Compañía Cervecerías Unidas S.A. (NYSE:CCU) Q1 2025 Earnings Call Transcript

Compañía Cervecerías Unidas S.A. (NYSE:CCU) Q1 2025 Earnings Call Transcript May 11, 2025

Claudio Las Heras – Head, IR:

Patricio Jottar – CEO:

Felipe Dubernet – CFO :

Fernando Olvera – Bank of America:

Alvaro Garcia – BTG Pactual:

Felipe Ucros – Scotiabank:

Ewald Stark – BICE Inversiones:

Constanza Gonzalez – Quest Capital:

Operator: Good day, everyone, and welcome to CCU’s First Quarter 2025 Earnings Conference Call on the 8th of May 2025. Please note that today’s call is being recorded. At this time, I’d like to turn the conference call over to Claudio Las Heras, the Head of Investor Relations. Please go ahead, sir.

Claudio Las Heras: Welcome and thank you for attending CCU’s first quarter 2025 conference call. Today with me are Mr. Patricio Jottar, Chief Executive Officer. Mr. Felipe Dubernet, Chief Financial Officer. Mr. Joaquin Trejo, Financial Planning and Investor Relations Investor Relations Manager; and Carolina Burgos, Senior Investor Relation Analyst. You have received a copy of the company’s consolidated first quarter 2025 earnings release. The goal is to review our overall results, and then we will then move on to our Q&A session. As usual, before we begin, please take note of the following statements. Statements made in this scope that relate to CCU’s future 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 additional information about risks and uncertainties set forth in CCU’s annual report in Form 20-F with the U.S. Securities and Exchange Commission, and the annual reports submitted to the CMF available on our website. It is now my pleasure to introduce our CEO, Mr. Patricio Jottar.

Patricio Jottar: Thank you, Claudio, and thank you all for joining us today. In the first quarter 2025, we delivered higher financial results versus last year, expanding consolidated EBITDA and net income by 6% and 10.7% respectively, in spite of a highly volatile business environment. In this context, organic consolidated volumes, this is excluding the volumes of Aguas de Origen and AD in Argentina and Paraguay respectively, were down 1.8%, given by all operating segments amid soft consumption in the region. The higher EBITDA was explained by international business operating segments, largely due to Argentina. We’re certain that the scenario for 2025 will continue to be challenging and volatile. Our focus in the coming quarters will be to continue implementing our 2025-2027 strategic plan and its three pillars, profitability, growth, and sustainability, with a special focus on profitability, through further efforts in revenue management and efficiency.

At the same time, under the growth pillar, in a difficult context for expanding business scale, we’ll focus on brand equity, sales execution, and innovations to address new consumer trends. Lastly, in the sustainability pillar, our goal is to progress in our Juntos por un Mejor Vivir strategy in its two pillars, our Planet and our People. The figures that I will refer now for the consolidated and the international business operating segment results consider organic figures. This is excluding, again, the consolidation of Aguas de Origen in Argentina and AD in Paraguay. Regarding our consolidated performance in first quarter 2025, organic consolidated net sales were up 3%, explained by 4.9% higher organic average prices in Chilean pesos, while organic volumes were 1.8% lower.

Higher organic average prices in Chilean pesos were explained by all operating segments as a consequence of revenue management efforts. Gross profit grew 1.7% organically, and organic gross margin contracted by 56 basis points due to higher cost of sales. On the other hand, organic MSD&A expenses expanded 2.7% in Chilean pesos, offsetting inflationary pressures with efficiency. And as a percentage of net sales declined 11 basis points. In all, organic EBITDA reached CLP 130,006 million, a 4.8% organic increase. In terms of our segments, in the Chile Operating segment top line expanded 2.8%, as a result of a 4.8% increase in average prices while volumes were down 1.9%. Average prices were driven by revenue management efforts, partially compensated by negative mix effects in the portfolio.

Gross profit decreased 1.1% and gross margin was down 180 bps compared to last year, mainly driven by higher manufacturing costs, a negative mix effect in packaging, and cost pressures coming from higher U.S. dollar denominated costs. MSD&A expenses were 2.7% higher, being practically flat as a percentage of net sales, due to efficiencies that compensated inflationary pressures. Altogether, EBITDA reached CLP 94,400 million, a 2.4% decrease, and EBITDA margin was down 97 basis points. In the International business operating segment, excluding the inorganic volumes from the consolidation of ADO and AV, in Argentina and Paraguay, respectively, organic Net sales recorded a 6.3% increase, driven by higher organic average prices, which more than offset a 1.2% contraction in organic volumes.

Organic volumes in Argentina were nearly flat, continuing on a recovery path of business scale compared to previous quarters. Meanwhile, Uruguay and Paraguay posted low and mid-single digit organic volume declines, respectively, while Bolivia grew by low-single digits. Higher organic average prices were mostly driven by revenue management initiatives in all the geographies, more than offsetting cost pressures coming especially from a weaker ARS against the USD, and inflationary pressures. Consequently, organic gross profit expanded 10.7%, and organic gross margin grew 202 basis points. Organic MSD&A expenses as a percentage of net sales increased 32 basis points, mostly from inflationary pressures in Argentina. In all, organic EBITDA reached CLP 33,435 million, a 28.1% expansion, driven by Argentina, Uruguay and Bolivia.

The U.S. operating segment posted a top-line expansion of 2.1%, fully driven by a 6.2% rise in average prices, while volumes were down 3.8% compared to last year. Lower volumes were explained by a contraction in the Chilean domestic market industry, while exports from Chile were flat. The better average prices were mostly explained by a weaker Chilean peso and its favorable impact on export revenues and revenue management initiatives in the domestic markets. Gross profit was down 1.6% and gross margin deliberated by 142 basis points due to cost pressures from a higher cost of wine and higher U.S. dollar lean packaging costs. MSD&A expenses were flat and as a percentage net sales improved 56 basis points due to efficiency. Altogether, EBITDA reached CLP 6,592 million, a 1.1% decrease, and EBITDA margin was down 36 basis points.

Regarding our main JVs and associated businesses, in Colombia, we posted better financial results versus last year despite a slight contraction in volumes, which nonetheless was slightly lower than the industry. Now I will be glad to answer any questions you may have.

Q&A Session

Operator: [Operator Instructions] Okay, so our first question is from Fernando Olvera from Bank of America. Your line is now open. Please go ahead.

Fernando Olvera : Hi, good morning everyone and thanks for taking my question. First I would like to explore volume performance in Chile. If you can give us some details of how different was the performance between non-alcoholic and alcoholic beverages and specifically on beer. Also, if you can comment about the performance between premium and mainstream? That’s my first question. Thanks.

Patricio Jottar: Thank you, Fernando, for your question. Look, according to Nielsen, our overall market share in the Chile operating segment is stable. Now, making double click, we have gained some market share small in non-alcoholic and we have lost some market share small in beer. Taking into consideration, according to Nielsen data, overall alcohol industry is decreasing in its single digits. These are sell-outs volumes to consumers. Companies publish selling volumes to clients including different channels and thus are not necessarily reflected in market share. But again, market share is total, that Chilean operating segment is stable with a small increase or gain in non-alcoholic and a small decrease or loss in beer.

Fernando Olvera: Okay, and regarding the recovery going forward on volumes, how are you seeing such trends?

Patricio Jottar: Excuse me, regarding mainstream and premium. So, regarding mainstream and premium stable. Look, looking forward, there is a big concern not just in Chile but in the world regarding alcohol patterns of consumption. Probably you have heard about this because it is something which is being discussed in every company producing and selling alcohol all over the world. Look, huge figures. Let’s take the consumption of alcohol at 100 degrees. To make this calculation, you take beer and calculate 5%, wine calculate 12%, spirits and calculate 35%, tea is 40%. If you are considering other spirits and you calculate the per capita consumption of alcohol at 100 degrees. This figure in Chile in 2019 was 5.3 liters of alcohol per capita per year, 5.3. In pandemic it increases a lot and after pandemic it began to decrease.

In 2023 it was still 5.3, same level than pre-pandemic. But in 2024 it decreased to 5.1. And beginning 2025 the trend is to decrease. The same figures for United States, 7.4 in 2019 pre-pandemic, 7 in 2024. So the decrease in United States has been even higher than in Chile. And global in the world as a whole 3.1 liters in 2019 and 2.8 liters in 2024. There are many hypotheses why it is occurring. If you want, we could discuss on this. My main concern regarding the future are volumes on the alcoholic categories. Indeed, I don’t see a disaster, a big decline. But the trends are not favorable. We are making a lot of things to change the trend. Of course on responsible consumption basis. But this is a concern.

Fernando Olvera: Okay. And if I may just one last question. If you can give us more color on the lower tax in Argentina. Which I understand that caused the sharp decline on consolidated taxes. And if this effect is expected in the coming quarters? Thank you.

Patricio Jottar: Felipe could you elaborate on this? Could you clarify that this is related to. This is for the import taxes you mean.

Fernando Olvera: Yes, I mean at consolidated taxes you mentioned that it declined significantly year over year. Due to lower tax in Argentina. Because of inflation. I understand.

Patricio Jottar: I understand your question. This is related to the use of inflation for tax purposes. So usually in Argentina until 2019 we didn’t use the inflation for tax purposes. Since 2019 we started to use that. We have some provisions related to that. As Argentina has become more stable in terms of macroeconomics. Or liberating as you know the exchange controls. We decided to release some provisions related to that in the use of inflation for tax purposes. This is the explanation.

Fernando Olvera: Okay. And this effect this benefit is expected in coming quarters Felipe?

Felipe Dubernet: Yes. Yes. Because it is gravel.

Fernando Olvera: Okay. Perfect. Thank you.

Patricio Jottar: Look Fernando, one more remark regarding trends of alcohol consumption. My remark before showing a decline in Chile and the United States and worldwide. On the alcohol consumption. It is a long term consideration. If you make double clicks in quarters Q2 last year in Argentina was very poor and Q2 in Chile was very poor. So we expect to have a much better result regarding alcoholic volumes in Q2. But leaving it apart. Because it is a consideration on the basis of 2024. The trend is not favorable. For the industry, according the business.

Fernando Olvera: Okay. Great. Thank you so much.

Operator: Thank you. Our next question is from Alvaro Garcia from BTG. Your line is now open. Please go ahead.

Alvaro Garcia : Can you hear me?

Patricio Jottar: Yes, we can. Please go ahead. Alvaro we cannot hear you now. Okay. Perhaps you can send us a text question or redial.

Alvaro Garcia: Can you hear me there?

Patricio Jottar: Now we can. Yes.

Alvaro Garcia: Sorry about that. Wrong mic. Hi Patricio, hi Felipe. I have a couple of questions. One on, how you are thinking about margins in Chile in a stronger Chilean peso environment. Into the second half of this year. Obviously you have had a lot of questions over the last couple of years on sort of where you can take margins over the medium term. And we seem to be getting in a better sort of input cost environment for you. So that would be interesting. And then my second question is on Argentina. I was wondering if you could talk about pricing. Because we were a little bit surprised. I mean I know you are consolidating a water business. Which obviously has much lower pricing. But I was wondering if maybe you can comment a bit on pricing. There was a little bit of a surprise let’s say in our model there. What you are seeing from a pricing standpoint as inflation comes down? Thank you very much.

Patricio Jottar: Thank you Alvaro for your two questions. I will begin with Argentina. And then I will jump to Chile. Look it’s a big question mark. Because I mean for many years’ prices were key in Argentina. And we had no difficulties to increase prices in line to inflation. Even higher than inflation. Because if inflation amount is 10% and increase prices by 11% or 12%. Nothing happens. Consumers are there paying for your products. Now inflation is decreasing a lot. And after the liberation of the exchange rate. The exchange rate remained almost stable in Argentina. So there are different opinions. What is going to happen with inflation in Argentina? Some people think that inflation will continue to be 2% per year. Some people are saying that it will move to zero very rapidly.

And there are opinions also saying that probably we will have negative inflation. That is the first remark. Second remark. There are some services which are adjusting their prices. So there is a hidden inflation which will come from those services. Which prices have been controlled? So we expect that the price increase of the industry — of the consumer products industry will be lower than official inflation for this effect. So we don’t know. We are not sure. I prefer to think that inflation is going to be very low. That it is going to be very difficult to continue increasing prices. And that we have to compensate this with input costs. Which are helping. And with strong efficiency programs on SBA. This is what we are doing. If inflation continues to be 2%.

Indeed, we will have to increase prices. Otherwise we will have a huge gap. Which is impossible to find. But again. This is executing every single day. But summarizing. If inflation continues being high 2% to 3%. We will continue increasing prices. In line with inflation and more. It is possible. If inflation collapses and goes to zero. We will not be able to increase prices. In both cases we are making strong efforts in reducing expenses. Regarding margins in Chile. We have been increasing prices to compensate the prices that we didn’t increase in the past, when the cost of raw material the input cost jumped a lot. We are recuperating margins quarter after quarter and we continue with this trend on one hand. Input costs are helping. And we are being very extreme.

On being efficient in our expenses. Altogether we expect to recuperate margins. Having said that. The comparison basis in Q2 2024 was very weak. So we will have a good Q2. But this is something exceptional associated to the weak basis of comparison for 2024. But in the long run, it will start to give great margins.

Alvaro Garcia: Great. Thank you. A follow-up on the Argentina element. Would you say that in the first quarter, you passed a little less price than usual? Or was it just pretty standard from a core organic standpoint?

Patricio Jottar: Yes. Definitely less. In 2024 we passed more than inflation to prices. And in Q1 the trend continues, in Q2 it’s extremely difficult to increase prices. This is the reason why I think that inflation is going to collapse very soon. I personally think that inflation will move in the range of 0% to 0.5% for maximum 1% per month. Because we realize in our categories. We see the market that prices of consumer goods are very stable and it is very difficult to increase prices.

Alvaro Garcia: That’s clear.

Patricio Jottar: We need to see. This is what we are seeing today.

Alvaro Garcia: Thank you.

Operator: [Operator Instructions] Our next question is from Felipe Ucros from Scotiabank. Your line is now open. Please go ahead.

Felipe Ucros : Thanks operator. Well, Patricio, Felipe and team thanks for taking my question. My first one is around costs. The release mentioned. That you experienced higher manufacturing costs in Chile. I was curious about the language about it being around manufacturing rather than raw materials. Can you expand on what exactly were the drivers for these costs? And then I will have a follow-up after that. Thank you.

Patricio Jottar: Indeed, Felipe. There is one time — Felipe, why don’t you elaborate?

Felipe Dubernet: So, the manufacturing costs were due to two reasons. One was about inventory depletion. As we have reduced inventory, at the end the allocation of fixed costs was higher than a year ago. So it is an accounting issue or matter. On the other hand, higher labor costs. That we experienced in Chile. Because of some — we needed to improve our operation plan. Because we incurred in overtime and this was due to higher labor costs. And also included some write-offs of some lines. That we are not using anymore because they were too old and we replaced by new technology. So we incurred on extra depreciation costs. As we have allocated write-offs in the Chile operating segment in the depreciation line. So we have two write-offs that Patricio mentioned.

One is related to write-offs in the Chile operating segment and the second is, we have less inventory than last year in Chile. So it was affected by the allocation of fixed expenses as an accounting matter. And the overtime. That is an inefficiency. Because of let’s say, not too good sensor operation, but we have a project. That is called [indiscernible]. That we did some disclosure on that and we are now report that we are working on improving our plan. So we oversee that in the following quarters we should deliver efficiencies and be more efficient in manufacturing.

Felipe Ucros: Very clear. And my next question was actually around efficiency. You managed to maintain your efficiency levels despite having negative volumes. Which is not easy to do? So it seems like your efficiency program is beginning to work. Can you expand a little bit on how far along you are in that program and how much more you expect?

Patricio Jottar: Okay. Thank you for your remarks. More than beginning to work, it has worked for many years. Here we have the figures but the MSD&A has declined by 5 or more percent in a longer period of time. But we are putting much more pressure today on this. As we expect volumes of alcoholic products to be tough in the future. As I mentioned before and as I expect that in Argentina we have tough times. So tougher times regarding prices. The combination of these elements supplies us. So calling our premium to be much more stern when executing efficiency programs. We are moving in that direction.

Felipe Ucros: Let me ask a follow-up on the efficiency side. Are you reducing marketing expenses in any way? Or is that part of the SG&A, kind of the plan is to maintain it consistent and draw the efficiencies from other lines.

Patricio Jottar: No. Particularly on sales efforts we are replacing a lot of functions made by sales people through technology with a lot of success. In a few words, typically for many years our salesperson had four responsibilities. Number one, to recommend that the client looks to buy. Number two to execute on place the order. Number three to execute in the point of sales. And number four, to keep a good personal relation with the client. On these four activities, the first two are completely — could be completely replaced by technology. Today, our artificial intelligence programs are much smarter than our sales force to recommend the client to buy number one. There are much more efficient ways to place the orders through digital on the other.

Sales force is still. Extremely important. To execute in the point of sale and to have the personal relation with the client on the order. We need less sales force to do this and more technology. We are moving rapidly in this direction. If you look at our MD&A especially in Chile, which is the main operating segment. They were below inflation by 2.7%. While marketing expenses were above inflation. So it mean that we are making efficiencies as Patricia said, in sales but also in distribution. Distribution also necessary because it is a big chunk of money there. As you know current efficiency warehouses. There we are perfectly in the good path. Let’s say efficiency program. As I said, if we maintain this path of growing our expenses less than inflation while maintaining or investing better in marketing.

That is a good sign, Felipe. In fact, we measure four times per year the brand equity of each one of the brands of our portfolio and the brand equity of each one of the brands of our competitors. And the indicators. Of Q1 2025 for like key categories show us that our brand equity indicators are one of the highest. Historically in the last 10 years that our portfolio today is extremely healthy. And this gives us a lot of confidence on having good volumes, good market shares, good prices to continue improving our profitability.

Felipe Ucros: Very clear. Thanks a lot for the color.

Operator: Thank you. Our next question is from Ewald Stark from BICE Inversiones. Your line is now open. Please go ahead.

Ewald Stark : Good morning. Thanks for taking my question. In the press release you mentioned that competition and the context remains highly volatile and you expect to do so in the coming quarters. I wanted to ask how do you expect competition — how aggressive do you expect competition to be in Chile in the remaining of the year?

Patricio Jottar: Thank you Ewalk for your question. Look, competition has always been very tough. I know the categories where we participate in Chile and other countries. I think that this is not going to change. At the same time this my main comment. The good element — the tough element of having tough competition difficult to make money, to increase prices, to increase margins. But we would like to do this particularly to efficiency. The good thing of tough competition is that it promotes per capita consumption. Which is key. Because as I mentioned before the alcohol consumption all over the world is under pressure for many reasons. And a lot of competition, a lot of innovation, a lot of marketing, a lot of execution at the point of the sales contributes to offset those trends.

Let me give you one example which is a very clear signal of this. Per capita consumption in Chile in beer. We compete strongly in beer. Per capita consumption in beer in 2014 10 years ago it was 44 liters. Per capital consumption beer in 2024 10 years after was 54.2. 10 more liters per capita. In the United States in the same period, per capita consumption has increased from 34 to 46, 74.5. To 59 liters. In the world from 25.4 liters to 22.7 liters. So it’s we have been competing in a very tough way. There is more categories for many years, it will continue. But I think as mentioned, it is good for categories. We are not afraid of this. It obliges us to improve our capabilities day after day. And finally as I mentioned before. The high level of brand equity.

Measures quarterly. It got a maximum level in the last 10 years. In the last many years in most of our categories. So we are very glad on that. It will allow us to be a strong competitor in Chile and the other countries where we participate.

Operator: Thank you. Our next question is from Constanza Gonzalez from Quest Capital. Your line is now open. Please go ahead.

Constanza Gonzalez : Good morning, Patricio and Felipe. Thank you for the call and for taking my question. I have a question regarding Argentina. For example, considering that you are seeing a recovery in the economy. Do you expect that volumes in the next quarter are going to increase? And the second question with this the degradation of the economy, do you expect to bring more dollars from Argentina to Chile. How is going to be the process. I would like to appreciate if you can give us some color about that change? Thanks.

Patricio Jottar: Indeed, Contanza. Look, regarding volumes in Argentina, pre the presence of Mr. Milei, when inflation was very high, there was a lot of money in the pockets of consumers. Before the adjustment the running rate — the volumes of the last quarter adjusted by the industry, let’s say it was 100. In the worst moment in 2024 that was Q2 and Q3 volumes of the industry decreased and maintained by 20%, were if handed before were 100%, today we are in 90%. Now just in the middle of the road between pre-adjustment and the worst moment after adjustment. My remark number two. The worst moment of the adjustment was Q2 and Q3 2024. So we expect to have a good growth in volumes compared to those figures. But again 90% is less than 100%. So the industry is stabilizing in a level which is 10% better than the worst moment and 10% lower than the pre-adjustment movement. And then on your second question, I will ask Felipe to elaborate.

Felipe Dubernet: Now this was regarding the new measures announced on April 14 by the Argentinian government. Yes, the central bank announced an agreement first with the international monetary fund. Which is good. But also included comprehensive financing package. A new regulatory framework for exchange rate controls. These announcements of course for the futures are very positive. Because for results or income delivered from financial statements, from 2025 and thereafter, we would be able to bring dividends from Argentina. Which is good news for the future. I cannot tell you, if we will bring or not, it will depend on our results and other accounts. And also it was announced a new bonus for our reconstruction of a free Argentina delivering in Spanish.

That would allow us to settle some accounts with some commercial partners, that we have foreign rate exposures in our P&L, which is positive. But also to pay some unsettled share sales from the holding company to Argentina. So. First is to settle the accounts, would be the first objective. And then of course for the future is positive, that we could bring dividends from the results from 2025 and thereafter. So we see with very good eyes this new announcement of the government.

Constanza Gonzalez: Okay. Thank you for your answer. I have a follow-up question. In relation with the shingles in trends. What is, — I’m sorry, which is the level of margin EBITDA that you feel comfortable for the long term?

Patricio Jottar: See, we do not make projections publicly for the long term. But we are trying to recuperate the EBITDA margin in the year business both in Chile and Argentina.

Constanza Gonzalez: Okay. Thank you. Thank you for your answers.

Operator: Thank you. We have a follow-up question from Fernando Olvera from Bank of America. Your line is now open. Please go ahead.

Fernando Olvera: Great. Thanks for picking up my question again. I would like to hear your thoughts about the weak demand in wine, in both local market and exports. Is there any other reason beside a lower demand of alcohol? And also how do you expect volume to behave the remaining of the year given that you will face easier comps? Thank you.

Patricio Jottar: Thank you Fernando. I mentioned before the trends to reduce the alcohol consumption on the whole alcohol category. But if you double click the wine category has been the one suffering the most. Figures, this is Chile. 2019 the per capita of wine is really stopped investments in wines. The per capita in Chile 2019 12.7 liters. 2024, 10.5 liters. 2025, continually declining. The United States wine as 2019. 9.8 liters. 2024, 8.4 liters. The world as a whole which impacts on our ability to export per capita in 2019, 3.8 liters. 2024, 3.3 liters. Among all the categories the one suffering the most is the wine. The beer and spirit categories have been able to defend themselves. I think that because the wine categories are much more conservative and the beer category has been bringing a lot of innovation and the spirit category has been much more innovation, particularly on flavors alcoholic products which are growing a lot.

Low alcohol flavor sparkling those categories are increasing a lot and we are promoting strongly those categories based on beer business. Spirit are also based on wine, we have been able to defend volumes and profitability by doing this. And we expect those categories to grow a lot in the future. Regarding this year, we prefer not to make public estimations. Of course we have our own estimations, but we prefer not to make them public. But again, the trend is complicated as I mentioned before particularly for wine. But we are trying to offset these trends by pushing a lot of those flavors or the low level of alcohol, non-alcoholic products, beer without alcohol. Sparkling wine without alcohol. We expect those categories to grow in the future and we are pushing a lot.

With a lot of margin because those categories make sense because they bring volume and they also bring margins. At the very beginning you have to invest in marketing, you have to generate a little bit of additional costs in your operation. But we are convinced that they will be extremely important in the future. Not only in the future in the near future. That’s it.

Fernando Olvera: Okay. Great. Thank you so much for the color.

Operator: Thank you. We have a question. From Santiago Petri from Franklin Templeton. Good morning. Thanks for the call, do you perceive a change in consumption habits towards beer consumption globally? Why are sodas doing better than beer? What is your outlook for beer consumption in the future?

Patricio Jottar: Thank you Santiago for your question. It’s a key question that probably you texted this question before my last remarks. But again I will repeat some figures and give you information on this. All over the world in the last 10 years, let’s compare pre-pandemic with post-pandemic. Beer in all over the world the per capita was 23.9, in 2024 it was 22.7. So a decline but not as important as in the case of wine. In the case of Chile, per capita in 2019, 52.2, in 2024 54.2. So we have been able to move in a different direction than the world in the beer category. Among other reasons in the tough competitive environment that we have in Chile, so apply all competitors to be very smart promote our volumes. So we have been able to move in the right direction.

In 2025 the trend is not good. As I mentioned before and it shows. I would say that this is the key challenge for all the companies producing alcohol all over the world. And we are facing this challenge. But indeed it is a challenge.

Operator: Thank you very much. I will now be passing the line for the CCU team for the closing remarks.

Patricio Jottar: In summary, the first quarter 2025 we were able to deliver higher financial results expanding EPA. And the income in a challenging business environment for volumes and continues costs pressures. Ii line with our priority of recurring profitability, we implemented revenue margins across all operating segments, while continue to deliver efficiencies. Furthermore, in 2025 we are celebrating 175 years of history. We have overcome many challenging times by being a dynamic and innovative company. Capable of adapting to transformations in Chile and the other countries where we have expanded our operations. This past business experience, will be key to navigating the current uncertain business scenario, especially in terms of consumption trends and the change rate politics. Thus we continue implementing our 2025-2027 strategic plan, supporting our multi-category strategy to ensure sustainable and profitable growth for CCU.

Operator: This concludes the call for today. Thank you and have a nice day.