AMBEV REPORTS 2017 FIRST QUARTER RESULTS UNDER IFRS

Transcription

1 Page 1 AMBEV REPORTS 2017 FIRST QUARTER RESULTS UNDER IFRS Sã Paul, Ambev S.A. [BOVESPA: ABEV3; NYSE: ABEV] annunces tday its results fr the 2017 first quarter (1Q17). The fllwing perating and financial infrmatin, unless therwise indicated, is presented in nminal Reais and prepared accrding t Internatinal Financial Reprting Standards (IFRS), and shuld be read tgether with ur quarterly financial infrmatin fr the three-mnth perid ended March 31 st, 2017 filed with the CVM and submitted t the SEC. Operating and Financial Highlights Tp line perfrmance: Tp line was up 8.0% in the quarter, driven by grwth in all peratins: Brazil (+0.6%), Latin America Suth (LAS) (+27.4%), Central America and the Caribbean (CAC) (+5.5%) and Canada (+2.3%). Cnslidated vlumes were up 2.4%, grwing in mst regins, and net revenue per hectliter (NR/hl) increased by 5.3%. In Brazil, vlumes grew by 2.6%, while NR/hl was dwn 1.9%. In CAC, while rganic vlumes were up 1.2% with a NR/hl grwth f 3.4%, reprted vlumes increased by 27.3%, as a result f the swap f assets carried ut with ABI and ur peratins in Panama. In LAS, vlumes increased by 3.1% and NR/hl was up 23.3%, reflecting the high inflatin in the regin. In Canada, vlumes were slightly dwn (-0.9%), with a slid 3.3% NR/hl grwth. Cst f Gds Sld (COGS): Our COGS increased by 26.4% in 1Q17 while, n a per hectliter basis, it grew by 23.1%, mainly due t inflatinary pressures and unfavrable currency in Brazil and LAS. Selling, General & Administrative (SG&A) expenses: SG&A (excluding depreciatin and amrtizatin) in 1Q17 was up 6.4%, with efficiency gains in nn wrking mney and cst savings in wrking mney. EBITDA, Grss margin and EBITDA margin: Nrmalized EBITDA reached R$ 4,356 millin (-7.6%) in 1Q17 with grss margin f 59.8% (-580bps) and EBITDA margin f 38.7% (-670bps). Nrmalized Net Prfit and EPS: Nrmalized Net Prfit was R$ 2,316 millin in 1Q17, 20.1% belw 1Q16, driven mainly by a lwer EBITDA and currency translatin due t the appreciatin f the Brazilian Real. Nrmalized EPS in the quarter was R$ Operating Cash Generatin and CAPEX: Cash generated frm peratins in 1Q17 was R$ 3.1 billin versus R$ 2.3 billin in 1Q16 (+37.7%). In the quarter, CAPEX reached R$ 559 millin, 20.9% lwer than in 1Q16. Other cash gains: We have recrded in ur Equity a cash gain f R$ 159 millin, related t the recvery f restricted funds, t be received in 36 installments as f January, Pay-ut and Financial discipline: In 1Q17, we returned apprximately R$ 1.1 billin t equity hlders in dividends. As f March 31 st, 2017, ur net cash psitin was R$ 2,106 millin. Financial highlights - Ambev cnslidated % As % R$ millin 1Q16 1Q17 Reprted Organic Ttal vlumes 39, , % 2.4% Net sales 11, , % 8.0% Grss prfit 7, , % -1.5% Grss margin 65.8% 59.8% -600 bps -580 bps Nrmalized EBITDA 5, , % -7.6% Nrmalized EBITDA margin 45.5% 38.7% -680 bps -670 bps Prfit 2, , % Nrmalized prfit 2, , % EPS (R$/shares) % Nrmalized EPS % Nte: Earnings per share calculatin is based n utstanding shares (ttal existing shares excluding shares held in treasury). This press release segregates the impact f rganic changes frm thse arising frm changes in scpe r currency translatin. Scpe changes represent the impact f acquisitins and divestitures, the start up r terminatin f activities r the transfer f activities between segments, curtailment gains and lsses and year ver year changes in accunting estimates and ther assumptins that management des nt cnsider as part f the underlying perfrmance f the business. Unless stated, percentage changes in this press release are bth rganic and nrmalized in nature. Whenever used in this dcument, the term nrmalized refers t perfrmance measures (EBITDA, EBIT, Prfit, EPS) befre special items adjustments. Special items are either incme r expenses which d nt ccur regularly as part f the nrmal activities f the Cmpany. They are presented separately because they are imprtant fr the understanding f the underlying sustainable perfrmance f the Cmpany due t their size r nature. Nrmalized measures are additinal measures used by management and shuld nt replace the measures determined in accrdance with IFRS as indicatrs f the Cmpany s perfrmance. Cmparisns, unless therwise stated, refer t the first quarter f 2016 (1Q16). Values in this release may nt add up due t runding.

2 Page 2 Management Cmments We started the year with net revenue ging up 8.0% and EBITDA dwn 7.6%, driven by slid results in CAC, LAS and Canada but negatively impacted by Brazil s perfrmance. As anticipated, ur EBITDA decline in Brazil is explained by temprary headwinds: (i) the increase f ur COGS mainly driven by negative effect f the FX, and (ii) a tugh cmparable f NR/hl, due t state taxes increases impsed twards the end f February On the ther hand, whilst the cnsumer market in Brazil remains challenging, leading t the beer industry decline f lw single digit, we have been able t revert the negative trend and grw ur beer vlumes by 3.4%. Our beer vlumes perfrmance represents a gd first step twards ur bjective f resuming tp line and EBITDA grwth and benefited frm ur strng executin thrugh ur five cmmercial platfrms: Elevate the Cre Skl and Antarctica bsted summer experiences and tk a leading rle during Carnival, spnsring the street Carnival in mre than 40 cities and engaging with mre than 35 millin peple thrugh a cmplete 360 activatin. We have just launched a new visual brand identity (VBI) fr Brahma, ur classic lager, t highlight the brand s attributes f flavr and beer expertise. Its gld and red clrs are still there, but in a ttally new design inspired in its ld VBIs, evking its traditin. Accelerate Premium Near Beer In Hme Out f Hme Our dmestic and glbal prtflis f premium brands have delivered anther quarter f slid perfrmance, with vlumes increasing duble digits, led by Budweiser that grew mre than 30% year ver year. Stella Artis launched a glbal campaign Buy a Lady a Drink, in partnership with the Water.rg, t help raise awareness f the glbal water crisis, inviting its cre targets cnsumers t leave a legacy. Our strng activatin during Carnival has been supprted by Skl Beats, with its three variants, Senses, Spirits and Secret. Ging frward, there is still a big pprtunity fr Near Beer, as we increase ur prtfli and capture a bigger share f thrat in nn-traditinal beer ccasins. We have been expanding ur market prgrams designed t imprve the assrtment f prducts and categry space, enhancing shppers experience in the ff-trade channel. The 300ml returnable glass bttles cntinue t be a big fcus fr 2017, driving affrdability t cnsumers. This presentatin grew duble digits year ver year. The bar is an extensin f the Brazilian s living rms. We have been imprving executin and service level acrss the cuntry and investing in trade prgrams t supprt the pints f sales in the challenging macr envirnment. The 1 liter returnable glass bttles grew high single digit year ver year, playing an imprtant rle in such envirnment. In CSD & NANC Brazil, we cntinued t invest behind ur brands and t strengthen ur pack price strategy, delivering flattish vlumes, while the industry came under significant pressure declining, as per ur estimates, high single digit. In ur internatinal peratins, CAC delivered anther quarter f rganic vlumes grwth and slid revenue management strategy that, cupled with a slid cst discipline, led t an EBITDA increase and margin expansin. In LAS, the weakness in sft drink industry was mre than ffset by an strng beer vlumes perfrmance in all the cuntries we perate, leading t slid EBITDA grwth. And in Canada, we cntinued t grw ur tp line and EBITDA driven by rganic vlumes grwth and strng revenue management strategy.

3 Still with respect t ur internatinal peratins, it is imprtant t highlight that ur reprted results include fr the first time ur peratins in Panama and exclude ur frmer peratins in Clmbia, Peru and Ecuadr, which are treated as a scpe in ur CAC as LAS divisins, respectively. Page 3 Lking at ur divisinal perfrmance highlights in mre detail: Brazil. NR in Brazil was up 0.6% in 1Q17 and EBITDA dwn 23.8% t R$ 2,455 millin, with a margin f 39.0% (-1250bps). In Beer Brazil, net revenue grew by 1.1% in 1Q17. Ttal vlumes increased by 3.4% in the quarter, despite the cntinued macrecnmic weakness. We estimate that beer industry vlumes declined lw single digit. Premium cntinued t grw, with vlumes increasing duble digits. NR/hl was dwn 2.2%, due t a hard cmparable in 1Q16, as the 2016 state taxes increases nly became effective twards the end f February In additin, as part f ur revenue management strategy, we cntinued t use ur full prtfli f packs and brands t drive affrdability t cnsumers, including the 1 liter returnable glass bttles in the n-trade channel and the 300ml returnable glass bttles in the fftrade channel. Vlumes f bth packaging presentatins grew duble digits in the quarter. In CSD & NANC Brazil, tp line was dwn 2.6% in the quarter. Vlumes were slightly up (+0.1%), better than CSD industry that declined, as we estimate, high single digit, as cnsumers cntinue t be pressured by negative real dispsable incme grwth. NR/hl in CSD & NANC was dwn 2.7%. Brazil cash COGS was up 38.2% while, n a per hectliter basis, 34.8%, mainly due t (i) FX impacts, (ii) inflatin, and (iii) a hard cmparable in 1Q16, when ur cash COGS/hl increased by 2.3%, despite f an inflatin f arund 10% and a FX impact f mre than 20%. Brazil cash SG&A was up 1.5%, belw inflatin, due t (i) a lw single digit grwth f distributin and administrative expenses, and (ii) a decline in sales and marketing expenses driven by efficiency gains in nn wrking mney. Central America and the Caribbean (CAC). In 1Q17, EBITDA in CAC reached R$ 377 millin (+7.8%) driven by tp line perfrmance (+5.5%) and anther quarter f EBITDA margin expansin (+80bps) t 35.6%. In US dllars, reprted EBITDA grew clse t 25%. We cntinued t experience a gd mmentum f tp line grwth in the regin. Organic vlumes grew by 1.2% n a tugh cmparable, given the 10.4% vlume grwth in 1Q16 while, n a reprted basis, vlumes increased by 27.3% benefitting frm the recent swap f assets carried ut with ABI and ur peratins in Panama. In Dminican Republic, we cntinued t cnnect with ur cnsumers thrugh relevant platfrms, such as Carnival Presidente and The Wrld Baseball Classic, supprting the equity f ur brands, while, in Guatemala, we further imprved ur executin, with strng summer activatin f Crna and Busch. Latin America Suth (LAS). In 1Q17, tp line was up 27.4%, and EBITDA in the regin reached R$ 1,203 millin (+20.5%) with an EBITDA margin cmpressin f 250bps t 43.5%. Vlumes were up 3.1%, as the sftness f the CSD&NANC industry in the regin was mre than ffset by a strng perfrmance f beer in (i) Argentina, where vlumes reverted the recent negative trend and increased by a high single digit, leaded by Brahma, Iguana and Crna; (ii) Blivia, driven by Huari; (iii) Paraguay, with an utperfrmance f Brahma, Bud Light and Our Fin; (iv) Chile, with strng perfrmance f ur Glbal Brands; and (v) Uruguay, with a duble digits vlume grwth. EBITDA margin in LAS cmpressed 250bps in the quarter mainly due t a 41.8% cash COGS increase (+35.0% n a hectliter basis) impacted by FX in Argentina. Canada. EBITDA fr the cuntry ttaled R$ 321 millin (+17.5%) driven by tp line grwth (+2.3%) and cntinued cst discipline t drive rbust EBITDA margin expansin (+370bps) t 28.5%.

4 Page 4 We delivered anther quarter f slid tp line perfrmance in Canada, with NR/hl grwing 3.3% mainly as a result f ur revenue management strategy. Vlumes were dwn 0.9% in 1Q17, due t Easter hliday phasing impact n the beer industry, partially ffset by the cntinued grwth f ur Glbal Brands, led by Bud Light and Stella Artis, and strng perfrmance frm ur craft and near beer prtfli, which are grwing duble digits. Outlk We are cnfident that the initiatives taken under ur cmmercial platfrms have played an imprtant rle fr the recvery f beer vlumes in Brazil. Hwever, it is imprtant t keep in mind that the macr envirnment remains very challenging, with an alltime high unemplyment rate and depressed dispsable incme, what is leading t a cntinued decline f the beer industry. In this cntext, we remain cautiusly ptimistic fr the year and we will cntinue t leverage ur cmmercial platfrms. We will als keep pursuing efficiency in ur investments and, despite the shrt-term negative impact f ur COGS, as part f ur culture, we will push urselves further t imprve ur cst perfrmance and deliver superir results, as we remain excited with the pprtunities we see ging frward t resume tp line and EBITDA grwth. We reiterate ur guidance that we expect cash COGS/hl t grw duble digits in the first half and t be flattish t lw single digit up in the secnd half f Further, year ver year, the increase f the cash COGS/hl in 2Q17 will be significantly lwer than the year ver year increase in 1Q17, being a bridge fr secnd half f the year. Finally, regarding ur internatinal peratins, in CAC, we will keep pursuing tp line grwth and EBITDA margin expansin and we remain enthusiastic with the regin. In LAS, we are excited with the psitive vlumes trend and tp line grwth pprtunities, especially fr beer, whilst still cautius with the macr envirnment in Argentina. In Canada, we cntinue t fcus n balanced tp line grwth translating int the bttm line and remain ptimistic that we have the right prtfli t deliver prfitable grwth.

5 Page 5 Ambev Cnslidated Incme Statement Cnslidated incme statement % As % Currency Organic R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Net revenue 11, (1,373.1) , % 8.0% Cst f gds sld (COGS) (3,960.3) (28.0) (1,029.5) (4,523.1) 14.2% 26.4% Grss prfit 7, (878.4) (115.5) 6, % -1.5% Selling, general and administrative (SG&A) (3,596.6) (59.7) (203.6) (3,480.9) -3.2% 5.7% Other perating incme (114.8) % -29.2% Nrmalized perating incme (nrmalized EBIT) 4, (499.4) (433.9) 3, % -9.8% Exceptinal items abve EBIT (6.2) (6.6) 4.5 (20.3) (28.7) nm nm Net finance results (1,171.3) (872.6) -25.5% Share f results f assciates % Incme tax expense (336.4) (338.5) 0.6% Prfit 2, , % Attributable t Ambev hlders 2, , % Attributable t nn-cntrlling interests % Nrmalized prfit 2, , % Attributable t Ambev hlders 2, , % Nrmalized EBITDA 5, (575.7) (403.6) 4, % -7.6%

6 Page 6 Ambev Cnslidated Results The cmbinatin f Ambev s peratins in Latin America Nrth (LAN), LAS and Canada s business units, eliminating intercmpany transactins, cmprises ur cnslidated financial statements. The figures shwn belw are n an as-reprted basis. Vlume (millin hectliters) Q14 1Q15 1Q16 1Q17 Net revenues per HL (R$) COGS per HL (R$) Q14 1Q15 1Q16 1Q Q14 1Q15 1Q16 1Q17 Nrmalized EBITDA (R$ MM) Nrmalized EBITDA margin (%) , , , , % 50% 40% 30% 20% 10% 44.8% 47.1% 45.5% 38.7% Q14 1Q15 1Q16 1Q17 0% 1Q14 1Q15 1Q16 1Q17

7 Page 7 Ambev Cnslidated We delivered during the quarter R$ 11,241.8 millin f Net Revenue (+8.0%) and R$ 4,356.2 millin f Nrmalized EBITDA (-7.6%). Ambev results % As % Currency Organic R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 39, , % 2.4% Net revenue 11, (1,373.1) , % 8.0% Net revenue/hl (33.2) % 5.3% COGS (3,960.3) (28.0) (1,029.5) (4,523.1) 14.2% 26.4% COGS/hl (99.1) (22.6) (109.5) 10.5% 23.1% COGS excl. deprec.&amrt. (3,403.3) (24.2) (994.9) (3,976.1) 16.8% 29.7% COGS/hl excl. deprec. &amrt (85.2) (22.1) (96.3) 13.0% 26.2% Grss prfit 7, (878.4) (115.5) 6, % -1.5% Grss margin 65.8% 59.8% -600 bps -580 bps SG&A excl. deprec.&amrt. (3,289.8) (53.8) (207.9) (3,200.3) -2.7% 6.4% SG&A deprec.&amrt. (306.9) (5.9) (280.6) -8.6% -1.4% SG&A ttal (3,596.6) (59.7) (203.6) (3,480.9) -3.2% 5.7% Other perating incme (114.8) % -29.2% Nrmalized EBIT 4, (499.4) (433.9) 3, % -9.8% Nrmalized EBIT margin 38.0% 31.4% -660 bps -640 bps Nrmalized EBITDA 5, (575.7) (403.6) 4, % -7.6% Nrmalized EBITDA margin 45.5% 38.7% -680 bps -670 bps

8 Page 8 Latin America Nrth (LAN) Our LAN regin includes Beer Brazil, CSD & NANC Brazil and Central America and the Caribbean (CAC) peratins. LAN EBITDA fr the quarter ttaled R$ 2,832.0 millin (-20.5%). LAN results % As % Currency Organic R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 29, , % 2.5% Net revenue 7, (234.3) , % 1.3% Net revenue/hl (7.7) (2.9) % -1.2% COGS (2,484.8) (86.7) (660.8) (3,128.4) 25.9% 26.6% COGS/hl (85.7) (1.3) 3.4 (19.8) (103.3) 20.6% 23.1% COGS excl. deprec.&amrt. (2,061.0) (75.5) 90.6 (658.0) (2,703.9) 31.2% 31.9% COGS/hl excl. deprec. &amrt (71.1) (1.2) 3.0 (20.0) (89.3) 25.6% 28.2% Grss prfit 4, (130.4) (568.7) 4, % -11.9% Grss margin 65.8% 57.4% -840 bps -850 bps SG&A excl. deprec.&amrt. (2,041.2) (95.1) 52.5 (20.6) (2,104.3) 3.1% 1.0% SG&A deprec.&amrt. (218.0) (11.0) (221.7) 1.7% -0.4% SG&A ttal (2,259.1) (106.1) 58.9 (19.7) (2,326.1) 3.0% 0.9% Other perating incme (150.4) % -35.3% Nrmalized EBIT 2, (70.9) (738.8) 2, % -25.0% Nrmalized EBIT margin 40.7% 29.7% bps bps Nrmalized EBITDA 3, (90.6) (736.8) 2, % -20.5% Nrmalized EBITDA margin 49.5% 38.5% bps bps

9 Page 9 Ambev Brazil In 1Q17 we delivered R$ 2,455.1 millin (-23.8%) f Nrmalized EBITDA in Brazil, with an EBITDA margin f 39.0% (-1250bps). Net revenue increased by 0.6% in the quarter, with vlumes ging up 2.6% and a NR/hl dwn 1.9%. Cash COGS and cash COGS/hl were up 38.2% and 34.8%, respectively. Cash SG&A grew 1.5%. Ambev Brazil results Currency Organic % As % R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 26, , % 2.6% Net revenue 6, , % 0.6% Net revenue/hl (4.5) % -1.9% COGS (2,013.0) - - (651.5) (2,664.5) 32.4% 32.4% COGS/hl (75.1) - - (21.8) (96.9) 29.1% 29.1% COGS excl. deprec.&amrt. (1,662.2) - - (635.3) (2,297.5) 38.2% 38.2% COGS/hl excl. deprec. &amrt (62.0) - - (21.6) (83.6) 34.8% 34.8% Grss prfit 4, (615.4) 3, % -14.5% Grss margin 67.8% 57.7% bps bps SG&A excl. deprec.&amrt. (1,794.5) - - (27.3) (1,821.8) 1.5% 1.5% SG&A deprec.&amrt. (197.2) (188.2) -4.6% -4.6% SG&A ttal (1,991.7) - - (18.2) (2,009.9) 0.9% 0.9% Other perating incme (139.7) % -33.3% Nrmalized EBIT 2, (773.3) 1, % -28.9% Nrmalized EBIT margin 42.7% 30.2% bps bps Nrmalized EBITDA 3, (766.2) 2, % -23.8% Nrmalized EBITDA margin 51.5% 39.0% bps bps

10 Page 10 Beer Brazil In 1Q17, EBITDA fr Beer Brazil was R$ 2,214.9 millin (-20.1%) with an EBITDA margin cmpressin f 1100bps t 41.2%. NR was up 1.1% in the quarter, as vlumes grwth f 3.4% was partially impacted by a negative NR/hl (- 2.2%), driven by (i) a hard cmparable in 1Q16, as the 2016 state taxes increases nly became effective twards the end f February 2016, and (ii) negative mix. Cash COGS/hl increased by 34.3%, driven by (i) FX impacts, (ii) inflatin, and (iii) a hard cmparable in 1Q16, when ur cash COGS/hl increased by 2.9%, despite f an inflatin f arund 10% and a FX impact f mre than 20%. Cash SG&A was flattish due t (i) a belw inflatin grwth f sales and marketing, driven by efficiency gains in ur nn wrking mney, and (ii) a lw single digit increase in distributin csts and a decline in administrative csts, as a result f the revisin f ur lgistics and administrative cst allcatin between Beer and CSD & NANC businesses. Beer Brazil results % As % Currency Organic R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 19, , % 3.4% Net revenue 5, , % 1.1% Net revenue/hl (5.9) % -2.2% COGS (1,599.4) - - (514.5) (2,113.9) 32.2% 32.2% COGS/hl (80.5) - - (22.4) (102.9) 27.8% 27.8% COGS excl. deprec.&amrt. (1,297.5) - - (504.3) (1,801.7) 38.9% 38.9% COGS/hl excl. deprec. &amrt (65.3) - - (22.4) (87.7) 34.3% 34.3% Grss prfit 3, (453.9) 3, % -12.2% Grss margin 69.9% 60.6% -930 bps -930 bps SG&A excl. deprec.&amrt. (1,576.8) (1,576.6) 0.0% 0.0% SG&A deprec.&amrt. (159.1) - - (8.6) (167.7) 5.4% 5.4% SG&A ttal (1,736.0) - - (8.4) (1,744.3) 0.5% 0.5% Other perating incme (114.0) % -33.8% Nrmalized EBIT 2, (576.3) 1, % -24.9% Nrmalized EBIT margin 43.5% 32.3% bps bps Nrmalized EBITDA 2, (557.4) 2, % -20.1% Nrmalized EBITDA margin 52.2% 41.2% bps bps

11 Page 11 CSD & NANC Brazil In Brazil CSD & NANC, we delivered an EBITDA f R$ millin (-46.5%) in the 1Q17, with an EBITDA margin f 26.0% (-2130bps). Net revenue was dwn (-2.6%), as a flattish vlumes (+0.1%) were impacted by a NR/hl decline f 2.7%. Cash COGS/hl increased by 35.8% driven by (i) negative FX impacts, (ii) inflatin, and (iii) a hard cmparable in 1Q16, when cash COGS/hl increased by 1.1%, despite f an inflatin f arund 10% and a FX impact f mre than 20%. Cash SG&A was up 12.6% driven by a duble digits decline in sales and marketing impacted by higher distributin and administrative expenses, due t the revisin f ur cst allcatin between ur businesses t better reflect the CSD & NANC peratins. CSD&Nanc Brazil results Currency Organic % As % R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 6, , % 0.1% Net revenue (24.5) % -2.6% Net revenue/hl (3.6) % -2.7% COGS (413.6) - - (137.0) (550.6) 33.1% 33.1% COGS/hl (59.6) - - (19.7) (79.3) 33.0% 33.0% COGS excl. deprec.&amrt. (364.7) - - (131.1) (495.8) 35.9% 35.9% COGS/hl excl. deprec. &amrt (52.5) - - (18.8) (71.4) 35.8% 35.8% Grss prfit (161.5) % -30.2% Grss margin 56.4% 40.4% bps bps SG&A excl. deprec.&amrt. (217.7) - - (27.5) (245.1) 12.6% 12.6% SG&A deprec.&amrt. (38.1) (20.5) -46.3% -46.3% SG&A ttal (255.8) - - (9.8) (265.6) 3.8% 3.8% Other perating incme (25.8) % -31.0% Nrmalized EBIT (197.1) % -54.4% Nrmalized EBIT margin 38.2% 17.9% bps bps Nrmalized EBITDA (208.8) % -46.5% Nrmalized EBITDA margin 47.3% 26.0% bps bps

12 Page 12 Central America and the Caribbean (CAC) Our peratins in CAC delivered an EBITDA f R$ millin (+7.8%) in the quarter, with an EBITDA margin f 35.6% (+80bps). In US dllars, reprted EBITDA grew clse t 25%. Tp line increased by 5.5% in 1Q17 driven by rganic vlume grwth (+1.2%), despite a tugh cmparable in 1Q16, when vlumes grew 10.4%, and by a NR/hl increase f 3.4%. Reprted vlumes increased by 27.3%, benefitting frm the recent swap f assets carried ut with ABI and ur peratins in Panama. In Dminican Republic, we cntinued t cnnect with ur cnsumers thrugh relevant platfrms, such as Carnival Presidente and The Wrld Baseball Classic, enhancing ur brand s equity, while, in Guatemala, we imprved ur executin, with a strng summer activatin f Crna and Busch. Cash COGS/hl grew in line with tp line perfrmance, while ur cash SG&A declined 2.7%, driving anther quarter f EBITDA margin expansin. The scpe change in CAC refers t the beginning f ur peratins in Panama as a result f the swap f assets carried ut with ABI n December 31, CAC results Currency Organic % As % R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ttal ('000 hl) 2, , % 1.2% Net revenue 1, (234.3) , % 5.5% Net revenue/hl (17.1) (83.9) % 3.4% COGS (471.8) (86.7) (9.3) (463.9) -1.7% 2.0% COGS/hl (215.2) (1.4) (166.2) -22.8% 0.7% COGS excl. deprec.&amrt. (398.8) (75.5) 90.6 (22.7) (406.4) 1.9% 5.7% COGS/hl excl. deprec. &amrt (181.9) (6.5) (145.6) -20.0% 3.6% Grss prfit (130.4) % 8.6% Grss margin 53.6% 56.1% 250 bps 160 bps SG&A excl. deprec.&amrt. (246.7) (95.1) (282.6) 14.6% -2.7% SG&A deprec.&amrt. (20.7) (11.0) 6.4 (8.2) (33.5) 61.7% 39.7% SG&A ttal (267.4) (106.1) 58.9 (1.5) (316.1) 18.2% 0.6% Other perating incme/expenses (10.7) % % Nrmalized EBIT (70.9) % 12.1% Nrmalized EBIT margin 28.0% 27.0% -100 bps 180 bps Nrmalized EBITDA (90.6) % 7.8% Nrmalized EBITDA margin 37.2% 35.6% -160 bps 80 bps

13 Page 13 Latin America Suth (LAS) LAS EBITDA increased by 20.5% in 1Q17 t R$ 1,203.4 millin, with an EBITDA margin f 43.5% (-250bps). Our vlumes grew by 3.1%, as the sftness f the CSD&NANC industry in the regin was mre than ffset by a strng perfrmance f beer in (i) Argentina, where vlumes reverted the recent negative trend and increased by a high single digit, with great cntributin frm Brahma, Iguana and Crna; (ii) Blivia, mainly driven by Huari; (iii) Paraguay, with an utperfrmance f Brahma, Bud Light and Our Fin; (iv) Chile, with strng perfrmance f ur Glbal Brands; and (v) Uruguay, with a duble digits vlume grwth driven by bth mainstream and premium prtflis. Tp line was up 27.4% with a NR/hl increase f 23.3%. Cash COGS grew 41.8% while, n a hectliter basis, 35.0%, mainly driven by higher inflatin and negative currency impact, as we are very systematic with ur hedge plicy. Cash SG&A increased by 27.7%, adversely impacted by inflatinary pressures mainly in Argentina. The scpe change in LAS refers t the terminatin f ur peratins in Clmbia, Peru and Ecuadr as a result f the swap f assets carried ut with ABI n December 31 st, LAS results Currency Organic % As % R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 9,017.0 (197.3) , % 3.1% Net revenue 2,973.9 (87.8) (913.4) , % 27.4% Net revenue/hl (100.5) % 23.3% COGS (1,044.3) (400.6) (1,059.9) 1.5% 40.7% COGS/hl (115.8) (4.3) 35.6 (40.8) (116.6) 0.7% 33.9% COGS excl. deprec.&amrt. (941.2) (370.7) (964.1) 2.4% 41.8% COGS/hl excl. deprec. &amrt (104.4) (3.7) 32.4 (37.8) (106.1) 1.6% 35.0% Grss prfit 1,929.6 (26.7) (589.5) , % 20.5% Grss margin 64.9% 61.7% -320 bps -350 bps SG&A excl. deprec.&amrt. (669.2) (173.1) (598.0) -10.6% 27.7% SG&A deprec.&amrt. (70.3) (17.0) (60.4) -14.1% 26.0% SG&A ttal (739.5) (190.0) (658.3) -11.0% 27.6% Other perating incme/expenses (27.7) 1.3 (0.4) % % Nrmalized EBIT 1, (368.9) , % 19.3% Nrmalized EBIT margin 39.1% 37.9% -120 bps -260 bps Nrmalized EBITDA 1, (420.5) , % 20.5% Nrmalized EBITDA margin 44.9% 43.5% -140 bps -250 bps

14 Page 14 Canada In Canada, we delivered R$ millin f EBITDA (+17.5%), while ur EBITDA margin increased 370bps t 28.5%. In the first quarter ur vlumes were dwn 0.9% mstly due t cntractin f the Canadian beer industry, which was impacted by Easter hliday phasing, partially ffset by perfrmance ahead f trend f ur lead brand Budweiser, duble digits grwth n Bud Light, and cntinued strng perfrmance frm the craft and near beer prtfli. Our net revenue per hectliter increased by 3.3%, mainly explained by ur revenue management initiatives. Cash COGS decreased by 8.4% while, n a per hectliter basis, by 7.6%, primarily driven by cst absrptin with increased prductin and cst efficiencies with ur imprt prtfli frm ABI, while Cash SG&A expenses increased by 2.5%. Canada results Currency Organic % As % R$ millin 1Q16 Scpe Translatin Grwth 1Q17 Reprted Organic Vlume ('000 hl) 1, (17.6) 1, % -0.9% Net revenue 1, (225.4) , % 2.3% Net revenue/hl (116.8) % 3.3% COGS (431.2) (2.4) (334.8) -22.4% -7.4% COGS/hl (222.3) (0.4) (173.6) -21.9% -6.5% COGS excl. deprec.&amrt. (401.2) (2.3) (308.1) -23.2% -8.4% COGS/hl excl. deprec. &amrt (206.8) (0.4) (159.7) -22.8% -7.6% Grss prfit (158.6) % 7.1% Grss margin 67.2% 70.3% 310 bps 310 bps SG&A excl. deprec.&amrt. (579.4) (3.8) 99.4 (14.2) (498.0) -14.0% 2.5% SG&A deprec.&amrt. (18.6) (0.0) (0.3) % % SG&A ttal (598.0) (3.8) (496.5) -17.0% -1.0% Other perating incme/expenses (6.5) 0.5 (0.1) % % Nrmalized EBIT (0.7) (59.6) % 27.1% Nrmalized EBIT margin 21.3% 26.3% 500 bps 510 bps Nrmalized EBITDA (0.6) (64.6) % 17.5% Nrmalized EBITDA margin 25.0% 28.5% 350 bps 370 bps

15 Page 15 Other perating incme/(expense) Other perating incme ttaled R$ millin in 1Q17 (-25.9%), mainly driven by gvernment grants related t State VAT lng-term tax incentives that were dwn year ver year due t (i) the expiratin f VAT Gvernment Grants Agreements in 4Q16, and (ii) revenue gegraphic mix. Other perating incme/(expenses) 1Q16 1Q17 R$ millin Gvernment grants/npv f lng term fiscal incentives (Additins t)/reversals f prvisins (22.2) (10.6) Net gain n dispsal f prperty, plant and equipment and intangible assets 2.9 (5.4) Net ther perating incme/(expenses) Exceptinalitems During the first quarter we recrded an expense f R$ 28.7 millin in exceptinal items (as cmpared t R$ 6.2 millin in 1Q16). Exceptinal items 1Q16 1Q17 R$ millin Restructuring (6.2) (27.1) Csts f new acquisitin - (0.7) Other exceptinal items - (0.8) (6.2) (28.7)

16 Page 16 Net finance results Net finance results declined 25.5% (a R$ 1,171.3 millin expense in 1Q16 cmpared t a R$ millin expense in 1Q17), as a higher Interest Expenses f R$ millin, due t interest expenses and the nn cash expense related t the put ptin assciated with ur investment in the Dminican Republic (arund R$ 140 millin), was mre than ffset by lwer lsses n: (i) (ii) Derivative instruments, driven by the carry cst f ur FX hedges, primarily linked t ur COGS expsure in Brazil and Argentina, and nn-cash gains r lsses related t the mark t market f the hedges; and Nn-derivative instruments, related t freign exchange translatin n intercmpany payables and lans, as we benefited frm the BRL appreciatin. Net finance results 1Q16 1Q17 R$ millin Interest incme Interest expenses (361.0) (402.2) Gains/(lsses) n derivative instruments (417.4) (246.6) Gains/(lsses) n nn-derivative instruments (245.3) (78.4) Taxes n financial transactins (43.3) (38.0) Other financial incme/(expenses), net (289.4) (216.0) Net finance results (1,171.3) (872.6) As f March 31 st, 2017 we held a net cash psitin f R$ 2,106.1 millin (dwn frm R$ 2,763.3 millin as f December 31 st, 2016). Cnslidated debt crrespnded t R$ 5,132.9 millin whereas cash and cash equivalents less bank verdrafts ttaled R$ 7,229.1 millin, dwn frm R$ 7,876.8 millin as f December 31 st, December 31 st, 2016 March 31 st, 2017 Debt Breakdwn Current Nn-current Ttal Current Nn-current Ttal Lcal Currency , , , ,760.0 Freign Currency 2, , , ,372.9 Cnslidated Debt 3, , , , , ,132.9 Cash and Cash Equivalents less Bank Overdrafts 7, ,229.1 Current Investment Securities Net Debt/ (Cash) (2,763.3) (2,106.1)

17 Page 17 Prvisin fr incme tax & scial cntributin The weighted nminal tax rate fr the quarter was 29.6%, cmpared t 30.9% f 1Q16, while the effective tax rate increased frm 10.4% t 12.9%, mainly driven by lwer benefits frm interest n sharehlders equity. The table belw shws the recnciliatin fr incme tax and scial cntributin prvisin. Incme tax and scial cntributin R$ millin 1Q16 1Q17 Prfit befre tax 3, ,628.3 Adjustment n taxable basis Nn-taxable net financial and ther incme (130.0) (104.9) Gverment grants (VAT) (341.1) (434.4) Share f results f assciates (7.4) (1.0) Expenses nt deductible Freign prfits taxed in Brazil , ,212.8 Aggregated weighted nminal tax rate 30.9% 29.6% Taxes nminal rate (1,079.4) (655.5) Adjustment n tax expense Tax benefit - interest n sharehlders' equity Tax benefit - amrtizatin n tax bks Other tax adjustments 14.1 (3.6) Incme tax and scial cntributin expense (336.4) (338.5) Effective tax rate 10.4% 12.9% Sharehlding structure The table belw summarizes Ambev S.A. s sharehlding structure as f March 31 st, Ambev S.A.'s sharehlding structure ON %Outs Anheuser-Busch InBev 9,726,265, % FAHZ 1,601,417, % Market 4,375,218, % Outstanding 15,702,901, % Treasury 14,714,346 TOTAL 15,717,615,419 Free flat BM&FBvespa 3,034,242, % Free flat NYSE 1,340,975, %

18 Page 18 Recnciliatin between nrmalized EBITDA & prfit Bth Nrmalized EBITDA and EBIT are measures used by Ambev s management t measure the Cmpany s perfrmance. Nrmalized EBITDA is calculated excluding frm Prfit the fllwing effects: (i) Nn-cntrlling interest, (ii) Incme Tax expense, (iii) Share f results f assciates, (iv) Net finance results, (v) Special items, and (vi) Depreciatin & Amrtizatin. Nrmalized EBITDA and EBIT are nt accunting measures under accunting practices in Brazil, IFRS r the United States f America (US GAAP) and shuld nt be cnsidered as an alternative t Prfit as a measure f peratinal perfrmance r an alternative t Cash Flw as a measure f liquidity. Nrmalized EBITDA and EBIT d nt have a standard calculatin methd and Ambev s definitin f Nrmalized EBITDA and EBIT may nt be cmparable t that f ther cmpanies. Recnciliatin - Prfit t EBITDA 1Q16 1Q17 Prfit - Ambev hlders 2, ,199.1 Nn-cntrlling interest Incme tax expense Prfit befre taxes 3, ,628.3 Share f results f assciates (7.4) (1.0) Net finance results 1, Exceptinal items Nrmalized EBIT 4, ,528.6 Depreciatin & amrtizatin - ttal Nrmalized EBITDA 5, ,356.2

19 Page 19 Q Earnings Cnference Call Speakers: Language: Date: Time: Bernard Paiva Chief Executive Officer Ricard Rittes Chief Financial and Investr Relatins Officer English May 4th, 2017 (Thursday) 13:00 (Brasília time) 12:00 (EST) Phne number: US participants + 1 (844) Internatinal participants + 1 (412) Cnference ID: Ambev Please call 15 minutes prir t the beginning f the cnference call. Webcast: The cnference call will als be transmitted live thrugh the Internet, available n Ambev s website: Playback: The cnference call replay thrugh internet will be available ne hur after cnclusin at Ambev s website at the same link abve. Fr Playback thrugh telephne: participants calling frm USA: +1 (877) / participants calling frm ther cuntries: +1 (412) / Cde: enter "1" t start the playback. Fr additinal infrmatin, please cntact the Investr Relatins team: Nicle Brink André Thmaz (+55 11) (+55 11) nicle.brink@ambev.cm.br andre.thmaz@ambev.cm.br ir.ambev.cm.br Statements cntained in this press release may cntain infrmatin that is frward-lking and reflects management s current view and estimates f future ecnmic circumstances, industry cnditins, cmpany perfrmance, and finance results. Any statements, expectatins, capabilities, plans and assumptins cntained in this press release that d nt describe histrical facts, such as statements regarding the declaratin r payment f dividends, the directin f future peratins, the implementatin f principal perating and financing strategies and capital expenditure plans, the factrs r trends affecting financial cnditin, liquidity r results f peratins, are frward-lking statements within the meaning f the U.S. Private Securities Litigatin Refrm Act f 1995 and invlve a number f risks and uncertainties. There is n guarantee that these results will actually ccur. The statements are based n many assumptins and factrs, including general ecnmic and market cnditins, industry cnditins, and perating factrs. Any changes in such assumptins r factrs culd cause actual results t differ materially frm current expectatins..

20 Page 20 Ambev - Segment financial infrmatin Organic results Ambev Brazil Beer Brazil CSD & NANC Brazil Ttal Ambev Brazil 1Q16 1Q17 % 1Q16 1Q17 % 1Q16 1Q17 % Vlumes (000 hl) 19, , % 6, , % 26, , % R$ millin Net sales 5, , % % 6, , % % f ttal 45.9% 47.8% 8.2% 8.2% 54.1% 56.0% COGS (1,599.4) (2,113.9) 32.2% (413.6) (550.6) 33.1% (2,013.0) (2,664.5) 32.4% % f ttal 40.4% 46.7% 10.4% 12.2% 50.8% 58.9% Grss prfit 3, , % % 4, , % % f ttal 48.8% 48.5% 7.0% 5.6% 55.8% 54.0% SG&A (1,736.0) (1,744.3) 0.5% (255.8) (265.6) 3.8% (1,991.7) (2,009.9) 0.9% % f ttal 48.3% 50.1% 7.1% 7.6% 55.4% 57.7% Other perating incme/(expenses) % % % % f ttal 85.8% 76.6% 21.2% 19.7% 107.0% 96.3% Nrmalized EBIT 2, , % % 2, , % % f ttal 52.5% 49.2% 8.2% 4.7% 60.7% 53.8% Nrmalized EBITDA 2, , % % 3, , % % f ttal 52.7% 50.8% 8.5% 5.5% 61.2% 56.4% % f net sales Net sales 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% COGS -30.1% -39.4% -43.6% -59.6% -32.2% -42.3% Grss prfit 69.9% 60.6% 56.4% 40.4% 67.8% 57.7% SG&A -32.7% -32.5% -27.0% -28.8% -31.8% -31.9% Other perating incme/(expenses) 6.3% 4.1% 8.8% 6.2% 6.7% 4.5% Nrmalized EBIT 43.5% 32.3% 38.2% 17.9% 42.7% 30.2% Nrmalized EBITDA 52.2% 41.2% 47.3% 26.0% 51.5% 39.0% Per hectliter - (R$/hl) Net sales % % % COGS (80.5) (102.9) 27.8% (59.6) (79.3) 33.0% (75.1) (96.9) 29.1% Grss prfit % % % SG&A (87.4) (84.9) -2.9% (36.9) (38.2) 3.8% (74.3) (73.1) -1.6% Other perating incme/(expenses) % % % Nrmalized EBIT % % % Nrmalized EBITDA % % % Ambev - Segment financial infrmatin Organic results LAS CAC Canada Ambev Operatins Operatins Operatins Cnslidated 1Q16 1Q17 % 1Q16 1Q17 % 1Q16 1Q17 % 1Q16 1Q17 % Vlumes (000 hl) 9, , % 2, , % 1, , % 39, , % R$ millin Net sales 2, , % 1, , % 1, , % 11, , % % f ttal 25.7% 24.6% 8.8% 9.4% 11.4% 10.0% 100.0% 100.0% COGS (1,044.3) (1,059.9) 40.7% (471.8) (463.9) 2.0% (431.2) (334.8) -7.4% (3,960.3) (4,523.1) 26.4% % f ttal 26.4% 23.4% 11.9% 10.3% 10.9% 7.4% 100.0% 100.0% Grss prfit 1, , % % % 7, , % % f ttal 25.4% 25.4% 7.2% 8.8% 11.6% 11.8% 100.0% 100.0% SG&A (739.5) (658.3) 27.6% (267.4) (316.1) 0.6% (598.0) (496.5) -1.0% (3,596.6) (3,480.9) 5.7% % f ttal 20.6% 18.9% 7.4% 9.1% 16.6% 14.3% 100.0% 100.0% Other perating incme/(expenses) (27.7) % % (6.5) % % % f ttal -7.1% 0.5% 1.7% 2.8% -1.7% 0.4% 100.0% 100.0% Nrmalized EBIT 1, , % % % 4, , % % f ttal 26.4% 29.7% 6.5% 8.1% 6.4% 8.4% 100.0% 100.0% Nrmalized EBITDA 1, , % % % 5, , % % f ttal 25.4% 27.6% 7.2% 8.7% 6.2% 7.4% 100.0% 100.0% % f net sales Net sales 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% COGS -35.1% -38.3% -46.4% -43.9% -32.8% -29.7% -34.2% -40.2% Grss prfit 64.9% 61.7% 53.6% 56.1% 67.2% 70.3% 65.8% 59.8% SG&A -24.9% -23.8% -26.3% -29.9% -45.5% -44.1% -31.1% -31.0% Other perating incme/(expenses) -0.9% 0.1% 0.7% 0.8% -0.5% 0.1% 3.4% 2.6% Nrmalized EBIT 39.1% 37.9% 28.0% 27.0% 21.3% 26.3% 38.0% 31.4% Nrmalized EBITDA 44.9% 43.5% 37.2% 35.6% 25.0% 28.5% 45.5% 38.7% Per hectliter - (R$/hl) Net sales % % % % COGS (115.8) (116.6) 35.2% (215.2) (166.2) 0.7% (222.3) (173.6) -6.5% (99.1) (109.5) 22.9% Grss prfit % % % % SG&A (82.0) (72.4) 22.7% (122.0) (113.2) -0.5% (308.3) (257.4) -0.1% (90.0) (84.3) 3.1% Other perating incme/(expenses) (3.1) 0.2 nm % (3.3) % % Nrmalized EBIT % % % % Nrmalized EBITDA % % % %.

21 Page 21 CONSOLIDATED BALANCE SHEET R$ millin Assets Current assets Cash and cash equivalents March 31 st, ,230.3 December 31 st, ,876.8 Investment securities (CURRENT) Derivative financial instruments (current assets) Trade receivables (current) 3, ,368.1 Inventries 4, ,347.1 Incme tax and scial cntributins receivable (current) 4, ,693.7 Other taxes receivable (current) Other assets (current) 1, , , ,887.0 Nn-current assets Investment securities Derivative financial instruments (assets) Trade receivables (nn-current) Incme tax and scial cntributins receivable (nn-current) Deferred tax assets 2, ,268.1 Other taxes receivable (nn-current) Other assets (nn-current) 2, ,973.6 Emplyee benefits Investments in assciates Prperty, plant and equipment 18, ,153.8 Intangible assets 5, ,245.9 Gdwill 30, , , ,954.4 Ttal assets 80, ,841.4 Equity and liabilities Current liabilities Trade payables (current) 9, ,868.8 Derivative financial instruments (current liabilities) Interest-bearing lans and brrwings (current) 3, ,630.6 Bank verdrafts Payrll and scial security payables Dividends and interest n sharehlder s equity payable ,714.4 Incme tax and scial cntributin payable (current) Taxes and cntributins payable (current) 2, ,378.2 Put ptin granted n subsidiary and ther liabilities (current) 5, ,735.8 Prvisins , ,773.6 Nn-current liabilities Trade payables (nn-current) Derivative financial instruments (liabilities) Interest-bearing lans and brrwings 1, ,765.7 Deferred tax liabilities 2, ,329.7 Taxes and cntributins payable (nn-current) Put ptin granted n subsidiary and ther liabilities (nn-curr Prvisins (nn-current) Emplyee benefits (nn CURRENT) 2, , , ,416.5 Ttal liabilities 32, ,190.1 Equity Issued capital 57, ,614.2 Reserves 64, ,230.0 Cmprehensive incme (77,195.9) (77,019.1) Retained earnings 2, Equity attributable t equity hlders f Ambev 46, ,825.1 Nn-cntrlling interests 1, ,826.2 Ttal Equity 48, ,651.3 Ttal equity and liabilities 80, ,841.4

22 Page 22 CONSOLIDATED STATEMENT OF OPERATIONS R$ millin 1Q17 1Q16 Net sales 11, ,565.1 Cst f sales (4,523.1) (3,960.3) Grss prfit 6, ,604.8 Sales and marketing expenses (2,925.2) (3,063.0) Administrative expenses (555.7) (533.6) Other perating incme/(expenses) Nrmalized EBIT 3, ,400.5 Exceptinal items (28.7) (6.2) Incme frm peratins (EBIT) 3, ,394.2 Net finance results (872.6) (1,171.3) Share f results f assciates Prfit befre incme tax 2, ,230.4 Incme tax expense (338.5) (336.4) Prfit 2, ,894.0 Attributable t: Equity hlders f Ambev 2, ,766.9 Nn-cntrlling interest Basic earnings per share (cmmn) Diluted earnings per share (cmmn) Nrmalized Prfit 2, ,900.2 Nrmalized basic earnings per share (cmmn) Nrmalized diluted earnings per share (cmmn) Nº f basic shares utstanding 15, ,688.9 Nº f diluted shares utstanding 15, ,809.4

23 Page 23 CONSOLIDATED STATEMENT OF CASH FLOWS R$ millin 1Q17 1Q16 Cash Flws frm Operating Activities Prfit 2, ,894.0 Depreciatin, amrtizatin and impairment Impairment lsses n receivables and inventries Additins/(reversals) in prvisins and emplyee benefits Net finance cst ,171.3 Lss/(gain) n sale f prperty, plant and equipment and intangible assets 5.4 (2.9) Equity-settled share-based payment expense Incme tax expense Share f result f assciates (1.0) (7.4) Other nn-cash items included in the prfit (464.6) Cash flw frm perating activities befre changes in wrking capital and use f prvisins 4, ,943.6 Decrease/(increase) in trade and ther receivables 1, ,021.6 Decrease/(increase) in inventries (199.9) (683.5) Increase/(decrease) in trade and ther payables (2,707.9) (3,023.4) Cash generated frm peratins 3, ,258.2 Interest paid (155.2) (145.8) Interest received Dividends received Incme tax paid (1,028.6) (4,391.7) Cash flw frm perating activities 1,984.5 (2,214.8) Prceeds frm sale f prperty, plant, equipment and intangible assets Acquisitin f prperty, plant, equipment and intangible assets (559.5) (707.3) Acquisitin f subsidiaries, net f cash acquired (332.7) (1,695.1) Net prceeds/(investment) f debt securities Net prceeds/(acquisitin) f ther assets Cash flw used in investing activities (607.6) (2,364.8) Prceeds/(repurchase) f shares (48.4) 0.5 Prceeds frm brrwings 1, Repayment f brrwings (1,482.8) (227.5) Cash net finance csts ther than interests (429.9) (1,142.8) Payment f finance lease liabilities (2.3) (0.8) Dividends and interest n sharehlders equity paid (1,132.0) (2,099.6) Cash flw used in financing activities (1,857.2) (2,697.2) Net increase/(decrease) in Cash and cash equivalents Cash and cash equivalents less bank verdrafts at beginning f perid Effect f exchange rate fluctuatins Cash and cash equivalents less bank verdrafts at end f perid (480.2) (7,276.8) 7, ,617.6 (167.5) (333.5) 7, ,007.3