Ambev S.A. (ABEV3) Earnings Call Transcript & Summary

Good morning, good afternoon, everyone. Welcome to 2022 Ambev Investors Day. I'm Yoka. I've been with the company for about 8 years now. I joined here in Brazil back in 2013 in the finance department. I started here in Brazil back in 2013, in finance department. Then I spent about 6 years in the Asia Pacific region, working mostly on FP&A and also participated on the IPO for Budweiser APAC. Early last year, I moved back to Brazil to lead the Investor Relations team, and it's a great pleasure to be here with you today. Today is a very special day for us at Ambev. After a long period of Zoom calls and home office, we are finally together in person, so I would like to thank you all of the analysts and investors that made it here in person. It's great to finally meet you. For those who weren't able to join us today, I'm looking forward to meeting you in person soon. In any case, I would like to thank all of you for taking time to be with us for the next 2 days. Today, we are broadcasting from Campinas. Campinas is a city about 100 kilometers from Sao Paulo with a population of about 1.2 million people, making it the third largest city in the state. The city is also one of the largest research centers in Brazil and is also a technology hub, hosting offices for large tech companies such as IBM, Dell and HP. Campinas is also home for Ambev Tech, the building that we are here today, which we'll talk more about later on. Today, we gather a great team here from Ambev to share more about our transformation journey. Our goal for the next 2 days is to provide more transparency on our transformation, both regarding what we have already accomplished so far and also how it fits our strategy going forward. Please bear in mind that all presentations include past company data and do not refer to 2022 performance. No information disclosed in the event should be taken as a guidance, and there's no guarantee that any forward-looking statement will actually occur. Having said all that, I'd like to share with you the agenda of our event for the next 2 days. First, our CEO, Jean Jereissati, will share our purpose and strategic priorities. Then, our CFO, Lucas Lira, will share his view on how we optimize our business. Then our CTO, Eduardo Horai, will lead you through our tech ecosystem, and the heads of our main tech ventures will share a little bit more about their businesses. Finally, at the end of the presentations today, we'll open the floor for analysts' Q&A directly to those who presented today. Tomorrow, we'll start the day at 10:30 in our headquarters back in Sao Paulo. The day will be dedicated to our Brazilian operations. Eduardo Lacerda will start the day laying out the strategy for our largest BU and show how the tech platforms connect with our beverage business, followed then by [indiscernible] who will talk more about our beer brands, our NAV and Beyond Beer businesses. Lastly, we will again open the floor to the analysts -- for an analyst Q&A on Brazil beverages. I hope you enjoy the next 2 days. Thank you for your attention, and please welcome Jean Jereissati to the stage.

Okay. So welcome, everyone. Glad to have you all here with us, both online and who is with us, thanks for joining this session. This will be a great opportunity for us to share where we are in our transformation journey. Last week, we had our Brazil annual strategy convention after 2 years off. It was amazing, great energy. I think we have some photos down here. We have never had so many women on a stage and in the crowd, and I was very proud to see our company much more diverse in many ways. The theme of this meeting was The Future is Now. That was a way to highlight that our transformation is real. It has started, has momentum and is in our hands to elevate and accelerate value creation. And that's what we'll be talking about in the next 2 days. At first, I would like to introduce myself very briefly. I have been with many of you. I have been working at Ambev for 24 years. I did a bit of everything on the commercial side. I went to Central America to run our operations there, then China, Asia Pacific North where I developed our business in there and then came back to Brazil, to Ambev, 3 years ago to accelerate the transformation of our business. So let me do a quick recap on our history. From the creation of Ambev in the 2000s, we had 15 years of strong growth and value creation. During that time, we developed a very -- an amazing replicable model that allowed us to become the most efficient beer company in the world, to expand geographically and non-organically in a very efficient way. During this time, our EBITDA grew more than 10x and our market value more than 15x. After 2015, though we started to struggle, volume's down, margins deteriorated, EBITDA stopped growing and our market value started to reflect that. Macro played a big role and continues to play, but the reality is that the industry changed, consumers changed, M&A opportunities were not as relevant, operational efficiencies were more marginal and we did not adapt. It was time then to evolve our growth model from operational efficiencies, M&A and geographic expansion to a profound reconnection with our ecosystem, to have innovation as a mindset, to transform through technology. This new growth model is also part of a cultural evolution journey. It's all about being more collaborative, improving our active listening and reinforcing our more long-term view in a company of owners that continues to dream big. With that in mind, we started to develop our new growth journey. First, it was time to revert our negative trend on volumes. Our beverage business is our core and we will only grow if it's healthy. 2019 was a turning point. To any, we were able to grow volumes even with the pandemic. 2021, we reached our all-time high mark. Second, we had never lost our financial discipline, especially regarding free cash flows. Cash is king and always will be. And the third is about ROIC, along with EVA, we see that. In fact, our return was on a negative trend until 2021 and when we started to revert. Lucas will go deep on these financial metrics and how we are approaching them in our transformation journey. As we start to develop new business with different financial profiles, we believe this -- that ROIC is the best metric to fully capture the value we are creating in a company that is transforming itself. That said, when we look at our core beverage business, we continue to use EBITDA and EBITDA margin as a key performance indicator. And even though the unprecedented impact of COVID and the cyclical effects of currencies and commodities that put a lot of pressure on our margins, the great news is that the initiatives that we took in the last 2 years, specifically in the investment on the portfolio rebalance, are already paying off. We have great momentum now and as a facts in commodities reverse, that mean, we believe our beverage margins should reverse at the least to the high 30s over time. Eduardo Lacerda will elaborate further on that tomorrow. Pablo Firpo will come to stage who will join us to discuss how the trends are in our favor in the nonalcoholic business. And then [indiscernible] who joined the company last year will be here tomorrow talking about our growth opportunities in other alcohols and how we are approaching them. After talking a lot about the past, where we are now in giving some hints of where we are going, let me walk you through what we want to achieve and how we will do it. So we want to lead and grow the category, to digitize and monetize our ecosystem and also our core part of our DNA. We want to continuously optimize our business. I will leave that part to Lucas Lira that will come next. This is what we want. To get there, we established this vision of Ambev as a platform, where we feel that being only a beverage company does not fully represent us properly anymore, and we like to picture ourselves more as a platform of inspiring brands that connects people in the ecosystem so that we can all grow together. And this vision of Ambev as a platform is our how-to win in the market and is supported by 5 pillars that guide, today, the whole organization in everything we do. I will walk you through each of these pillars now and you will see a lot of initiatives connected to them today and tomorrow. So the first pillar of our platform is really elevating consumers and brands by decision and by design that the first pillar, it is called brands for each and everyone. We will show how we are a different company already in terms of building brands and connecting with consumers. I will try to portray that to you today and tomorrow. Our brands are what differentiate our platform. will talk tomorrow and about what we are doing in Brazil and how is our frame of building brands. It's about head, mouth and heart. It's about being relevant in consumers' mind, entertaining, not interrupting. It's about delivering what consumers want with nothing else than the highest quality. It's about having purpose, higher values, building brands through archetypes and touching people's hearts. I will give you a teaser with the example of how we used this concept and created Brahma Duplo Malte while we're strengthening the mother brand, Brahma. So let's go. [Presentation]

So that was Brahma Duplo Malte. And then we bring to this pillar this concept of fans, okay? So it's all about touching people's hearts. There is the top of the funnel and the bottom of the funnel, might look a little bit abstract but that's what we call -- we measure our top of the funnel and the consumers that say that loves our brands. So we do a survey every quarter with our consumers regarding affinity. So the summary is that we ask, so which brands do you love? So in the whole Ambev, in our footprint, we have 300 million consumers above 18 years old. 188 million of them consumed at least one of our products last year. In Q4 2021, we have 101 million consumers that said they love at least one of our brands. So this is -- we are really measuring, upgrading and with upgrading tools really to touch consumers' heart with our products. With that, with the survey, we can really measure progress and sentiment towards our portfolio. So that was the pillar 1. [indiscernible] will deep dive tomorrow with you more about the pillar 1. So moving to the second pillar is [indiscernible] the future. This pillar is all about innovation. It's about developing capabilities to always be on the edge of innovation on everything that we do from new liquids, to packs, to brands, to experiences and business models. So it's a broader perspective on innovation. You will see a lot of this tomorrow. And this is not by chance. It's really a muscle that we are exercising as a core competency that we have started to build 3 years ago and it's really on fire. So to give you an example, looking at our alcoholic beverage as an example, we developed that, what we call our goals that are the growth opportunity area, so that's the big picture. So we define that based on growing trends, demands from consumers that we focus when thinking about the white spaces and the innovation pipeline. So it was based on that, that we framed our goal of having at least 20% of our net revenues coming from new products based on the ambition towards mapped goals. And then we have a very disciplined approach towards it, so a deep consumer understanding. We have fully dedicated teams on developing liquids and working on insights, a lot of test and failed test and fail until we get there and some golden rules, incrementality in everything we develop on innovation. So it's great to see that we are having great results on innovation already. Above 20% of our net revenue is coming from innovation in 2021. And we are above with the basket of new products. We are above-average gross profit and above-average market share of the company. So let me call a video to give you a real example of what we did on innovation on -- in 2021. [Presentation]

So that was the goal that we were looking for in his pilot testing were really the trade up or it was the core plus. So we see in mature markets, in many other markets, 25% of the volumes of the industry on the core plus segment, and it didn't exist in Brazil. We know that there would be a place for us to win. Our international brand would be the next place, so that's what we did last year thinking about many international brands that we have and how we would approach and Spaten is just doing great this year. So you will see a lot more about our innovation process tomorrow. So going to the third pillar. Third pillar is about a toast to customer success. So the main question we are continuously asking ourselves is how can we maximize the success of our clients, of our customers. And the best answer we have to that is the customer digitalization. Every time we digitalize one of our customers if his revenues grow. So this, our platform for customers is a key initiative on that. It allows us to offer the best digital solutions to our clients. So digital order take in marketplace, financial services, other value-added services, while freeing up time and empowering our business reps to solve our clients' needs. Bill will be here later today and he will go with you over the connection between online and off-line of this. And [ ramel ] will share the logistics initiatives that serve not only clients but our consumers as well. As one of the key metrics to measure progress in this pillar is NPS. And to give you an example of Brazil, we have been growing NPS every year since we started the journey and we -- but we still have a long way to go. So along with improving NPS with our customers and growing beverage volumes and revenues, there are 2 very important initiatives that empower customer success. So the first one is the adoption of this marketplace by our customers. When they adopt, everybody grows, that allow us -- so our marketplace allow us to connect other suppliers to our customers, serving a need that we were never able to fulfill before such as an assortment with spirits, snacks, milk, oil and the list goes on. And what was amazing is the adoption was very fast. By the end of 2021, we had already 370,000 customers buying products from our marketplace other than our products. And we reached an annualized GMV of BRL 1 billion and it keeps growing. Only in Brazil, the total addressable market of this marketplace is higher than BRL 700 billion with close to 80% more potential customers than we have today selling only beverages. We are excited about the value creation opportunity of this business. Incremental notepad, limited needs of incremental investment, given our already established infrastructure, along with a very positive free cash flow profile. So Leonardo Almeida, the founder of Menu, a start-up that we partnered in 2019 and then integrated on this last year. He is the head of our marketplace today. He will talk more about that today and discuss some of the economics and reasons that make us so confident on these initiatives. The second initiative is still inside customer success that I would like to highlight is the fintech. So originally called Donus and now renamed to BEES bank. Our customers are extremely underserved from a financial service perspective, and that's what makes this initiative so relevant. Looking at financial services for small and medium business, this is a BRL 3 billion industry only in Brazil, and we started to accelerate it last year. And by year-end, we already had 220,000 accounts opened, BRL 1 billion of TPV and our credit to our customers growing twofold versus the start of the year, Q1 2021. Figures are already very relevant and some trends are very encouraging. For example, we have 30% of POS penetration in BEES bank, Donus, BEES Bank active accounts and 34% of our active customers on the fintech. They use the Bizbank app every day, so it's very recurrent. We will have [indiscernible], CEO, sharing more details about this bank later today. Pillar 4, let's go for pillar 4, experiences that come to you. As I just explained, how technology is transforming our relationship with our customers in our third pillar. In this pillar, I will explain how technology is transforming our relationship with consumers, with our consumers. Due to our digital transformation, for the first time, that's not common, FMCGs have direct relation with consumers. So we were able to build this capability, this muscle in the last 5 years. Paula and Stella will talk about this later today while presenting the draft line to you. That is a revolution on media, on insights and on responsiveness, and not only to enhance our market initiatives but also to deliver experiences to our consumers. So Ze Delivery is a great example inside this pillar. It started in 2015 and e-commerce, delivering cold beer at an affordable price in [indiscernible] at your door. The value proposition for consumers and partners is very strong, which makes that growth exponential. And in December 2021, we reached 4.9 million active users in Brazil and 5.9 million orders. The venture is growing very fast and also our scale and efficiency gains, which make us confident in the business economics of our model. At Q4 2021, we were already at 77% commercial profit per hectoliter when compared to comparable channels. As this business grows, we expect to generate even better economics. And later today, Rodolfo will guide you through our strategy and the unit economics of Ze Delivery. And tomorrow, we will see Ze Delivery in action, so the dark stores, the delivery and the consumers. So while delivery already presents a great potential, this is just a piece of the consumer journey. By connecting directly with consumers, we have an opportunity to build a very strong solid relationship with each one, knowing them better and being able to offer customized solutions and experiences from promotions to how we can really customize experience and rewards. So one of our consumers might dream about meeting [indiscernible] another might dream about a self session with [indiscernible] and we can offer multiple customized experiences in our DTC platforms. And as we connect in the future Ze with BEES, so these promotions, these rewards or experience can be offered omnichannel. So in home through Ze Delivery, in bars, in supermarkets or in restaurants, so that's a big vision that we have. A single consumer, an omnichannel approach. So this is our journey of the Pillar 4, the experiences that come to you. So finally, together for a better world is our fifth pillar. As we organize ourselves as a platform, we want to grow together with our ecosystem, which means that sustainable value is created by generating value to the ecosystem, to consumers, customers, suppliers, partners and the whole society along with our stakeholders. This is a key part of our strategy. Last year, we had our first ESG Day that gave us an opportunity to share this strategy in detail. This Investor Day will be more focused on the digital transformation in Brazil, and we will have another ESG later this year. But I would like to already share with you our most important initiatives on that front. So video, please. [Presentation]

So that was pretty much it. Excited, so we are living a new chapter. Transformation is already happening and it's real. And thank you very much for being with us online or together here. So let's have 2 great days with all of you. Thank you very much. And I call Lucas.

Can you hear me okay in the back? All right. So let's talk about how we're thinking about optimizing our business. Good morning, good afternoon, good evening, everyone. To those who made it here to Brazil, to Campinas, to Ambev Tech, welcome. And to those of you that are connecting remotely, thank you for joining as well. It's great to be here and share a bit more of how we've been thinking about value creation since we embarked on this transformation journey. I'm Lucas Lira, Ambev's CFO since April 2020. And together with my team -- nobody does anything alone, together with my team, I'm responsible for our finance organization as well as shared services. I was born in Minas Gerais, so I love a good [indiscernible], right? If you ask me natives who are from Mina Gerais, they'll probably say that any [indiscernible] is good but I love a good [indiscernible]. I'm married to Mariana, and I'm Maria Catarina, Maria Valencia and Maria [indiscernible] dad. And I'm a lawyer by training. We do these crazy things at Ambev, right? We put lawyers to do other things and eventually move into finance. I joined Ambev as a lawyer in 2005, but I was lucky enough to be challenged outside my comfort zone over and time again. First, in supply chain in 2011 to rethink our demand to dispatch operating model in Brazil. Then moving to finance as head of Investor Relations in 2012, then going to AB InBev for over 6 years to work in finance with M&A globally, then back to legal when I thought I was out, they pulled me back in, back to legal for the SAB Miller combination. And finally, back to finance to lead M&A globally for ABI, taking Budweiser APAC public and divesting the Australian business in 2019. Every step of the way, 3 things: great people, big dreams and lots of learnings. So I've been around for a while, not as long as JJ, but for a while, but it feels great to be right here right now. And here's why. I believe we're at a very unique moment in our history at Ambev, a very fascinating moment. On the one hand, we have [indiscernible] which, apart from being my favorite product, represents to me what brought us here, the strengths we've built over the years. It represents our history. It represents our people, people who dream big and our owners. It represents the beer category, our strong core business and the amazing assets we have. It represents our resilience and our ability to deliver results. And on the other hand, we have BEES. BEES, to me, is a symbol of our cultural evolution and our ability to learn to adapt. It's a symbol of the continued focus on people with building a more diverse talent pipeline and a more inclusive environment. It's a symbol of how technology is allowing us to better serve our clients and consumers. And it's a symbol of the opportunity we have to transform this company and write a new chapter of long-term sustainable value creation. But it's not about one or the other, it's about both. We need both to work together. So let's see what this means for me and my team as we, in finance, try to help the company build a great future. My main goal for today is to try and answer this exact question, how to make financial sense of our transformation. We've been asking this question ourselves a lot, and the investment community has been asking us this question a lot as well. We may not have all the answers yet. But at the very least, since we're at the early stages of our transformation. However, at the very least, today, I wanted to walk you through the financial logic that's embedded into our strategy and what are the reasons to believe that if we deliver our plan, there is a path to sustainable long-term value creation for Ambev. To answer this question, I'm going to focus on 3 topics: first, a quick recap of how we got here and what our priorities are; second, why we've elevated return on invested capital as a key metric going forward; and third, what are the building blocks of value creation, many of which we will highlight during the day today and tomorrow. So how we got here. As Jean briefly mentioned, right, this is our EBITDA and EBITDA margin performance over the last 20 years. You know this story really well. A mix of geographic expansion, M&A cost synergies, productivity gains and operational excellence, leading to an organic EBITDA CAGR of nearly 18% until 2015 and EBITDA margin peaking at about 50%. But since 2016, the tide turned and facing the blur facts, we were unable to sustain our financial performance. EBITDA CAGR was a little over 3% and EBITDA margin contracted to approximately 31%. The main culprits are well known, limited top line growth, changing market trends and competitive dynamics as well as gross margin compression, given tax changes in Brazil, currency depreciation vis-a -vis the U.S. dollar and commodity inflation. So we clearly needed to do something about it. Step one was to look at the same 20-year history but through a different lens, the lens of free cash flow. The simple yet powerful insight here was that despite our EBITDA growth and EBITDA margin struggles, we were able to sustain very solid cash flow generation, growing at a 10% CAGR since 2016. This was mainly due to the conversion of EBITDA into cash flow at a rate above 70% on average, thanks mainly to our negative working capital cycle. So okay, in site number 1, we managed to continue to generate a lot of cash, great problem to have. Now what do we do with it? In comes step number 2. Step 2 was to take a close look at the evolution of our business itself, our strategy and the 10-year plan that we built for our main operations. Since 2015, with the creation of ZX Ventures, we started to systematically invest behind going beyond beer. As a result, our business has become more diverse, bringing new dilemmas different trade-offs. And our strategy has also evolved and is much more customer- and consumer-centric than in the past. And in 2020, we laid out a long-term plan for our Brazilian operation that began serving as a north star to us. So in site number 2, our business has evolved and will continue to evolve. Bringing steps 1 and 2 together led us to reframe our challenge from the finance side, our little aha moment. Instead of just looking at how to drive EBITDA growth and margin recovery, we realized that the better we get at reinvesting our free cash flow generation behind investment opportunities with more attractive returns, the greater the chance of going back to a virtuous cycle of value creation, which leads me to where we are today. Let's get our priorities straight first. This is how I summarize where me and my team have spent a disproportionate amount of our time and energy over the last 2 years. It all starts with great people and engaged people and we've evolved since 2020 when protecting our liquidity, given the COVID-19 pandemic and laying the groundwork to recover profitability were paramount, to 2021, where resource allocation and financial discipline started to take center stage. Looking ahead, our priorities are also crystal clear. First, we will continue to invest behind building a great team, a more engaged team. Second, we will continue to carefully manage our costs and expenses to look for ways to improve productivity and our working capital management. And third, we will continue to embed into our management system this focus on value creation, looking for better, smarter ways to generate better returns for our cash flows, all this in order to help the organization, optimize our business as well as digitize and monetize our amazing assets. So this is the what. Now let's talk about the how. As part of the process of reframing our challenge from the finance side, it became clear to us that if we continue to simply focus on EBITDA growth and EBITDA margin, we would become a more and more myopic organization. Therefore, we would either fail to allocate resources efficiently and/or probably miss out on some pretty sizable value creation opportunities. So we went back to the Brahma days and decided to look again at EVA as the measure of value creation and return on invested capital as an additional way of looking at profitability, given how our business is evolving. It's not that EBITDA growth and EBITDA margin are no longer important because they are. But the more we looked, the more we felt that it made a lot of sense to bring these 2 metrics back into our financial management system, starting with an emphasis on return on invested capital. This way, we believe we see the bigger picture and truly measure if we are indeed reinvesting well our free cash flow and ultimately, making better decisions that lead towards value creation. Now let's take a look at our 20-year history from a ROIC perspective to see what we've learned from it so far. Until 2005, ROIC deteriorated, thanks to declining NOPAT margin and declining asset turnover. This coincides with our international M&A expansion. However, from '06 to '09, ROIC actually recovered, thanks to a step change in both NOPAT margin and asset turnover. In other words, we delivered on the M&A synergies for deals like [indiscernible] and Kinsa. Meanwhile, Brazil performed well organically. From 2010 to 2016, performance improved from a ROIC perspective, thanks to a continuous NOPAT margin expansion and asset turnover being taken to new levels. This is when everything came together. Now from 2017 to 2020, we saw ROIC suffer from both NOPAT margin and asset turnover contracting to a lower level. We lost momentum, headwinds increased. And finally, 2021 was the first step of the journey to improve ROIC by focusing on not just one but both levers, NOPAT margin and asset turnover. As you know, 2020 and 2021 were marked by pretty significant margin pressure. But in 2021, we actually managed to improve return on invested capital, thanks to better asset turnover. It was a good start but we still have much to do. And one of our main challenges going forward is to really balance both levers in order to consistently improve return on invested capital. So let's talk about how we think we can get there. In a nutshell, in order to consistently create value, we believe we need to get 3 things right. First, we need to strengthen and grow our core business, primarily through top line growth. Number two, we need to scale up our tech platforms, leveraging the core business capabilities and the unparalleled assets we have. And third, we need to dynamic allocate resources between the 2, being agile to pilot at small scale and double down on what's working. So let's look at some examples. Today, we will focus on our tech capabilities, BEES, BEES Bank, Logistics, Ze Delivery, draft line and Ambev Tech. Tomorrow, we're going to look at the core business units of Brazil Beer, Brazil NAV and Beyond Beer. So I put together this guide with a few examples of what you will see in the presentations to come and how they connect with the potential ROIC improvements going forward. Hopefully, this will help you better understand what we are trying to achieve from a financial perspective. And we believe that the opportunities to improve NOPAT margin and asset turnover are plenty. I'm not going into each example now because folks will give you more color later, but let me double click into BEES. BEES is a great example because it illustrates really well the opportunities, the challenges, the dilemmas and the trade-offs we faced on this journey. In fact, I would argue that maybe 5, probably 10, 15 years ago, the business case for BEES may not have even seen the light of day internally because of how inherently different the business model was and how we, frankly, approach things differently from a financial perspective. But we're evolving. We're learning and BEES is showing us that it's possible. First, BEES has helped accelerate profitable growth of our core business. It's helped us serve better our clients. It's solving their pain points. It's bringing them more convenience, empowering them. NPS improves through initiatives like flexible delivery days, extended payment terms, improved cooler maintenance while also bringing in additional revenue. This has allowed us to better understand the needs and preferences of our clients, which has led to more and better product offerings, smarter promotional campaigns and revenue management tools leveraging technology. As a result, this has expanded our distribution reach for not only for beer but also for nonalcoholic beverages and Beyond Beer brands, given that we've increased the number of clients we serve. And second, BEES allows us to unlock profitable new business opportunities. The fast rate of adoption of BEES has allowed us to quickly bring in new revenue streams through sale of third-party products that are important to our clients through the 1PL marketplace model. Next, we're starting to work more and more with the 3PL software-as-a-service model, which has better margins and more attractive returns. Further, given our extensive distribution capabilities and trusted relationships with clients, the customer acquisition and retention costs are far lower. There's also limited invested capital required to scale up, and we benefit from a negative working capital cycle. As a result, despite the 1PL marketplace, lower margin on its face, for instance, in 2021 was mid-single digits at the gross margin level, just to illustrate, BEES can still help us improve our profitability by generating attractive returns for the company and thus creating value. Put simply, more top line growth, incremental NOPAT, limited incremental investments and negative working capital cycle. Abilio and Leo will give you more color later today, but I wanted to share this in advance, just to give you a sense of how to connect the strategy with the financial implications we see. To wrap up, I wanted to go back to the numbers and put things into perspective. As I hope you will be able to see during the next 2 days, we've been investing behind many opportunities not only in our core business but also behind our tech capabilities that, if executed well, can unlock sustainable long-term value creation, starting with continuing to improve our ROIC. We're very proud of our history and our performance to date and how we've managed to deliver good returns over the years, but we know we have to earn it every day. So we have a clear view of what are the right levers and what needs to be done, but we have to keep delivering and transforming consistently. For us, this dashboard is a good guide on how we think of it going forward. So we need to keep growing the top line. We need to grow EBITDA. EBITDA margins need to improve. Free cash flow generation needs to remain strong and return on invested capital is a metric we've elevated to give us the better picture and allocate resources more efficiently as we try to grow efficiently. Thank you very much. And I would like to invite Eduardo Horai to join me on stage. Thank you.

Thank you, Lucas. Good morning, good afternoon. Good evening, everyone. Welcome to Ambev's Investors Day. My name is Eduardo Horai, I'm the CTO and VP of Technology for Ambev. I have been working -- a quick introduction. I've been working in technology for the last 17 years. Before joining the company, I spent 7 years working at Amazon, building the AWS business across Latin America, leading the technology team from the early days of the cloud technology until it became a multibillion-dollar group. I joined Ambev 2.5 years ago, really motivated by the big dream of this new leadership to transform this huge [indiscernible] using digital and technology. And honestly, I've always been curious about the [indiscernible]. So far, this 2.5 years have been a tremendous journey, a lot of lessons learned. And hopefully, we'll be able to show you some of the things that we achieved throughout this transformation. So let me start contextualizing where we are. We are in Campinas, in our global office Ambev tech office, where some of our key global projects such as BEES that you hear much more today and [indiscernible] implementation are being developed. In addition to Campinas, we have a big office in [indiscernible] where our logistics, sales and back office applications are also being developed. And we do also have presence in Sao Paulo where our ventures such as Z-Tech and Ze Delivery are based out of. We do also have other smaller offices in place like Budweiser Argentina, and also people hired in home office across Brazil as we need a lot of tech talents. We will cover much more about our tech people, our talent strategy later towards the day. So let's move towards the platform. I think JJ and Lucas mentioned our focus on transforming the company into a platform business. Our strategy is really based on the 2 big digital platforms, BEES for our customers and Ze for our consumers. And as well, how can we leverage our great assets to provide great service level and insights helping the whole ecosystem. BEES is part of our customer ecosystem that we know and we have a relationship for many, many years. With our digital platform, we're expanding our offerings from financial services to selling other goods beyond beer or liquids, which is our marketplace. Ze is also building a strong ecosystem directly with our consumers, a brand-new space for us that we didn't know until recently years. As JJ mentioned, Ze has a very unique proposition: cold beer, affordable price in 30 minutes or less. And now that we prove that value proposition, we believe there are much more that we can add to this ecosystem. And as I mentioned, there are many other services and assets that we are connecting into this 2 platform to provide a better experience to our customers and consumers. This includes Ambev's strong footprint and fulfillment capabilities as well as our financial assets, as Lucas mentioned. So in a nutshell, this is our platform strategy, and you'll see much more details later. Let me cover the digital agenda for today. Abilio and Leo are going to cover BEES marketplace strategy and performance. Later, [indiscernible] are going to talk about our fintech business, then Andre Mello is going to give details on how logistics is really transforming to better serve our customers and consumers, then [indiscernible] will cover our strategy for Ze and performance. And last, Stella and Paula will show how we are connecting digitally our acquainted brands with our consumers, how we are evolving our marketing which are social, data-driven and personalized marketing, leveraging a lot of data and consumer insights. And finally, I'll come back again at the end of the day to connect all the dots and show how our technology strategy is going to support all this growth. Before we go into each business, and they're going to go much deeper, I just want to show -- I want to spend 2 minutes showing our technology framework that orchestrates and shapes our teams, and this is fundamentally important for us to direct resources and efforts that are really connected to the platform. So on top, as we all mentioned, we have BEES for our customers and marketplace and for consumers, we have Ze with a lot of consumer insights. In the following layer, we have core services that are providing additional value and offering to the platform. We mentioned fintech, we mentioned logistics, but there are other things like our breweries and our supplier network. Everything above is powered by data and analytics layer that collects, process and store all the data generated across the company. And we do have a lot of algorithms on top of that, that is powering many parts of our business. You'll see that throughout the presentation, I will give more insights later as well. Then this is all enabled by our technology foundation to make sure that we are building robust, scalable and secure applications being developed efficiently and fast. We leverage, obviously, we leverage cloud and the modern architectures such as APIs and micro services. And we are also modernizing our ERP. We're consolidating, we are simplifying. We are building micro services to add flexibility around it and agility. Unless this is only possible with a strong team of technical talent. We have built strong company brands, as you saw today, with BEES, Ambev Tech, Z-Tech and Ze, we are hiring the best tech talent on the market, and we are creating programs to support their journey throughout the company that is very different from the traditional Ambev employee journey. So next, I'll let each business present themselves. They're going to give much more details about the business. And then I'll come back later on the day to detail these 3 layers, data, tech foundation and people. So let me call a video to the stage to talk more about BEES. [Presentation]

Can you guys -- okay? Now it's okay. It's always good to start by listening to our clients. My name is Abilio. I joined the company in 2010. Since then, I spent most of my time in the sales team with several different positions. Now I take care of BEES here in Brazil, which I believe is the most exciting position in the company. So I'm going to talk a little bit about that. So we piloted BEES for the first time in April '20 in Rio. After a very impressive adoption, we were able to see clearly that it was something our clients really liked and we should scale up the implementation quickly. In less than 2 years, what was a pilot became 80% of our total revenue, representing 88% of our active buyers. We were really happy to have what was a very traditional market becoming digitalized, bringing lots of opportunities for our clients and also for our company. But at the same time, we were digitalizing our relationship with the current base, we also had a relevant customer base expansion since the digitalization gave much more autonomy to the clients, and this autonomy also made it easier for entrepreneurs to become part of Ambev ecosystem. As a result, this brought us over 150,000 new customers in less than 2 years, achieving our all-time high active buyers. This represents almost 1 million additional hectoliters already excluding cannibalization effects. And we still have a lot of space to grow. This fast adoption and buyers expansion allowed us to become one of the top e-commerces in Brazil in terms of total GMV. What makes us really proud since we have a very young platform with lots of opportunities ahead. It is not just about digitalizing. It is really about creating deeper connections with our clients. One of the biggest benefits to have our clients online is the fact that now we have 25 minutes more interaction with them in a week compared to 7 minutes in average that we had in the past, relying only on our frontline team visit. Another very good point is that since our clients buy inside the app, we save transactional time so our BDR visit is much more focused on sell-out activities such as execution, brand activation as well as relationship building and service level, which have a huge impact on performance. We became a company very focused on clients' growth rather than just interested on selling, and that gave us 20 points growth in NPS. We also can see here that there is a huge impact on volume related to how engaged our clients are to BEES. By engagement, I mean having more interaction with different BEES features and capabilities. Volumes from highly engaged clients outperformed by 21 points in comparison to those that are still off-line. So the more engaged they are with BEES, the better our service level gets and performance follows. So we were able to get majority of the base and also the new clients digitalized, and we are building this deeper connection with them. What is really important to add here is that from this deeper connection, we became much more data-driven once the platform became a very impressive way to understand our clients' needs and also a powerful tool to customize our go-to-market. For example, we had over 40million accesses in December last year, generating almost 90 million minutes connected. And with 8,000 data points by each session, data is generating a much better understanding of our clients' behavior, allowing us to invest more in analytics, which became a way to customize every tool in the platform. So we are evolving a lot on the way we use data to improve our clients' experience and to have our commercial strategy deployed through our platform tools. For example, we currently have proprietary algorithms working on customizing the selection of SKUs that are going to be promoted within the platform, using all these different tools for that. And this is made customized for each one of our clients with a very deep statistical understanding of potential volume impact, conversion probabilities and so on. Just like Netflix evolves on understanding what users are going to like to watch, we evolve on understanding what is best for our clients' success. This is a crucial step for a company that is innovating every day more and a portfolio that grows also by adding marketplace partners. This is part of the increasing role of our analytics team. And I wanted to show you guys from here is a sample of what became our new go-to-market which we call B2O, meaning BEES To Off-line. So the B2O is our new go-to-market and using artificial intelligence coordinates our commercial strategy through all BEES platform. Taking advantage of the online tools such as the digital communications, quick [indiscernible] upsell, [indiscernible] challenge and promotions, but also coordinating the off-line execution mostly driven by our BDIs, the frontline team using BEES for us as well as the customer experience center and our delivery. The idea here is to show you some sample on this and how we are becoming much more effective on the way we approach the clients and execute our brands. I'm going to start by talking about these communications. The main goal here is to take advantage of this qualified and number of audience exploring the whole journey that clients have inside and outside the app. We aim on giving an awareness to the main strategies we have in terms of portfolio and also service level. We have developed several media tools to capture most of our clients' attention, minimizing friction in order to have clients engaged and being impacted by the B2O objectives, promoting Ambev's portfolio and also marketplace partners that invest in media for reaching higher customer reach. We generate over 21 million impressions in a month, reaching most of our base with a click to rate by 18%, much above the social media benchmark. For example, on this slide, we have displayed what we just did during March for [indiscernible] campaign. For this kind of campaign, we also used our channel on YouTube, which became a new source of client's engagement and has shown very good results, reaching over 1 million views a month. In this Brahma example, we increased distribution by 13% and volume by 20% in a new way for a sales proposition. Let's see a summary of these tools working in a video, please. [Presentation]

Besides communication, our deeper relationship with our clients is also being built by our engagement club, the Club B. In the club, our clients can earn points by buying products or completing challenges such as promoting our brands in hotspots of their stores, for example. They also became a very important venue for portfolio development and price discount optimization since we are able to migrate discount to points, and that gives the clients the autonomy for redemption in different categories, including trade materials, product from partners, what is also a new business opportunity. We have seen a growing interest from partners to be part of the club and incentivize their portfolio through points. With all of this new way to connect, engage and sell to our clients online, we are taking advantage of the digitalization process to also revolutionize our off-line execution. Using data and advanced analytics, our front-line is now being guided by BEES Force, featuring tasks which ensures the right execution for each block totally based on the clients' needs and integrated to other choosing B2O. The tasks are designed to deliver a better service level, help customer digitalization and completely change the way we execute and develop our brands once it allow us to ensure task completion by image recognition. This optimization also contributed to have a bigger [ ratio ] on POCs per BDR enabling buyers expansion without frontline cost increase. Let's see a deeper explanation of this in a video also. [Presentation]

Also improving the off-line execution, the delivery is a very important part in the clients' journey. Here, our focus is to ensure better service level, minimizing failures or delays with a better cost predictability and giving more flexibility to our clients. In the past, we used to have fewer data available for each client, and now we offer much more options, allowing them to place an extra order when they did an extra product replacement. For that, we charge a delivery fee that became a new revenue stream, but at the same time, we improved service level. That is also coordinated by algorithms, improving sales curve linearization and cost efficiency by organizing available delivery dates and fees. This is something crucial to keep expanding our buyers base in a fast pace without adding delivery costs. Wrapping up, what I tried to show you during the last minutes together, we are really happy with the journey we had so far with BEES, which brought us to this new digitalized go-to-market with a much deeper connection and understanding of our clients, allowing us to become a customized Ambev to each one of our 1 million clients, that has already proven to be a really powerful way for our customer satisfaction performance and is helping us to manage this fast innovative environment. And as a final message with a clear taste on results, here are the portfolio main distribution KPIs. As a consequence of what we have just spoken about, we can see our total SKU distribution evolving by 27% since BEES implementation in Brazil, delivering our best number in history for POC average purchase SKUs, with all main categories increasing penetration within our base. And to talk about one of these very important categories, I'm going to invite Leo, my partner, our director for marketplace. Thank you very much. Leo, please?

Hello. Hello, everyone. So did you like the presentation, Lucas? So just broke the protocol. Imagine just for a second, everything that you show here in other CPGs. And this is what marketplace can allow us in the near future. So just to introduce my presentation, I'm going to present me. I'm Leonardo Almeida. I have 16 years experience in technology area. I'm an economist, 35 years old. I'm from Minas Gerais, born in [indiscernible], it's a small city. And I chose those pictures because these pictures represent me a lot and everything that I love. The first one is sports at a competitive level. This was a competition in 2014. The second one is my wife, Claudine. Beer, also I love a lot. And the picture in the center, it's about Menu. I love work and I found Menu in 2015 as a B2B marketplace in Brazil. At that time, it was the first, and we did amazing work with BEES incredible team. And I'm sorry. I did something wrong, okay. And I selected this picture because this picture represents a lot why I'm here today. This picture is -- it was in 2017 in China, in Beijing. And I was in a roadshow that I prepared. I was negotiation with some VCs for a Round B of investments in menu.com. And during the negotiation, at a certain point of the negotiation, I was very advanced in the negotiation with a VC called [indiscernible]. And the venture catalyst called me in a Starbucks meeting, and they said, "Okay, man, what are you going to do with these X million dollars that I'm investing in you?" And I said, "For growth," and they asked again, "what are you going to do?" And I said, "in sales and marketing," and they said, "how?" And I said, "sales and marketing," and they said, "how?" And the question never stopped. At a certain point, 10 questions later, they said, "Man, the name of the game, it's audience and assortment." So I studied a lot the Brazilian market and the Latin America market. It was a VC focusing on Asia. And they said, "Man, it's almost impossible to win in Brazil or in Latin America without a large CPG. It's almost impossible to win without Ambev in your country. So I can invest in you, but I suggest you come back and start the negotiation with the partner, a local partner." So I was frustrated at that time because I know it was a bit difficult to make this deal for Ambev. And then I come back and start to negotiate in 2017. And then in 2019, we signed a deal. And thank you [indiscernible]. And this is why I'm here today. And I think this photo explained a lot about our journey and why we are here. So I have 3 years in Ambev since that day, and I'm founder of menu.com. So as Abilio said and as [indiscernible] in China said, audience, it's the name of the game. So we came from 7 minutes a week per BDR visit to 24 additional minutes, so 31 minutes in total. And this audience -- with this better audience, we can broaden portfolio for our customers. So audience, it's our first step in this journey, in this transformation. The second one is assortment. When we look about assortment, it's very important to offer a better assortment, to put our customer in the center and increase the audience that we have and also assortment. So I'm glad to be here to present to you the BEES marketplace. And the third pillar that I'm considering very important is experience. When we put our customer in the center and understand what is the pain points and how we can help -- truly help this journey, we see that in average, the customer has 70 different suppliers per month. They buy from different -- 17 suppliers per month. It's a very complicated routine. It's a very tough routine in this business model. So they deal with a very complex assortment. And this picture explain a little bit about a phenomenon that we have in Brazil related to the cash and carry within some distributors. So when we look at these pain points, it's hard to solve it. It's not easy. We were in the launch. And it's hard to solve. But we choose to dream big here and to dream big in a digital way. So all of this, it's turning possible for us as BEES marketplace. So we are putting a complementary assortment in our warehouse and delivery at the same trucks for the -- for our customers. So talking about total addressable market and thinking about the size of opportunity, we -- excluding modern trade, excluding large supermarkets, we are talking about a BRL 760 billion market size, so the total addressable market is huge. We are playing our days in a beer and alcoholic beverage. It's about BRL 160 billion. And in the same box with categories that we have synergies today, we have more BRL 252 billion in a market opportunity. So when we consider in categories that we have no synergy like meat, for example, or vegetables, and when we consider in POCs that we don't serve today, we have more BRL 348 billion of opportunities. So it's a huge opportunity. It's a huge market we're dealing with 1.8 million POCs. So in -- and looking at -- this wasn't a financial perspective here is the investment perspective. So why do you play in this game? So we see that our customer is underserved nowadays. We have -- they have a weak relationship with their supplier. They have an inefficient purchase process. They have a lack of management tools. And also, they have a poor service level. So they have to go to the cash and carry. They have to go to the players to serve them. And also, it's a fragmented market. The top 10 leaders, the top 5 leaders, no matter how we choose the list, it's less than 10% market share. So it's a very fragmented market with a high opportunity. First step is to do the basic, it's expansion. It's turn the marketplace available in our operations. So we came in 2020 from 2 operations to more than 200 right now with more than 300 SKUs. And we are very proud to do this expansion with small improvements, as Lucas said, is more improvements in the logistics side. And the growth KPIs, it's exponentially. So we have a very exponential growth. So in customers, our CAGR per month in the last 9 months, it's about 18%. So we have an 18% CAGR growth in customers with a 22% CAGR growth in GMV. So the CAGR of GMV is higher than customer because we are increasing also the AOV and with a very low market investment. So the higher amount that we invest in marketing to attract new customers for marketplace, it was about BRL 2 million. So our customer acquisition cost is quite low. It's quite low, BRL 29. And to measure our lifetime value, it's quite unfair because we don't have a property churn because the customer is the same cost as Ambev. And we're considering that this is a business with a high single-digit profitability. So with a low churn, it's almost unfair to share the lifetime value. But we are very proud of the results, and we believe that we can keep going, keep pushing in this business. So we have 2 different business model. So the first one is 1P products with high synergy with our logistics with our footprint. So here, we have examples like, [indiscernible], Kellogg's and Kraft Heinz. So all of these products, we can connect with our footprint and deliver in the same truck. And also, we have the 3P business model. And here, I connect with the question that I did for you, Lucas, because imagine everything that we show here, Abilio show here from this in other CPGs. So the reality is pretty the same, and we can offer this product as a software-as-a-service in a more asset-light model. So BRF is our first partner here, and we are expanding this business model in the future. About assortment, very quickly, we have different categories. Here is the Nielsen map of category for on-trade. So there obviously, some categories had no synergy in the first step, like meat, vegetable fruits, for example, or cheese or bakery or don't know what. But all of the greens categories, we have high synergy with our operations. So we have a great sweet spot here. For example, coffee, carbonated, other categories, drinking milk, dairy, confectionery, snacks and hard liquid spirits, there's a lot of opportunity here. And here is some examples of the categories that we -- were available in the marketplace today. Every supplier when came to our marketplace start in the first step as a silver partner. And they have an opportunity to give step-by-step and evolving in the partnership with us. And as a platinum partner, we have examples like [indiscernible], Mondelez, [indiscernible] and all of these partners can access everything that Abilio showed in the previous presentation. Finally, to give 2 messages here. The first one, this business is -- usually is not invented for us. It's usually in this business a negative working capital. So the breadth of the market is 25 days payables, 25 days of inventory, 6 day receivables and 14 days of our cash flow. And we are working aligned with the best spreads in the market. And the second one, is they have a high synergy with our footprint. So it's -- it requires a very slow investment to connect with our footprint. The example is here, it's flow hacks, [indiscernible], shelves, grids, and it's improvements that we use for marketplace, but also we can use for beer, and it's a very small investment that we are doing. And of top note here, if the marketplace were independent from Ambev, we will need more than 10 cash and carry stores, for example, to serve the current demand. So as Lucas said about the return on investment, we have a great example of this here. So guys, thank you very much. I would like to invite Pantoja to present a little bit about BEES Bank.

Hi, everyone. Good afternoon. My name is Marcelo Pantoja. I am currently the CEO of Z-Tech in Brazil, which is our Ambev's technology hub, focused on empowering small- and medium-sized businesses to change the world through technology. I've been with ABI for 16 years. And before joining Z-Tech, I spent 5 years running multiple sales and marketing positions in the U.S., and more recently, moved back to Brazil as a Regional Director in the south region and then Director of Strategy and Finance. I will be here today with Valter Nakashima, CFO of our fintech, Donus, recently rebranded to BEES Bank. Valter has an extensive career in finance, previously being the Finance Director for [ Banky ], and Head of Finance for Livelo and Dijon. So let's get started. Three years ago, when we created Z-Tech, we conducted a deep study to map the biggest pain points in SMB's day-to-day activities. Among other findings, we realized that there was a big untapped opportunity related to giving them access to financial services in a fair way so we could help them thrive and grow. And at Z-Tech, we were very well positioned alongside with Ambev and its established capabilities to lead this effort and promote financial inclusion for merchants in Brazil. Among the pain points we observed, we could highlight 3: first, loss of sales due to difficulties in accepting cards; second, high banking fees in general; and third, lack of access to credit lines to run their business or help their expansion. As a starting point, we built our first product portfolio to meet these needs. A digital wallet, which acts as a central interface to introduce them to digital banking services; two, a sales acceptance system such as a physical point-of-sale terminal like a POS machine, or a digital gateway for e-commerce, which receives payments electronically and place the receivables in the e-wallet; third, a debit card, free of charge, to help them better manage their relationships with suppliers; and fourth, a set of credit offerings that provide liquidity and flexibility for the POCs. And how do these solutions work in real life? We can split our customer journey in 4 major steps, and we developed a platform that has a positive impact on each one of them. First, when the POC owner orders products from BEES, at this moment, they have access to extended credit terms as well as new payment options, like PIKs or credit card to avoid paying cash. Secondly, when their order arrives, the POC owner can also choose to pay via [indiscernible], which is a proprietary tool that allows customers to select which bank slip or Boleto they want to pay, and instantly pay it to a supplier through a costless wallet-to-wallet transaction. As they no longer need to handle cash, the delivery process becomes safer and more efficient. And in addition, the pop owner also earns cashback, which can be used in their next purchase at BEES. Third, we facilitate payment from consumers. We facilitate payments from consumers to POCs by providing POS machines that accept debit and credit cards as well as QR code. And lastly, our e-wallet provides real-time management capabilities, offering a user-friendly digital interface that provides better visibility, facilitating all supplier financial transactions for the POC. All of that, combined with a great user experience, creates daily engagement and high recurrence from customers. Let's see how it works directly from our customer. Please roll the video. [Presentation]

Okay. So 2021 was a great year for us at Donus. We deployed many products in the first semester, iterated and learned a lot, pivoted a couple of times until gained traction through a great product market fit. In the beginning of the second semester, we were ready to ramp up. We then defined a clear go-to-market strategy, reaching all Ambev's DDCs. And even with a tough external environment due to the pandemic, we managed to open 220,000 accounts and achieved BRL 1 billion processed volume in the month of December alone. The utilization of our e-wallet has been growing at a fast pace, and 34% of active POCs use it every working day. In addition to that, 30% of active e-wallet POCs were using our POS machines to receive payments from their customers. Also, we managed to provide a safer and agile payment process for our POCs through [indiscernible], which was responsible for the digitalization of 13% of Ambev cash payments in December. And recently, this number more than doubled after Ambev's peak acceptance launch earlier this year. Now I will invite Valter to walk you through some of our financials. Valter, the stage is yours.

Hello, everyone, and thank you for being here. Well, let's move to our P&L drivers and unit economics. We separate our financials in 4 main drivers. First of all -- sorry, first of all, we have essentially [ three-thirds ]of revenue, and all of them follow the market standard take rates: acquiring service, [ MGR ], debit card interchange and credit concession, the interest rate. With regards to cost, we have an opportunity because we still work a white-label solution, which could provide some cost efficience in the future as we evaluate a super acquirer or acquired model. In credit, we have a huge differential using client's historical data for Ambev, combined with their transactional information to the e-wallet. It then feeds our credit algorithm, which then drives better results in terms of credit scoring and bad debt. And third, we can measure our CAC with joint effort between our sales team and Ambev's field team, supported by customized marketing campaigns on digital channels such as BEES and social media, like Instagram, Facebook and Google. In December, we spent around BRL 21 -- can you go back, please? Okay. Thank you. In December, we spent around BRL 21 in CAC, so much lower than industry standard. Also, within Ambev ecosystem, we are the official financial solution provider for the direct-to-consumer platforms, for example, Zé Delivery and [ ShoppiBram Express ], with a large array of possibilities to expanded service to their franchises and operations, just like payments gateway, PIKs and credit card acceptance. Lastly, we see the same efficiency happening on the retention costs. We are able to create a unique value proposition for the POC zone based on better utilization of existing discounts via cashback and digitalization of existing trading market incentives. And let's talk about -- a little bit about credit, okay? In '21, you can see the difference in Ambev's short-term credit operation comparing the period pre- and post-Donus acceleration. We almost doubled the total payment extension. We reinvested a lot of short-term solutions as we took the major step to facilitate payment extensions for the POCs and give them opportunity to sell more and grow. At the end of the day, we increased 1.1 day under average terms. And you may ask, what are we doing different? Well, we are basically talking about 2 things. The first one, we are improving our credit scoring to algorithms to be able to offer credit to more POCs without compromising our financial health. And second, we developed easier rates to a bit in terms [indiscernible] through technology. Therefore, we are changing the way Ambev used to manage payment terming strategy evolving from sales management to a product to inside a fintech. So after an exciting journey in '21, we are now talking about a bold step to accelerate Donus in '22. In order to strengthen our synergies with BEES, we are rebranding our fintech to be called BEES Bank. With this movement, we still operate as an independent organization without any change in the management team. But this change will allow us to gain even more traction and quickly bring financial inclusion to more merchants. This change will bring relevant additional benefits to our customers. More familiar, too, with the brand and confidence, which brings credibility, better user experience. For example, single sign-on with BEES that facilitate their interface. And it will allow us to use real-time data to bring a customized solution at the exact time the POC is needed. And also, it brings some benefits to our existing too, operational synergies, even lower CAC and CRC, and discount efficiency, and hasten data analytics to better understand the business driver, optimizes conversation funnel, churn reduction and also you can bring new financial products to merchants. And what the size of this opportunity? We are just getting started. Currently, we are operating with only Ambev's DDCs, but so as we can expand it to third-party wholesalers, which increased by 80% the volume potential. Then if you consider the opportunity to play outside Ambev's current playing field, we estimate a total addressable market 20x larger than the current one. And we believe BEES marketplace could be a natural fit for BEES Bank to tackle this opportunity.

Hello. Okay. Great, Valter. Just to wrap up, I wanted to remind you all that everything we just presented was possible because we created Z-Tech 3 years ago as our technology hub focused on solving the main pain points of retailers, bars, restaurants, convenience stores and groceries. Since then, we've been able -- we've been working to promote innovation through investments, partnerships and development of technology solutions, which strengthen small- and medium-sized businesses. Our first success case was Menu.com, our B2B market platform incorporated into BEES last year, as Leonardo just showed you. And besides BEES Bank, we currently have 3 other companies in our portfolio: first, [ Garin ], which is a startup that offers solutions to bars and restaurants through a single platform that manages their waitlist, reservations, delivery and digital menu; second, Lemon, which is a startup that seeks to democratize the consumption of clean energy in Brazil, connecting local energy producers with POCs, providing to them electricity bill cost reduction; and third, [indiscernible] a digital platform that aims to digitalize sales processes and manage marketing campaigns, CRM for small and medium grocery stores to maximize sales conversion. The key for our success is to combine the diverse expertise of entrepreneurs and their diverse teams with Ambev's assets, like strong brands and capillarity to make these businesses grow and bring even more value to our ecosystem. Now I want to hand over to André to talk about logistics revolution. Thank you.

Thank you, Valter. Thank you, Pantoja. Good afternoon, everyone. Now we are going to switch gears into logistics and talk a little bit about how our platforms are changing its dynamics. But before that, let me give you a quick intro myself. My name is André. I was born and raised here in São Paulo, and I had a slightly different career path than most of my colleagues here. After I left college, I spent 7 years in the asset management industry, working in equity buy side. After those years, I decided to pursue a lifelong dream to study abroad and get an MBA degree. During that time, I had the opportunity to work at ZX Ventures. There, I redesigned the logistics to support Colorado's draft beer expansion plan. Ambev invited me to come back, and I did after my graduation. Here, I have worked as inbound logistics manager for Brazil, transportation sourcing manager for South America. And in the last 1.5 years, I have been working as a finance manager for [indiscernible], which is a logistic department focused on developing new capabilities to support our future. That's enough of myself. So let's talk about what really matters, logistics. First, I would like to talk a little bit about the logistics ecosystem we have built over the years. I'm going to split it in 2 fronts: one we will call hardware, which is basically the hard assets we use to get our products to our customers and consumers. The other, we will call software. Here, we are talking about the set of systems and processes that support our hardware, ensuring efficiency, service level and operational excellence. Talking about hardware. Since our first direct distribution center in [indiscernible], we've spent the last 25 years building a capillarity we believe to be unique in Brazil. Nowadays, we have 29 breweries, 157 wholesalers and 111 distribution centers spread all around the country. These structures are equipped with over 2,000 heavy-duty trucks for transportation and over 8,000 light trucks for distribution. This is how we are able to get to cover 95% of Brazil's territory, directly reaching about 1 million clients in over 5,000 cities. This is our footprint in Brazil and we have similar structures throughout [indiscernible]. But to tap into the potential of all that hardware, we need technology. So let me guide you through what we call our software. First of all, let me start by apologizing for this slide. I know it's a lot to take in, but that was the only way I found to convey the message I want. This is a simplified representation of our supply chain from farm to glass. From left to right, you can see our suppliers, our breweries, our distribution centers and finally, our customers and consumers. At the top, you can see our control tower, which is structured in Jaguariuna responsible to oversee all this process. As you can see, there are a lot of moving parts, and quite frankly, there is no escape. It is and always will be a complex system to manage. And the best way you have to do this is with technology. With that in mind, in 2018, we created a department 100% focused in logistics technology. All these logos across the chain are systems that they integrated into our process, being either a top-notch market solution or an in-house development. All the systems provide us with real-time information on the supply chain, bringing visibility and agility to our decision-making. Everything is integrated in a single data lake, and that is how we are able to control the whole chain from our control tower. We run complex analysis on the chain as a whole, not a single node. As of now, we are already driving to machine learning and building algorithms to improve our efficiency. And for me, talking about cloud, data lake, analytics always seems to be a bit ethereal, so let me give you an example of the power of this integration. Now suppose we had a surge in demand for Brahma Duplo Malte 12 ounces can in a remote area in the countryside of northeast Brazil, the system would analyze the demand for the whole region, identifying potential shortage and would suggest a change in the production line. Our new plan will need more cans, so the systems automatically sends a purchase order to our local supplier with no human interaction. Back in the day, this decision would take more than a day. Now it happens in just a few hours with almost no human interaction. We have reached a great degree of maturity in our replenishment and deployment, and that brings a big stability to our process. Our goal is to have a fully autonomous process, reducing our time to react and implementing predictive tools. So far, we've talked about hardware and software. Now I want to close this chapter and open a new one, talk about our customers and consumers. Let's talk on how our platforms are changing the dynamics of our distribution, especially in the last mile. In the past, we had a sales model that we call one-to-many, meaning the same source person visiting several clients each week in an off-line interaction with very little data. BEES and Zé changed that. Now we have an interaction that we call 1:1. In this new world, each customer and consumer can order whenever they want, having an exclusive and personalized experience. Also, the digitalization enables us to offer different products and services, not only from a sales perspective but also from a logistics one. With BEES, for instance, customers can already choose between different delivery dates. And to our marketplace, they have access to non-Ambev products. Zé Delivery on the other hand brought the convenience of cold beer at home in less than 35 minutes at market prices. We became an ambidextrous company able to directly reach both customers and consumers, and the combination of our hardware and software is key to support the growth of these platforms. While this digitalization changed the way we interact with customers and consumers, it also had another positive effect. Now businesses and people can become our customers and consumers through just a few clicks. In the past few years, with BEES, our customers base reached the mark of 1 million POCs. And with Zé Delivery opening new areas across the country every day, our consumer base growth is exponential. The number of deliveries followed a similar pattern, and this growth led us to develop what we have been calling our third tier distribution. As you may remember, we talked a little bit about in our earnings release. Now I will shed some light on what we were talking about. Let me bring São Paulo's case to make it clearer. Here, you can see the map of São Paulo downtown. And these are the orders density for both BEES and Zé. In the center, you can see the delivery behavior during the day. It is clear that the peak utilization of our assets occurred during different times. We saw the opportunity to capture synergies, integrating both platforms in 1 single logistics, and that led to a creation of an efficient third tier. Relying on data, we found out that we needed structures to optimize our logistics, dark stores anchored by Zé Delivery's orders and urban distribution centers, or UDCs, driven by BEES orders. Both structures are small warehouses located in regions with high delivery density. And remember this concept because it's key, delivery density. With the creation of the third tier in São Paulo, we integrated our B2C and B2B platforms in 1 logistics, increased our productivity, increased our delivery capacity and brought convenience and flexibility to our customers and consumers. Now we have warehouses in the most dense regions of the biggest cities with little space, not to mention potential traffic restrictions. It was time to review our transportation models. So let's talk about that. Before the third tier, we had a one-size-fits-all operation. No matter what was the order profile, all deliveries came from our DDCs in trucks. We needed smaller and nimbler vehicles. We are talking about things like motorcycles or light commercial vehicles. With different models, each asset can specialize where they are most efficient. We shifted the small orders to UDCs with smaller models that can have a high delivery output count. With that, our distribution centers and trucks could specialize in delivering less orders with larger volume. What enabled us to do that is our delivery density. I'm talking about serving the consumer with the right asset at a lower cost. Now I will show a video to help me summarize all this. [Presentation]

This is what we have done so far in terms of building our third tier. Between UDCs and dark stores, we have built 85 units in 7 states, which are responsible for over 37% of the deliveries in the region that they operate. We also have more than 400 light commercial vehicles and 40,000 motorcycles. In terms of cost efficiency, Zé Delivery is having a 10% reduction in costs compared to the community POCs. As for BEES, when we compare to our traditional distribution center, we have a 20% decrease in distribution costs in orders fulfilled by our third tier. This is the third tier we have been talking about. But before I go, let me give you a glimpse on what we believe the future of our logistics look like. Today, we talked about how our platforms are changing the dynamics of our business. I also talked about how our logistics are evolving to support that strategy through a combination of hardware and software. We also believe in a more collaborative logistics, sharing this path with our system, creating an environment that raises the efficiency not only for ourselves but for the supply chain as a whole, reducing costs and becoming more sustainable. This is what I would like to call open log. We now have our platforms. We now have our platforms, we know our platforms will keep us exploring new frontiers, and we are preparing ourselves to cater to their needs. This is how we see our logistics evolving as our platforms grow. The platforms will bring us more clients and more consumers, which will increase the delivery density, which will lead us to increase our capillarity and capacity, which brings more agility and flexibility to our ecosystem, which enables us to have more logistics services, which raises the convenience and service level for our clients and customers, which helps in bringing more customers and clients. Thank you for your time, and now let me invite Yoka to the stage.

Thank you, André. I hope you guys all enjoyed the presentation so far. We will now take a break. It's a 30-minute break. But before we leave, I'd just like to tell you that during the break, you'll see a short video from our colleagues from Central America and Caribbean. It will be looping over. You guys can watch at any time during the break. See you soon. [Break]

Welcome back. So let's start our presentation today talking about Zé Delivery. Rodolfo Chung, please come to the stage.

A very good afternoon to everybody. My pleasure to be here. My name is Rodolfo Chung, and I'm very excited with the whole transformation journey that we've been talking today of Ambev, right, and the opportunities that a lot of them are open because of our DTC business. Today, I'm going to talk to you or walk you through the Zé business model. We're going to talk about why it is so unique, yes. And we're going to review some key results and explore a bit of the potential and why we believe everything that we're talking is actually quite viable proposition, quite sustainable, quite viable. We're going to talk about this, yes. So if you allow me, a little bit about myself first, just to introduce myself. I've been with Ambev for 20 years. I started with the company back in 2002 as a trainee. But my career is rather unique because I had the opportunity to spend 15 of these years abroad, 2 of them living in Boston during my MBA and then 10 years in Shanghai where I held several positions in commercial areas and I helped the business to grow many times over during that time in China. And finally, in South Asia and Pacific with that scope, I had the opportunity to establish the ZX Ventures in the region. And that's where -- that was the moment where I had experience with e-commerce, with start-ups, right, and I had this chance to work as a Board member alongside some great founders. And maybe it was kind of this experience that combined had both -- new ventures but also worked many years with the main business that maybe qualified me for this next role assignment that I took since June 2020, and I'm unbelievably excited with -- to be able to walk the organization through this revolution of DTC. So if you allow me, I'm going to start by reflecting back a little bit on the context that we had back then, right, on the cusp of what we had when we decided to create ZX Ventures, which is the organization from where Zé was born, was created, yes. So we always talked about the importance of being an ambidextrous organization and the importance of having a whole set of governance, a whole environment conducive for us to create organizations such as Zé. So it started all back then, right? And my first task when I arrived, thinking about, okay, DTC might be big, might be a big opportunity. And I talked to many people from inside the company and also outside the company to start to like get my mind around of why we should invest in DTC, right? So I talked to many people. And I grouped this in maybe these 4 buckets. Well, first, it starts with the consumer, right, because we believe that there are really unmet consumer needs. There are pain points from the consumers that we could solve much better through technology. Maybe some of them were around for like decades. But now with technology, we could address them, yes. So for example, the returnable glass bottles, right? You can imagine how painful it used to be that you have to plan your journey or have to plan that I am going to go buy beer, so I have to bring home and carry bulky empty bottles to the market. And it's not available everywhere, and then I have to exchange. And I can only buy the exact amount of the glasses that I bring there, right? Maybe this is one of the limitations of the model, of the RGB model. Now think how everything will be different just with technology, that you don't need to plan. You don't need to carry anything. You don't need to count the bottles, right? Just have this current account where you might want to buy, just pay the liquid, or you might buy the bottle with the liquid, all seamless. Just an example of consumer pain points that we can address, right, that nobody were doing, and that's why it created an opportunity for us to create a business based on that. Now another big bucket, it's about revenues. And we could increase a lot our top line, both by new revenue streams, which we can explore and think about the opportunities that this can bring to the business, but also by just increasing the regular volumes that Ambev already sells and make, the potential that this business has to improve the volumes that we make, not to mention the mix that also can help in the top line, yes. The other part, it will be about the efficiencies, right? So we can optimize the route to consumer because we can streamline the entire chain, make it much more efficient instead of relying on setups that are not made for beverages. They're not made for our occasion, our peak times, right? We can have an entire ecosystem of last mile built for that. We can also, through this, improve our bottom line because returnable glass bottles, as you guys know, are much more profitable for the industry, yes. So these allow us to tap into much more efficiency, which will help our bottom line. And finally, I think that there is an element of being closer to the consumer. It is very important for an FMCG that wants to keep relevant for the future, right? So I think that by being closer to them, we can think about consumer lifetime value. We can think about understanding them, having a platform for innovations, right, being much more efficient in media, right, and generating insights that will make Ambev become more and more innovative into the future. Okay. Very good. So now let's talk about Zé Delivery in itself. And it all starts from this tripod of a very basic, a very simple and elegant in a way business model, which would -- to address these 3 elements. We always offer beer at competitive price, supermarket prices. We offer them cold. We offer them fast. Very simple, very elegant but very efficient, something that was not being addressed by the market before. Okay. And in here, you can already see that there's an element of being a very democratic platform because everybody would deserve a beverage how, where and when they want. And this also allow us to think there's way more possibilities beyond just 35 minutes delivery with a BRL 4.99 charge for the delivery fee. There's way more opportunities. We already think that consumers actually start from here, but there's more opportunities ahead. Okay. Now let's talk about the business model. And I would like to address how unique it is by the first thinking that we are a marketplace of how many actors. And most of the marketplaces around, they are marketplace that connect digitally 3 actors: the couriers, the delivery man; the consumers; and the sellers, which can be a restaurant or can be a small market. Many times, the marketplaces are like this. But Zé is different. We connect 4 players, the fourth player being the industry. And this makes all the difference, all the difference. Because we connect also the industry to these other actors, right, the whole business model is different. We don't need -- in our business model, we don't need to charge hefty commissions from the sellers. We don't charge BRL 20-plus commissions from the small companies, the small, middle markets or beer depots, right? We don't need to squeeze everything from the delivery man. We can have a much more sustainable ecosystem. We also don't need to charge consumers extra neither in prices nor in delivery fees, right, because we have this model that have 4 actors instead of 3. And a little bit of how it works. First, the industry is responsible to supply our sellers with the goods. And they can choose how they do this. They might choose to do through these, or they can choose to do the way they prefer. It's not disruptive here. They have existing partnerships to distribute the product. They can use their own route to market. So they're responsible to distribute the product to the sellers. Then what happens? Consumers, they will place the order. They place the order, of course, through Zé. But what Zé does is just allocate the orders through each one of the sellers, yes, allocates the orders. So we have an algorithm, a proprietary algorithm that allocates the order to the seller that will fulfill this in a most efficient way. So the seller is the one that will hire the delivery man, that will provide the products and will deliver to the consumer. They are the ones who will do the actual transaction in itself. So the payment and the invoice goes directly from the consumer to the seller. So this is the uniqueness of the business model, right? It doesn't go through Zé. And then what happened with the flow of money, right? Zé will record all the orders. And instead of charge commission, we actually help with incentives and margin recompositions for the seller to be healthy and provide an excellent service. After that, the seller will pay the couriers the delivery fees. They will pay themselves. They hire. They pay them, right? And we will monetize all this through the industry, which will pay us a take rate. So this is how it works, and this is why it's unique. And it's important that we understand this, what's the difference of our business model. Okay. Some of the sellers might be our own stores. We do have a setting where we have multiple redundance model, where we have multiple sellers addressing one single ZIP code, right? And one of them might be fully owned by Ambev. And there will be a slight adjustment in the model, but this is the minority of the cases at this point. A little bit about going straight on the differences of our business model, right? So the first thing, we are beverage specialists. And for a long time, we didn't know if this would make sense or not. But today, we are very sure that we are very different, and there's a space for us being different from the grocery stores, for example, yes. So our times are totally different, right? We pick, I don't know, on a Wednesday evening, during a soccer game. We pick in the pre-night-out on a Saturday night. We pick Sunday late morning when people are preparing for the family lunch, family brunch or barbecue, right, which are not the occasions that you are thinking about grocery shopping. These are totally different occasions. And we are catered to that moment, to that mindset that the consumer had at that moment. And today, we know that these are different shopper missions and different journeys. Okay. Second is that our sellers are providing great service level because they are very confident on the predictability of our platform, right, also on the margin side. So if we run consumer promotions, we will recompose, we will reimburse them and guarantee a certain margin. So they would have predictability in their business, and therefore, they can provide excellent service, yes. Another thing that is very important, couriers are seller based. They go and come back from one seller. Why this is possible? Because we have high density, and we have high predictability of these orders, right? Different from a restaurant that have much less orders per night, per evening. We have a high density, so they can come and -- go and come back from the same place. And this means a lot of difference. First, because they like to have a face-to-face relationship with someone. We don't have problems that other platforms might have. Sometimes they get decommissioned. They get canceled because there's a fraud suspicion. And they get canceled by a machine, right? And they're going to complain. They talk to a robot, right? It's a very impersonal relationship, and that sometimes creates a problem. Here, it's not. It's a very humanized relationship. You know who you talk to. You know if there's a problem, there's someone for you to complain or for you to suggest something, right? The other thing is that they will have a structure to help them. They will have a toilet to go, somewhere to sit, somewhere to charge their phone, right? There are microwaves maybe to heat up a meal that they might have. So they have a base. And these are all little things that might help their NPS. And one day, we really want, we really envision that they will prefer to work in our platform than others because they have all these differentials, right? Their delivery is shorter. Their radius is much shorter. And their density of orders per night is much higher as well. And because they go and come back, they are the only ones who can do reverse logistics as we say. And they're the only ones who can enable returnable glass bottle, which is quite unique for our business model. Okay. Let's talk about the prices. So we always follow market prices, supermarket prices, right? And like I say, we also have very attractive delivery fees. In general, most often, we charge BRL 4.99, which is very, very attractive compared even to the cost that it takes. And finally, thinking about consumer experience. And I know if you ever thought about it, but the journey when you buy beer in Zé, it's much more simple. It's much streamlined because you buy a product. You go there. You look for Brahma. You see how much it costs, what's the delivery fee. You press purchase. You don't need to go through seller by seller, see who carries what in the inventory and see which price each one of them have and have to compare. And sometimes you find a good price here, but the delivery fee is high. And then you go for the one that has low delivery fee, but the price is high, but they're out of stock, right? We take all this hassle out of the consumer journey, and you don't worry about who's going to fulfill your order. You just want Brahma at this price, at this time with this delivery time. We will arrange everything for you. We will make it happen for you. So that's why we feel like our consumer experience is quite different, is quite unique in the marketplace. Okay. Very good. Now let's talk a little bit about how we are, some numbers that we have today. We have been growing quarter-over-quarter, right? We think that there's a lot of growth ahead of us. We reached 6 million orders per month in the end of last year, 2021. And these accounts, if you add all the -- also the physical stores that we have, depending on the month, DTC already reached 6% of the entire Ambev volume and more than leasing revenues. So it's not small anymore. It's quite representative and big and make us very confident that we really have a business model that is viable, right, and growing, of course. Now we have today almost 300 cities, and we are pacing ourselves in terms of geographic expansion mainly because of 2 reasons. Well, first, because we're already covering more than half of the population in Brazil, right? So there is diminishing returns as we further expand. And the other reason is very, very important. Because we increase these 300 cities that we are already present, there's different maturity levels. I would say maturity level is the number of orders per capita, per person, right, per month, let's say. Some cities, they're 10x more mature than others. A few cities are 10x more mature than most of them. So within the same business model, and you don't change anything, there's a lot of room for us to grow many times over just by bringing the cities that are less mature to the same maturity that some other cities achieved. And the difference between them is not related to how big the city is or how rich or the GDP per capita of the city or whether it's located in certain geographic region or not. Nothing of this is correlated with the maturity. So we believe that similar cities can reach similar penetration, right? And there's a lot of growth just within this footprint that we have today. Now today, we are reaching 3,000 sellers, 3,000 points of connection, right? And they are very satisfied, as you can see in the NPS. And on top of this, there are more than this in the queue to enter the system, right? So we pace ourselves of how many ports will have enough quality to be part of the system. In terms of monthly active users, we have here the stable users that always are recurrent. And they always come back, and they are ever growing, right? And they have our -- one of the main reasons for the success is that they have an outstanding NPS. They're very satisfied with the service. Simple and robust, not many features, not really fast speed but reliable. This is the most important for them. It always works and it's transparent. Everything is open to prices, the fees. There's no hidden fees. That's why they love the platform so much. And finally, the couriers, which has been growing, right? And we can always do better, but we also have a quite positive NPS in the system already. This is how we closed last year. Talking a little bit about unit economics, profitability. The first thing I want to call to attention here is that we've been improving a lot. These are the unit economics. Sometimes you can translate into [ CoRes ] per hectoliter, right, commercial result per hectoliter, of the off-trade, which is where we will be an alternative, let's say, right? So the average of 2021, we were almost half -- we then have almost half of the profitability unit economics than the supermarkets. But within 2021, there was already a big improvement also coming from 2020, and we already closed at 77% of the margins. And the direction is that we still have plans, and we still have actions that we're going to totally close this gap. So we're going to have the same unit economics, the same commercial results as the supermarkets for Ambev, and maybe even better, right? So there's no worry about do we lose money with this business or not. There's not even much worry about does it cannibalize the current channels or not. And at some point, we might even be mix accretive, positive impact to the mix. How does this work? So here, we open a few of the levers here, right? It starts with the net revenue that ours is better. This is from last year, Q4 last year, yes. And then we have much less discounts. We don't need to have commercial agreements as we have in other channels, right? We do have specific costs here, why we have the last mile cost, that not everything maybe is covered by the delivery fee that we charge from the consumer, right? And we also have acquisition costs here in forms of coupons. But they're not that significant, and it's a quite sustainable cost of acquisition that we have in the platform today, yes. With all the other costs today, with the help of the mix that is much better than the average supermarket because of the RGB, because of the high end, we have today a profitability unit economics that represents only 22% less percentage-wise than the supermarket and closing fast this gap. Can we believe -- can we have reasons to believe that this gap is going to really close and is going to improve a lot? So this is how we evolved during the last year, right? And these are 3 of the main levers that we would have to drive this improvement. First is the mix impact, where in Zé Delivery, we have a much higher weight of -- in beer of returnable glass bottles and a much -- and a higher weight of high end. So we have a much better mix than the average supermarket, yes. The last mile cost, we've been driving a good efficiency, and there's more to come because there, you can imagine that we can be more efficient in how we allocate, how we stack, how we route. We combine orders. And there's so many things that we don't even do. We don't even have click and collect yet. We don't have scheduled delivery yet. There's a lot of features that will make us -- there is reason to believe that we can do even better than this. And the operational incentive is the support that we give to some of the sellers. We also have a journey that is getting better and better, and there is still opportunities for us to improve what do we need to help to support, subsidize our sellers. So if we are good in these drivers, we can believe that we can be even better going forward in the unit economics of the business. Very good. Now I would love to talk to you about the brand that we have, which is kind of like a rough diamond that we have in our hands. It is a very special brand, and we built it like this, right? It's a very personal brand. And for some reasons, we have the levers. The people love the brand. There's an emotional connection to the brand, right? People see Zé as one of their friends in their WhatsApp group that helps them planning their weekend, helps them connect with their friends, right? It's the hero of the night out, or they bring the friends to your place, to your barbecue, to your gathering. And people are [ rating ]. This is all natural. People do music, compose music. People throw birthday parties with a Zé theme, right? People do tattoos. People do all kind of crazy things because this brand has these potential. Potential because today, we only have 50% awareness, which is now, of course, not even close to some of the leading grocery apps or delivery apps that we have. So there's a lot of room for us to grow and make the brand an iconic brand in Brazil. Okay. And I'll finally say that we are very excited and we are in the beginning of this journey because there's so many other things that we are planning to improve in our product, right? We have this consumer centricity obsession. We do have. And we do a lot of -- we follow the project-led mentality and philosophy. So we do a lot of test and learn. We test a lot. We learn a lot. We are never in love with the solution. We always are in love with the problem, trying to solve a problem, yes. So things that are coming. For example, we're going to think about omnichannel experience, physical stores, click and collect, right? We're going to think about new delivery models, which we saw in André's presentation, there's a lot of improvement coming in the footprint in the last mile side, right, and to personalize the platform to consumers to reward the loyal users. There's so much for us to do. And I think that this is a little bit about why I'm so excited not only about the results to date but about the prospect of the platform going forward as well. We already have positive margins. It's already a business that is sustainable by itself. There's room to improve there, right? There is room for us to expand in capabilities, and there's room for us to grow within the same business model and eventually expand the business model. So I'd like to thank the attention of everybody. And I'll invite Stella and Paula to the stage to talk about draftLine. Thank you very much.

Good afternoon. My name is Stella. I'm Media Director and Data here in our marketing. And here is Paula, my partner. She is Marketing Transformation Director. And we, together, are responsible for draftLine. So we will see more about this area during this presentation. Today, we are going to talk about how we have been using technology to understand more and more our consumers. So let's imagine if we could combine the best of 2 worlds, in one hand, technology, a lot of data, performance in marketing and all the best things that a D2C company could give us. Some examples like Uber, Amazon, Apple, Airbnb, this company has a strong intimacy with their consumers and drive their business following this relationship. And on the other hand, iconic brands, intimacy and love with our consumers. Here, we have the CPG side. And as Ambev, we are [ known ] very well. This is our goal, our dream, and we have been working hard for that to bring the best of these 2 worlds to a reality. D2C companies have the agility, a lot of data, a real information about our consumers and a constant growth mindset. And as a real CPG company, we already have strong brands and see our consumers, as I said. So a real match between these 2 worlds will make the future a reality. And this has been our dream since 2018 when we created draftLine. We have a team that crosses 4 markets at Ambev, and Brazil is one of the biggest and main operations we have. draftLine is an area focusing on superior consumer understanding to create intimacy with them. We like to think here that draftLine is the operational system of the marketing transformation that merges, in one side, Mad Men, the traditional advertising guys from Madison Avenue; and in the other side, the Math Men bringing the engineering mindset. This is the perfect combination between art, creativity, content, [ culture ], with science, media and data. But for us, we are going further. We prefer to say here mad women with math women because the diversity -- this diverse team is key for our strategy. So this is draftLine, our engine to make our marketing more digital, creative and diverse. And now we are going to see how we've been doing that. Let's take a look at some results. When we talk about digital, first, exclusivity to our consumers guide the important changes in our marketing. Since 2019, we've increased our digital media investment more than 50% in order to follow our consumers' attention. We went from 30% to 47% when it comes to our digital media concentration. Now we are ready to shift this concentration and invest more in digital media than in open TV. Okay. We've been building our base for years. And now we are in our best moment to get the results, investing in market and focusing our D2C that Chung showed to us right now. We increased our database more than 100% in 2 years, of course, always in a fair and transparent way with our consumers. This allow us to know better about our consumers and take the right message and product to them. We can see the results and the impact of this intimacy when we look at our volume of earned conversation of our brands. Since 2019, we increased [ by ] 300%. What does this mean? Here is the number of times that our consumers mention that our brands during this conversation on social media. And of course, all these data allow us to be more creative and faster in order to follow the culture of our consumers. The best way to show the impact of our creative step-up is the recognition through advertising awards, and we can already see good results. All of this is only possible because we are ready to attract, develop and retain the new profile of marketing, the profile that meets those 2 worlds that I mentioned: D2C and CPG companies. We have in draftLine creators and data scientists, producers and media specialists, people who understand our business better than anyone and people with a fresh vision, with years of marketing experience. We have a team that combines generalists and specialists. And for us, this has made the difference in the future of our marketing. Now we are a big company with a lot of brands to invest in marketing. So any decision is very important to us and make the difference. draftLine studios is not just a tech and creative ecosystem. It has also been our source of efficiency. And when we look at our media efficiency, we can already see that we are in the right way. Being more digital, creative and diverse allow us to have one of our best media profitability in recent years. Since last year, we are capable of measuring the incrementality generated by our media strategy in our ROI. And it's not about just media cost. We are buying more sophisticated media than before. So we have more segmentation in more premium places, but our return comes from effectiveness. What is this? It's the perfect mix between creative and media. So in additional to have more intimacy with our consumers, to talk with them as fast as their social media conversation, we are in our best moment. And what we do -- what did you do with these decisions? Our market investment didn't increase more than the inflation last year. And even with this scenario, we could launch 3 more brands. So we reallocated the money to bring more brand solutions for our consumers. You already know draftLine in our result. So my partner, Paula, will show you some examples. Thank you.

And the best way to start with our examples is talking about how we have been using data-driven insights to ignite powerful ideas. We have a platform that we call owned insights developed internally by our team last year. That allows us to use our own data to generate actionable insights for our brands being more agile and precise in the insights process. Let's watch the video to understand better. [Presentation]

To deeply understand our consumers, so now let's see how we can use our data to be more creative and relevant to that given our cultural context. Another video. [Presentation]

Powerful insights, data-driven creativity, all this, of course, is very important for us. But if we really want to get consumer attention, we need more. We need agility. So everything starts on listening real time, over 75 million of open conversations every year on social media. We can understand and analyze what Brazilians are saying about future and about our brands. We know what they say about our campaigns and their feeling regarding our products' quality. This kind of intelligence enables us to move at a speed of culture. And I will give you here 2 examples from -- 2 each to activate different ways to connect fast with our consumers, being relevant to them. We have in draftLine an operation ready to respond quickly, respecting the personality and purpose of each brand. We have thousands of interactions per year on social media. We act as creators, building relationships and communities of offers. And we love this example. During the [ Life ] Ambev campaign about the gay pride, we've adjusted all the Ambev logos in social media to a rainbow. So someone asked us if we could create another specific logo for the straight pride shoot. Our answer in this case, of course, was no, we cannot. And this kind of response and agility helps us to harmonize our brands, and we become part of people's conversation in a very natural way. But we can go further, and we can also be agile to take social conversations to offline. And we have a very recent example like 2 weeks ago with Anitta, the biggest ambassador for Beats. For the first time, we had a Latin American artist #1 in the Spotify list. So when we realized that in a few hours, we could create, produce it and air it, a move with the message that the Brazilians were claiming for on the social change. And as a result, this brand -- the brand was the most commented on the social media that day. Our agility and consumer understanding were key in this case. And the last case is the connection between everything we've just seen. Once we have intimacy for our consumers, creativity and agility [ to talk to them ], we can offer a great 360 experience, respecting their journey. The new marketing for us is not only about the top of the funnel anymore but about what we call full funnel activation that integrates media, content and commercial strategy. In order to do it, we have an integrated marketing campaign process to ensure that we are not thinking only in the TVC ads as in the past but building full funnel activation with specific creative efforts for each consumer touch point. Our last Brahma campaign had all the offline and digital media channels covered to generate the impact that we need. We had an exclusive promotion and content for the delivery, engaging with our consumers and also own trade efforts using digital coupons to create demand for our clients. All these integrated with these with specific incentives there, a full connected strategy to reinforce the brand message and increase our sales. So I will close this chapter of this presentation. I'll give you 3 takeaways about our content. First, draftLine is the operational system of the marketing transformation. Because of that, we can be more relevant for consumers and efficient for our brands. We believe this is the new way to build powerful brands, generating business growth. And we remember that Stella mentioned about the best of CPG and D2C roads. We are getting closer. As a platform company, draftLine plays an important role to connect the dots. More intimacy with our consumers means more lovers for our brands and more cheers for Ambev. Thank you very much. And I'd like to invite back Horai to the stage.

Okay. Hello again, everybody. I hope you saw all the amazing possibilities that are emerging from our digital business, right? We are heading towards the end of our day together. We start the day with [ JJ ] and Lucas giving a broader view about our strategy. And then you saw how our team went through key strategy and aspects of our platform. Now as we are closing up, I would like to give you a deeper perspective on all the components that are enabling an accelerated platform growth, which are basically these 3. I'll start with data and analytics. Well, you all saw in all presentations a lot of comments around data. I want to start to reemphasize that we came from a strong industry legacy. Our process goes all the way back from our value crops to the brewing, packaging process and finally getting our products to customers and customers. In the last years, we have been digitalizing all this chain, and based on our strong footprint, creates a lot of data. You saw many places today. And as I think André mentioned, as we cover 95% of the Brazilian territory, that gives a huge amount of data. In addition to that, as we have become more digital with our digital products, we are capturing more data, different types of interactions from products our customers are searching and to communications they are receiving. And we understand which ones had a better click-through rate, for example. You can see -- I'm not going to go one to one, but you can see all the medium type of interactions that we have in our platforms that we didn't have 2 years ago. All this data lives in our data lake. It's an ever-growing data platform designed around data flexibility and privacy. Everything that we do in the company is captured, all the entire supply chain combined with the fact that we own a decade long of market information. So it's a lot of information that allows our data science team to deliver insights, top line improvement through operational excellence and financial discipline. So it's a lot of data that is really transforming the company. I just put some examples. Some of those were already mentioned of areas where we are really changing with data. For example, we have 30% uplift on suggested orders based on our algorithms that are helping our customers to decide which products they should buy. Another example is when we are giving credit to our ecosystem balancing risk and returns. The algorithm that we have has 50% less overdue payments compared to our previous process. In logistics, you saw André, he mentioned via our machine learning models, we increased our total capacity delivered by FTE by 12%, 12% on a big footprint gives our -- we are giving our certain routing and delivery times while still guaranteeing a 10% increase in daily work shift accuracy. And in spaces where we are also exploring, we have algorithms on blue, on red ocean like the commodities where we believe there's 3% to 5% on top savings due to negotiations that we're anticipating a price increase. These are just some of the many examples that we have where we have data improving how we do business across all the chain and across our digital platform as well. All this data strategy and digital platforms are only possible given our investments on improving our technology foundation. This is a quick summary of our journey so far. We started in 2019 when we decided that we need to evolve our ERPs. We had a proprietary Cobalt-based ERP, 20 years old, and an older version of an SAP. And then we are building everything into our microservice network. We have lean and solid core based on S/4HANA. This is a long journey. It's still not finished. It's still ongoing. But it has already allowed us to support online transactions and faster promotions and pricing decisions. Due to this, it's a reality now in the marketplace. In 2020, we also -- we improved our development process. We put in place all what we call DORA and Flow Metrics that drives quality and efficiency. DORA means DevOps Research and Assessment team, which was a research made by Google, who analyzed several companies using the best practices during 7 years and established key metrics for a high-performing technology organization. We can say today that we are on the top. We're in the elite group of that organizations based on the results that we have below. One example for DORA metric is the mean time to recover, which basically tells how much time it takes for our service to come back if there is a failure. Because in the industry, it doesn't matter how much you do, there's always going to be incidents. There's always going to be outages in any applications. And since failures cannot be avoided, it's really important that we measure how long it takes for us to restore a system. We started 2 years ago with 77 minutes, which was more than an hour, and we managed to stay below 40 minutes last year. So this is really transforming the availability of our system. Another metric that's not part of the DORA but I think it's really important is our NPS, Net Promoter Score, which we measure for all the systems, including internal systems. In 2019, our NPS was 20, so we had to shift our focus tremendously to focus on our users' pain point and experience. And with that, last year, we closed with 57. Obviously, we want to improve, but it was a big jump. In 2020, we also decided to move everything we could to the cloud. It's really in part to gain speed and flexibility and not having to worry about non-added value tests of traditional data centers. Today, around 70% of our infrastructure is in a public cloud provider. Last year, 2021, we tried to focus on data, both collection and usage. So we created our consumer data platforms that you saw from Paula that is the core of the consumer insights she mentioned earlier. We also defined a common tech stack to lower our costs and improve our agility. And you can see some of the results on our time to market, which means how long it takes when we start to develop a feature to when that feature is going in production, which was 47 days 2 years ago, and now it's 27 days. And that includes legacy old systems as well as the new digital products. So it's a tremendous shift towards innovation and agility. Earlier this year, we defined an API-first approach which is going to be fundamental for us to connect all the services of the platform exchange information on a more real-time manner. And last, we are defining a common company strategy to keep our large ecosystem of developers in a much more cohesive and productive way. This is a long journey of our tech, how we improve our technology foundation, every aspect of it, from our ERP to the digital platforms that you saw. We really want to become a high-performing technology organization. Last part I want to cover today, and it's really central to our transformation. It's our people. During the last 4 years, we built a strong technology team. As you can see, we went from less than 200 people in 2019 to more than 2,500 by the end of last year in our tech ecosystem. In 2019, we made this big leap when we acquired HBSIS, a software company based in Blumenau that added 500 professionals to our company. And the rest, we basically grew organically. In the end, it's a lot of people focused on technology and digital for Ambev, and we can say today that we are among the big tech companies in South America. But more important than the size or the quantity is also the quality, right? So during these years, we also brought some of the best tech employees of the region, and we expand into [ securos ]. For instance, everything that you saw on data today, we have more than 200 people on data and analytics between data engineers and data scientists in the company. Another area of growth is cybersecurity. Given everything that's happening in the market today, we really brought the best-in-class people. And this just protect this whole ecosystem and it's a team of [ strategy ] professionals today. All this growth made us completely review our employee value proposition, both internally and externally as we are now competing for talents, not with [indiscernible] anymore. We're competing talents with other big tech companies. As you will see in the next slides, we invested in building career paths for specific talents. We created development programs and review our benefits of our market. This is in Attraction, we launched a bunch of different initiatives. I'll call out one example which is Start Tech that we started in 2019 which focused on entry level professionals. Given the lack of professionals all across the world in technology, these programs basically hire people with diverse background, not only technical background. We provide the [indiscernible] platform with a mix of practical and theoretical classes. Then they are located for some time in some projects until we have an open position that we hire effectively. This program was really important for us to support the growth that I saw [ 2 slides ] ago. And up to last year, we graduated and we hired more than 500 people just with this program. So this is really our benchmark for entry level professionals. Zé is also a very good example of employer brands. We put a lot of programs that attracts people and the best tech talent as we need to grow this platform. Last, D&I, diversity and inclusion, is also a very important part of our agenda. There's a lot of different programs that you can see that we put in place in the last years, and we wanted to keep our focus on gender and race [ improvements ]. As I said, we brought a lot of people, all right? And we structure our employee brand approach and we launched new programs to attract them. But more important than attract is to develop them. Here, we launched a new learning platform, Ambev On Tech. We partnered with some external vendors and we developed a lot of technology [indiscernible] specific for this population. So products, UX, data, soft development, architecture and so on and so forth. With that, we are also launching specific career paths for each different role that we have in the company. You know with all these people, they require different motivational and different skill sets than the traditional [indiscernible] management roles that we are used to. So we are completely revamping and changing how we are upskilling and developing our talents. So we still have a lot to do, still a growing space, but we are very proud as we received some external recognition to celebrate. We won first place on Startup Awards and also first place on the 100 Open Startups on the corporate segment. Both are external recognitions of our work with the start-up ecosystem. We also won the sixth best place on Great Place to Work in Brazil among the large tech companies in the region. And our team also recognized our efforts. So we have 4.5 out of 5 rate on Glassdoor, which is really a big mark and it's in line with our internal engagement survey. These recognitions are just examples, and we are also -- it's also showing in the press, highlighted in many different articles around our innovation, our proximity to the start-up ecosystems and our growth. So just to wrap things up, I hope we were able to show you our gist of platforms transformation, how it's real, how it's adjusting fast with our digital business with minimum size and revenue contribution. But obviously, they are going to grow even more as you saw today. The second message, which I think is important is that the transformation is not only on the new business, but it covers our core capabilities, we saw on operations, on logistics and in marketing. We're reaching some of those with technology. And in terms of technology, we invested a lot in data. You saw in our presentations, our core business, our digital business, we are really changing to data science to create much more value in the company. This is just the beginning of our data journey. There's much more that we can achieve through this. And last, as I just mentioned, we invested a lot in our [ better ] capabilities to connect and grow the platform as well to drive efficiency and agility in our development process with our tech team at the center, with various programs to -- that we want to ensure that we have the best place for tech talents to work and grow in their careers. There's a lot more to do. Hopefully, this was productive. This is all for today from the digital platforms and technology review. I think now we want to do a 5-minutes break, and we will be back with Q&A with all the leadership team. Thank you. [Break]

I'm sure you guys all have questions for the presenters today. This closed our presentations for today so now we are going to start the Q&A session. Okay, so to get started, I wanted to invite the presenters of the day to the stage. And we also have Paulo Zagman, our VP of Logistics here with us. While they get comfortable, we'll have 45 minutes for this session, okay? And because nobody wanted to sit here in the front when we started the day, right, I'll start from the good students here from my left to my right, okay? So in 1 minute, [ Lavoy ], you can start. Please introduce yourself and then please keep it to 1 question each analyst. And then whenever you guys are ready, we can start.

Yes. Thanks for doing this presentation. It was like drinking from a firehose. It was really, really good. I want to start with Stella and Paula, I had a question. I mean, getting into the heart, mind and soul of the consumer is so critical. And we hear Jean speak about this, JJ speak about this a lot. And so how do you use data? How do you use data that informs you on the motivations of the consumer so that you're not just reflecting back to the consumer what they want to hear, so that you're actually gleaning consumer insights that can elevate the brand identity and strengthen the brand identity? How do you use data to inform that function?

I think it's more about how we put the use of data inside our marketing. So how our teams can get the insight, get the information. So sometimes it's about to get agility and bring to the consumer the right answer at the right moment, I think. And it's a good example. So in one day, the people were talking about and we put a [ TVC ] on global. So I think it's one side is agility. On the other hand, we have the information to bring us more to [indiscernible] side. So it's about how we can talk more closer than our consumers and put our brands very near to them. So I think it's how we use inside our team.

And just adding something here. We believe in this combination between what makes sense for the brands and what makes sense for consumers. So sometimes in draftline, we have this role in the structure. So we have the brands team, of course, thinking about what's important to the brand, communicate for consumers. But in the other side, we have draftline with this kind of input from data, what's important for our consumers based on social listening data that we've showed here, based in our own database that we have with the deliver data, for example, integrated in our database that we generated insight using our owned platform. So we believe in this combination. So the combination that we showed about the best of B2C and CPG, it's about this because we believe in this combination about what's important for the brands and the brand's message integrated with what's important for consumers too. So this is our mindset.

Let me try to add on that, too. I think the starting point, it is that our brands, they are -- they have been built through archetypes, okay? So every brand has its archetype and has its values and purpose. So when we showed you here the response of Ambev on that post, so Ambev is the hero, Ambev is courageous. So we have an archetype behind the Ambev brand and how it reacts to us in the context, but always has the soul of each brand. So we had -- Brahma is about the every man. So we build [indiscernible] is the explorer that explores the world. So we had an issue in Brazil that everybody was fighting about eating meat or do not eating meat. So there was a big conversation. Brazil was very polarized and divided on the day of the barbecue last year. And we -- the Brahma team was asking how to respond with Brahma. And Brahma is about inspiring the Brazilians, about uniting the Brazilians. So that's the archetype of Brahma. So Brahma went ahead and did an advertising with a barbecue box and say, so everybody's fighting, let's sit around. We put everything, we put anything we want around, but let's talk about it. So that's Brahma, the architect of every man. So it wasn't that response, it was really about fighting and being courageous, [ that is more rebel, is more explorer ]. So every brand has a soul behind. And then the context that what happens in the market, it's how we react, but with the personality of each brand.

So Next question, Marcella, please.

My name is Marcella [indiscernible], I'm from Credit Suisse. My question is for you, Lucas. Thank you so much for the presentation. Basically, I understand that ROIC is what matters, right? And my question is that it's very obvious to reignite ROIC when you have clear assets such as trucks, and you just need to add merchandise to that, right? What you have told us is that you will need new business to reignite your ROIC, right? And that is also suggesting that we will have [ linked ] invested capital on that. But based on our peers, for example, like [indiscernible] my understanding is that they invested a lot to build assets. And then later on, they will monetize that. So I just would like to understand a little bit better how do you intend to do that, right, with less capital than these guys?

Okay. So I think the realization was that, in addition to the tangible assets, right, the distribution network that we built over the years, the second tier and the direct distribution that we have, I think we realized over the last couple of years that we also have these intangible assets, which is the trusted relationship that we have with 1 million points of sale in Brazil that do business with us every single day. And when we combine the tangible assets that we have and the intangible kind of trust that we developed with points of sale over the years with our clients and customers, we just saw this opportunity, right, to look for other ways to really, by solving customer pain points, by solving client pain points, not only adds value to them but leverage the asset base that we've been investing behind over the last 30 years. So I think -- and that's where kind of the mindset evolution, the mindset shift comes in, right? And we've been more and more vocal around elevating return on invested capital. Again, it's not the only measure. It's not the only thing that matters, right? Everything is important. But we felt, for the current environment, the current conditions of temperature and pressure, right, for our business and for the market, we think that it makes sense to look more and more through a return on invested capital lens. But just to go back to your question, I think this was the realization, right, that we have this amazing asset base, part tangible, part intangible. And we have an opportunity to put these assets to better use for our clients, our customers and our consumers.

Next question, Isa.

Isabella Simonato from Bank of America. I think my questions are to Abilio and Horai. You guys show several NPS data right for the many initiatives. And Horai, in your last -- second presentation, you showed you're still around the 50s and want to improve -- of course, it has been improving, but want to improve. I know that Zé is already above that, in the 70s, the 80s, but can you talk about the -- why it is not even higher, right, for some of the other initiatives, maybe BEES which has a great penetration already? What do you think is bringing or at least not ramping it faster? What could be the opportunities to improve this index?

I will start and then I'll let Abilio talk more about BEES. So NPS, there's different perspectives, right? The one I showed around the platforms includes external and internal platforms, right? For the internal platforms, the NPS normally measures the experience of the user directly with the platform. That's how we focus on the digital product, on the digital system. We have been able to improve that. When you go externally, and then Abilio is going to -- has much more comment to make, there's a mix between the digital product with the actual experience that the customer gets, the level when a delivery gets late or something, affects the whole NPS of the whole system, right? That's why there is some virality. I think that is an extremely good example because everything that [indiscernible] showed around our ability to really deliver constantly in the -- below the threshold, below the [indiscernible], it's something that we probably will never -- or almost we never fail. That's why the NPS, the product, combined with the operation is so good.

I think in my experience, what I see is that Zé is completely out of the curve, is it's just amazing what the team did with the NPS. And usually the digital evaluation of our digital products is higher than the total. And for example, what we see in this is really about customers that they want investments. So sometimes it's something that you're not going to solve very well. We can talk, we can postpone a little bit. But sometimes you have to say I don't have this investment now and then this affects a little bit. When you go to that, it's much higher. But when we go to the daily relations that we have and then logistics plays a big role when we have peaks and we miss out something so the evaluation really goes down. It's more about the transaction as what I mentioned but this long-term relation that sometimes it impacts this too.

I would just complement like we have this relationship that is very frequent with the [ work ] owners. And when they are giving the notes, they are evaluating everything that is happening. So it's not just about the product itself, it's the whole service. And because it's very frequent, if you have like failed once maybe in 3 months, they're going to evaluate you in a bad way, I mean. So like the journey that we've been having, increasing NPS by 20 points as we mentioned here, I think, is the main message. Usually, we compare ourselves with companies that are more used to have this kind of measure evaluated by consumers. So much less frequent and kind of easier. It's not -- easier would be something that is not so fair to say, but kind of easier to have a nice experience when you don't have any chance to have problem, right? So in our cases, like a journey with a lot of things involved. So I think the trend is really good. And we believe, with everything that we spoke about here, the trends are going to be going up.

Lucas, please.

Lucas Ferreira from JPMorgan. It's almost impossible to pick one question to ask for all of you. But the question I have is, if you speak to analysts, financial analysts, and looking at CPG companies, obviously, we look at a lot of variables, but I think there are two that people are obsessed about. So EBITDA margin and market share, right? The first one, Lucas, already explained that it's relevant, but you're kind of migrating to a ROIC [ view ]. So I wanted to ask about market share. If it's kind of starting to lose relevance for you? Obviously, it's still important than losing relevance given you're now in so many different channels looking the market in maybe in different ways, addressable market. So how -- are you guys still very obsessed about market share? Is this something that it's a top priority for you or not anymore? How you guys can help us kind of demistify and try to measure market share in this kind of crazy new reality we are in today?

So let's talk about beer. So today, the day was really about tech. Tomorrow, it will really be about beer. I was missing. I lost that, but I was really missing like the occasion and beer, but that's a good question. So having said that, last year was the year by far that we gained the most market share ever, okay? So it was really something unprecedented. You can use -- so using -- is a little bit delayed on everything. So we have [ BEES in here ] and then we have internal data. So somehow, all the cross checking that we did. So it was an amazing year in terms of gaining market share. But looks like we are more obsessed now with growth. So in the past, we were addicted to like every week market share, [ ops ] come, supermarkets go and go back and go in. So we are really looking on a more long term, so understanding where are these places that we should grow more, reestablish the momentum of the company on these places with innovation and let it grow. So that's where we are. So we are much more understanding consumers, asking what they want, feeling their needs, increasing service and putting the company with momentum. So we are passionate about really momentum now. So and this naturally comes with the market share. But we are less looking at competitors and market share. We are looking more into customers and consumers. And momentum for us is key. So that's what I can say.

And just to add to what Jean mentioned, I think in addition to market share, we're also looking at brand health and fans, right? So if we want to have a more holistic picture of how we're connecting with consumers at the end of the day, either through our core business or through one of our platforms, right, we think we need to look at not only share, but also brand health, how that's trending, and number of fans. That's why we deliberately wanted to talk about number of fans today. Tomorrow, [ Bernie, ] our CMO, is going to talk about this a little bit more with everybody. But I think market share is important. It's also about fans [indiscernible].

And just again to make this point, so it was found that when we stopped looking at market share every week, it was when we were free up ourselves to really resolve the structural things that we had to structure and build the momentum on the whole company, even though making the hard choices of saying no when having some turbulence in the beginning. So when we -- we look at that consumer and the customer and we look at the long term, it's really when our top line went to go high and the volumes and then the market share came naturally.

Next up, Ricardo in the back.

Ricardo Alves, Morgan Stanley. I had a question for Rodolfo, I guess [indiscernible]. Really interesting comments on the improvement on profitability on the commercial metrics. Wanted to see if you could elaborate a little bit more on 2 things. What were the initiatives that were most important for you to achieve the improvement on the profitability side that you mentioned? And maybe more important, what is to come? We get a lot of questions on the distribution side, for example, particularly considering very high fuel costs. So I don't know if it's the distribution that is on your radar right now, if it's perhaps mature in the number of cities that you mentioned, a lot of cities catching up with the others. So just your thoughts on those 2 topics. What have you already delivered and what is to come?

Thanks for the question. I would start to say how important scale is for our business model and the density. And I think you captured well that if I have cities, they are 10x more mature right than others. So I already have the playbook of how to get to a better profitability. I just need to add more scale to the cities they are -- that started later, that we just launched in 2021. So it's a natural journey of evolution, they will catch up. The numbers that you saw here, they were all average of all the cities. So I think that just by doing this, adding scale to the cities that are less developed, you can already expect a big improvement in the unit economics, in the average unit economics, right? Other things that I think that will move the needle for us, we do -- when we have our own operations, when we run the store ourselves, our stores, right, we do have better economics, and we do have better service level. So I think that there's a lot of room for us to improve that. And with that, will come another big piece of improvement in the unit economics. The nature of the orders, how many orders we put in 1 delivery, right, when the delivery man leaves the store with 1 or 2 or maybe 3 orders, this makes all the difference in the cost per order. This, there's a long way for us to keep improving. And I think it's proven that we can do this without affecting the NPS of the customer, the expectation of the customer. So these are 3 of the things that we can improve a lot within our business model, like I say, if we start to expand to schedule delivery, click and collect, other things. There's more room for us to further improve on the last mile piece, right? So these are some of the things that we are working today. And that's why we are confident that this unit economics can keep improving over time.

Next, Thiago.

Congrats for the presentation. I have a question for Jean. We all know life isn't that simple right now, but if you had to cut it down to 1 very specific area in your job where you cannot fail, what would you say it is? Is this branding in Brazil, managing cost inflation, pricing, competition, BEES or anything else?

In reality, I cannot fail in people. So that's what -- where I cannot fail. I have to have the best team in Brazil. I have a culture that evolved, prepared with the capabilities for us to really succeed in the future. I think -- so as a CEO, more and more, my job is on people and having talent and have the organization as 1 together. Sometimes we have some divisions, but everybody is fighting for the same cause. I think that's where my mind is most of the time. So having said that, so with that -- and I'm very happy with the team that we have been building and the culture that we have been evolving. We are working in 3 things. We are working on the new portfolio. We are working on BEES, and we are looking at Zé. So these are the 3 things that takes a lot of my time that I put a lot of heart, a lot of mind on these things.

Next up, Leonardo.

[indiscernible]. My question is probably maybe to [ Abilio ], but then about the assortment on the BEES, right, probably started with some big brands, national brands, which is easier to connect to the platform. But then moving on, probably you're going to reach some small cities with better opportunities with maybe even changing the mix for these smaller cities. I wanted to hear from you guys about the -- you're either going to be looking for profitability with this mix, but then maybe some -- taking some risks or some changes, given with the brand power that you have, connecting to other brands inside the BEES [ focus ]. Once you're selling, you start to connect and maybe if in the future, it could even hurt the brand of Ambev. So just regarding an idea of how the strategy of assortment inside BEES is going to play, especially while you're going to be rolling out for smaller cities as well.

I think, first of all, BEES is a brand. So we are elevating BEES. We are talking about BEES. So of course, that today, Ambev and BEES, they are very connected, but BEES more and more, will have its personality, will have its NPS, will have everything every time that we put a supplier inside BEES. So we have in contract NPS so we have really to protect the BEES brand. So this is one thing. And more and more, it will be Ambev one thing and BEES another. We don't want to have like [ BRF ] NPS, we want to have Ambev NPS. The [ structures ] are different. So more and more, this thing about being a platform and not just myself delivering and bringing more suppliers and have this national reach and more and more putting suppliers over there, I think, is the way to go on BEES. And the concern that we have the most is really about services, NPS. We are not there on this thing about what type of -- for example, we decided not to put cigarettes there. So we had an opportunity to have a deal, decided not to do. So we have -- we curate what we put. Probably there are 300 SKUs that I want to do myself, logistics, but the big growth 3 years, 5 years from now is really about putting sellers, putting [ as a 3P ]. And we do some curation, but we have to take care of this brand. I think this is what I can say. And it's really about -- so in the end, I think that the advantage of BEES, it is that nobody can do this with the low cost that we do. I think we are leading in terms of reach and cost. And in Brazil, we have a lot of revenue discount, high-low prices and brands that cannot reach that we believe that we can solve this issue. And in between these 2 things, there is a lot of value for us to share. So I think somehow it's really something that it has to make sense in terms of value for us, a value play.

Okay. And just to complement, I think we have to invite the customer, our client, the bulk owner to the center of the room and ask him what they want. So I think our relationship with the customer is very close, and we learn a lot with the relationship. I think your concern, it's fair. But we listen every time and a lot with the customers with insights there they bring to us, and we can improve this experience with these -- all of these learning and everything that Jean said is just not to repeat, but I agree fully.

Next question from Thiago Duarte.

Thiago Duarte with BTG. I think you mentioned that the 1 thing you can't fail is people, right. And taking the opportunity that we have, a lot of the future of the company in front of us here, I think the one thing that strikes me when we think of Ambev in the past -- you just described how you, at some point, you guys were obsessed with market share on a weekly basis, right, and how that's changing. And several of the things that we discussed today, either in creating brands or BEES bank or the logistics or the BEES, and those are things that somehow seem to mature over the longer term, 3 years, 4 years, 5 years down the road, right? How you manage people and incentives in a company that was so obsessed with short-term results in the past and now it's looking more towards the long term, how you keep the talents going and people motivated. What kind of KPIs you're looking at, is this the EVA that Lucas was discussing before or the ROIC, or kind of things to keep everybody motivated for a longer-term project?

That's a good question. Somehow -- so just to mention one thing, I feel that we are stronger than ever in terms of attracting people, okay? So that's how I feel. I feel somehow Ambev is more open. We went to the front line to talk about our plans, to talk about what we stand for, how our company plans to transform itself into the future. And I go into any university, and I talk about Ambev in Brazil when I feel that like I'm highly evaluated, I really can attract great people, okay? So that's where we are. And there is a lot of excitement outside the company, inside this company about being part of this transformation, this story, okay, so just want you to know that. So having said that, we had an issue of value creation from 2014 to -- from then to today, okay? So in the end, the value -- the stock didn't go up. So the wealth of the people that was during this moment didn't went as expected. And we made a lot of changes on our compensation model. It is less -- it's less leverage this was before based on options and really towards short-term achievements, and we changed it to be a little bit more reliable, to be more based on stocks and not options and to have a better balance on the monthly and the best that we do that will mature in the long term, okay? So for the last 2 years, we have been changing the compensation model that people look and people feel that they can wait a little bit more for it to mature. So I think this year was -- we announced a change again that goes in this direction. And somehow, the people now look at the compensation and feels, look, if this transformation happened with this type of compensation, I can stay longer. So that's how I feel. So it was quick. The change is less based on the short-term achievement of the year, more on things that will mature in 2 or 3 but are not options that keep underwater all the time. They are stocks and we protected the short term too that it was too much leverage. So we made some tweaks. We talked about the transformation. Somehow, I feel that my talents are into it.

Just to add one thing to the compensation side is the target setting side, right? So we've been speaking a lot about collaboration over the last 2 years. And I think one example that really illustrates it is the decision in 2021 to have each leader share 1 target with his or her entire team, the exact same target precisely to incentivize people to collaborate on the target achievement. It's about the collective group as opposed to the individual, okay? So Jean has a target that he cascaded to his entire management committee. It's the exact same target, pretty much. I have a target that I cascaded down to my entire team. You can guess what that target was for this year, right? And this is the logic right, for each member of the [ man com ], really to try and stimulate people to share targets that are exactly the same and make it more collaborative.

And Thiago just to complement a start of the compensation, right? I think for me, speaking for myself, I've never been more proud to work at Ambev, right, being part of the transformation, being able to share with you guys everything that we are doing here, right, the ownership that each of these people have. I think it's amazing to be here at this moment, right? So aside of that part, which is very important, right? Being a part of this group at this moment is incredible. But thank you for your question. Next, Thiago.

Thiago [indiscernible] from Citi. Well, first of all, thank you for the presentations. I think they have been pretty incredible. My question goes to [indiscernible]. So I would like to circle back to the economics of that. And I understand that the delivery people are a key factor in the business and that having a physical spot to go back and forth is a really good differentiation from the other platforms. But still, I imagine that the actual paying is a really relevant part for the people themselves. So I just wanted to see if you could give us some information on how the math goes on the fees, paying and how you position yourselves versus the other delivery platforms.

Thank you very much for the question. It is indeed a key driver of the NPS. And I think that we have to measure through the NPS. So we have to really make sure that the ecosystem, all the players, including the couriers are -- it's on a sustainable level for us. So we're always going to be gauging this and we're going to make our decisions, if we are being healthy or not, based on this metric. Having said that, I think what is important is that we differentiate ourselves from other deliveries in terms of how we structure our payment because I think that has to reflect the uniqueness of our business. So if you just go and can have the same reals per kilometer, the reals per orders that everybody else, then I think that we're not going to be taking advantages of what we are different, will be different. We have way more fricking orders per hour for our delivery men. The number of orders that churns out of a store is much bigger than a kitchen, for example, right? So we're talking about a small seller, not a big one, a small seller would churn 200 orders in a day. So the time that he has to be waiting there for the next order to come, sitting in their motorbike, waiting for it, it's just totally not comparable, much faster. When he delivers, the radius is much shorter on average would be 2 kilometers. You will never go 4, 5 to 6 kilometers like you would go because it has to come from this specific kitchen from this specific restaurant when the consumer order. So I think that we have to take advantage of these differences and pay according to that. We have a much higher possibility of routing orders, of putting 2, 3 deliveries in 1 out. So I think that we have to structure our fees to take advantage of that. Should you pay per order or should you pay per departure from the store? And maybe the second fee, the third fee is smaller because the guy just needs to do a little detour and stop by then. So all these, I think that's how we're going to play. We have to be smart and take advantage of the uniqueness of that and avoiding the direct comparison. So we're not going to have the same structure of remunerating our delivery men. What matters in the end is how much money he makes per night or per day. We also know that he is our delivery men, they're not going to work every day for us. We have a lot of peaks, right? And he can have second and third, other jobs as well. This can be a part-time remuneration for him. So I think that we have to put it all together, play to advantage, right, and be able to compensate him better than average with the best option without having to be like-for-like in every single metric in terms of payment. What matters is that he really sees us as an incremental source of income for him.

Just to give you one example, so not exactly numbers. But we are implementing something now that we say to our deliveries to -- that it's like, so the numbers are not new, but it's like 8 for 1 delivery, 12, 15. So you get 15 on a ride of 3 [indiscernible]. So then you come back. So this is just an example. And they are very close to each other. So it feels that 1 round 15, he goes to the line again, to the queue again. And it's much more than some -- than he would get and wait a lot. So these type of things we are implementing, and they are very appreciated by the delivery men.

I'll give another example of the opportunities that we had ahead of us, right? What constraint that I have is that once I get an order, I have to -- I have the opportunity to route that order, right, to combine with another order that is close by. I have a very short window, I have 5 minutes. So I do. But you know what happens? Sometimes I make a -- I would deliver here. You go out with 2 deliveries. You deliver 1 here. And the other 1 will be the same site, now we'll be westwards. We will be across the river. We will be like 20 blocks away because I won't get -- you only gave me 5 minutes to combine orders, to give me more time, to give me 2 hours, one hour. It's a game changer. I'm going to put 5 orders in the same duty, in one stop in the same block. So all of these are the things that we have to work together with our customers, gauge the willingness to pay from our consumers, right? And I think eventually make it much more efficient for everybody.

Density and number of orders are everything. So if you can get a lot of orders here is we really can make it working out in a very efficient way.

Next up, Gustavo.

Gustavo from Itau. so actually, my question is for Lucas. And Lucas, just to explore a little bit more the graph that you showed us on the ROIC with the breakdown, with the assets turnover and the no PET margin. As I remember, the assets turnover is a little bit at the all-time high or fast or very close to that today, while no PET margins are slightly below the average of the [ circle ] margins. So what I'd like to hear from you is looking forward, is it reasonable to expect that the biggest improvement on your ROIC should come from an even higher improvement on your assets turnover, which is already high rather than no PET margin improvement, which is below average? Is it reasonable to assume that? Because we saw in your slide that most of the initiatives that we are mentioning are focusing on basically assets turnover improvement. So is it reasonable to assume that? And how would you expect your driver to be -- of your ROIC to be more focused on the assets turnover or margin improvement going forward?

Sure. Thank you for the question. I think it's hard to give predictions here of what will happen, okay, on fairness. But when we break down the 2 drivers, right? I think one of the objectives behind, right, sharing the data we shared today was partly because when we look at the environment in 2020, 2021, in 2022, you've seen our, right, cost -- cash cost per hectoliter guidance. Everybody is following what's happening to commodities going into 2023, all right? I think everybody acknowledges that and it's reasonable to assume that, right. Cost pressures are still around us, right, which makes our life more challenging, right? But I think 2021 was a good example of where, despite the cost pressure, despite the margin pressure and the no PET margin, right, contraction that we saw, we still manage to improve return on invested capital through asset turnover, right? And so only time will tell kind of where we land in '22, '23, '24. But we wanted to bring back asset turnover to the conversation because since our business is indeed evolving and we are seeing all these opportunities, leveraging technology to deploy our assets, right, to better serve our clients and consumers, we see a clear opportunity to improve asset turnover, right? So that's why we wanted to break it down the way we broke it down and show everybody that margins are important and will continue to be important, but they don't give the full picture, right? And for us, when we broke it down the way we showed you today, that became very clear to us that we have to be very close to our believers that drive asset turnover to make sure that we are balancing both. At the end of the day, longer term, we're going to have to have both, okay? But in the short term, given what we're seeing in the environment, the better we get at the levers that drive asset turnover, the better the chance we believe we have to improve return on invested capital. And I hope that answers your question. Just to -- the long run, both have to grow, right? But I think this asset turnover historic here that we have is no reference for what's coming next. We are really a platform. It's really something that is ambidextrous footprint of commodity of consumers and customers. And we are aggregating the marketplace, and we have the delivery going to consumers. I think this asset turnover that we have historical, it's just no reference.

For our last question, Leonardo.

So when you said that your 2021 was your biggest market share improvement that you've ever had, would you be able to break that up into on-premise and off-premise?

So [indiscernible] you help me if I keep thinking over there, if we went there, if I miss something you'll help me, okay? So this was really a lot towards the on-trades. It was really about gaining distribution. It was really about getting to the all-time high market share in bars and traditional trades. So the platform and the reorganization and our capillarity and BEES and the price structure that we put in place to be more linear, so it's really late, it was an explosion of market share in the small on-trade on -- and the good part, it is that now it was really market share gains in the depressed occasion. There is social at homes, mobile bars that we change at levels and all looks like the wind is in our favor. So this is the segment that will go up, and we overindex in market share and looks like finally, like wind is really in our favor.

[indiscernible]

Okay. So we're going to really have many PowerPoints on that.

Thank you, Leandro. So with that, we close the session today. I would like to thank all of you for your participation, the analysts, the executives and also all the investors that are here with us and also on the web. Tomorrow, our meeting starts at 10:30 a.m. Brazil time. Have a good rest of the day, and see you tomorrow.

Thank you very much.

Just one second for you guys that are here, we would like to invite you to the Happy Hour now outside. Our management will be there with us. Also, not only the presenters, but we also have our management here. Can you guys stand up so you get recognized? So please talk to them during the Happy Hour. Vans will leave back to Sao Paulo -- to our office in Sao Paulo at 7, okay? And we'll meet tomorrow at 10 a.m. in the office, same address where you were picked up today. Thank you for coming. Have a great day.