Embotelladora Andina (ANDINA-B) Q2 2024 earnings summary

Executive summary

• The company is the largest bottler in Chile, Argentina, and Paraguay, and third largest in Brazil, serving over 57 million consumers and 272,000 clients with a diversified beverage portfolio across four countries.

• Emphasizes sustainable value creation, digital transformation, and operational efficiency, with strong ESG commitments and a high mix of refillable packaging.

• Strategic objectives focus on growth through portfolio expansion, new categories, digitalization, and sustainability, supported by a high-performance, engaged team.

• 2Q24 consolidated sales volume was 197.1 million unit cases, up 0.3% year-over-year, with transactions down 0.1%.

• The company will terminate its beer distribution agreement with Heineken in Brazil in October 2024, aiming for greater flexibility and new business opportunities in the beer segment.

Financial highlights

• 2Q24 net sales reached $718 million, down from $767 million in 2Q23; total volume was 197 million unit cases, up slightly from 196 million in 2Q23.

• Adjusted EBITDA for 2Q24 was $117 million (16.3% margin), compared to $125 million (16.2% margin) in 2Q23.

• Net income for 2Q24 was $26 million, up from $15 million in 2Q23; in local currency, net income attributable to owners was CLP 24,602 million, up 101.8% year-over-year.

• FY2023 revenues were $3,094 million, with adjusted EBITDA of $555 million (17.9% margin) and net income of $203 million.

• Dividend yield for 2023 was 10.1% for Series A and 8.8% for Series B; payout ratio was 96%.

Outlook and guidance

• Strategic focus remains on portfolio growth, digital transformation, and sustainability, with 2025 objectives targeting increased efficiency, customer satisfaction, and gender diversity.

• Management is optimistic for 2H24, citing recent volume improvements in Argentina and continued digital transformation, with over 46% of revenues now through digital platforms.

• Commitments include doubling female participation among employees (from 2020 base) and increasing energy from renewable sources to 50% by 2030.

• The new beer production unit in Brazil is on schedule, expected to begin operations in 2Q25 with an initial capacity of 13 million unit cases.