Good morning and thank you for waiting. We would like to welcome everyone to Ambev's First Quarter 2019 Results Conference Call. Today with us we have Mr. Bernardo Paiva, CEO for Ambev; and Mr. Fernando Tennenbaum, CFO and Investor Relations Officer. As a reminder, a slide presentation is available for downloading on our website at ri.ambev.com.br, as well as through the webcast link of this call. We would like to inform you that this event is being recorded and that all participants will be in listen-only mode during the company’s presentation. After Ambev’s remarks are completed, there will be a question-and-answer section. At that time, further instructions will be given. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are made under the Safe Harbor of the Securities Litigation Reform Act of 1996. Forward-looking statements are based on the beliefs and assumptions of Ambev's management and on information currently available to the company. They involve risks, uncertainties and assumptions because they relate to future events and, therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Ambev and could cause results to differ materially from those expressed in such forward-looking statements. I would also like to remind everyone as usual that the percentage changes that will be discussed during today's call are both organic and normalized in nature and unless otherwise stated percentages changes refer to comparisons with first quarter 2018 results. Normalized figures refer to performance measures before exceptional items, which are either income or expenses that do not occur regularly as part of Ambev's normal activities. As normalized figures are non-GAAP measures, and the company discloses the consolidated profit EPS, EBIT, and EBITDA on a fully reported basis on the earnings release. Now, I will turn the conference over to Mr. Fernando Tennenbaum, CFO and Investor Relations Officer. Mr. Tennenbaum, you may begin your conference.

Thank you. Hello, everyone. Thanks for joining our 2019 first quarter earnings call. I’ll guide you through the financial highlights for following operations, including our below the line items and cash flow, as well as commercial initiatives on CAC, LAS and Canada. After that, Bernardo will give you more details about our operations in Brazil. Beginning with the main highlights of our consolidated results. On a consolidated basis, in the first quarter, top line grew 13.7%, a combination of volumes increasing 5.7% and net revenue per hectoliter of 7.5%. EBITDA reached BRL5.1 million with an organic growth of 16.4%, while EBITDA margin increased 100 basis points to 40.5%. Normalized net profit for the quarter was up 6.2%, delivering BRL2.8 million. It is worth highlighting that, following the conceptualization of Argentina as accounting hyperinflation rate, rates had been 100%, the country is considered as highly rational in accordance with IFRS. Similar to the last few quarters, we continue to report the results of our operations in Argentina applying hyperinflation accounts. Having said that, I’ll now move to our regional results and start with Brazil. In the quarter, Brazil reached BRL2.9 million, an increase of 8.1% versus first quarter's 2018 while margins contracted 220 basis points to 40.8%. Beer Brazil had a very solid performance, with volumes delivering double-digit growth at 11.3%, which adjusting for the 3.7% net revenue per hectoliter growth, with top line 16.4% higher than the first quarter 2018. Net revenue per hectoliter ended up being in line with inflation, fighting off high price increase and negatively impacted by the regional link as most ahead of the country average. While our volumes grew 11.3%, the industry estimated by Nielsen points low single-digit. EBITDA for Beer Brazil was up 5.4% in the quarter with margin contraction of 400 basis points…

Thank you, Fernando. Hello, everyone. As mentioned by Fernando, we started the year delivering solid volumes in EBITDA growth. When we announced the 2018 full year results, we highlighted that is transformational investment behind our strategic platforms in the past years. Even in a moment of external volatility and challenging macroeconomic environment, which placed us in a very stronger position to compete in the Brazilian beer market, and definitely would be prepared to fully benefit from the economic rebound. Our performance this quarter is a consequence of the consistent investment we've used in our strategic platforms. It's important to point out we have not seen yet disposable income resuming growth, which would likely provide meaningful boost or bonus. We're focused on the long-run and sustainable value creation. Therefore, it's important to understand our strategy. Having said that, I would like to take some time to further explain our strategic platforms, what's our long-term plan, and how we implement it. The heart of is the consumer-centric approach, which, with the category developed framework, guides the design of our portfolio. The same consumer-centric approach is translated into our strategic platforms, Premiumize at Scale; Differentiate the Core; and Drive Smart Affordability, supported by Sustainability; Operational Excellence; and finally, Business Transformation Enabled by Technology. All of this is supported by our major long-term sustainable advantage, our Dream, People and Culture. Now let's go through the category framework and portfolio strategy. Our approach is based in the market maturity model and the category expansion framework. The market maturity model is about how end market evolve while the category expansion framework is a vision of the portfolio mix and initiatives that should be applied to each market stage. Markets have different stages of maturity, one, two and three. Therefore, different consumers-centric approach should be adopted in…

We will begin the question-and-answer session. [Operator Instructions] And our first question today comes from Antonio Gonzalez with Credit Suisse. Please go ahead.

Good morning, Bernardo and Fernando. Thank you for taking my questions. I just have two quick ones, if I may. The first one on SG&A in Beer Brazil. I think that if you take out the bonus accruals, right, even with double-digit volume growth, if my numbers are right, SG&A -- underlined SG&A in Beer Brazil was basically flattish, right, year-on-year. So, I wanted to ask your view on the sustainability of this trend and whether the operational excellence and the tech initiatives that you just described, Bernardo, are really meaningfully impacting the SG&A positively? Or at this stage, it's the early days? So that's number one. And number two, if I may, very quickly. You made reference to value brand declining 200 basis points, right, in the beer industry. That seems quite substantial, now if I'm not mistaken, you made reference before to 500 or 600 basis points of value increasing throughout the crisis, right, and now, in just one quarter, we see a meaningful reversion. So I just wanted to confirm whether this is on your new Nielsen numbers? Are the numbers really comparable? And can you give any, I guess, bigger picture thoughts on how quickly can this reversion fully materialized? Thank you.

Hi, Antonio. Fernando here. Thanks for your question. On the SG&A bps, I think it's very clear that we follow hedging volumes. We always know one year ahead what's going to happen to our cost of goods sold. And knowing that we're going to have some cost pressures this year, of course, we prepared ourselves, and we look for even more savings and what we call non-working money. And you're right, given all the new technology initiatives, we lever more on that also to find even more efficiencies on the SG&A side. So, when we look ahead, I do believe we can continue to deliver good performance on the SG&A floats. So I don't think that should be an issue this year. Of course, on the cost side, on the cost of goods sold, as anticipated and in the guidance that is provided, we've been in pressure this year. But as we always do, try to offset some of that on the SG&A line.

Hi. Antonio. So linked to your question of the value brand, the number that we've shown to you is 200 bps -- I mean, below the peak of this year are Nielsen numbers, our Nielsen 2.0 numbers. So, basically, calculate that, all the brands that are marketing in the price mix below 90. So, those are official numbers that we have made by Nielsen. And we always said that at least the consumer confidence with pick up a little bit more. Consumers will trade up, and we will meet -- I mean encounter our much stronger portfolio of core brands like we've shown to you -- I've showed to you in the slides, of Brahma, Skol family, Bohemia, and then the core segment would present -- would grow again. So, basically, based on the Nielsen, numbers that backlog happen in the first quarter.

And those numbers -- thank you, Bernardo. Just to clarify, those two conversations are from the peak in the second semester of last year or from a year ago?

It was from the second semester of last year and UC numbers, exactly the quarter -- maybe I can follow up for the numbers from last year.

That's…

In the last quarter, the value in the final months of the year started to -- I mean, ease and decline. And then I can follow up with you. But we're I think the third quarter of last year. But I will follow-up with you. But for sure, last year.

That's very helpful. Thanks.

Thank you.

And our next question comes from Robert Ottenstein with Evercore. Please go ahead with your question.

Great. Thank you very much. And I apologize if you answered this, but the line wasn't that clear. It looks like you've invested a significant amount over the last four or five years on innovation, which is great given the kind of challenges that you had, and you're starting to see some of the benefits from that. Can you perhaps contrast what percentage of your sales or volume came from innovation this quarter compared to where it was a couple of years ago? So that's question number one. And I realize that may be tough to get. And then second, can you help us think through kind of that sort of the general volume run rate that you're at now? Obviously, you had a huge benefit from the Carnival this quarter. What would be the kind of a normalized run rate given the current economic environment? Thank you.

Thanks for the question Robert. I think the first question, we had been procuring, investing in the portfolio as we've shown -- I mean, minutes ago, in the last years. And for sure, the innovation pipeline is full -- I mean we have been implementing those new launch, new liquids, variance of core brands, premium brands. And all of this is supported by our innovation-center in Rio de Janeiro that's state-of-the-art, that really assure that I have the best liquids in the market. So innovation was key in the first quarter. Skol Puro Malte was a huge success. To be very candid, we have kind of to delay the national rollout because the first quarter was much stronger than we expected. But not only in the core innovation impacts, it means as well with design. So, we cannot disclose the number, Robert, but it was a strong. And the other important benefit there was the trigger, with the consumer confidence starting to come back, even though in the disposable income is not yet there, I mean, it didn't change, the trade up will benefit us like benefit in the first quarter. We had a big headwind of Everson like it was the last four years. It was not the case in the first quarter. So, consumers are trading up for premium, so continue to grow the premium segment. And then when they come back to the core, they are seeing all the innovations in terms of our core brands that I just mentioned in my speech. This is the first question. The second question linked to the volumes was basically -- was basically that, no? What strategic comps? Again as we announced in the 2018 year -- the last call of the year, we highlighted the mission to customer vessel…

Thank you.

Thank you.

And our next question comes from Leandro Fontanesi with Bradesco. Please go ahead with your question.

Hi Bernardo, Fernando. Thank you for the opportunity. I have two questions as well. You mentioned Nielsen 2.0. Just to confirm the data that you mentioned in the press release that the market grew low single-digit, if that's really the Nielsen 2.0 full comparison base. And if that's the best indication that we should use to indicate what we want to sellout during the quarter? And the second question is one big can maker mentioned last week that the biggest -- the largest beer player in Brazil was shifting from returnable bottles to cans. And if you could comment, what's driving this strategy? What's behind that? Thank you.

I think I'll take the first question. Leandro, thanks for question. Those are Nielsen data, comparable basis, expanded base, the 2.0, and then the numbers of low-single-digit is sellout number and you'll see sellout number. But something that's very important sideway for me just to highlight some of the things that we always talk about is selling and sellout. This year, actually, the selling and sellout dynamics, there was no major effect. We started the year with a strong January, and the base remained consistently until the end of the quarter. For sure, the sellout of – the sellout of new season catched 100% from January to March, because there is a delay kind of -- 20, 15 days a month in terms of the sellout data that they measured in the market. But in our numbers, in our volume, there is no major big effect. General strong, and then that's the same pace that we have in the end of this quarter. Selling and sellout has more of an impact the first quarter of 2018, given the weather -- bad weather at the end of December 2017 and January. This was part -- this was the reason why -- one of the reasons why the first quarter of 2018 was the easiest comp among the quarters in the 2018 year. But all-in-all, we start the year with intentional loadings does not make any sense as we have three quarters ahead of us, the full year and basically, wouldn’t be right. So basically, that's what I can tell you about the numbers of sellout. The other thing about the cans and RGB, we continue to invest behind affordability and smart affordability, and that's why RGB is very, very important. So, we see opportunities to grow in the off-trade as well and to reap-up even more than one later. So we're doing that. But in the end, as a consumer-centric company, we'll be aware of consumer trends, and if they want more cans, we'll supply them. By the way, we have a very good relationship with the suppliers, and they are building a can plant. So we are really focused on approach, of occasions, need space and what our consumer wants. RGB is part of that. But if they want cans, they will have cans in the nice portfolio, superior portfolio, like I've just shown slides ago. Hope that answers your question.

Yeah. Thanks very much for the color, Bernardo.

Okay. Thanks.

And our next question comes from Isabela Simonato with Bank of America Merrill Lynch. Please go ahead.

Thank you. Good morning, Bernardo, Fernando. Just a quick questions. First of all, in LAS, in Argentina specifically, what are the real risks you guys are seeing given the political and macro challenges? Do you see chances of price control on your segments? And you bit of mentioned two SKUs have been -- had suffered from price control recently. So what are the real risks you guys are seeing in Argentina? And second of all, think about Beer Brazil. In the second quarter last year, we had the effect of the World Cup and the truck driver strike, which apparently one offset the other. So can we think about Q2 as a comparable basis for this year? Thank you.

Hi, Isabella. Fernando here. Argentina, I think you get the right point, there are some kind of macro challenges, if I could say. So the economy, the GDP is suffering, inflation is very high, consumer confidence is at a low. And we had very tough comparables because, if you remember, first quarter last year, we saw very strong volume growth. So when you add all that, for sure, you had volume pressures on the first quarter in Argentina. We are used to operate in a market like that. It's no new to us. So, I believe that in this year, there are likely to be still some macro challenges given how the economy is going. But if you look over through it -- if you take a medium and long-term view, then I think you should be always in a good place, because there is a lot of growth still to come in Argentina. So [indiscernible] opportunities, premiumization opportunities, and that hasn't changed. But I think it's fair to assume that this year is going to be more volatile than average in Argentina.

And I think, just to add, Isabella, we don't see there any formal price control. So we adopted -- I mean, we put two SKUs in this, because we want to help the country as well, to go through this -- this I mean tough moment in terms of macro there, so supporting the country there. But it's not kind of a formal enforced price control at all. So just to add -- I mean, we have confident that Argentina is always like that, ups and down. We have been there for many, many years as a successful business, and we'll continue to be. And this price control problem has no meaningful impact in our profitability. So linked it to the quarter, as we said -- so last year, yeah, you're right, I mean we had truck drivers in May but a very strong World Cup, so kind of a water wash. So even a little bit -- the World Cup was a little bit even I mean better effect in the -- what we lost in terms of the truck drivers strike. So for sure, the second quarter is not easy comp at all compared to the first quarter. That was an easy one, given the weather and given the other things that we mentioned last year.

That’s very clear. Thank you.

Thank you.

And our next question comes from Ben Theurer with Barclays. Please go ahead with your question.

Well, thank you very much, and good morning. I actually have a question a little bit on your outlook in terms of cost and what you've been seeing. Clearly, there's been a lot of pressure during the quarter in terms of some of the input cost pressure, commodity prices, aluminum and so on. Is there something you have done in terms of strategy to offset that, i.e. pricing strategy or have you engaged in some sort of a hedging strategy to kind of at least, well, smoothen a little bit impact or try to offset some of the impact? That would be a first question, and then I have a minor follow-up. Thanks.

Hi, Ben, Fernando here. Our hedging policy, we always hedge one year ahead. So the good thing about this hedging policy is that, in the first quarter of last year, I knew that would have some pressures in the first quarter of this year, because I knew what would be the effect -- because I knew what would be aluminum, and I knew what would be valley. So with bear in mind, we already prepared ourselves, and we try to find additional savings, some of them on the cost of goods sold line and a lot of them also in the SG&A line. So that's why you are seeing that our SG&A didn't grow as much as other lines, as the cost of goods sold lines and it somehow a way for us to offset this growth. We know that going forward and through the remaining of the year, we're going to have pressures on the cost of goods sold. We disclosed that back in our guidance. And as always, we try to find ways to offset that on our other lines, SG&A and other lines. But we don't plan to do an offsetting on the revenues revenue per hectoliter line that follow the commercial strategy.

Okay. Perfect. And then just quickly on the -- just following up a little bit on your strategy and what you have in terms of the different approaches elevate and so on. Have you seen some sort of -- I mean, you kind of indicated [Indiscernible] but like market share changes or how competitors have started to react and what you've been doing in the different categories, be it on the affordability side or on the core side or the premium side? Like those three sectors that's we're most focused on?

Thanks, Ben, for the question. I think in regards to the market share, we don't disclose the numbers. But what we can say that the industry grew low single-digit based on Nielsen 2.0, around 3%. And our volumes grow ahead of that as we saw our numbers. In terms of the reaction of the market and so on, we have our plan the strategy is there. It's focused big time on innovation and the expansion of the portfolio of the core and premium. So premium is growing a lot. We're gaining share. So it's not -- I mean, when you do that, you're not talking about price disruption in the market, nothing like that. It's basically growing from the top layers of the price structure, so premium and core. So I think that's good for the industry. We're building brands. So -- and Brazil was always a competitive market likewise in the last many, many years. And I think that to have a superior portfolio, go-to-market dream, people, culture, to win and continue to win in this market. Very confident on that.

Okay, perfect. Thank you very much.

Thanks, Ben.

And our next question comes from Antonio Barreto with Itau. Please go ahead.

Hi, guys. Thanks for the question. My first question is on LAS. We saw that volume, the volume LAS accelerated a little bit in the quarter compared to what it had been in the fourth quarter and third quarters as well. I'd just like to see your opinion on what do you think changed to accelerate the volume loss in LAS? Do you think it's just a natural consolidation of a weaker environment in Argentina? Or is there something different? Did you lose market share in there? Were you a bit more aggressive on the pricing ahead of the cost increases that are likely to come in the upcoming quarters? If you could share a bit of color on that, I would appreciate. That's my first question.

Antonio, what happened in Argentina, basically and Paraguay as well to be fair it's just tougher comp. I mean, first half of last year was really, really strong in those countries. And in a way, what we could say the macro is not helping at all at this time. I think in those countries that we know for sure, always ups and downs that you always see in terms of the macro environment there. But the fact that in the first half -- in the first quarter, I mean, it's really, really it was a tough macro and tougher comps when you compared to the previous year. So portfolio is very strong. We are gaining share in the premium. We have Brahma in Quilmes doing well. And I think that all the plans in terms of concept wise all the platforms are very similar that I just explained to the Brazil market. And that is for the local environment for sure. But as a concept, it's the same direction.

All right. Thank you. And if I can go back to the Brazilian beer segment, when we look at the revenues per hectoliter, it's the second quarter in a row that we see the revenue grow a little bit below inflation, not by much but a little bit below inflation. We expected a bit more with the growth of the premium segment and now with the loss of share of the value segment as well. Could you tell us if the prices for brands are increasing in line with inflation, why aren't we seeing this effect more strongly on the revenues per hectoliter in the Beer Brazilian segment? Where these revenue's growth has been diluted away in your opinion?

Very good question, Antonio. I think what's -- I mean, basically, when you see a trade up, what the value segments that's going down, we are not -- I mean, we're not present, specifically and we're gaining share there, but still at a very low market share, way below our fair share in the value segment. So when this happens, the trade up, happening in both two segments for the core, to the core plus, continue to happen, continues to grow the premium. But the core segment, what we expect? When we'll have shrink in the value segment. The core segment? In fact, it's a segment that -- I mean, in the shorter term, when you have a big shrink of that -- I mean, it's the segment that suffers more when you have an issue of the value segment, right? But it's a segment that most benefits when you have the opposite the value shrink. And on top of that we have regional mix, so we have different prices per brand per region. And according to the regional mix, this could affect in net revenue project even if premium growing. Even if increasing price per brand is in line with inflation. So this regional mix it's an important thing to be aware. The growth of the core segment is important to be aware as well. But people want to buy our beers, innovation so on is one it's introducing. That's why the volume was strong as well.

Just to make sure I understand it correctly, Bernardo, I can say, I can affirm that regions with lower average price grew faster than the orders and you think that's the most important reason why we are not seeing this effect?

Yes. Just give you one example. If we go more in the northeast and north, that's by the way a region that we saw lowest market share in beer when you compare that. And if you have a trade up there and we have innovations there that's helping. That's like Skol is doing well. So this is the effect of the regional mix, but some of that things. So we are growing volume in a region that we have been underperforming maybe in the last years. So that's the regional mix that I talked to. So even if we don't change, I mean, if we have the same price policy everywhere, increased by volume inflation. But if you we have one reason, in this example, that’s [indiscernible] the northeast and north growing volume way ahead of Brazil like happened in the first quarter, this affected revenue for us. But it's a reason that -- it's a very important sign that our portfolio strategy is working there, the development is shrinking there, that Nossa is working and [indiscernible] is working and finally Brahma is working, so good news. Hope that works for you now.

Very good, thank you.

And our next question comes from Luca Cipiccia with Goldman Sachs. Please go ahead.

Hi good morning. Thanks for taking my question. I wanted to follow up on the premium portfolio performance. I think if I was looking -- I was checking back at the first quarter last year, I think in spite of the fact that the overall volumes for Beer Brazil were weak, were down and comps were fairly easy this time around, in premium, I think last year, you mentioned that in the first quarter you did grow by double digits as well. So 50% growth on a double-digit growth on year-over-year seems to signal a very strong, a very consistent performance. So my first question would be can you give us a measure of how much would you define the premium portfolio represents of the overall? And secondly, if directionally if you could remind us, give us a sense of the ways of the different brands or at least the global brands relative to the national brands, if you can just maybe remind us the significance of the 70-year old brands. So that would be my first question. And then secondly, just on portfolio innovation, there've been a number of initiatives, you enter sort of the value segments in a way with Nossa, with Magnífica. You introduced pure malt across the Skol family. I was just curious, looking forward, what other the areas of innovation, if not -- without being specific, you're most excited about. Is it flavors, packaging? What type of area that you're looking at to continue to innovate in the portfolio? Thank you.

Luca, thanks for the question. I think premium -- just the weight of premium is around 11% of our beer volumes and growing. So that's good. It's a good trend. And the segment will continue to grow. What you said, that's the global brand this quarter grew 50%, and the domestic ones, double-digit. So we had a very, very strong growth. We have the numbers. The news expanded number for the premium segment and the premium industry for the last quarter. And yes, as we're growing big time share in the premium segment, so strong growth, it's a portfolio gain and its quarter after quarter, and we are waiting. This is a fact. We have the numbers. We have the news to expand that and including a much easier reading because premium is more of trade, it's most scanned, so I mean, it's really there. It's real. So then if any of you see other markets and I've been saying if you go to U.S., I think the leading brand in the premium segment has around 60%, 70%. It is a portfolio gain. I mean, basically, what you saw in the end in every market, so now we have here Budweiser, our biggest brand. It's a strong brand, almost the same size as the competitor's brand that they have. But we have Stella that is growing double, double-digit, big time. We have Corona, 100%. Dorado original back to growth -- we made a pilot in the south to sell Patagonia that did very, very well. And then we built kind of a structure, a high-end structural being truly, to give this complexity. And it's working. So I think that the innovation that would come in the premium segment, for sure have more things. One example that I can tell you, we launched Beck's in the most important urban centers. It's an amazing brand, German brand. You know all edgy -- the edgy, I'll say, attitude of this brand, from German. It's pure malt, Puro Malte. It's bitter. It's trendy. It's an amazing brand. And we launched kind of one month. And in the quarter, I think this concept of family that we applied for Brahma is working very well for Skol as well. So that opened doors for us to give more variety in terms of liquids to the core consumer in Brazil. So that's amazing for the industry because we can expand the industry, giving access to people to great liquid that could in the umbrella of the portfolio in the future, so very excited about the portfolio approach that we have employed in premium, in core and of more things to come.

And Bernardo, if I can follow up, just the emphasis on premium, which has been there for a while and it seems to be working. It seems to me though you're more assertive now on the idea that the scaling benefit or the scaling opportunity is larger. Is that correct? Are we seeing -- I wouldn't call it premium 2.0, but in a sense like sort of more of a maturity of the strategy from a premiumization standpoint?

Look, it was always there. We always knew that premium would be bigger. But to give a premium brand, I mean it's not like, you have to see the brand stage by stage. So we're reaping the benefits in terms of Corona and Stella, the seeding that we've done years ago cannot launch a beer in premium like we launched Beck's and out of the gate sell tons of volumes and so on. So I mean the brand loses its uniqueness. So we already thought that premium would be the segment that will grow more in Brazil. The maturity model shows that. I mean the weight of the segment, even the price and the growth of the segment shows that. But to build a portfolio of brands that is Tier 1, you have to be patient. And this is a big change in terms of our way of beer brands. We are patient. So having investing in Stella for years, having Corona for years -- our pipeline of premium brands in the right moment, in the right stage with scale up, and then you'll see the vital count. They’re both same. There are lots of things to come from, even Bird, Stella, Corona and other new liquids initiatives that we’re foresee to be launched in the future.

Very good, thank you. Thanks very much.

And our next question comes from Thiago Duarte with BTG. Please go ahead.

Hi, Hello everybody. Thanks for the question. I have three questions, if I may. The first one is related to the industry. You mentioned that you believe that the industry has grown low single-digits in this quarter. And if we circle back to the last several releases from Ambev. And I think it's the first time that you actually stated that industry has apparently grown. So actually, Bernardo, my question to you would be whether you think this path of recovery for the industry in general is a good proxy for what you expect to see for the whole industry throughout the year? So, for the whole of 2019. So if we -- in your view, we should expect the industry to keep growing in the next few quarters or you expect the comps to also affect how you see the industry growing in the rest of the year. So that will be the first question. The second question would be related to market share. In the past, we’ve discussed with you guys several times about the fair share of Ambev in the market, right, the 67%, 69% market share, if I'm not mistaken. And, of course, a lot has changed over the last few years. You now mentioned the Nielsen 2.0 as a better assessment of the size of the industry. So one, you've introduced a lot of innovation. There's a much more granular approach to the market. And in this quarter, in particular, it looks like you have outperformed a lot the industry, right. So my question to you guys is, where you believe you are in terms of the fair share, in terms of where your ideal market share should be considering the portfolio that you have in place with the premium brands, or the value propositions and the mainstream, I think with the industry if you could elaborate on that. And the third question is actually about the Skol Pure Malt, which you mentioned as being a very successful launch. It’s still rolling out in the rest of the country, as you said? But it was a very huge success as you described, especially during the Carnival. So my question to you is how do you see the introduction of pure malt relative to the Skol Pilsen? And what kind of cannibalization you have been seeing, if any? And how the Skol brand has performed from a market share perspective considering the entire family? I think, it would be interesting to see the benefits of the brand extension that you're introducing there. Thank you very much.

Thank you for your questions, Thiago. I mean, the first one, the industry. I mean, it's nothing like that. I know it's Nielsen data. It's low single-digits around 3%. And you cannot comment about the full year numbers. But again, those are numbers based on the research from the big coverage of Nielsen in the quarter. So linked to the market share, we'll not disclose our market share. But I could say that it's not an issue. We are within our range. And we are confident that we are on the right path to continue to move in terms of our position in the market. Linked to the pure malt, the Skol Pure Malt effect, I think it was an amazing launch because it brings the concept of the pure malt from a little bit bolder liquid in the Skol way, a very drinkable liquid. That was kind of a long research and that brew market terms, in the last years in our innovation center in Rio de Janeiro assures us a specific process, boiling process that assure that even with a little bitterness, you can maintain this flavor aspect of a pure malt, but in a very drinkable liquid. So because of that and because the liquid is drinkable, but is different from Skol Pilsen the cannibalization is way below the average of the launch that we've done. And even without the full rollout in the full country the Skol family grew in the quarter. That's valid important. And it was helped by Skol pure malt, for sure, but not only that. So when you launch a family of quality beers like we have now in Skol and we have in Brahma in the past, all of those innovations bring brand equity and equity for them by the brands. So I think the innovation pipeline is full and I think this family approach is working very, very well. And just remind us in the core segment, Bohemia, Bohemia is big, big success as well. It's a very strong brand. It’s selling a lot. And it's growing, I mean, double, sometimes triple-digits. So we have Bohemia pure malts, definitely been helping us in the core segment as well. So that's what I could say. Thanks, Thiago.

Thank you.

And the next question comes from Lucas Ferreira with JPMorgan. Please go ahead.

Hi. Thanks for the question. Guys, my first question is a follow-up on this regional mix you've commented before. I was just wondering, if this is a trend that we should expect to continue in the following quarters? Or in other words, if you see sort of a more room to grow your market share in these regions or if that was something punctual? I'm asking because follow-up to Antonio's question, I also noticed that your -- another way I think we could also track this premiumization is look at your EBITDA per hectoliter sold. And this number declined by 5%. I understand the cost effect. That's clear to me. But I would expect also premium to help over time your EBITDA per hectoliter metric. So, wondering if the regional mix has an effect of that. In other words, serving these regions could also be less profitable to you guys. And the second question is on the non-alcoholic portfolio and the results, actually, pretty strong results. If you can comment on, which were the categories in sign non-alcoholic that drove volumes up in your results? And if we see already these results the impact of actually API tax benefits, right, this year where we should have started to see some impact in the first quarter. I'm wondering if there were some if you can comment on the profitability there, how sustainable that is going forward? Thank you.

Hi, Lucas. Fernando here. So on your first question about pricing premium and margins, I think the biggest impact that we’re having on net revenue per hectoliter was actually the regional mix on the first quarter. So it's not growing at a faster pace than the other regions. And not that other regions even grew as well, but they're not to grow at a faster pace. So of course, premium helps. Premium improved revenue per hectoliter but, in this quarter, it was somehow offset by the regional mix. On the EBITDA per hectoliter, the major driver is actually costs. So we have a meaningful impact in cost, which was anticipated. And that's why we have some pressure on our EBITDA per hectoliter. But there, again, we always say that FX, commodities, they are kind of a cyclical. Sometimes they help, sometime they go against us. If you take a long run definitely premium and the premium portfolio that is gaining more relevance aggregates EBITDA margin and aggregate EBITDA per hectoliter. So, net-net, it's very accretive. On the NAV question, the growth was pretty much across the board. I wouldn't see single one out any particular impact from a part of the portfolio. I think it was across the board, very robust both for premium portfolio, Gatorade, H2OH, energy drinks as well as our more call, like Guaraná, Pepsi, everything performed quite well in the quarter. So I wouldn't highlight one single item that performed better than the other.

And I think Luca, just I mean, the same thing we have been talking about our beer business, I mean we have been doing for non-alcoholic business as well. So premium portfolio is very, very important. We invest on that, like brands like Tonica it's really a huge success and growing a lot so helping us, the premium segment. And for sure, Guaraná Antarctica is a very, very strong brand. And we'll continue to invest.

And Lucas, for your question on, API, there's not too much of a change. It's kind of -- the lowest change is last year. So there is not too much of new news here, and the impact was not that relevant in our numbers.

Thank you.

And this will conclude our question-and-answer session. I would like to turn the conference back over to Mr. Bernardo Paiva, for any closing remarks.

So basically, what I could say that, we are very confident with the transformational investments and focus that we've done in our strategic platforms in all of those years. As we've always said, we have been preparing ourselves for a moment that has a better macroenvironment. Consumer confidence helped a little bit in the first quarter. And it was a very, very big quarter. Innovation helping us in Brazil, big, big time and then the pipeline is full for the future. So we'll continue to focus on the long run and sustainable value creation in an algorithm of growth that consumer-centric. And for sure, we'll continue in my opinion, reaping the benefits of this approach in the years to come. So thank you. Have a great day. Enjoy the rest of your day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.