Companhia de Bebidas das Americas, or AmBev, which today entered into an agreement to combine with the Belgian brewer Interbrew, also released lacklustre fourth-quarter and full year results.

"Our results in 2003 did not present the growth we hoped for. Our consolidated EBITDA grew 9.6% in nominal terms, or 0.2% in real terms. The significant achievements in the soft drinks segment, which posted a 14.8% real EBITDA growth, and the impressive recovery of Quinsa's operations after the Argentinean crisis, more than doubling its EBITDA in dollar terms, were offset by our core operation, the Brazilian beer segment, which suffered from a highly adverse environment," said Marcel Telles, co-chairman of AmBev's board of directors.

EBITDA reached R$3,072.4m, compared to R$2,804.6m last year, on the back of net sales of R$8,683.8m, up 10.2%.

"We acknowledge that the results of 2003 were below our expectations, but we remain confident about the merits of our long-term strategy," said Telles.

In Brazil, beer EBITDA increased a modest 3.1% to R$2,500.0m in 2003, from the R$2,425.0 million reported in 2002.

Ambev blamed a 2.1% contraction in the beer market, caused by a combination of a sluggish economic scenario and poor weather conditions, as well as its currency hedging policy, which negatively affected the company's cost of good sold. Ambev also pointed to massive marketing investments by the competition, which negatively impacted its market share in the second half of the year and also demanded higher marketing expenditures.

However, these disappointments were balanced out to an extent by the performance of Quinsa, which more than doubled its EBITDA.

"Furthermore, our Guatemalan operation posted an EBITDA of R$9.1m in its first quarter of full operation, and we are very excited about the potential of our new operations in Peru, Ecuador and the recent investment in the Dominican Republic," Telles said.

He added: "We are confident that we have established a solid platform for growth, and we trust in the powerful combination of our people and our culture to deliver great results in 2004."