Good day, everyone. Welcome to CCU's fourth quarter 2024 earnings conference call on the 26th of February, 2025. Please note that today's call is being recorded. At this time, I would like to turn the conference call over to Claudio Las Heras, the Head of Investor Relations. Please go ahead, sir. Welcome, everyone, and thank you for attending CCU's fourth quarter 2024 conference call. Today with me are Mr. Felipe Dubernet, Chief Financial Officer, Joaquín Trejo, Financial Planning and Investor Relation Manager, and Carolina Burgos, Senior Investor Relations Analyst. You have received a copy of the company's consolidated fourth quarter earnings release. Felipe will now review our overall results, and we will then move into a Q&A session. As usual, before we begin, please take note of precautionary statements. The statements made in this call that relate to CCU's future financial results are forward-looking statements, which involve known and unknown risks, and uncertainties that could cause that our actual performance or results to materially differ. These statements should be taken in conjunction with the additional information about risks 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 CMF and available on our website. It's my pleasure now to introduce Mr. Felipe Dubernet. Thank you, Claudio, and thank you all for joining us today. Before moving into the quarter, I would mention some highlights of the full year, 2024. In 2024, CCU delivered higher financial results versus 2023 after a strong turnaround during the second half. Also, we continued to advance in our strategy in a particularly challenging and volatile business environment. Through the year, we faced a low 20s contraction in the beer and water industries in Argentina and a modest economic growth in Chile that led to flat volumes in the Chile operating segment. In addition, we experienced cost and expenses pressures coming from the depreciation of our local currencies against the U.S. dollar. In this context, and excluding the non-recurring effect of the sale of a portion of land in Chile in quarter two, 2024, full year consolidated EBITDA reached CLP 387,267 million, increasing 2.1%. When including the non-recurring gain, EBITDA increased 9.6% versus last year. At the same time, and also excluding the non-recurring gain, full year consolidated net income expanded 32.5%. When including the non-recurring gain, net income increased 52.3% versus last year. The strong turnaround in the second half of the year, where consolidated EBITDA surged by 27.7%, was mainly explained by a solid performance in quarter four in all our operating segments, more than offsetting a challenging first half where we post a 26.5% decline in EBITDA as of June 2024. This upward trend was driven by effective initiatives in revenue management and efficiencies in all our operating segments, enabling us to more than offset the negative impacts in our results from the challenging scenario described above. The initiatives mentioned above were executed under the regional plan HérCCUles, which we started in 2022 and ended in 2024. Being key to align the company under six pillars with the objective of recovering financial results, resulting in positive EBITDA and net income growth, the latter well above inflation in the period, despite an unfavorable external context with devaluation of the currencies and low economic growth in the region. Regarding our business strategy, during the year, CCU continued strengthening its regional footprint. In July 2024, we started consolidating Aguas de Origen, our water business, with Danone in Argentina, which will continue bringing synergies to our operations in that country. In October 2024, we increased our scale in Paraguay through a partnership with the Grupo Vierci, which includes the PepsiCo license for the production and distribution of beverage as well as the distribution of snacks. With this association, Paraguay became the second country where the PepsiCo license is part of CCU's brand portfolio, in addition to Chile. At the same time, we continue investing in our brands, achieving a strong brand preference, especially beer in Chile, and kept reinforcing our digital transformation to support sales execution and drive operational efficiencies in the future. Finally, we were the first to inaugurate a modern PET recycling plant, bottle to bottle, in Chile, named CirCCUlar. Now, I will move into the quarter. In quarter four, 2024, CCU delivered a solid set of results. Consolidated EBITDA reached CLP 182,621 million, a 65.2% increase. This result was driven by all operating segments. It is important to mention, as we mentioned in that moment, that in quarter four, 2023, the application of IAS 29 from IFRS in Argentina generated a loss of CLP 24,018 million in consolidated EBITDA, versus a gain of CLP 1,095 million in quarter four 2024. Nonetheless, even isolating this mentioned effect due to the hyperinflationary accounting, consolidated EBITDA expanded robustly by 34.9%. In terms of quarterly volumes, excluding the inorganic volumes from the consolidation of Aguas Danone de Origen and the association with the Grupo Vierci in Paraguay, volumes were down 0.1% in quarter four, 2024, fully explained by the I nternational Business operating segment, which continued to contract versus last year due to Argentina, almost fully offset by an expansion in the Chile operating segment. While Wine volumes were flat. I would like to mention anyway that Argentina continued to improve its scale compared to previous quarters. Consolidated net income reached a gain of CLP 74,153 million, up by 77.7%, driven by the better operational results and a better non-operating result, particularly in Argentina. In terms of our segments, in the Chile operating segment, top line expanded 9.9% as a result of 4.9% increase in average prices and 4.7% higher volumes. Average prices were boosted by revenue management efforts, partially compensated by negative mix effects, while volume expanded mainly due to a low comparison base in quarter four, 2023. EBITDA expanded 23% and EBITDA margin grew 208 basis points to 19.6%. In the International Business operating segment, excluding the inorganic volume from the consolidation of ADO and AV in Argentina and Paraguay, respectively, organic net sales recorded a sharp increase driven by higher organic average prices, which more than offset an 11.5% contraction in organic volumes. Higher organic average prices were mostly caused by a low comparison base due to a negative impact on revenues from the sharp Argentine peso devaluation against the U.S. dollar in last quarter of last year, and to a lesser extent, revenue management initiatives. EBITDA more than tripled versus last year, driven by all the geographies. The Wine operating segment posted a top- line expansion of 21.4%, driven by 21.57% rise in average prices where volumes were flat. Exports expanded during the quarter, being almost fully compensated by the drop in the Argentine domestic market as Chilean domestic volumes were flat. The better average prices were most explained by a favorable comparison base, a weaker CLP, Chilean peso, and its favorable impact on export revenues and positive mix effects. EBITDA posted a 16% growth, and EBITDA margin was down 74 basis points. Regarding our main joint venture and associated business in Colombia, volume reached 2.3 million hL in full year 2024, increasing 7.8%, and we reached positive EBITDA. Now, I will be glad to answer any question you may have. Thank you. We'll now move to the question and answer section. If you'd like to ask a question, please press star two on your phone and wait to be prompted. If you're dialed in by the web, you can type your question in the box provided or request to ask a voice question. We'll just wait a moment or two for questions to come in. Okay. Our first question comes from Fernando Olvera from Bank of America. Please go ahead, sir. Your line is now open. Great. Good morning, everyone. Good afternoon there. Thanks for taking my questions. I have two. My first question is, if you can comment, what was the performance in Chile between premium and mainstream beer and how much represents premium of your beer volume now? How do you expect the mix to behave this year? And my second question is how are you thinking about the price elasticity in Chile? Thank you. Yeah. In your first question, I understood the first part of the question. We have some communication problems in the second part. Let me answer the first part of your question, what is premium and mainstream, so how was the mix? This is your first question regarding that? Yes. What is your outlook for this year? You You know, in these two categories. Thank you, Felipe. Okay. I would say between premium and mainstream is rather stable, the mix in comparing quarter four 2024 and quarter four 2023. The outlook in Chile. You know, quarter four the industry was, I would say soft, because although we have a mid-single- digit growth in Chile during the quarter, 4.7% we grew the volumes, it's worth to say that the comparison base of last year, as we mentioned in our press release at that time, due to weather conditions, was a low comparison base. If we exclude that, we could conclude that the industry is rather flat; I would say soft. What we expect in the future, you know, it's too early to call 'cause only we have one month, but what we—i t was slightly positive, I would say, compared to the first quarter of last year. It's too early to call. It would be a soft industry for sure. I would say the economic growth in Chile is expected to be 2% in the long term, so do not expect, you know, a big jump in the industries. I would say a similar year in terms of growth of what we experienced. A little bit more growth maybe, but low- single- digit growth would be something reasonable. Okay? Okay. Regarding the second question, how are you thinking about price elasticity? You know— Thinking about that soft volume. Yeah. Yeah, you know, at the end of the day, if you look at the overall quarter, or excuse me, the overall Chile operating segment, we grew the volumes, and volumes they are, let's say, running at, you know, a very similar rate, you know. I would say that the price elasticity. Of course we aim, we increase prices by 4.9%. This is in part as we have discussed in many phone calls, that we need to recover our margins due to this big jump after the pandemic's of the input costs. Because we still have a lower gross margin compared to 2019, for example. That is the year previous to the pandemic. We need to continue to do revenue management efforts. Price elasticity, I think, you know, there is something, but at the end, it's exactly the same we have. Remember, in 2019, for example, we used to sell in the last quarter 6 million hL, just as a data, you know. In the 2024 last quarter, we sold 6.6 million hL while we have the increased the prices in line with inflation. It's not the same price. There is a—w e could increase price while increasing the industry. If you see the numbers, we are against 2019, 15% above in terms of volumes. The first pillar of HérCCUles was to maintain the scale, and still we are more than maintaining the scale, despite the price increases. These price increases were not enough to compensate the input costs. We have increased the prices while increasing the volumes. Okay. Great. Thank you, Felipe. Thank you. Our next question comes from Ewald Stark from BICE Inversiones. Please go ahead, sir. Your line is open. Hello. Thanks for taking my question. I have a question regarding Argentina. So far in 2025, how have you seen Argentina performing, and what are your expectations going forward? Thanks. Thank you, Ewald, for your question regarding Argentina. Yeah. In Argentina, after you know the big decrease in volumes occurred in quarter two and quarter three, where we saw high 20s decrease in volumes, between 25%-28% decrease in volumes compared to the same quarter of the previous year. In quarter four we saw an improvement. We decreased our volumes in a much lesser extent the volumes. We saw gradual improvements in Argentina. Just to give you a flavor on that, this is seasonally adjusted volumes. In quarter one 2024, our seasonally adjusted volume, this is not including the inorganic volumes of ADO, were 5.8 million hL. In quarter four, it was 5.6 million hL. We haven't yet recovered the quarter one volumes. However, in quarter two, which was the bottom, was 5.2 million hL. We continue to see some improvement in January, but as I like to mention, it's too early to call. We think it will, it would gradually recover to a higher scale in Argentina. Would Argentina recover the scale we had in 2023? No. The industry as you know inflation is more controlled and as it is projected a higher economic growth should continue to recover in the way to recover the scale we had previous to the macro adjustment in Argentina. Okay. Perfect. Do you have any sense about when 2023 volumes could be achieved going forward, maybe in 2026, 2027? It's difficult to predict, you know. I would say— Totally. Maybe you mentioned exactly what could be reasonable between two to three years. It would depend on many factors. In Argentina you have still many macro challenges. Would the government release the cepo at the end of the day? We are in a good path in the sequential improvements. I would like to say. To predict, you know, when we would recover the scale in Argentina. At the end, Argentina today manage a completely different micro and macroeconomic reality. You know, it's a country that maybe the first question you may ask me or we may think is when hyperinflation would end in accounting, for accounting purposes, you know? Because, yeah, we saw very good results in inflation with improvements. You know, salaries need to recover, employment needs to recover. The macros need to recover. We could answer the question regarding when would we recover the scale in Argentina. We are on the path; q uarter four results showed that. Early January results show that we continue with the sequential improvement that we are saying that is happening since quarter three. Quarter three more moderate, quarter four better, and we expect quarter one to be a little bit better and continue to recover the scale. Okay. Perfect. Thanks. Have a nice day. Okay. Thank you. Just a reminder, if you'd like to ask a question, please press star two on your phone and wait to be prompted. If you're dialed in by the web, you can type your question in the box provided or request to ask a voice question. We'll just wait a moment or two for questions to come in. We have a question from Martin Zetzsche, from Fundamenta Capital. Should we expect margin recovery during 2025 and 2026? Would that recovery come on the back of price increases going ahead of cost inflation? Yeah. Thank you, Martin, for the question. Yeah. The last quarter results are encouraging, especially in the case of Chile. As you compare, we recover our margin path. For example, in 2024 we have exactly the same margin as we had in 2021 when we had an extremely high volume. In general terms, it's a tough scenario. It's very volatile. It would depend a lot on external factors, especially the exchange rate. If you ask me that question at the beginning of the year with the Chilean peso at CLP 1,000 per U.S. dollar, it would be very difficult to improve EBITDA margin. We will continue our revenue management effort as well as our efficiencies effort in order to show sequential improvement in margins. These are key. As you mentioned in your question, revenue management is key, not only increasing prices, but also rationalizing promotions is key in that sense. Certainly the improvement of margin will not come from volumes, so it should come from revenue management, but also from efficiencies. We should be seeing an improvement; I'm talking regarding Chile. In the case of Argentina, as I mentioned in the previous question, we continue with this sequential improvement. We should recover margin certainly. Okay, thank you. It looks like we have a follow-up question from Fernando Olvera from Bank of America. Your line is now open. Please go ahead. Hi. Hello, guys. Thank you for taking my question again. Maybe if you can comment about the Wine division. I mean, your volume is still far from the peak reached in 2021, so how do you expect volume to behave this year, and what is your outlook on export, the corresponding domestic markets? Also if you can comment about Colombia, about volumes in Colombia, how are you seeing the behavior this year given the solid growth that we saw in 2024? Thank you. Okay, regarding the Wine division, I would maybe divide your question in three answers because we operate in different markets. First of all, exports. Exports, as we haven't yet recovered the scale we had previous to the pandemic. We are below the 2019 volumes by 13% in exports from Chile. Twenty twenty-four was the first step in terms of recovering that, as we grew 4%, 3.9%. Still is moderate. We think we will continue to recover, especially by the implementation of our commercial offices in China, U.S., and U.K. This initiative certainly will improve our execution in these three key markets, along with the recovery of other markets such as Korea. In general terms, we should be recovering, growing this year, and in the way to recover this market. It's tough. It's a very competitive market. You know, we have experienced destocking in 2023 of all of our clients. Going forward, 2024 shows growth. We need to—w e are still far from recovering the scale we had previous to the pandemic. Another important lever is innovation. Innovation is key in a category that globally doesn't grow. Innovation is key. Jumping now to Chile domestic. In that case, it's the opposite to the export market because we have a higher scale than previous to the pandemic. We have preserved the sales despite an improvement in margins as we have increased prices. But in that sense, this is a very good business that we are in in very good shape. We are the market leaders. Innovation has been key in that. Argentina suffering from what's happening in Argentina in terms of volume. This year we suffered in the domestic Argentinian market in 2024. Overall the perspective is growing exports, maintaining our leading position in Chile. But essentially, the recovery of export volume is key going forward. Excellent. Yeah. Regarding Colombia. Regarding Colombia, we grew high single digits, gaining share with an excellent performance of Andina Light. Also an excellent performance of Tecate. There is still job to be done in our execution. The team in Colombia is working hard. We also, with our partner Postobón, in improving our, especially our sales execution and also while increasing our brand preference there. But we are very happy about the performance of Andina Light. You expect the good performance to continue? As I mentioned, we reach a positive EBITDA, which is very important to continue to invest behind the brands. Okay. No, perfect. Just a quick one. About the massive blackout from yesterday in Chile. I mean, I was just wondering if that blackout affect, in some way, your operation, no? If it was highly affected or not. No, not significantly. First of all, we lost, you know, one shift of production because production, you don't have backups for the full production, only for the essential. For example, to keep the beer in the fermentation tanks, you have backups. All the distribution is not a heavy user of electricity, so you have full backups. We completely deliver our customer orders without any disruption. We lost one shift of production. It's not significant, as we could extend some shift going forward and completely recover this shift that we lost. Okay. Our contingency plans work perfectly in the IT side, in our data centers, and also in the distribution to completely deliver the products to our clients. Great. Thank you, Felipe. Okay, thank you. Our next question comes from Constanza González from Quest Capital. Your line is now open. Please go ahead. Good afternoon, Felipe and team. Thank you for taking my question. I have two. The first one regarding CapEx. What is the CapEx that you are expecting for this year? And I appreciate if you can make the separation between investment and maintenance. And the second one is just regarding CapEx too. Do you have any target regarding the EBITDA that you intend to invest in the future? Thank you. Hello? Hello, Constanza. Thank you for your question regarding CapEx. What we can say is that CapEx against depreciation would be going forward a little bit above inflation, a bove depreciation. Our CapEx would be a little bit above depreciation. But much lower than what we saw in previous year. Let's say 2019, 2022, which was a period of big expansion in terms of volume capacity. We moved from between 1.4 on average, 1.3-1.7, which was the peak in 2022. We are moving to ranges between 1.1 and 1.2 going forward. Because, as I mentioned, we saw a soft industry, at least in 2025 and maybe in two years. As I mentioned, we need to recover the scale in Argentina. We saw a more moderate CapEx going forward. CapEx, especially that of sales, were in ranges between 7%-7.5% on average, 2019-2022. 2023-2025, we saw something around 5.5%. That's for CapEx. Could you repeat your second part of the question? Of course. Do you have any target regarding CapEx versus EBITDA? Or it's not a measure that you follow? No. The metrics I mentioned are the metrics we use. You know, CapEx as percentage of net sales. As I mentioned, we don't have a—b ecause CapEx, you need to be flexible enough. If we have a jump in industries, you need to invest in capacity. Main CapEx, you know, the mix of CapEx now is moving to efficiencies, is moving to regulation. As I mentioned, a big jump in CapEx last year was due to the construction of CirCCUlar, which is a plant to recycle PET bottles. Okay. It's more linked to environmental and efficiencies rather than capacity. I think our level of CapEx should be in the average of the industry. What we have seen is between 5%-8%, depending on what are the needs. There is no specific, but I think this would be the level of the CapEx that's a little bit above inflation between 1.2x and 5x depreciation. Excuse me, not inflation, depreciation. Thank you, Felipe. I have another question, regarding net financial debt over EBITDA, are you evaluating some range in the next year? Or are you comfortable with your current levels? Yeah. In general terms, we are within the range. We don't have a public target on that, but I think it's when we compare with the industry, comparing with other actors, I think we have a reasonable level. As far as we kept our investment grade, which is key. That's important for us. We still are keeping our investment grade level. We need to be in that range. As I mentioned, we have maybe less CapEx in the next three years because we are moving from 1.5x depreciation to 1.2x depreciation or moving from above 7% of purchases on the same CapEx. This indicator will continue to improve. In fact, in the last quarter, we moved from net financial debt to EBITDA from, you know, 2x to 1.8x. We are in the good path, but it's key for us to preserving our investment grade. Thank you so much for your answers. Okay. Thank you. Our next question is from Álvaro García from BTG Pactual. Can I ask about Chile cost inflation outlook specifically, and your outlook on how this might impact the rationality of pricing in Chile over the next year? Thank you. Okay. Álvaro, thank you for your question. Regarding cost inflation, as I mentioned in the previous question, it's very volatile because it's very different, this business with a CLP 1,000 per dollar exchange rate is very different than CLP 940. This is CLP 60. You know, it's 1% of the valuation. It's a lot of money in our P&L that we need to compensate with efficiencies or with pricing. Because as I mentioned, we will not have great news from volumes. At the end, that's key for us. If the dollar going forward is maintained in a range of CLP 940, every price increase we do, at least in line with inflation, would be a good news in terms of overall margin. This is the aim, you know. Usually in the long term, CCU is aiming to increase price in line with inflation. Our ability to increase prices will depend on several factors. One of the factors is competition, of course. More than thinking about the competition, we need to think about ourselves. This is what is key, and it was a big pillar in HérCCUles and continues to be a very important KPI for us: brand sales. The stronger our brands are, the more our brands are in the heart of the consumer, the better price we can get for our brands. Even if the competition does promotions or, you know, discounts, we need to rely on our brand equity in order to sell, you know, at better prices. Of course, it's key, as I mentioned, the volatility in the markets. If we have a scenario of CLP 940, I would say it is reasonable to increase the prices in line with inflation or a little bit above inflation. Okay. Thank you. Our next question comes from Francisca Taverne from LarrainVial. Have you seen competition regarding price increases in the beer market in Chile? Have they followed in the last months? Yeah. We have been in the last quarter increasing prices in some specific packages. Because we have some packages that are less profitable than others. We have touched these packages, especially the large- size packages, and this has been implemented, especially in the beer category in Chile. As well, I think every company has suffered a lot in terms of margins of the levels we had before the pandemic. We need to continue to recover profitability. Usually, competition or the whole industry has increased the prices over time. And this is what I said: a t the end, it's a combination of overall industry price, but also brand equity matters in n ot only in the price list, but also in rationalizing promotions. This is key in a very competitive market such as Chile. Okay? Okay, thank you. Just a reminder, if you'd like to ask a question, please press star two on your phone and wait to be prompted. If you're dialed in by the web, you can type your question in the box provided or request to ask a voice question. We will wait a moment or two for questions to come in. We have a question from Sergio Winter from Falcom Capital. In your press release, you mentioned that HérCCUles is already concluded. Is there any other plan or measure to continue working on efficiencies in 2025? Hello, Sergio. Thank you for your question. Maybe we haven't been very clear in the press release, but we are mentioning that, of course, HérCCUles as a name, as an idea, as a brand, ended in 2024. It was a three-year plan in order to recover our results against 2022. That was in fact a very disappointing year in terms of results. In fact, we recovered EBITDA growth, especially net income growth that was above inflation in that period. Now going forward, as we mentioned, our focus will be on developing our 2025-2027 strategic plan, reinforcing our three pillars, profitability, growth, and sustainability. HérCCUles ended, but many elements of HérCCUles are still present and will be still present in our 2025-2027 strategic plan. In the upcoming annual report that we will issue according to the regulation going forward, we will be more specific and give more color on different KPIs of that new strategic plan, 2025-2027. Many elements of the plan would continue, especially in terms of profitability, where we need to continue to recover gross margin, because this is what suffered the industry, as well as reducing our expenses as a percentage of net sales, in let's say kind of efficiencies at gross margin level and efficiencies also at expenses level in order to protect our bottom line going forward. It is worth to say that HérCCUles was a successful plan in order to recover to some extent, despite the external effects we had, the contraction in Argentina. At the end, HérCCUles helped us in the delivery of the results that are showed in, especially in the last quarter. Okay, thank you. We are not seeing any further questions. Thank you everyone who asked questions. I'll be handing the line back to the CCU team for closing remarks. Thank you all for attending this conference call. To conclude, in 2024, we posted strong turnaround in our financial results during the second half of the year, expanding EBITDA and net income versus 2023 in a challenging business scenario. At the same time, we strengthened our regional footprint. Looking ahead, we are cautious about 2025 as the business scenario will remain volatile and uncertain. Our focus will be on developing our 2025-2027 strategic plan, reinforcing our three strategic pillars, profitability, growth, and sustainability, with a special focus on profitability through revenue management efforts and efficiencies. Finally, I would like to extend my gratitude to all our employees. Their dedication and commitment have been key to navigate challenging times. We will continue to work to ensure sustainable and profitable growth for CCU. I wish you a wonderful afternoon today. Thank you. That concludes the call. Thank you and have a nice day.