Welcome to Anheuser-Busch InBev's First Quarter 2023 Earnings Conference Call and Webcast. Hosting the call today from AB InBev are Mr. Michel Doukeris, Chief Executive Officer; and Mr. Fernando Tennenbaum, Chief Financial Officer. To access the slides accompanying today's call, please visit AB InBev's website at www.ab-inbev.com and click on the Investors tab and the Reports and Results Center page. Today's webcast will be available for on-demand playback later today. [Operator Instructions] Some of the information provided during the conference call may contain statements of future expectations and other forward-looking statements. These expectations are based on management's current views and assumptions and involve known and unknown risks and uncertainties. It is possible that AB InBev's actual results and financial condition may differ, possibly materially, from the anticipated results and financial condition indicated in these forward-looking statements. For a discussion of some of the risks and important factors that could affect AB InBev's future results, see risk factors in the company's latest annual report on Form 20-F filed with the Securities and Exchange Commission on March 17, 2023. AB InBev assumes no obligation to update or revise any forward-looking information provided during the conference call and shall not be liable for any action taken in reliance upon such information. It is now my pleasure to turn the floor over to Mr. Michel Doukeris. Sir, you may begin.

Thank you, Jesse and welcome, everyone, to our first quarter 2023 earnings call. It is a great pleasure to be speaking with you all today. Today, Fernando and I will take you through our first quarter operating highlights and provide you with an update on the progress we've made in executing our strategic priorities. After that, we will be happy to answer your questions. Let me start with our operating performance. Our business momentum continued this quarter and we are very pleased with our strong performance to start the year. We delivered revenue growth of 13.2%, with volumes up by 0.9%. Revenue per hectoliter increased by 12.4% driven by price actions across our markets, other revenue management initiatives and ongoing premiumization. We grew EBITDA by 13.6% with a margin expansion of 13 basis points despite continued commodity cost headwinds and while increasing sales and marketing investments in our brands. Underlying EPS was US$0.65, an 8.7% increase versus last year. Our focus on disciplined resource allocation and everyday efficiency continues to enable us to invest for the long term while delivering consistent profitable growth. We delivered broad-based growth this quarter with both top and bottom line increases in all 5 of our regions. Revenue increased in 80% of our markets, with volume growth in over 60%. Our diverse geographic footprint provides a unique combination of growth and reliable cash flow generation, positioning us well to deliver superior long-term value creation. Now, I'll take a few minutes to walk you through the operational highlights for the quarter from our key regions, starting with North America. In the U.S., the beer industry remains resilient with industry volume trends improving sequentially and U.S. dollar sales up 3%. Our business delivered another quarter of top line growth and stable EBITDA despite delivery cost environment. Our…

Thank you, Michel. Good morning. Good afternoon, everyone. We aim to maximize value by focusing on 3 areas: optimize resource allocation; robust risk management; and efficient capital structure. With respect to capital allocation, we are focused on maximizing long-term value creation by dynamically balancing our priorities. We continue to invest in organic growth to support our strategy to lead and grow the category and digitize and monetize our ecosystem. The excess cash generated by our business is then dynamically allocated to our 3 capital allocation priorities: Deleveraging; selective M&A; and return of capital to shareholders. Our debt maturity profile remains well distributed with no bond maturity in 2023 and no relevant medium-term refinancing needs. If you look at our debt maturity profile, we have US$3 billion worth of bonds maturing through 2025. Our bond portfolio has an average pretax coupon of around 4% and a weighted average maturity of 14.5 years. In addition, our debt portfolio does not have any financial covenants and it is comprised of a variety of currencies, diversifying our FX risk. 95% of our bonds have a fixed rate, insulated from interest rate volatility and inflation. As a result of our deleveraging progress, strong free cash flow generation and robust risk management practice, both Moody's and S&P recently upgraded our credit rating to A3 and A-, respectively. And now let me take you through the drivers of our underlying EPS this quarter. We grew underlying EPS by 8.7% versus last year, delivering EUR 0.65 per share. This increase was primarily driven by nominal EBITDA growth which accounted for a $0.13 per share increase. As we continue to deleverage, our net interest expense has reduced, contributing a $0.01 improvement. Higher income tax reduced EPS by $0.04 driven by country mix. With that, I would like to hand it back to Michel for some final comments before we start our Q&A session. Michel?

Thanks, Fernando. Before opening for Q&A, I would like to take a moment to recap my key takeaways for the quarter. We continue to make progress in executing across each of our 3 strategic pillars. Our business momentum continued this quarter. Driven by the strength of our leading brand portfolio, we grew volumes in 60% of our markets. We made important strategic choices in pricing and other revenue management initiatives which drove continued strong net revenue per hectoliter growth of 12.4%. We progressed our digital transformation generating US$8.2 billion [indiscernible] with 59% of these customers now also base marketplace buyers. EBITDA grew organically by 13.6% and our margins expanded even in the context of continued elevated cost environment. And as a result of our deleveraging progress and strong free cash flow generation. Our credit rating was upgraded 1 notch by both, Moody's and S&P. We are investing to drive long-term value creation and our results this quarter are another proof point of the effectiveness of our strategy. With that, I will hand it back to Jesse for Q&A.

[Operator Instructions] Our first question is coming from the line of Priya Ohri-Gupta with Barclays.

Firstly, congratulations on the upgrade from both Moody's and S&P. Fernando, I'd love to start with you. Now that you've achieved those low single A ratings, how should we think about your focus on getting to 3x net leverage as a near-term target? And is there any potential desire to move towards mid-single A ratings over time, given that, that could lift you to Tier 1 commercial labor access?

Thanks for your question. I -- the best way to frame it is to go back to our resource allocation priorities. The objective, at the end of the day, is to maximize the value creation. We always invest behind the organic growth of our business. And with the remaining cash, we balance the leveraging shareholder payouts and selective M&A. When you think about deleveraging, we said a few times that we maximize the value of our business at 2 times, but 90% of these benefits we will be capturing around 3x. So our goal is to do the right thing for the business. And by doing the right things for the business, the rating will be a consequence. In a nutshell, for the time, we still see a meaningful amount of value on deleveraging. We increased the dividend last quarter. But in the grand scheme of things, most of the cash is still going towards deleveraging. But as we start moving closer to 3x, then start defense in 3x, moving closer to 2x. More and more, we can have other priorities, but always with the mindset of doing the right thing for the business and rating will be a consequence.

Great. And just as a follow-up, you highlighted that you have only about $3 billion of maturities coming due through '25. So as you think about further debt reduction, would you prioritize looking at those or maximizing deleveraging by perhaps looking further out the curve, given some of those months are still trading below par?

It changes a lot depending on the interest rate environment. And we -- whenever we are in a position to start redeeming more debt, we always look at different trade-offs. If you recall correctly, in early 2020, given all the services, we focus a lot on the short term. And because interest rates were low, it made more sense for you to ride short-term debt. As we see interest rates rising it made more sense for us to redeem long-term debt because it was much more attractive. And we are in a position, given all the risk -- the risk management initiatives that we had in 2020, that we don't have any near-term so we can really make sure that we focus on whatever is maximizing value because the risk profile is in a very good place.

Our next question will be coming from the line of Rob Ottenstein with Evercore ISI.

Great. Thank you very much. So Michel, as you clarified in your comments in terms of Bud Light, this is all about one can, one social media post, one influencer. And yet somehow it's just become something a whole lot bigger than that. There continues to be a lot of misinformation out there, a lot of confusion. Can you offer any thoughts, reflections on how this happened, what you've learned and what -- now that we're here, what are you going to do about it?

Robert, thanks for the question. So I think that to start, we need to understand the current environment and especially social media landscape. And how consumer brands, especially big brands with significant reach, can be pulled into a discussion like this one. And we know that ours, Bud Light, is certainly not the first brand that was pulled in a situation like that. And as I said, while beer will always be at the table when important topics are debated, the beer itself should not be the focus of the debate. And to me, this is the key learning. So moving forward, I agree with you. One challenge is what you call the misinformation and confusion that still exists. We will need to continue to clarify the fact that this was one can, one influencer, one post and not a campaign and repeat this message for some time. But as we do that, we are more focused on leveraging our global experience and mobilizing our global resources to support the U.S. team as we move forward. We have adjusted and streamlined our marketing structure, so the most senior market peers are more closely connected to every aspect of our brands. In addition, we are supporting our frontline teams. We are investing behind Bud Light tripling our need investment for the summer and we are investing more together with our wholesalers in our local markets. Just getting like last week, Bud Light was on the stage at the NFL Draft. We released a new TV commercial that continues our campaign. The current campaign easy to drink, easy to enjoy. We have strong presence in the Stagecoach Country Music Festival in California and there is much more to come. And as I said, it's too early to have a full view on the impact, but I know that we have the people, the partners to learn from that, to continue to move forward and to come out stronger.

Our next question is coming from the line of Mitch Collett with Deutsche Bank.

I've got two questions, please. The first is, given the strong start to the year from an organic EBITDA perspective, can you give some color on why you didn't raise or refine the F '23 guidance? And in particular, I'd be interested in the puts and takes from volume, pricing, COGS and SG&A perspective, as we pass through the quarters. And then secondly, Colombia has been a really strong performer for a couple of years now, but it seems to have hit some challenges in Q1. Do you expect to be able to take enough price to offset input cost pressures in Colombia? And do you think the consumer is in the right place to accept it?

Mitch, Fernando here. Let me take the first question. In terms of guidance, I always refer back to the reason why we started giving guidance. We give guidance, our medium-term outlook at the end of 2021, because we are moving from an inorganic strategy to an organic strategy. And when we look at the middle term, that's the growth that our business can sustain and can deliver. With that in mind, every quarter is going to be different. There are going to be better quarter, worst quarters and there will be puts and takes in different regions of the world performing in different ways. With regard to this year specifically, we just had the first quarter. It's too early. We had a good quarter. And of course, there are always puts and takes. That's why, for the moment, we are maintaining -- because the main objective of the guidance is to give certain of the medium-term potential performance of the business. In terms of commodities, the question that you asked, we said about 2023, that we would have some commodity pressures, of course, to a lesser extent than 2022. We have most of our commodities hedged, but there is always a portion of your cost of goods sold that is not hedged. A good example is cost of freight. And to some extent, this is moving in our favor, this is moving favorite, it's somewhat healthy. You also have the different geographies corporates. We said before that you have some regions like Brazil where the cost of goods sold should be in a better place. You could actually see that the Brazilian operation having gross margin expansion already this quarter. And this is their commodity scenario. On the other hand, you have regions like Europe which is still somewhat under pressure on the commodity front and will continue to be for this year because energy prices, although they are improving, they are is still very high compared to previous levels. So a lot of puts and takes. We just had the first quarter. We continue to be confident on the business. But I think it's too early for us to talk about changing the guidance on upon way or another. And the second question, I will pass to Michel.

Mitch, thanks for the question. I think that when we talk about Colombia, if you allow me just to step back for a second, I think that we need to look at this developing markets and how inflation cost of goods sold and consumer purchase power is playing a different role in each of these countries. And the fact that, as I said before and I keep repeating, we've been balancing our revenue management strategy, aligned with category, consumer purchase power and the inflation and cost of goods sold. So Colombia is coming from a very good performance for the industry. The last year was a great year for the industry. And this year, in quarter 1, we saw volumes declining by low single digits. And we have good share. Beer is gaining share of growth. What we saw in the industry overall was an impact from a softer macroeconomic. We need to remember that Colombia imports a lot of goods and you have 2 impacts there. One is the inflation itself, the other one is FX. The country is moving. So you see that salary is already moving up as well. And the demand for our brands remain strong. We grew well gaining share of total alcohol. Our brands, core brands performing well, premium brands performing well as well. And under this macro background, we need to keep watching how the industry will behave while we continue to invest in our brands and they have good underlying demand. So the business is great. The macro environment was a little bit soft, but we continue to watch deals across the globe very carefully as we continue to push forward on our -- both category strategy but also revenue management strategy. Thanks for the question.

Our next question is coming from Trevor Stirling with Bernstein.

Michel, just one question from me and following up and thank you very much for your perspectives on the Bud Light feeding frenzy. We're looking, I suppose, trying to judge things based on the scanner data which is one channel and several weeks in advance. I know you have more closer to real-time data across many channels. Is there any sign that the pressure is starting to ease, or it's still very too early to say?

Trevor, I think that's still too early for us to understand the duration and the total impact. We look at the same public data that you look and we see the data. There's a lot of information on the week basis, but we also see day after day. We can see on the days that there is some stabilization and this Bud Light volume in the first 3 weeks, as I said, they would account for like 1% of our global volume in this period, because there is still a lot of confusion there and misinformation as I was telling Robert. So we need to continue to clarify these information as we move forward. We need to continue to invest as we have done last week. And together with our wholesalers continue to drive both the business forward, the focus on beer which is what we do best and make sure that the right information is clarified to everybody. Because when we do beer, our brands perform well.

Our next question is coming from the line of Jeff Stent with BNP.

Two questions. The first of which, would the 4% to 8% like-for-like EBITDA guidance still hold if Argentina was to be excluded? That's the first one. And the second one is -- you've talked a lot about Bud Light. But has there been any sort of spillover impact beyond Bud Light? And also, what are you doing to ensure that the market peers don't sort of enter a state of paralysis and become very fearful of sort of embracing any creativity?

Jeff, Fernando here. Let me take the first one. I'll go back to the reason why we provided an outlook and we did that the medium-term outlook at the end of 2021. What is the potential for our business over the medium term now that we move from an inorganic to an organic strategy. And that includes our whole portfolio. But of course, there is one very important KPI, but there are other KPIs that we should be looking at. From first quarter, for example, for the first quarter, we ended up growing more than our outlook. We ended up growing 13.6%. But this is the organic growth. If you look from a business standpoint, we grew more -- on a nominal basis, we grew more than $270 million. So it was a very strong growth. If you look from an EPS standpoint, we grew like 8.5%. So at the end of the day, this is our food business and we need to make sure that we manage all the different variables, all the different KPIs. And the goal at the end of the day is to create value and that's what we are aiming for. So the guidance is for -- the outlook is for our full business. And the second question, I'll pass it to Michel.

Yes, Jeff. Thanks for the question. I think that similarly to what we just discussed on the Bud Light volume, the public available data shows some spillover effect across the other brands, while the majority of the impact is still on Bud Light. And this is happening, I think, that on the same direction, given the information that's out there, the confusion and the noise and of course, more localized on Bud Light and we continue to drive our programs forward for all brands. And I think that one of the key points that I was highlighting before is that we continue to be committed to the programs, partnerships, investments that we have in place, our key programs and campaigns for the brands, they remain in place. And one key thing in the U.S. was quickly adjust and streamline our structure. So in this situation and given the current environment, especially for the social media landscape, that we have senior marketers running the programs. We have a strong plan for the year. The brands are performing very well in the quarter 1. The programs we know they impact correct consumers and they move the brands in the right direction. And I think that as we do what beer needs to do: Focus on sports, focus on music, focus on connecting with our consumers, our brands perform well as we know, right? So we will continue to invest. We are having healthy investments now during the summer across all brands as original part of our plans. But also, we are having up the investments on Bud Light as we reallocate global resources and we invest more on Bud Light. So I think that we feel good about the plans that we have moving forward. And while it's still too early to understand again, all the numbers and the duration of this impact, we need to keep moving the business forward. And that as CEO, I think that my role is to really get the learnings, mobilize resources support the team and work together with our partners as we move forward.

Next question is coming from Laurence Whyatt with Barclays.

Michel, Fernando, two for me, please. Firstly, on margins, they've come out a lot better this quarter than perhaps the Street was expecting. And I seem to remember, previously, you said that Q1 was probably going to be the toughest quarter for COGS. Do you see the COGS environment getting a little bit easier from here? And how would you split the impact from COGS from both commodities and transactional FX? And then the second question on China. Could you give us any more color on the exit rate or sort of March number? I think you previously mentioned that Bud 8-pack was up around 20% in February. Can we assume that March was significantly stronger than that?

Laurence, Fernando here. Let me take the first one on margins. Definitely, we talked a lot about COGS. And I want to talk about COGS, COGS probably we still have some pressures this year. Probably the pressure is a little bit higher in the first half of the year, a little bit smaller in the second half of the year. Of course, there are some portions that we cannot hedge. And I mentioned a while ago, freights and this is something that came in our favor. Every market is different. If you say about transactional effects, it's better in Brazil than it was the year before and you are seeing that reflecting through the Brazilian beer margins or the gross [indiscernible] being positive, increasing year-on-year. It's a little bit more of a pressure when you think about Europe, so every market is different. But you have to bear in mind that the EBITDA margin is not only about cost of goods sold. It's the main driver of our last year's cost of goods sold. But you also have overhead and overhead was an important component. And of course, overhead you have seasonality. So it's going to be slightly different quarter-on-quarter. We're still maintaining our outlook where revenues are growing ahead of costs. and continue to manage an opportunity to improve an opportunity to better, we continue to leverage on that. Probably a number that you should continue to look is how commodity and FX evolve. For 2023 is more or less set. A few open items like trade, but more or less set. And for 2024, at least too early to say, but we are not seeing any major swings in commodities like we see in the last couple of years. And if that's the case, that should be positive news, also going forward. But it's too early to have a final view on that.

Yes. And with China, I think that the way that we see the quarter 1 is like a transition quarter. You remember, all the restrictions being lifted at the end of last year. There was an earlier Chinese New Year. So January was a little bit dislocated. And therefore, we see continued recovery that accelerated throughout the quarter. If you look at some of the leading indicators, let me share one, for example, the on-trade, night life, Chinese restaurant reopening. Beginning of the year, January, they were around like 70%, 75%. And as you look at the same indicator in March, we were pretty much like close to 100% of the POX [ph] operating we've normalized operating environment, in-store, traffic. And that happened from middle of February towards March. We, of course, we put our plans in place. We are getting our fair share in premium and super premium. And as the channels reopened the long-term trends of premiumization, they continue to impact the industry and our business in China which benefits from that. So we have strong innovation and we see that the industry is recovering. The premium opportunity continues to be huge in China and we have disproportional or asymmetric market share in this segment. And as the channel reopens, this is a tailwind for the business. The prospects for the long term do not change. We think that in the short term, that is this good opportunity and the industry so far is performing well.

The next question is coming from the line of Edward Mundy with Jefferies.

I'm sorry to come back to Bud Light, but I've got -- I just want to pick up on some of your opening comments, Michel, around having experienced the resource and the partners to manage through. If we take experience, could you talk about some of the prior experience ABI has a brand turnaround of this nature? I mean Stella Artois, for many decades in the U.K. had a pretty bad name and those previous negative associations have been eliminated. What are the 2 or 3 things you've got to get right as you think about taking things forward from here? And then on resource, I think you mentioned you're going to mobilize global resource to support the U.S. team. I think Bud Light is about a $5 billion revenue business at supply level, probably spend 10% on A&P, maybe a fraction of that, maybe half of that is media so call it, $250 million. If you're going to triple that, that's about $500 million and that's about 2% to group EBITDA. Are those numbers directionally okay, or have I missed something there?

Ed, I think I got all your topics here, then I'll try to cover one by one. So the first point around experience and how we deal with different situations globally. And of course, starting from the point that each and every situation is unique in itself. And given the current environment, especially social media landscape and how brands have been pulled into these situations, that is a big learning from this situation that can help the company also on the other way around globally. But we have faced, as you know, just to think about COVID from alcohol ban in some countries. And then we had to adapt to the situation, keep a very agile mindset, rethink the way that we go to market and how we organize our operations, to the other [indiscernible] in the very big footprint that we have. You remember, for example, the U.K. for that time was an issue. We had issues before in Korea. We had issues in Brazil. And the way that our brands got attacked for some time there. And we redesigned the portfolio, rethought the way that we communicate to our brands. And we always stay true to what we do best which is brew high-quality products, make sure that we keep connected with our partners investing to the long term and keep reading and learning from consumers and see how we adjust our path forward. We know that easy to drink, easy to enjoy, it's a powerful message for Bud light. We know that the Bud Light lane is around, quality beer is to drink, is to enjoy, is about sports. That's why we came back strong with the NFL Draft. It's about music and it's about every day enjoyment. So when we do that, our brand performs very…

If I could just follow up. I appreciate you don't run your business on a 4 to 8. That's really a framework for us essentially and some years ahead, some years below. But I guess you face the choice of either looking to protect the bottom line in the U.S., or perhaps you could use a windfall from the rest of the group, from a COGS rollover or trying to bounce back to double down in the U.S. Is the message that, look, you're running the business for the long term and you're going to really double down on the U.S. And you can allocate global resources to really go behind Bud Light?

So all markets are important for us. We do not minimize this situation on the U.S. Fully committed to get our plants and our brands and our portfolio to rebalance in the U.S. and we are investing to make it happen. And this all falls into our outlook. We always have an issue to deal with every quarter, every year in every geography and it's very important that at global level, we keep this agile mindset to use the resources. And definitely, urgency creates opportunities as well. So as we invest, focus, mobilize in the U.S., we think that this situation is manageable globally. We never minimize any issues for our brands, our consumers. But we are confident that we have the team and the resources to continue to invest, to move forward in the U.S. and to support our team there to get out of this stronger.

Our next question is coming from the line of Sanjeet Aujla with Credit Suisse.

Michel, Fernando, two from me, please. Firstly, I appreciate your earlier comments on Colombia. But if I look at some of your major emerging markets, more broadly, volume seems to have deteriorated as pricing has picked up. So I'd love to get your thoughts on any inflections you're seeing in consumer behavior, particularly with regard to frequency of consumption, past formats, et cetera. And then my follow-up is really around Brazil. One of your competitors there recently filed for bankruptcy. I think you called out stable market share in the quarter, but I'd love to get your perspective on how you see the competitive landscape evolving in Brazil in recent weeks and months.

Sanjeet, two pieces there. I'll try to address both to you. The first one, I think there is this inflationary scenario which is common across the globe. And we see that, as I've been saying, different clusters, three type of clusters where we see the industry and the whole consumer purchase power and consumer goods moving is slightly different and they're all dealing with the same issue. The key point there is we see the beer category continues to be resilient and performing well and gaining share of growth. I just gave the example of Colombia. Of course, when you talk about resilience, doesn't mean growth across the board and all the markets at the same time. Especially because when inflation moves fast, you have this timing in which salaries, especially minimal salaries for these developing countries, they get to be approved. So think about Brazil that just announced the salary increases now in May, right? So January to April, consumers were dealing with high inflation and they have their salaries from last year. Industry performed well. But now you have an extra injection of cash and purchase power coming to consumers. So when inflation goes up, there is some time for prices to catch up and there is some time for salaries to catch up. I think that we need to look throughout the lenses of the full year before drawing to many conclusions. And amongst the markets, they have different realities. To use the same example, why you see currency devaluation in Colombia. And Colombia has a high percentage of goods that they import, Brazil is in the other side of that, because currencies that are appreciating and therefore, the import goods will have like a different impact on the basket for inflation as well as focused consumer…

And just one quick follow-up on that. Has there been any noticeable change in the competitive landscape since one of your competitors filed for bankruptcy there in recent weeks?

Not meaningful for us to talk about here. And I think that while they deal there with that situation, our focus is on our consumers, our focus is improving our service level that's very high in Brazil now in getting our portfolio to perform, the portfolio of the physical brands that we have in the digital assets. So we remain steady focused on our strategy.

Thank you. Our final question is coming from the line of Brett Cooper with Consumer Edge.

So I want to come back to, I guess, the first question, but more from an operational standpoint. After the SAB deal, you guys have been relatively inactive on acquisitions. At the same time, the beverage and alcohol markets have changed and are evolving. So can you continue to maximize the growth potential of your business via organic activity, or acquisitions and higher growth parts of the industry necessary to maximize that growth in returns?

Brett, it's Fernando here. At the end of the day, this is a resource allocation discussion and about the value creation discussion. If you look at our business, when we did the Investor Day, we said that the outlook for the business is to be able to deliver 4% to 8%. And if we deliver that, there is a minimum amount of value to be created. We can enhance this penetration by making resource allocation decisions. And that's the triangle. So -- which means that the priority is to invest behind our business because we believe it can grow, can grow at a decent pace and can create a lot of value with excess cash and our business generates a meaningful amount of the cash. How we use that excess cash can also create value on a stand-alone basis. Over the last 2 or 3 years, there was a strong focus on leveraging because, as we said, the leveraging creates a meaningful amount of value, most of that going to get to us 3x. We made meaningful progress, but we are not at 3x yet which means that we can still benefit from value creation by deleveraging a little bit further. But as we keep making progress, other options open up for us. Other options like we increased the dividend is likely as a percentage it was a meaningful increase. In that sole basis, it was not that much of an increase. But increased dividends, we are improving on that. And M&A is definitely an option as well. We can have selective M&A. We know how to do M&A. We did M&A in the past. We know how to create M&A. So if the right deal at the right moment shows up, of course, we entertain that if it can bring another avenue of growth. But we don't need M&A to deliver a meaningful value creation to pursue growth.

And if I can bug you with 1 follow-up. One component of your business is different than it was when you've done M&A in the past, is all the digital infrastructure that you've built? So how do you think that extracts value from transactions or creates or, I guess, improves your ability to create value from organic activity? And does that weight your view one way or the other over the medium to long term?

Yes, I can take this one. I think that in a short answer, these digital products that we created both on the B2B side and on the B2C side, they help us to get better and they are the second pillar of our strategy. They get us better because we have more information. With more information, we can make better decisions. And as we standardize our ways of operating with these products, we have efficiencies that we can extract from this scale, from these revised processes and our ability to act faster with the data that we have. A second part of that, as I keep saying, another advantage of the digital products is that once you build them, the scalability is very fast and you don't need more resources. So different from the physical products, if you grow Corona, the example that I just gave here in Brazil, we need more bottles, more production capacity. We need to invest in physical assets so we can grow our physical brands which we are doing. On the digital space, the scalability once the product is ready and available, is much faster. And the resources that you need to invest for the scalability are much smaller in proportion to the physical products. So we can continue to grow and we are doing that. For example, with beer, we are getting to geographies where we do not operate. We are getting there with the digital product by using partners. And then it can continue to monetize the digital product even if you are not present in that market. But then now that we are becoming present in that market, so you might have opportunities to go to market differently than what we had before. So you are right in the intuition that the digital projects are -- have done to our M&A to kids [ph]. But they can also become an important vehicle as we grow organically, including geographies that we are not present today because the digital roll to market becomes an enabler for our expansion strategy. Thank you.

Thank you. This was our final question. If your question has not been answered, please feel free to contact the Investor Relations team. I will now turn the floor back over to Mr. Michel Doukeris for closing remarks.

Thank you, Jesse and thank you all for your time today and for your ongoing partnership and support of our business. Stay safe and well.

Ladies and gentlemen, thank you. This does conclude our earnings conference call and webcast. Please disconnect your lines at this time and have a wonderful day.