Anheuser Busch InBev / : Script

AB INBEV'S CAPITAL MARKETS DAY 2023 MEXICO CITY, MEXICO

TUESDAY, 20 SEPTEMBER 2023

Chief Financial Officer, Fernando Tennenbaum - Optimize the Business- Intro

Hello everyone, and thanks again for joining our capital markets day here in Mexico City, it's a great pleasure to welcome you all here in person in one of our key markets.

I hope today's presentations have given you good visibility into our strategy to lead and grow the category and how we are digitizing and monetizing our ecosystem.

Now, I would like to talk to you about the third pillar of our strategy, optimizing our business to maximize long-term value creation.

I've been with the company for more than 19 years, across various finance functions, including Investor Relations, Treasury and M&A, and was most recently the Chief Financial Officer of our publicly listed subsidiary, Ambev.

When we think about maximizing long-term value creation at ABI we are focused on three key areas:

1. Optimized resource allocation
2. Robust risk management, and
3. Efficient capital structure

Let me start with Optimized resource allocation

Every day we make strategic choices to drive balanced and profitable organic growth.

Throughout the day, you have heard about some examples of these choices across the first two pillars of our strategy.

Consistent investment in our replicable toolkits: such as our megabrands, five category expansion levers, and our digital transformation

allows us to better serve our customers, attract new consumers to expand the beer category, and drive increased participation across our footprint,

resulting in volume growth ahead of the industry across most of our key markets over the last few years.

We have made important choices in disciplined pricing and other revenue management initiatives, which drove an annualized Net Revenue per hL growth of 5.4% since 2019.

The strategic investments we made in our digital capabilities such as BEES and DTC have further enhanced our ability to grow.

All combined, the execution of our strategy has delivered accelerated top line growth with a healthy combination of volume and net revenue per hl since 2019.

As Michel mentioned earlier, we operate in a large and growing category and we have no shortage of opportunities to invest in driving the organic growth of our business.

Despite the challenges of COVID, commodity cost pressures, and FX headwinds we have invested nearly 47 billion US dollars between Sales & Marketing and CAPEX over the last 4 years.

Perhaps more importantly, these investments have been consistent year over year to support the brand power of our portfolio, maintain the efficiency of our facilities and develop the right capabilities to drive future growth.

While we invest heavily in our business, we are always seeking opportunities to optimize the effectiveness of the resources we allocate.

Within sales and marketing, there are two key concepts which are enabling us to be more effective with our commercial investment dollars.

First, Marcel spoke earlier about the Megabrands concept and reducing unprofitable brands and SKU's, which are enabling us to focus our sales and marketing investments in the brands that have scale, brand power and are best positioned to capture growth across our markets.

Second, we are scaling our replicable toolkits such as BEES, digital direct-to-consumer brands and our inhouse marketing agency draftLine across our footprint globally.

We are still exploring how we can fully leverage the customer and consumer insights developed across these platforms and we see clear opportunities in driving both efficiency and increased effectiveness across sales and marketing.

We measure the effectiveness of our commercial investments through brand power and volume growth with consistent improvement across both measures since 2021 for our overall portfolio and for the Megabrands in particular.

In relation to Capex, from 2019 to 2022 we have invested nearly 19 billion US dollars in capex to support execution across our three strategic pillars.

Almost 60% of this capex was invested in growth & technology initiatives, including

• expanding our capacity to meet the growing demand across developing and emerging markets
• investing in capabilities in faster growing premium and beyond beer segments
• And developing digital platforms such as BEES and DTC, that have fundamentally changed our route to consumer and relationship with our customers.

We also continue to invest to optimize our business, improving productivity in our facilities & logistics operations and investing in key sustainability initiatives. Roughly 10% of our capex has been focused on cost efficiency projects across our business.

The next building block of how we think about optimizing resource allocation across our business and translating top-line growth to value creation is our margins so let me take a few minutes to go through the evolution of our margin profile…

Our business's superior margins are driven by our fundamental strengths:

• Our portfolio of iconic megabrands
• Our global scale
• Our unique global footprint and..
• Our efficient operating model

However, over the last couple of years the overall beer industry profitability has been under pressure due to unprecedented commodity and transactional FX headwinds.

And ABI has not been an exception.

As you can see on the left-hand side of the slide, our EBITDA margin compression since 2019 was almost entirely driven by the gross margin decline, as our key input commodities reached near all-time highs.

Further, our basket of emerging and developing market FX exposures depreciated significantly above inflation differentials.

These two factors combined resulted in input cost escalations well above CPI.

Despite the cost pressures we have been disciplined in continuing to price in line with local CPI as this is the long-term pricing strategy that we believe maximizes the value of the beer category.

This dislocation in local CPI versus brewer input cost pressures has primarirly driven the 660bps of gross margin contraction we have seen since 2019.

We cannot control commodity prices or FX movements but we are able to manage our overheads tightly to free up resources to continue to invest in our business despite the elevated cost environment.

Our culture of every day financial discipline and the ownership mindset of our people have enabled efficient overhead management

Over the last 4 years we have meaningfully increased our productivity with our volume per FTE increasing by 9% since 2019.

When you look at our total overhead expenses for the same period it has declined by 1% in US Dollars.

If we compare the evolution of our overhead expenses versus local CPI, we estimate that since 2019 we have saved more than 300 million US Dollars.

The silver lining is that what I've just covered shows that the margin decline we've seen in recent years is not structural..

And as we move forward, although input costs are still elevated, recently the key commodity and FX rates have begun to ease for the first time in a few years.

Our fundamental strengths, disciplined pricing, continued premiumization and efficient operating model remain the same, creating an opportunity for margin expansion over time.

I know there are many finance professionals with us in the room today, and as I always tell my team cash is king.

The ultimate measure of value creation of a business is the size of the free cash flow generation and the consistency of delivery. When you look at the last four years, despite the dynamic operating environment, and even including the impact of COVID in 2020, our business continued to deliver consistent free cash flow while investing for growth.

When we benchmark our cash conversion and margins across our peers in the CPG landscape we consistently have best-in-class profitability and conversion of net income to free cashflow.

Now let's move on to how we think about robust risk management…

Our risk management framework is an important lever to maximize value creation.

By reducing the uncertainties we lower the cost of capital, mitigate tail risk events and ensure the sustainability of the business for the next 100+ years. We do this by focusing on three areas:

• Cost visibility through our hedging policy
• Actively managing our debt portfolio, and
• Bringing greater efficiency and standardization, with our replicable management systems..

Our 12-month rolling hedging policy is focused on all economically viable exposures and is designed to provide our business with input costs visibility to enable revenue management and strategy planning

With respect to balance sheet management, as you can see on this slide - our debt maturity profile remains well distributed with NObond maturities in 2023 and NOrelevant medium-term refinancing needs.