2013

JOO CASTRO NEVES

Chief Executive Officer

Statements contained in this presentation may contain information that is forward-looking and
reflects management's current view and estimates of future economic circumstances, industry
conditions, company performance, and financial results. Any statements, expectations,
capabilities, plans and assumptions contained in this presentations that do not describe historical
facts, such as statements regarding the declarations or payment of dividends, the directions of
future operations, the implementation of principal operating and financing strategies and capital
expenditure plans, the factors or trends affecting financial condition, liquidity or results of
operations are forward-looking statements and involve a number of risks and uncertainties. There
is no guarantee that these results will actually occur. The statements are based on many
assumptions and factors, including general economic and market conditions, industry conditions,
and operating factors. Any changes in such assumptions or factors could cause actual results to
differ materially from current expectations.

AGENDA

Brazil: #1 Organic Growth Opportunity

AGENDA

Brazil: #1 Organic Growth Opportunity

BRAZIL HAS IMPROVED CONSIDERABLY IN THE LAST DECADE, BUT

REMAINS AS A COUNTRY OF DISPARITIES
Lower Index: 0,21
Aroeiras (PI)

Lower Index: 0,41

Melgao (PA) (same
as Afghanistan)
Lower Index: 0,41

Melgao (PA) (same as

Afghanistan)

Different
realities within
neighborhood
Different
realities within
neighborhood

Higher Index: 0,82

So Caetano do Sul (SP)

Source: PNUD, 2012 (Programa das Naes Unidas para o Desenvolvimento)

HigherIndex:
Index: 0,86
Higher
0,86
SoCaetano
Caetano do
do Sul
So
Sul (SP)
(SP)(same
as United
Kingdom)
(same
as United
Kingdom)

CONSIDERABLE SOCIAL MOBILITY HAS DRIVEN (AND SHOULD

CONTINUE TO DRIVE) INCREASING CONSUMPTION

Source: LCA, BCG

A/B: >5K R$

C1: 2,5K 5K R$

C2/D: 0,5K - 2,5K R$

AND WE ARE NOT EVEN HALF WAY THROUGH THE COUNTRYS

DEMOGRAPHIC BOOM
Population Bonus - Source: IBGE Elaboration LCA

Population Bonus

BRAZIL DEMOGRAPHIC
BOOM
2000-2034

Population under 14 years

Population over 65 years

Population 15 to 64 years

Source: IBGE, IPEA and FGV Study Demographic Boom and Economic Growth

AS SOCIAL & ECONOMIC INDICATORS EVOLVED, BEER PER CAPITA

CONSUMPTION & SHARE OF THROAT HAVE BEEN POSITIVELY IMPACTED
PER CAPITA (L)

57.7

60.8

65.4

67.0

BRAZILIAN BEER SOT EVOLUTION

68.5

89.2%
88.8%
87.1%

2008
Source: Plato

2009

2010

89.5%

2011

2012

87.7%

2008

2009

2010

2011

2012

Source: Euromonitor

 WITH REGIONAL OPPORTUNITIES TO REMAIN AS KEY PER CAPITA

GROWTH DRIVERS
0.85

HDI VS. TOTAL PER

CAPITA CONSUMPTION

0.80

SE
MW SE
MW
S
S

0.75

0.0

10.0 20.0 30.0 40.0

50.0 60.0 70.0 80.0 90.0

0.70

NO
NO
0.65

NE
NE

0.60
Source: Company estimates

AND DESPITE THE SHORT TERM CHALLENGES

THE BRAZILIAN CONSUMER REMAINS CONFIDENT WITH THE FUTURE
NEGATIVE EVENTS
Difficulty paying off credit/debit
Difficulty paying monthly bills

CONSUMER CONFIDENCE
20
49
24

56

3
11

2
2
12

27

30

Dont Know
Not at all confident
Not very confident
More confident than not

36
54

Very confident

23
Global (25)

CUTBACKS

PURCHASE INTENT
44

Dining out at
restaurants

57
35

Going out for entertainment (movies,

47

sports events, concerts, etc.)

Going out for

a drink
Global
Brazil

Brazil

Household energy
use

27
26

42
40

Home

10

Fine Watch / Jewelry

Special Vacation
Car / Other Vehicle

11

Home Appliances
Homes Electronics
Personal Electronics

28
19
22

41

23

52

25

54
32

67
39

66

Source: Roper 2013

10

..AND SO DOES THE INDUSTRY THAT CONTINUES TO INVEST

HEAVILY FOR THE FUTURE
COLD BEVERAGES
INDUSTRY CAPEX
(BRL BILLION)

7.9

7.5
6.2

2.0

2.2

Cold beverages industry

represents 3% of Brazils
GDP
Generates over 3 million
jobs (direct and indirect)

Biggest GDP multiplier in the

economy
Source: PWC, IBGE, BNDES, FGV

Source: CERVBRASIL, ABIR

11

AGAINST THIS BACKDROP, WE HAVE MANAGED TO DELIVER SOLID

RESULTS UNDER DIFFERENT AND CHANGING SCENARIOS
EBITDA
margin

Brazil Beer
52.4%

49.9%

48.8%

53.2%

18.4%
18.0%
17.3%
13.9%

12.5%
8.0%

12.3%

10.9%

8.5%

9.7%

9.7%
3.2%

1.8%

2010

2009
INDUSTRY
GROWTH VS. LY

2011
NET REVENUE
GROWTH VS. LY

2012
EBITDA GROWTH
VS. LY

Source: Company data

12

THE EXECUTION OF OUR COMMERCIAL STRATEGIES AND THE

CONTINUED FOCUS ON OUR CORE CAPABILITIES HAVE MADE (AND
WILL CONTINUE TO MAKE) THE DIFFERENCE
BUILDING BLOCKS

COMMERCIAL STRATEGIES

World Cup
Legacy

13

AND IT ALL STARTS WITH HAVING THE BEST PRODUCTS TO THE VARIOUS
TYPES OF CONSUMERS IN THEIR DIFFERENT NEED STATES

Needstate

Consumer Type

Source: Segmentation

14

INNOVATION AND PREMIUM WILL BE KEY DRIVERS TO CAPTURE THE

OPPORTUNITIES ACROSS THE DEMAND LANDSCAPE...

15

INNOVATION AND PREMIUM WILL BE KEY DRIVERS TO CAPTURE THE

OPPORTUNITIES ACROSS THE DEMAND LANDSCAPE...

16

17

INNOVATION HAS BEEN ONE OF THE MOST

CONSISTENT GROWTH DRIVERS SINCE 2008
20,0%

10,3%

20,4%

10,6%
11,8%

12,1%
4,8%

5,4%
5,2%
2008

9,7%

9,8%

11,8%

2010

2011

2012

7,3%
2009

Weight (ex RGB 1L)

Source: Segmentation

Weight RGB 1L
18

 AND OUR TARGETED INNOVATION CONTINUES: BRAHMA 0.0

Refresh Myself
Out Of Home occasions
Brahma 0.0 launch
Industry Non alcohol volume

+33.6%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2012

NA MS

+6.7pp

Sep12

Sep13

2013

Source: Nielsen

19

 AND OUR TARGETED INNOVATION CONTINUES: SKOL BEATS

EXTREME
Amp Up
Night Out
Beats relaunch
Extreme launch

NEW BOTTLE
NEW LIQUID
6.9% ABV

20

INNOVATION AND PREMIUM WILL BE KEY DRIVERS TO CAPTURE THE

OPPORTUNITIES ACROSS THE DEMAND LANDSCAPE...

21

PREMIUM PRODUCTS HAVE BEEN INCREASING WEIGHT IN SEVERAL

CONSUMER PRODUCTS CATEGORIES

Yogurt

Biscuit
22.3

19.4

Vodka
10.9

20.1

10.6

20.1

Cleaners
22.3

19.4
30.6

10.2

2011 2012 2013

2011 2012 2013

32.9

2011 2012 2013

30.8

2011 2012 2013

22

WHICH HAS ALSO BEEN THE CASE FOR BEER, WITH VOLUMES
SHOWING STEADY INCREASE SINCE 2011

5.5%

5.5%
4.8%

2008

2009

4.7%
4.1%

4.1%

2010

2011

2012

2013 YTD

23

WHILE DATA SHOWS THERE IS STILL PLENTY OF ROOM FOR GROWTH

Premium brand preference
19.1 %

5.5 %

Premium Vol Mix

Premium Pref

Premium Vol. Mix

Premium weight vs. Other beer markets

High HDI

2.7 %

0.75

Midle West

1.6 %

0.75

North East

0.76
Source: Company Data

South
East
SouthEast

21.9%

4.3 %

North

22.9%

13.2%

5.6 %

South

28.3%

24.9%

Remium vol. Mix

48.4%

LOWHDI

7.5 %

0.68

0.66

HDI

24

GROWTH HAS BEEN DRIVEN PRIMARILY BY

INTERNATIONAL BRANDS
WEIGHT WITHIN PREMIUM VOLUMES (%)

99%

98%

91%

1%

2%

9%

2007

2008

2009

87%

13%
2010

Domestic

Source: Nielsen

77%

23%
2011

61%

59%

39%

41%

2012

YTD13

International

25

 ALLOWING US TO LEAD THE GROWTH AMONG

INTERNATIONAL BRANDS

70

67

60

59
51

50

48
41

40

Competition

29

30
20
J08

Source: Nielsen Retail Index

J09

J10

J11

J12

J13 M M J

26

 BUT THERE IS MORE TO COME WHEN WE LOOK AT THE NEED

STATES OF THE BRAZILIAN CONSUMER
Savor the Moment
Ritual & Specialties

Activate Stella Artois

Chalice & Fine dinings

Bohemia

(harmonization & specialties)

27

 BUT THERE IS MORE TO COME WHEN WE LOOK AT THE NEED

STATES OF THE BRAZILIAN CONSUMER
Amp Up
International Premium
Budweiser

Lead the international Segment

+47%

YTD
12

YTD
13

28

OUR APPROACH IN NON-ALCOHOLIC BEVERAGES IS SIMILAR AND

CONTINUES TO DRIVE BETTER PERFORMANCE
FULL PORTFOLIO

INVESTING BEHIND
BRAND EQUITY

BLOCKBUSTER
PROMOTIONS

DIGITAL
CONNECTIONS

29

OUR APPROACH IN NON-ALCOHOLIC BEVERAGES IS SIMILAR AND

CONTINUES TO DRIVE BETTER PERFORMANCE
INCREASING PRESENCE IN
New Categories

CLOSING GAPS
THROUGH INNOVATION
Consistent Guaran Antarctica
Market SHARE GROWTH
9,0

10,7
9,6

2x

8,6

7,4

2008

7,7

2009

8,1

2010

2011

2012

YTD 13

Oct 13

2012
2012

2013
2013

Volume OCT13 YTD

Source: Nielsen

Source: Company data

30

AGENDA

Brazil: #1 Organic Growth Opportunity

31

CONNECTING WITH CONSUMERS BEFORE, DURING & AFTER THE FIFA

2014 WORLD CUP...
In order to build a strong soccer platform, we have developed relevant assets
ranging from local teams to the FIFA 2014 World Cup

32

CONNECTING WITH CONSUMERS BEFORE, DURING & AFTER THE FIFA

2014 WORLD CUP...

33

SINCE 2011 BRAHMA HAS BEEN INNOVATING ON HOW TO CONNECT

WITH CONSUMERS THROUGH THE SPONSORSHIP OF LOCAL TEAMS...
STRUCTURAL INVESTMENTS
REACHING OUT TO FANS
VIA DIGITAL MEDIA
BRAND ACTIVATION

STADIUM ACTIVATION

34

... AND IS ALSO LEADING AN INITIATIVE TO TRANSFORM SOCCER

IN BRAZIL...
Fan Membership Program

Program Evolution
(# of fans)

BRAND ACTIVATION

3MM

600K
157K
Jan 13 Oct13
Launch

Dream

35

CONNECTING WITH CONSUMERS BEFORE, DURING & AFTER THE FIFA

2014 WORLD CUP...

36

FIFA CONFEDERATIONS CUP WAS A UNIQUE OPPORTUNITY TO RAMP UP OUR

INITIATIVES AROUND BRAND EQUITY, INCREMENTAL VOLUME & CORPORATE
IMAGE AS WE GET READY FOR 2014...
EVENT HIGHLIGHTS
JUNE 15-30
16 MATCHES

INNOVATION
Zero
Alcohol

Special Edition
Aluminum Bottle

Confederations
Cup Special
Edition
Promo Pack

6 HOST CITIES

37

CONNECTING WITH CONSUMERS BEFORE, DURING & AFTER THE FIFA

2014 WORLD CUP...
On Trade

Off Trade

Stadium

Experiential

Media

CSR

Airports
38

CONNECTING WITH CONSUMERS BEFORE, DURING & AFTER THE FIFA

2014 WORLD CUP...
In order to build a strong soccer platform, we have developed relevant assets
ranging from local teams to the FIFA 2014 World Cup

39

MAKING THE MOST OF OUR ASSETS AND EXECUTION WITH SCALE

WILL BE KEY FOR THE FIFA 2014 WORLD CUP...
EVENT
HIGHLIGHTS

FOCUS
BRANDS

JUNE 12 JULY 13
64 MATCHES
12 HOST CITIES

MICRO
EVENTS

40

WORLD CUP FOR ALL

41

Q&A
42