We are playing alone in the core plus today. There is no other brand in Brazil in the core plus. So the other brands are premium or they went down all the way to core. So that space is still there. We are pretty much over there and we want to continue to bet on that. But we had material success in the high end. We are super excited about the success that we have been having in the high end. Corona is really doing well. So we had a shortage of capacity for a while and now we are unlocking it in Corona like the brand equity is really going up and spotting is a reality, is really doing very well too. So both are in the high end. Budweiser now, that is in the entry premium going into the core plus reignite itself in terms of brand equity is doing okay and in terms of volume, mainly because of the new packs that we launched, that they are more in better price points.
So it’s really doing well and it’s in this core plus, plus entry premium now, because of the new packs. And then when we go beyond the mega brands that we talk, the core is really performing in line with the overall industry. So that’s good in the long term. So we should really accelerate this a little bit. But overall it’s doing okay. And overall talking about a broader portfolio volume in the innovation strategy that we have match there is adjacency that’s doing very well. We are leading the segment, the segment of zero beer doing very well, leading this segment too. So overall the portfolio is very well established, and I foresee the growth really coming from the three segments, from premium, from the core plus and from the core too.
Okay. So this is one thing in terms of brand equity, we are really doing well with our focus brands. Brahma overall [ph] is a brand that’s very solid and then we have Spaten, Corona really doing well, really on fire. We see Original too, that is a brand that we have been expanding from outside the Southeast is doing very well in terms of brand equity. Stella is doing very well too. Budweiser has really reignited the volumes. We have a brand that is really the leading brand in specialties in Brazil that is Patagonia that we don’t talk about that much, doing very well too. So brands overall the focused ones are really performing very well.
Lucas Lira: Thiago, this is Lucas. I’ll take the second on SG&A and CAC. I think the first point to mention, Thiago, is that the approach towards SG&A for CAC follows the approach for SG&A that Jean mentioned for Brazil in his first answer. What I mean by this is the idea continues to be very disciplined and diligent, particularly around distribution and administrative expenses, in order to free up resources to continue to invest behind our brands in sales and marketing, okay. So that continues to be the prevailing logic across our different business units. With respect to Q3 in particular, the highlight in CAC was really lower distribution expenses year-over-year and that’s mainly because last year we suffered a lot in the region given all the supply chain constraints that the region kind of went through, right.
Let’s not forget that CAC is comprised of several islands and where logistics are extremely complicated. And so as the supply chain constraints were removed we began to benefit from kind of a meaningful reduction in our distribution expenses for the region, okay. And that more than offset the administrative expenses that grew year-over-year, while also allowed us to keep investing behind our brands as part of our – as part of our plan for the year. And then my last comment here, Thiago is I think it’s important just to take a step back and look at the year-to-date for SG&A as opposed to the quarter itself. And when we look at full year SG&A for CAC, the logic that I mentioned from the outset, I think is what we’re going to continue to pursue, meaning strong focus in distribution and administrative expenses to free up resources and continue to invest in our brands behind sales and marketing expenses, okay.
Thiago Duarte: Yes, that’s great. Thank you both for the color.
Operator: The next question comes with Ben Theurer with Barclays. Please go ahead.
Ben Theurer: Yes, Good morning and well, thank you very much for taking my question, and congrats on the results. Wanted to switch a little further south into Argentina, Latin America-south in general. Obviously, the trends here during the quarter have been much more pressured and kind of in line with what you anyway expected, but wanted to get your sense about how you feel about the region going forward, where you see opportunities to maybe reignite volume growth, particularly in Argentina. Are there any strategies you’re thinking of, or is it an implementation, or do you just think you have to go through the challenges right now and time will heal some of the issues you have right now? Any update you have on that would be much appreciated. Thank you.
Jean Jereissati: So thank you very much. I will start Ben, first with ex-Argentina, okay. And the truth is that we cannot – we do not disclose exactly the numbers, but we have been doing very well in this region. And in Chile, Bolivia and Paraguay they are doing very well with a great performance. Overall Chile, we have been working for a while to really get critical mass. We invested in supply chain capabilities, local production. We gained the market share according to our estimates. And the efficiencies are really kicking materially. So our business is really getting much stronger over there. Bolivia, we have a renewal rate in our portfolio. They’re launching new packs and new presentations and innovations, new products that are really igniting the country overall with our leading brand Paceña over there; and Corona doing very well too.
And Paraguay has been a place where we have been for like four or five years right now, really compounding growth over there, so doing very well. So this is inside LAS, the performance is really solid in these three countries. When we go to Argentina, Argentina, we knew that the winter was coming right over there that the scenario of currencies, control and everything was something that at some point in time would change. And we were really trying to overprotect ourselves with financial instruments that was really consuming cash. So we really changed the way we operated over there. So we are really for one-year preparing for the volatility, for the changes on the macro scenario. And in the end during this year and the next, more important for us is really to go through this correction in a way that we can protect the business for the future, but really go through the turbulence.
So we are pretty much looking more in terms of on the commercial side, on market share and brand equity. So these are the two things that is a must for us. But overall volumes this year and probably the next, it will be depending on the equation of how we should protect ourselves from a devaluation, from a cost increase, and this is a variable that is more free to move up and down in a way that we could protect ourselves from the macro scenario. So, having said that we are happy with our performance because we have been able to protect cash flow generation, in reality to increase cash flow generation, to change the way we’re operating over there, thinking more how to protect the business operationally and not just financially. So we change the relation with suppliers, we change our price conduct depending on the forecast that we have.
