost pressures. MS and DNA expenses as a percentage of net sales decreased 54 basis points, In all, Evita contracted an 18.7.6%. Excluding the before-mentioned restructuring cost in Argentina, Evita would have contracted a 10.4%. The wine operating segment posted a top-line drop of 7.2%, mostly driven by 5.9% lower volumes and 1.4% lower average prices. Weaker volumes were explained by the contraction in both exports and our domestic markets in line with the industries. The lower average prices were mostly as a result of the appreciation of the Chilean peso against the U.S. dollar and its inferral impact on export revenues together with mixed effects. partially offset by revenue management initiatives in domestic markets. Gross profit was down 21.8% and gross margin deteriorated by 589 basis points, mostly due to higher cost of wine. Amazon DNA's purchases and percentages of trades were flat altogether. cost 1%, and EBITDA margin was down 508 basis points. Regarding our main joint venture and associated business in Colombia, we posted new themes for growth during the quarter, continuing on a positive path of building business escape. We are focused on building brand equity to enhance profitable growth in the future in this country. Now, I will be glad to answer any question you may have.