UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
__________________________
FORM 6-K
__________________________
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15b-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
September 2009
Date of Report (Date of Earliest Event Reported)
__________________________
Embotelladora Andina S.A.
(Exact name of registrant as specified in its charter)
Andina Bottling Company, Inc.
(Translation of Registrant´s name into English)
Avda. El Golf 40, Piso 4
Las Condes
Santiago, Chile
(Address of principal executive office)
_____________________
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F ___X___ Form 40-F _______
Indicate by check mark if the Registrant is submitting this Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(1):
Yes _______ No ___X____
Indicate by check mark if the Registrant is submitting this Form 6-K in paper as
permitted by Regulation S-T Rule 101(b)(7):
Yes _______ No ___X____
Indicate by check mark whether the registrant by furnishing the information contained in this Form 6-K is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
Yes _______ No ___X____
1
(Free translation of original in Spanish)
CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 2009
CONTENTS
Report of Independent Auditors
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Cash Flows
Notes to the Consolidated Financial Statements
Analysis of Results for the Second Quarter of 2009 and the Period ended June 30, 2009
Material Events
Ch$
-
Chilean pesos
ThCh$
-
Thousands of Chilean pesos
US$
-
United States dollars
ThUS$
-
Thousands of United States dollars
R$
-
Brazilian Reais
ThR$
-
Thousands of Brazilian Reais
AR$
-
Argentine pesos
ThAR$
-
Thousands of Argentine pesos
UF
-
Unidades de Fomento (Chilean government inflation-indexed monetary units)
2
(Translation of original in Spanish)
REPORT OF INDEPENDENT AUDITORS
Ernst & Young Ltda.
Id. N° 77.802.430-6
Santiago, July 30, 2009
To the Chairman of the Board, Directors and Shareholders
Embotelladora Andina S.A.
We have reviewed the accompanying Consolidated Balance Sheets of Embotelladora Andina S.A. and its subsidiaries as of June 30, 2009, and the related Consolidated Statements of Income and of Cash Flows for the six-month period then ended. These interim financial statements, including the corresponding notes thereto, are the responsibility of the management of Embotelladora Andina S.A. The Consolidated Financial Statements of Embotelladora Andina S.A. and its subsidiaries for the six-month period ended June 30, 2008 were reviewed by other auditors, who issued their report on the limited review of such without any observations on July 22, 2008. The analysis of results and relevant facts attached are not part of these financial statements and, therefore this report is not related to them.
We conducted our review in accordance with auditing standards established in Chile for the review of interim financial information. A review of interim financial information consists principally of applying analytical procedures to the financial statements and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, the interim consolidated financial statements as of June 30, 2009 have not been audited and therefore, we cannot, nor do we express, such an opinion.
Based on our review, we are not aware of any significant adjustments that should be made to the consolidated interim financial statements for the period ended June 30, 2009, for them to be in conformity with accounting principles generally accepted in Chile.
Víctor Zamora Q.
Id No. 7.446.815-2
3
Consolidated Balance Sheets
(Figures in ThCh$ of June 30, 2009)
| For the period ended | |
ASSETS | June 30, | |
| 2009 | 2008 |
CURRENT ASSETS | ThCh$ | ThCh$ |
Cash | 17,343,909 | 8,461,137 |
Time deposits | 68,296,923 | 31,438,278 |
Marketable securities (net) | 24,709,953 | 66,083,315 |
Trade accounts receivable (net) | 27,302,968 | 29,203,721 |
Notes receivable (net) | 6,957,744 | 8,049,462 |
Other receivables (net) | 11,483,184 | 16,823,521 |
Notes and accounts receivable from related companies | 639,066 | 903,981 |
Inventories (net) | 25,030,413 | 27,647,423 |
Recoverable taxes | 3,837,101 | 3,050,443 |
Prepaid expenses | 3,378,874 | 3,229,323 |
Deferred income taxes | 2,280,586 | 6,377,974 |
Other current assets | 6,116,270 | 6,350,613 |
TOTAL CURRENT ASSETS | 197,376,991 | 207,619,191 |
|
|
|
PROPERTY, PLANT & EQUIPMENT |
|
|
Land | 18,680,459 | 18,750,940 |
Buildings & improvements | 112,477,030 | 108,744,291 |
Machinery and equipment | 269,453,141 | 252,127,287 |
Other property, plant & equipment | 264,693,892 | 250,227,479 |
Technical reappraisal of property, plant & equipment | 2,350,481 | 2,347,017 |
Depreciation | (464,311,868) | (440,400,598) |
TOTAL PROPERTY, PLANT & EQUIPMENT | 203,343,135 | 191,796,416 |
|
|
|
OTHER ASSETS |
|
|
Investments in related companies | 29,461,159 | 26,712,597 |
Investments in other companies | 129,584 | 154,110 |
Goodwill | 51,485,943 | 58,943,407 |
Long-term receivables | 3,469,081 | 26,281 |
Long-term notes and accounts receivable from related companies | 38,079 | 47,267 |
Intangibles | 644,932 | 1,544,563 |
Amortization | (174,858) | (162,677) |
Others | 23,774,329 | 26,684,697 |
TOTAL OTHER ASSETS | 108,828,249 | 113,950,245 |
TOTAL ASSETS | 509,548,375 | 513,365,852 |
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
4
Consolidated Balance Sheets
(Figures in ThCh$ of June 30, 2009)
| For the period ended | |
| June 30, | |
LIABILITIES AND SHAREHOLDERS' EQUITY | 2009 | 2008 |
| ThCh$ | ThCh$ |
Short-term bank liabilities | 2,829,090 | 7,517,529 |
Current portion of long-term bank liabilities | 225,871 | 145,489 |
Current portion of bonds payable | 4,968,938 | 432,150 |
Dividends payable | 5,756,560 | 5,978,178 |
Accounts payable | 44,310,831 | 45,280,885 |
Other creditors | 3,980,607 | 6,214,814 |
Notes and accounts payable to related companies | 12,634,556 | 7,252,864 |
Provisions | 4,046,780 | 4,381,981 |
Withholdings | 11,105,745 | 16,207,743 |
Income taxes payable | 2,556,127 | 2,260,698 |
Unearned income | 0 | 132 |
Other current liabilities | 632,728 | 4,595,806 |
TOTAL CURRENT LIABILITIES | 93,047,833 | 100,268,269 |
|
|
|
|
|
|
Long-term bank liabilities | 301,616 | 793,604 |
Bonds payable | 72,896,180 | 78,266,741 |
Other creditors | 81,215 | 92,810 |
Long-term notes and accounts payable to related companies | 2,783,731 | 3,296,267 |
Provisions | 15,145,264 | 18,417,881 |
Deferred income taxes | 13,333,162 | 18,139,949 |
Other long-term liabilities | 11,392,577 | 13,855,813 |
TOTAL LONG-TERM LIABILITIES | 115,933,745 | 132,863,065 |
Minority interest | 10,564 | 9,114 |
|
|
|
Paid-in capital | 236,327,716 | 223,523,918 |
Reserve capital revalued | (5,435,543) | 7,152,765 |
Other reserves | (12,497,479) | (6,949,538) |
Retained earnings | 82,161,539 | 56,498,259 |
Accumulated earnings | 53,122,037 | 22,643,668 |
Net income for the period | 34,627,520 | 39,610,250 |
Interim dividends | (5,588,018) | (5,755,659) |
TOTAL SHAREHOLDERS’ EQUITY | 300,556,233 | 280,225,404 |
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | 509,548,375 | 513,365,852 |
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
5
Consolidated Statements of Income
(Figures in ThCh$ of June 30, 2009)
| For the period ended | |
| June 30, | |
| 2009 | 2008 |
| ThCh$ | ThCh$ |
|
|
|
Net sales | 344,630,292 | 367,347,877 |
Cost of sales | (195,472,494) | (199,526,834) |
Gross margin | 149,157,798 | 167,821,043 |
Administrative and selling expenses | (95,319,300) | (108,005,644) |
OPERATING INCOME | 53,838,498 | 59,815,399 |
|
|
|
|
|
|
Financial income | 4,201,947 | 7,667,078 |
Equity in earnings of equity investments | 495,920 | 439,871 |
Other non-operating income | 4,533,546 | 5,642,914 |
Equity in losses of equity investments | (99,006) | (95,538) |
Amortization of goodwill | (3,191,409) | (3,250,289) |
Financial expenses | (4,180,954) | (14,898,179) |
Other non-operating expenses | (2,244,362) | (7,031,791) |
Price level restatement | 963,387 | (869,237) |
Foreign exchange gains | (7,432,260) | 4,275,508 |
NON OPERATING INCOME AND EXPENSE | (6,953,191) | (8,119,663) |
|
|
|
Income before income taxes and extraordinary items | 46,885,307 | 51,695,736 |
Income tax expense | (12,256,936) | (12,084,994) |
Income before minority interest | 34,628,371 | 39,610,742 |
Minority interest | (851) | (492) |
NET INCOME FOR THE PERIOD | 34,627,520 | 39,610,250 |
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
6
Consolidated Statements of Cash Flow
(Figures in ThCh$ of June 30, 2009)
| For the period ended | |
| June 30, | |
| 2009 | 2008 |
| ThCh$ | ThCh$ |
|
|
|
Collection of trade receivables | 505,494,594 | 546,000,788 |
Financial income received | 13,191,147 | 25,926,347 |
Dividends received | 1,497,000 | 1,811,770 |
Other income received | 27,044 | 66,000 |
Payments to suppliers and personnel | (369,217,284) | (396,650,360) |
Interest paid | (11,652,644) | (11,371,415) |
Income taxes paid | (12,217,577) | (16,239,588) |
VAT and other tax payments | (66,259,381) | (77,196,912) |
NET CASH PROVIDED BY OPERATING ACTIVITIES | 60,862,899 | 72,346,630 |
|
|
|
Borrowings | 8,618,264 | 47,242,153 |
Dividend distribution | (49,273,370) | (61,037,212) |
Loan payments | (10,346,707) | (44,566,286) |
Bond payments | (2,531,444) | (6,749,780) |
NET CASH USED IN FINANCING ACTIVITIES | (53,533,257) | (65,111,125) |
|
|
|
Proceeds from sales of property, plant and equipment | 778,264 | 317,935 |
Proceeds from sales of other investments | 0 | 1,035,753 |
Additions to property, plant & equipment | (26,212,649) | (31,673,667) |
Permanent investments | (913,164) | 0 |
Investments in financial instruments | 0 | (16,758) |
Other investment disbursements | 0 | (860,236) |
NET CASH USED IN INVESTMENT ACTIVITIES | (26,347,549) | (31,196,973) |
|
|
|
TOTAL NET CASH FOR THE PERIOD |
|
|
Effect of inflation on cash and cash equivalents | 4,685,199 | 992,256 |
Net (decrease) increase in cash and cash equivalents | (14,332,708) | (22,969,212) |
Cash and cash equivalents at beginning of period | 124,683,493 | 128,951,942 |
Cash and cash equivalents at end of period | 110,350,785 | 105,982,730 |
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
7
Reconciliation between Net Income and Net Cash Flows
Provided by Operating Activities
(Figures in ThCh$ of June 30, 2009)
| For the period ended | |
| June 30, | |
| 2009 | 2008 |
| ThCh$ | ThCh$ |
|
|
|
Net Income | 34,627,520 | 39,610,250 |
Income on sale of assets: | (93,769) | (65,921) |
(Gain) Loss on sale of property, plant and equipment | (98,645) | (58,528) |
(Gain) Loss on sale of other assets | 4,876 | (7,393) |
|
|
|
Adjustments to net income that do not represent movements of cash | 22,909,448 | 21,409,225 |
Depreciation | 15,985,837 | 17,159,091 |
Amortization of intangibles | 80,927 | 34,345 |
Write-offs and provisions | 763,306 | 511,471 |
Equity in earnings of equity investments | (495,920) | (439,871) |
Equity in losses of equity investments | 99,006 | 95,538 |
Amortization of goodwill | 3,191,409 | 3,250,289 |
Price level restatement | (963,387) | 869,237 |
Foreign exchange losses, net | 7,432,260 | (4,275,508) |
Other credits to income that do not represent cash flows | (3,245,216) | (445,781) |
Other charges to income that do not represent cash flows | 61,226 | 4,650,414 |
|
|
|
Changes in operating assets | 42,410,385 | 24,451,447 |
(Increase) decrease in trade accounts receivable | 47,857,208 | 27,986,735 |
(Increase) decrease in inventories | 4,307,826 | 1,211,704 |
(Increase) decrease in other assets | (9,754,649) | (4,746,992) |
|
|
|
Changes in operating liabilities | (38,991,536) | (13,058,863) |
Increase (decrease) in accounts payable related to operating income | (33,143,741) | (20,185,884) |
Increase (decrease) in interest payable | 4,878,909 | 26,594,121 |
Increase (decrease) in income taxes payable | (2,693,497) | (19,382,608) |
Increase (decrease) in other accounts payable related to non-operating income | 170,454 | 2,897,798 |
Increase (decrease) in valued added tax and other similar items | (8,203,661) | (2,982,290) |
|
|
|
Minority interest | 851 | 492 |
|
|
|
NET CASH PROVIDED BY OPERATING ACTIVITIES | 60,862,899 | 72,346,630 |
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
8
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
As of June 30, 2009 and 2008 (figures in ThCh$ of June 30, 2009)
Note 1 - Incorporation in the Securities Register
Embotelladora Andina S.A. was incorporated in the Securities Register under No. 00124 and, in conformity with Law 18,046 is subject to the supervision of the Chilean Superintendence of Securities and Insurance Companies (the “SVS”).
Note 2 - Summary of Significant Accounting Principles
a)
Accounting period
The consolidated financial statements cover the period January 1 to June 30, 2009 and are compared to the same period in 2008.
b)
Basis of preparation
The consolidated financial statements have been prepared in conformity with generally accepted accounting principles issued by the Chilean Institute of Accountants, as well as rules and regulations of the SVS. In the event of discrepancy, the SVS regulations will prevail.
c)
Basis of presentation
For comparison purposes, the figures in the prior-year financial statements have been restated by 3.0% according to the variation of the Chilean Consumer Price Index (CPI)and in addition, some minor reclassifications have been made.
d)
Basis of consolidation
The accompanying financial statements include assets, liabilities, income and cash flows of the Parent Company and its subsidiaries. The equity and income accounts of the Parent Company and its subsidiaries have been combined, eliminating investments and current accounts between consolidated companies, transactions between them and the unrealized income from inter-company transactions.
In addition, for proper presentation of consolidated net income, the minority shareholders participation in income is shown in the consolidated statements of income under Minority interest.
Holding percentages
The subsidiaries included in the consolidated financial statements and Andina’s direct and indirect holding percentages are as follows:
| Ownership Interest | |||
Company Name | 2009 | 2008 | ||
| Direct | Indirect | Total | Total |
ABISA CORP. | 0.00 | 99.99 | 99.99 | 99.99 |
ANDINA BOTTLING INVESTMENTS S.A. | 99.90 | 0.09 | 99.99 | 99.99 |
ANDINA INVERSIONES SOCIETARIAS S.A. | 99.99 | 0.00 | 99.99 | 99.99 |
ANDINA BOTTLING INVESTMENTS DOS S.A. | 99.90 | 0.09 | 99.99 | 99.99 |
EMBOTELLADORA DEL ATLANTICO S.A. | 0.00 | 99.98 | 99.98 | 99.98 |
RIO DE JANEIRO REFRESCOS LTDA. | 0.00 | 99.99 | 99.99 | 99.99 |
SERVICIOS MULTIVENDING LTDA. | 99.90 | 0.09 | 99.99 | 99.99 |
TRANSPORTES ANDINA REFRESCOS LTDA. | 99.90 | 0.09 | 99.99 | 99.99 |
VITAL S.A. | 0.00 | 99.99 | 99.99 | 99.99 |
RJR INVESTMENTS CORP. | 0.00 | 0.00 | 99.99 | 99.99 |
9
e)
Price-level restatement
The financial statements have been restated to reflect the effect of price-level changes on the purchasing power of the Chilean peso during the respective periods. Restatements have been determined on the basis of the percentage variation of the official Chilean Consumer Price Index, “CPI”, issued by the Chilean National Institute of Statistics, which amounted to - -2.3% for the period December 1, 2008 to May 31, 2009 (3.2% for the same period of the previous year).
f)
Currency translation
Balances in foreign currency are considered as non-monetary items and are translated at the exchange rate prevailing at year-end. Regarding balances subject to indexation, these have been restated by the corresponding restatement index or by the agreed upon terms.
Assets and liabilities in foreign currency and Unidades de Fomento have been translated into local currency at the following year end exchange rates:
|
| 2009 | 2008 |
|
| Ch$ | Ch$ |
Unidades de Fomento | (UF) | 20,933.02 | 20,252.71 |
United States dollars | (US$) | 531.76 | 526.05 |
Argentine pesos | (AR$) | 140.05 | 173.90 |
Brazilian Real | (R$) | 272.47 | 330.45 |
Euro | (€$) | 746.33 | 828.16 |
g) Time deposits
Time deposits are valued at investment cost plus readjustments and accrued interest as of the end of each period.
h)
Marketable securities
Marketable securities include investments in mutual funds and investment fund quotas, valued at the period end redemption value.
i)
Inventories
The cost of raw materials includes all disbursements made in the acquisition process and deemed necessary for them to be readily available for use. The costs of finished products include all manufacturing costs. Raw materials and finished products are valued at the average weighted cost.
Provisions are made for obsolescence on the basis of turnover of raw materials and finished products.
The stated values of inventories do not exceed their estimated net realizable value.
j)
Allowance for doubtful accounts
The allowance for doubtful accounts consists of a general provision determined on the basis of the aging of accounts receivable and on a case-by-case analysis where collection is doubtful. In the opinion of the Company’s management, the allowances are reasonable and the net balances are recoverable.
k)
Property, plant and equipment
For companies incorporated in Chile, Property, Plant and Equipment is carried at acquisition cost plus price-level restatements. For companies incorporated abroad it has been restated in terms of the variation of the U.S. dollar according to the criteria described in Note 2m. Technical reappraisal of property, plant and equipment, authorized by the SVS on December 31, 1979, is shown at restated value under the heading “Technical reappraisal of property, plant and equipment”.
10
Fixed assets to be disposed of are valued at the lower of the net realizable value and book value. Estimated losses are reflected in the consolidated statement of income under other non-operating expenses.
l)
Depreciation
Depreciation of property, plant and equipment is determined by the straight-line method based on the estimated useful lives of the assets.
m)
Containers
Inventories of containers, bottles and plastic containers at plants, warehouses, and with third parties are stated at cost plus price-level restatements and are included in other property, plant and equipment. Broken or damaged containers at plants and warehouses are expensed in each accounting period.
n)
Investments in unconsolidated affiliates
Investments in shares or rights in companies in which the Company has a significant holding in the investee are accounted for using the equity method. The Company’s proportionate share of net income and losses of related companies is recognized in the consolidated statements of income, after eliminating any unrealized profits or losses from transactions between related companies.
Investments in foreign companies are valued in conformity with Technical Bulletin No. 64 issued by the Chilean Institute of Accountants. The United States (“US”) dollar is the currency used to control these investments and to translate the financial statements of the foreign companies. Assets and liabilities are translated into Chilean pesos at year end exchange rate, except that non-monetary assets and liabilities and shareholders’ equity are first expressed at their equivalent value in historical US dollars. Income and expense items are first translated into US dollars at the average exchange rate during the month.
o)
Intangibles
Intangibles include franchise rights and licenses that are amortized over the terms of the contracts, which do not exceed of 20 years.
p)
Goodwill
Goodwill represents the difference between purchase cost of the shares acquired and the proportional equity value of investment on the purchase date. These differences are amortized based on the expected period of return of the investment, estimated at 20 years.
q)
Bonds payable
Bonds payable includes the placement of Yankee bonds on the US markets and placement of bonds in UF in Chile, which are carried at the issue rate. The difference in valuation as compared to the effective placement rate is recorded as a deferred asset. This asset is amortized using the straight-line method over the term of the respective obligations, under Financial Expenses.
r)
Income taxes and deferred income taxes
The companies have recognized its current tax obligations in conformity with current legislation. The effects of deferred income taxes arising from temporary differences between the basis of assets and liabilities for tax and financial statement purposes are recorded on the basis of the enacted tax rate that will be in effect at the estimated date of reversal, in conformity with Technical Bulletin No. 60 issued by the Chilean Institute of Accountants. The effects of deferred income taxes existing at the time of the enforcement of the aforementioned Bulletin, i.e. January 1, 2000, and not previously recognized, are recorded as gain or loss according to their estimated reversal period.
11
s)
Staff severance indemnities
The Company has recorded a liability for long-term service indemnities in accordance with the collective agreements entered into with its employees. The provision is stated at present value of the projected cost of the benefit, which is discounted at a 4.0% annual rate (7% for the previous year) and a capitalization period using the staff’s expected length of service to their retirement date. Since the year 2005, the Company maintains a withholding plan for some officers. A liability is recorded according to the guidelines of this plan. The plan entitles certain officers of the Company to receive a fixed payment in cash at a predetermined date once he has fulfilled the required years of service.
t)
Deposits for containers
Corresponds to the liabilities constituted by cash guarantees received from clients for lending bottles to them.
For those loans for placement subsequent to January 31, 2001, an expiration date of five years as from the invoice date was established. In the event the client has not returned all or a portion of the containers and/or cases, the Company may, without delay, enforce the guarantee, in whole or in part, and record that effect in operating income of the Company.
This liability is presented in other long-term liabilities, considering that the number of new containers in circulation in the market during the year is historically greater than the number of containers returned by clients during the same period.
u)
Revenue recognition
Given the nature of its operations, the Company records revenue based on the physical delivery of finished products to its clients, based on the realization principle and in accordance with Technical Bulletin No. 70 issued by the Chilean Institute of Accountants.
v)
Derivative contracts
Derivative contracts include instruments used to hedge the risk of exposure to exchange rate differences as follows:
Derivative instruments used to hedge existing items on the balance sheet are recorded at their fair values. Unrealized losses are recognized as a charge to income and gains are deferred and included in other liabilities (current or long-term). Hedge ineffectiveness is recognized in the income statement.
Derivative instruments used to hedge forecasted transactions are recorded at their market values and the changes in their values are accounted for as unrealized gains or losses. Upon contract expiration, the deferred gains and losses are recorded in the income statements.
w)
Computer software
Corresponds to computer packages currently in use, which have a future economic benefit, and are amortized over a period equal to their useful life.
x)
Research and development costs
Costs incurred by the Company in research and development are immaterial given the nature of the business and the strong support from The Coca-Cola Company to its bottlers.
y)
Consolidated statement of cash flows
For purposes of preparation of the statement of cash flows, in accordance with Technical Bulletin N°50 of the Chilean Institute of Accountants and circular N°1,501 of the Superintendencia de Valores y Seguros (Chilean Securities and Exchange Commission)the Company has considered cash equivalent to be investments in fixed-income, mutual funds, short term time deposits (less than 90 days), agreements and financial investments maturing within 90 days.
12
Cash flows from operating activities include all business-related cash flows as well as interest paid, financial income and, in general, all cash flows not defined as from financial or investment activities. The operating concept used for this statement is broader than that in the statement of income.
z) Use of estimates
The preparation of the financial statements in accordance with accounting principles generally accepted in Chile requires management to carry out estimates and assumption that affect the asset and liability figures reported and the disclosure of contingent assets and liabilities as well as income and expense figures for the period. Actual results may differ from these estimates.
Note 3 - Accounting Changes
There are no changes in the application of generally accepted accounting principles in Chile in relation to the previous year that could significantly affect the comparability of these financial statements.
Note 4 - Marketable Securities
| Accounting value for the period ended June 30, | |
| 2009 | 2008 |
Type of Instrument | ThCh$ | ThCh$ |
Mutual funds | 20,902,080 | 6,818,392 |
Investment funds | 3,807,873 | 59,264,923 |
Total marketable securities | 24,709,953 | 66,083,315 |
| Accounting value for the period ended June 30, 2009 |
Mutual funds: |
|
Institution | ThCh$ |
Fondo Mutuo BBVA | 4,017,000 |
Fondo Mutuo Estado | 1,686,000 |
Fondo Mutuo Itaú Corporate | 3,596,409 |
Fondo Mutuo Santander | 2,822,800 |
Fondo Mutuo B.Scotianbank | 3,232,000 |
Fondo Mutuo Royal Bank of Canada | 5,547,871 |
Balance mutual funds | 20,902,080 |
| |
Investment funds: | |
Institution | ThCh$ |
Dreyfus Global Fund Universal Liquidity Plus | 295 |
Citi Institutional Liquid Reserves Limited - USA | 3,807,578 |
Balance investment funds | 3,807,873 |
13
Note 5 – Short and Long-Term Receivables
Almost all of said accounts correspond to the soft drinks category. The balance of other accounts receivable mainly corresponds to prepayment to our sugar suppliers.
|
| CURRENT |
|
| |
| Up to 90 days | More than 90 days up to 1 year | Subtotal | ||
| 2009 | 2008 | 2009 | 2008 | 2009 |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Trade receivables | 27,814,943 | 28,385,704 | 503,870 | 818,017 | 28,318,813 |
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | (1,015,845) |
Notes receivable | 6,925,198 | 7,372,484 | 655,961 | 676,978 | 7,581,159 |
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | (623,415) |
Other receivables | 10,577,153 | 15,525,881 | 1,111,479 | 1,297,640 | 11,688,632 |
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | (205,448) |
|
|
| LONG TERM | |||
| Total current (net) | For the period ended June 30, | ||||
| 2009 | 2008 | 2009 | 2008 | ||
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ||
Trade receivables | 27,302,968 | 29,203,721 | 0 | 0 | ||
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | ||
Notes receivable | 6,957,744 | 8,049,462 | 392,085 | 0 | ||
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | ||
Other receivables | 11,483,184 | 16,823,521 | 3,076,996 | 26,281 | ||
Allowance for doubtful accounts | 0 | 0 | 0 | 0 | ||
Total long term receivables | 3,469,081 | 26,281 |
14
Note 6 - Balances and Transactions with Related Companies
Receivable and payable balances with related companies correspond to the following concepts:
1) Notes and accounts receivable.
Embonor S.A.: Sale of products
Embotelladora Coca-Cola Polar S.A.: Sale of products
Coca-Cola de Chile S.A.: Advertising agreements.
| Short Term | Long Term | ||
| 2009 | 2008 | 2009 | 2008 |
Company | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Embonor S.A. | 268,025 | 499,285 | 0 | 0 |
Embotelladora Coca-Cola Polar S.A. | 371,041 | 404,696 | 0 | 0 |
Coca-Cola de Chile S.A. | 0 | 0 | 38,079 | 47,267 |
TOTAL | 639,066 | 903,981 | 38,079 | 47,267 |
2) Notes and accounts payable:
Recofarma Indústrias do Amazonas Ltda.: Concentrate purchases
Envases CMF S.A.: Raw material purchases
Servicios y Productos para Bebidas Refrescantes S.R.L.: Concentrate purchases
Envases Central S.A.: Net balance corresponds to raw materials and finished products transactions
Envases del Pacífico S.A.: Raw material purchases
Embonor S.A. and Embotelladora Coca-Cola Polar S.A.: Corresponds to unearned income due to commitments of sale of products of Vital S.A. to those companies, which will be realized in accordance with future deliveries
Vital Aguas S.A.: Finished products purchases
| Short Term | Long Term | ||
| 2009 | 2008 | 2009 | 2008 |
Company | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Coca-Cola de Chile S.A. | 8,627,263 | 1,676,307 | 0 | 0 |
Servicios y Productos Para Bebidas Refrescantes S.R.L. | 834,935 | 2,032,068 | 0 | 0 |
Envases CMF S.A. | 235,724 | 1,212,675 | 0 | 0 |
Recofarma Industrias do Amazonas Ltda. | 2,156,658 | 1,531,254 | 0 | 0 |
Envases Central S.A. | 313,486 | 409,862 | 0 | 0 |
Envases del Pacifico S.A. | 96,381 | 51,840 | 0 | 0 |
Vital Aguas S.A. | 370,109 | 338,858 | 0 | 0 |
Embonor S.A. | 0 | 0 | 2,215,502 | 2,620,416 |
Embotelladora Coca-Cola Polar S.A. | 0 | 0 | 568,229 | 675,851 |
TOTAL | 12,634,556 | 7,252,864 | 2,783,731 | 3,296,267 |
15
3) Transactions with related companies
The following table includes transactions with related companies that exceed ThCh$200,000.
|
|
| 30-Jun-09 | 30-Jun-08 | |||
|
|
| Amount | Effect on income (charge) credit | Amount | Effect on income (charge) credit | |
Company | Relation | Transaction | ThCh$ | ThCh$ | ThCh$ | ThCh$ | |
Envases Central S.A | Equity Investee | Purchase of finished products | 8,824,398 | 0 | 7,343,075 | 0 | |
- | - | Sales of raw materials and supplies | 1,106,893 | 262,823 | 777,528 | 52,889 | |
Coca-Cola De Chile S.A. | Shareholder | Concentrate purchases | 25,695,663 | 0 | 25,800,397 | 0 | |
- | - | Payment of advertising participation | 1,213,324 | (1,213,324) | 711,535 | (711,535) | |
- | - | Sales of advertisement | 1,749,514 | 0 | 816,896 | 0 | |
Coca-Cola de Argentina S.A. | Shareholder related | Payment of advertising participation | 1,676,876 | (1,676,876) | 1,154,048 | (1,154,048) | |
Servicios y Productos para Bebidas Refrescantes | Shareholder | Concentrate purchases | 17,899,107 | 0 | 14,643,522 | 0 | |
Recofarma Industrias do Amazonas Ltda. | Shareholder related | Concentrate purchases | 24,720,846 | 0 | 25,817,266 | 0 | |
- | - | Payment of advertising participation | 5,308,031 | (5,308,031) | 1,654,234 | (1,654,234) | |
- | - | Events and others | 298,241 | (298,241) | 0 | 0 | |
Envases CMF S.A. | Equity Investee | Container purchases | 4,927,531 | 0 | 5,503,608 | 0 | |
- | Equity Investee | Dividend payment | 2,000,000 | 0 | 2,636,800 | 0 | |
Envases del Pacifico S.A. | Shareholder related | Purchase of raw materials | 382,803 | 0 | 0 | 0 | |
Embonor S.A. | Shareholder related | Sales of finished products | 3,596,401 | 1,231,971 | 4,575,635 | 1,002,697 | |
Embotelladora Iquique S.A. | Shareholder related | Sales of finished products | 340,232 | 70,389 | 0 | 0 | |
Embotelladoras Coca-Cola Polar S.A. | Shareholder related | Sales of finished products | 2,052,618 | 381,062 | 2,736,733 | 293,184 | |
Iansagro S.A. | Director in common | Purchase of sugar | 6,503,207 | 0 | 8,467,973 | 0 | |
BBVA Administradora General de Fondos | Shareholder related | Redemption of mutual funds | 17,042,355 | 61,058 | 7,096,700 | 0 | |
- | - | Investments in mutual funds | 21,054,647 | 0 | 7,096,700 | 0 | |
Vendomatica S.A. | Director in common | Sales of finished products | 725,867 | 246,795 | 667,700 | 200,310 |
16
4) Other transactions
Within the normal course of operations, the Company entered into an agreement with IANSAGRO S.A., for the future supply of sugar to cover the company’s needs, this agreement expired during the year 2009.
Note 7 – Inventories
| 30-Jun-09 | 30-Jun-08 | ||||
| Gross Value | Obsolescence provision | Net value | Gross Value | Obsolescence provision | Net value |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
|
|
|
|
|
|
|
Finished products | 11,614,799 | (14,589) | 11,600,210 | 13,948,707 | (190,835) | 13,757,872 |
Raw materials | 11,524,298 | (199,313) | 11,324,985 | 11,037,812 | (144,142) | 10,893,670 |
Products in process | 1,560,502 | 0 | 1,560,502 | 2,269,471 | 0 | 2,269,471 |
Raw materials in transit | 544,716 | 0 | 544,716 | 736,408 | (9,998) | 726,410 |
Total | 25,244,315 | (213,902) | 25,030,413 | 27,992,398 | (344,975) | 27,647,423 |
17
Note 8 - Deferred Taxes and Income Taxes
For the period ended June 30, 2009 the Company presented taxable retained earnings in the amount of ThCh$65,033,645
including profits with credit resulting from corporate income tax in the amount of ThCh$28,728,880 and profits without
credit in the amount of ThCh$36,304,765. The previous period it did not present balances for this concept.
Short-term and long-term deferred tax assets and liabilities are shown as net balances in balance sheet.
| 30-June-09 | |||
| Assets | Liabilities | ||
| Short term | Long term | Short term | Long term |
Temporary differences | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Allowance for doubtful accounts | 418,310 | 77,855 | 0 | 0 |
Vacation provision | 169,144 | 0 | 0 | 0 |
Production expenses | 14,568 | 0 | 0 | 0 |
Depreciation of property, plant & equipment | 0 | 40,292 | 163,549 | 5,509,185 |
Severance indemnities | 103,163 | 15,641 | 18,047 | 0 |
Others | 545,356 | 533,197 | 143 | 0 |
Provision for assets write off | 128,535 | 662,669 | 0 | 0 |
Provision for labor lawsuits | 0 | 1,788,737 | 0 | 0 |
Tax loss carry-forwards | 478,933 | 0 | 0 | 0 |
Local bond issue expenses | 0 | 0 | 0 | 85,063 |
Contingency allowance | 0 | 297,305 | 0 | 0 |
Exchange rate difference (FRN Debt-Brazil) | 0 | 0 | 0 | 10,989,783 |
Provision for participation in income | 604,316 | 0 | 0 | 0 |
Temporary difference fiscal incentives-Brazil | 0 | 0 | 0 | 1,590,231 |
Others |
|
|
|
|
Complementary accounts, net of amortization | 0 | 0 | 0 | (1,425,404) |
Total | 2,462,325 | 3,415,696 | 181,739 | 16,748,858 |
| 30-June-08 | |||
| Assets | Liabilities | ||
| Short term | Long term | Short term | Long term |
Temporary differences | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Allowance for doubtful accounts | 153,152 | 43,939 | 0 | 0 |
Vacation provision | 169,557 | 0 | 0 | 0 |
Production expenses | 12,184 | 0 | 0 | 0 |
Depreciation of property, plant & equipment | 0 | 0 | 161,002 | 6,753,788 |
Severance indmenities | 56,097 | 0 | 29,900 | 225,823 |
Others | 1,004,562 | 725,242 | 30 | 0 |
Provision for assets write off | 239,495 | 1,237,891 | 0 | 0 |
Provision for labor lawsuits | 0 | 1,598,716 | 0 | 0 |
Tax loss carry-forwards | 4,452,184 | 0 | 0 | 0 |
Local bond issue expenses | 0 | 0 | 0 | 145,456 |
Contingency allowance | 0 | 347,592 | 0 | 0 |
Exchange rate difference (FRN Debt-Brazil) | 0 | 0 | 0 | 16,850,146 |
Provision for participation in income | 481,675 | 0 | 0 | 0 |
Temporary difference fiscal incentives-Brazil | 0 | 0 | 0 | 0 |
Others |
|
|
|
|
Complementary accounts, net of amortization | 0 | 0 | 0 | (1,881,884) |
Total | 6,568,906 | 3,953,380 | 190,932 | 22,093,329 |
18
c) The following table contains information on income taxes at each period-end.
| 30-Jun-09 | 30-Jun-08 |
| ThCh$ | ThCh$ |
Current tax expense (tax allowance) | (9,214,099) | (10,548,913) |
Adjustments tax expense (previous period) | 27,379 | 1,504,650 |
Deferred income tax expense/effect over assets or liabilities | (3,120,424) | (4,199,847) |
Amortization of deferred income tax asset and liability complementary accounts | (195,996) | (188,006) |
Other charges or credits | 246,204 | 1,347,122 |
Total | (12,256,936) | (12,084,994) |
Note 9 - Other Current Assets
| 30-Jun-09 | 30-Jun-08 |
| ThCh$ | ThCh$ |
Supplies | 5,367,638 | 5,613,599 |
Short term bonds discount | 246,456 | 387,425 |
Others | 502,176 | 349,589 |
Total | 6,116,270 | 6,350,613 |
Note 10 - Property, Plant and Equipment
Property, plant and equipment consist principally of land, buildings, improvements and machinery. Machinery and equipment included production lines and supporting equipment; sugar processing and liquefaction equipment; transportation machinery; and computer equipment. The Company has purchased insurance to cover its fixed assets and inventories. These assets are geographically distributed as follows:
Chile
:
Santiago, Puente Alto, Maipú, Renca, Rancagua, San Antonio and Rengo
Argentina
:
Buenos Aires, Mendoza, Cordoba, and Rosario
Brazil
:
Rio de Janeiro, Niteroi, Campos, Cabo Frío, Nova Iguaçu, Espírito Santo and Vitoria.
19
a) Main components of property, plant and equipment |
|
|
|
|
| |
| Balances at June 30, 2009 | Balances at June 30, 2008 | ||||
| Assets | Accumulated depreciation | Net, property, plant and equipment | Assets | Accumulated depreciation | Net, property, plant and equipment |
| ||||||
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Land | 18,680,459 | 0 | 18,680,459 | 18,750,940 | 0 | 18,750,940 |
Buildings and improvements | 112,477,030 | (44,972,790) | 67,504,240 | 108,744,291 | (40,839,679) | 67,904,612 |
Machinery and equipment | 269,453,141 | (207,221,202) | 62,231,939 | 252,127,287 | (199,244,617) | 52,882,670 |
Other property, plant and equipment | 264,693,892 | (211,400,208) | 53,293,684 | 250,227,479 | (199,602,084) | 50,625,395 |
Technical reappraisal of property, plant & equipment | 2,350,481 | (717,668) | 1,632,813 | 2,347,017 | (714,218) | 1,632,799 |
Total | 667,655,003 | (464,311,868) | 203,343,135 | 632,197,014 | (440,400,598) | 191,796,416 |
b) Other property, plant and equipment |
|
|
| 30-Jun-09 | 30-Jun-08 |
| ThCh$ | ThCh$ |
Containers | 157,949,562 | 143,332,119 |
Refrigerating equipment, promotional items and other minor assets | 62,952,461 | 61,350,473 |
Furniture and tools | 8,840,538 | 8,849,019 |
Other | 34,951,331 | 36,695,868 |
Total other property, plant and equipment | 264,693,892 | 250,227,479 |
c) Technical reappraisal of property, plant and equipment |
|
|
|
| ||
|
|
|
|
|
|
|
| Balances at June 30, 2009 | Balances at June 30, 2008 | ||||
| Assets | Accumulated depreciation | Net, property, plant and equipment | Assets | Accumulated depreciation | Net, property, plant and equipment |
| ||||||
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Land | 1,569,096 | 0 | 1,569,096 | 1,567,632 | 0 | 1,567,632 |
Buildings and improvements | 219,673 | (160,663) | 59,010 | 219,467 | (161,026) | 58,441 |
Machinery and equipment | 561,712 | (557,005) | 4,707 | 559,918 | (553,192) | 6,726 |
Total | 2,350,481 | (717,668) | 1,632,813 | 2,347,017 | (714,218) | 1,632,799 |
d) Depreciation for the period
Depreciation charges for the period amounted to ThCh$15,985,837 (ThCh$17,159,091 in 2008) of which ThCh$10,988,826 (ThCh$13,710,540 in 2008) are included under Operating Costs and ThCh$4,997,011 (ThCh$3,448,551 in 2008) under Sales and Administrative Expenses in the income statement.
20
Note 11 - Investment in Unconsolidated Affiliates
1.
Investments in unconsolidated affiliates and the corresponding direct shareholding in equity, as well as the recognition of unrealized income at year end of the respective years are shown in the table attached.
Company | Country | Functional | N° of Shares | Ownership Interest | Equity of companies | Income (loss) for the period | |||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | ||||
|
| Currency |
| % | % | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Envases CMF S.A. | Chile | Ch$ | 28,000 | 50.00% | 50.00% | 35,738,161 | 36,107,667 | 730,992 | 1,496,305 |
Envases Central S.A. | Chile | Ch$ | 1,499,398 | 49.91% | 49.91% | 5,461,555 | 5,072,751 | (67,555) | (20,919) |
Kaik Partipacoes Ltda. | Brazil | US$ | 16,098,919 | 11.32% | 11.32% | 9,943,559 | 11,251,137 | 990,015 | (574,563) |
Vital Aguas S.A. | Chile | Ch$ | 8,475 | 56.50% | 56.50% | 4,418,454 | 3,102,125 | 57,659 | (20,958) |
Holdfab Partic. Ltda. | Brazil | US$ | 1,283,158,339 | 14.73% | 14.73% | 44,114,995 | 30,120,461 | 2,419,087 | 1,246,947 |
Total |
|
|
|
|
|
|
|
|
|
Company | Accrued income | Partic. in net income (loss) | Unrealized income (loss) | Accounting value of investment | ||||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Envases CMF S.A. | (55,682) | 256,172 | 17,869,081 | 18,053,834 | (997,669) | (1,079,798) | 16,871,412 | 16,974,036 |
Envases Central S.A. | (43,324) | (15,895) | 2,725,862 | 2,531,810 | (257,100) | (256,859) | 2,468,762 | 2,274,951 |
Kaik Partipacoes Ltda. | 112,067 | (65,039) | 1,125,581 | 1,273,595 | 0 | 0 | 1,125,581 | 1,273,595 |
Vital Aguas S.A. | 27,476 | (14,604) | 2,496,427 | 1,752,699 | 0 | 0 | 2,496,427 | 1,752,699 |
Holdfab Partic. Ltda. | 356,377 | 183,699 | 6,498,977 | 4,437,316 | 0 | 0 | 6,498,977 | 4,437,316 |
Total |
|
| 30,715,928 | 28,049,254 | (1,254,769) | (1,336,657) | 29,461,159 | 26,712,597 |
21
The main changes occurred in the reported periods are described below:
During an Extraordinary Shareholders’ Meeting held during April 2009, Vital S.A. decided to carry out a capital increase in the amount of ThCh$1,274,284 through the issuance of 5,000 shares of which Embotelladora Andina S.A. subscribed and paid 2,825 shares equal to ThCh$719,970.
In June, 2008 Embotelladora Andina S.A. acquired a 48% ownership interest in Embotelladoras del Sur S.A. for ThCh$776,189. Subsequent to the acquisition Embotelladora Andina S.A. made a ThCh$84,048 loan to Embotelladoras del Sur S.A. As of June 30, 2008 Embotelladoras del Sur S.A., presents negative shareholders’ equity amounting to ThCh$736,376 that has been provided for by Embotelladora Andina S.A. in accordance to its ownership interest.
The amounts disbursed by Embotelladora Andina S.A. in the acquisition of and loan to Embotelladoras del Sur S.A., as well as the proportionate loss recorded corresponding to the negative shareholders’ equity of the latter, were recorded as of June 30, 2008, as an intangible since the final purpose is not that of acquiring the company but that of acquiring the rights of distribution of products of the water segment that were previously marketed by Embotelladoras del Sur S.A.
As of December 31, 2008, the Company recorded under Other Non-Operating Income all of the disbursements to Embotelladoras del Sur S.A. due to the fact that it is very difficult to measure future cash flows that the distribution of the water brand Benedictino generates and also because this brand belongs to The Coca-Cola Company.
On February 12, 2009 our subsidiary in Brazil, Rio de Janeiro Refrescos Ltda. met the capital increase agreed upon by Holdfab Participacoes Ltda. Of which it holds an ownership interest of 14.732%, by payment of the amount of ThCh$193,194.
Centralli Refrigerantes S.A. shows negative equity, which has been duly provided for.
The investment in Kaik Participações Ltda. (Brazil) where Embotelladora Andina S.A. holds an indirect ownership of 11.32% has been accounted for under the equity method, since the Company has a significant influence through one of its directors, who participates in the process of setting policies, operating and financial decision-making in accordance with the ownership structure which is exclusive owned by the Coca-Cola bottlers in Brazil
The investment in Envases Central S.A. is presented with a 48% reduction (the percentage share on the date of transaction) of the earnings generated during the sale to Envases Central during December 1996 for property located in Renca, because this transaction represents unrealized income for Embotelladora Andina S.A. The amount of the reduction is reflected in the following chart. This transaction will be realized once the property is transferred to a third party different from the group.
The investment in Envases CMF S.A. is presented with a 50% reduction of the earnings generated during the sale of machinery and equipment of our subsidiary Envases Multipack S.A. which took place in June, 2001, and that is recorded under Results during the remaining useful life period of the goods sold to Envases CMF S.A.
Unrealized income corresponds to transactions between subsidiaries and/or the parent company that have been deducted or added to the category of the originating asset with the following effect on income of the subsidiaries:
Envases CMF S.A. (purchase of property, plant and equipment: bottles): ThCh$(463,308) in 2009 (ThCh$(533,512) in 2008)
Vital Aguas S.A. (purchase of finished products): ThCh$(5,101) in 2009 (ThCh$(2,762) in 2008)
Envases Central S.A. (purchase of finished products): ThCh$(9,607) in 2009 (ThCh$(5,295) in 2008)
2.
No liabilities have been designated as hedging instruments for investments abroad.
3.
Income likely to be remitted by subsidiaries abroad amounts to US$331 million.
22
Note 12 - Goodwill and Negative Goodwill
Company | 30-Jun-2009 | 30-Jun-2008 | ||
Amortization during the period | Goodwill balance | Amortization during the period | Goodwill balance | |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Rio de Janeiro Refrescos Ltda. | 1,798,444 | 32,637,556 | 1,830,941 | 36,899,338 |
Embotelladora del Atlántico S.A. | 1,392,965 | 18,848,387 | 1,419,348 | 22,044,069 |
Total | 3,191,409 | 51,485,943 | 3,250,289 | 58,943,407 |
Note 13 - Other Long Term Assets
| 30-Jun-09 | 30-Jun-08 |
| ThCh$ | ThCh$ |
Judicial deposits (Brazil) | 8,857,856 | 9,029,667 |
Transfer fiscal credits (Brazil) | 5,661,798 | 6,730,448 |
Prepaid expenses | 2,981,292 | 3,987,856 |
Bond issuance and placement discounts and expenses | 2,666,103 | 2,919,270 |
Spare parts | 2,278,887 | 2,609,922 |
Non operating assets | 1,295,652 | 1,345,089 |
Others | 32,741 | 62,445 |
Total | 23,774,329 | 26,684,697 |
Note 14 - Short-Term and Long-Term Bank Liabilities
a) Short Term Bank Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
| Currency or indexation adjustment |
|
|
|
| |
Bank or Financial Institution | Other foreign currencies | Non-indexed Ch$ | TOTAL | |||
| 2009 | 2008 | 2009 | 2008 | 2009 | 2008 |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Bilbao Viscaya Argentina | 0 | 0 | 0 | 63,861 | 0 | 63,861 |
Banco de Chile | 0 | 0 | 0 | 154,449 | 0 | 154,449 |
Banco Galicia | 1,546,880 | 3,635,078 | 0 | 0 | 1,546,880 | 3,635,078 |
Nvo Santa Fe | 1,274,013 | 1,819,955 | 0 | 0 | 1,274,013 | 1,819,955 |
BBVA Frances | 0 | 1,844,186 | 8,197 | 0 | 8,197 | 1,844,186 |
Total | 2,820,893 | 7,299,219 | 8,197 | 218,310 | 2,829,090 | 7,517,529 |
Principal due | 2,802,206 | 7,299,219 | 8,197 | 218,310 | 2,810,403 | 7,517,529 |
|
|
|
|
|
|
|
Annual average interest rate | 16.24% | 17.64% | 8.64% | 8.58% |
|
|
|
|
|
|
|
|
|
Foreign currency liabilities | 99.70% |
|
|
|
|
|
Local currency liabilities | 0.30% |
|
|
|
|
|
23
b) Long Term Bank Liabilities (short term portion) |
|
|
| |
|
|
|
| |
| Currency or indexation adjustment |
|
| |
Bank or Financial Institution | Other foreign currencies | TOTAL | ||
| 2009 | 2008 | 2009 | 2008 |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Banco Alfa | 114,515 | 143,224 | 114,515 | 143,224 |
Banco Votorantim (Brazil) | 111,356 | 2,265 | 111,356 | 2,265 |
Total | 225,871 | 145,489 | 225,871 | 145,489 |
Principal due | 224,982 | 145,489 | 224,982 | 145,489 |
|
|
|
|
|
Annual average interest rate | 10.51% | 11.89% |
|
|
Foreign currency liabilities | 100.00% |
|
|
|
Note 15 - Long-Term Bank Liabilities
| Currency | Years to maturity | Total long term | Annual average interest rate | Total long term | |
Bank or Financial Institution | or indexation adjustment | More than 1 up to 2 | More than 2 up to 3 | at June 30, 2009 | at June 30, 2008 | |
|
| ThCh$ | ThCh$ | ThCh$ | % | ThCh$ |
Banco Alfa | Other currencies | 105,203 | 0 | 105,203 | 10.79% | 408,552 |
Banco Votorantim | Other currencies | 112,544 | 83,869 | 196,413 | 10.22% | 385,052 |
TOTAL |
| 217,747 | 83,869 | 301,616 |
| 793,604 |
Foreign currency liabilities | 100.00% |
|
|
|
|
|
Note 16 – Long and Short-Term Bonds Payable (Promissory Notes and Bonds)
1.
Current risk rating of bonds is as follows:
Bonds issued in the US Market
A
:
Rating according to Fitch Ratings Ltd.
Bonds Issued in the Local Market
AA+
:
Rating according to Fitch Chile Clasificadora de Riesgo Ltda.
AA
:
Rating according to Feller Rate Clasificadora de Riesgo Ltda.
2.
Bond repurchases.
During 2000, 2001, 2002, 2007 and 2008, Embotelladora Andina S.A. repurchased bonds issued in the U.S. market through its subsidiary, Abisa Corp S.A. for a total amount of US$350 million, of which US$200 million remain outstanding, which are presented deducting the long term liability from the bonds payable account.
3.
Bonds issued by the subsidiary Rio de Janeiro Refrescos Ltda. (RJR).
The subsidiary RJR has liabilities corresponding to an issuance of bonds for US$75 million maturing in December 2012 and semiannual interest payments. At period end, all such bonds are wholly-owned by the subsidiary Abisa Corp. Consequently, the effects of such transactions have been eliminated from these consolidated financial statements, both in the balance sheet and in the consolidated statement of income.
24
The following table contains more information on Bonds Payable:
Instrument subscription or ID N° | Series | Current nominal value | Currency | Interest rate | Maturity date | Term | Par value | Placement in Chile or abroad | ||
Interest paid | Amortization period | 2009 | 2008 | |||||||
Current portion of bonds payable |
|
|
|
|
|
|
| ThCh$ | ThCh$ |
|
Yankee bonds | B | 2,000,000 | US$ Exchange rate | 7.625% | 1-Oct-27 | Semiannual | Oct-2027 | 0 | 20,657 | Abroad |
Register 254 SVS June 13, 2001 | B | 3,700,000 | UF | 6.5% | 1-Jun-26 | Semiannual | Dec-2009 | 4,968,938 | 411,493 | Chile |
Total current maturities |
|
|
|
|
|
|
| 4,968,938 | 432,150 |
|
Long term portion of bonds payable |
|
|
|
|
|
|
|
|
|
|
Yankee bonds | B | 2,000,000 | US$ Exchange rate | 7.625% | 1-Oct-27 | Semiannual | Oct-2027 | 0 | 1,083,663 | Abroad |
Register 254 SVS June 13, 2001 | B | 3,700,000 | UF | 6.5% | 1-Jun-26 | Semiannual | Dec-2009 | 72,896,180 | 77,183,078 | Chile |
Total long term |
|
|
|
|
|
|
| 72,896,180 | 78,266,741 |
|
Note 17 - Provisions and Write-Offs
| Short term | Long term | ||
| ||||
| 2009 | 2008 | 2009 | 2008 |
Provisions | ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Taxation on banking transactions and social contributions (Brazil) | 3,101,787 | 3,590,143 | 4,342,952 | 8,376,997 |
Staff severance indemnities | 937,967 | 733,024 | 8,693,525 | 6,891,571 |
Contingencies | 7,026 | 58,814 | 2,108,787 | 2,795,853 |
Others | 0 | 0 | 0 | 353,460 |
TOTAL | 4,046,780 | 4,381,981 | 15,145,264 | 18,417,881 |
Note 18 - Staff Severance Indemnities
| 30-Jun-09 | 30-Jun-08 |
Staff Severance Indemnities | ThCh$ | ThCh$ |
Beginning balance | 9,179,042 | 7,340,576 |
Provision for the period | 2,262,553 | 840,871 |
Payments | (1,810,103) | (556,852) |
Ending balance | 9,631,492 | 7,624,595 |
As of December 31, 2008, the Company amended the discount rate of the current value of accrued benefits by its employees from 7% to 4% in order to adapt to current market conditions.
Note 19 – Other Long Term Liabilities
| 30-Jun-09 | 30-Jun-08 |
| ThCh$ | ThCh$ |
Guaranty on containers | 8,954,553 | 9,763,112 |
Participation acquisition of assets | 1,599,839 | 3,046,434 |
Advertising agreements | 150,810 | 111,985 |
Others | 687,375 | 934,282 |
Total | 11,392,577 | 13,855,813 |
25
Note 20 - Minority Interest
26
| 30-Jun-09 | 30-Jun-08 |
Liabilities | ThCh$ | ThCh$ |
Embotelladora del Atlántico S. A. | 10,543 | 9,095 |
Andina Inversiones Societarias S.A. | 21 | 19 |
| 10,564 | 9,114 |
|
|
|
|
|
|
| 30-Jun-09 | 30-Jun-08 |
Income Statement | ThCh$ | ThCh$ |
Embotelladora del Atlántico S. A. | (850) | (490) |
Andina Inversiones Societarias S.A. | (1) | (2) |
| (851) | (492) |
27
Note 21 - Changes in Shareholders’ Equity
The activity in Shareholders’ Equity, Dividend Distribution and Other Reserves is detailed in the following tables:
| 30-Jun-09 | |||||
| Paid in Capital | Capital revalued reserve | Other Reserves | Accumulated Income | Interim Dividends | Net Income |
| ThCh$ |
|
| ThCh$ | ThCh$ | ThCh$ |
Beginning balance | 236,327,716 | 0 | 9,055,154 | 23,201,754 | (17,171,979) | 94,835,957 |
Distribution of prior year income | 0 | 0 | 0 | 77,663,978 | 17,171,979 | (94,835,957) |
Final dividend prior year | 0 | 0 | 0 | (11,279,812) | 0 | 0 |
Translation adjustment reserve | 0 | 0 | (21,344,364) | 0 | 0 | 0 |
Extraordinary dividend | 0 | 0 | 0 | (34,326,396) | 0 | 0 |
Capital revalued | 0 | (5,435,543) | (208,269) | (2,137,487) | 0 | 0 |
Income for the period | 0 | 0 | 0 | 0 | 0 | 34,627,520 |
Interim dividend | 0 | 0 | 0 | 0 | (5,588,018) | 0 |
Ending balance | 236,327,716 | (5,435,543) | (12,497,479) | 53,122,037 | (5,588,018) | 34,627,520 |
Price level restated balances |
|
|
|
|
|
|
| 30-Jun-08 | |||||
| Paid in Capital | Capital revalued reserve | Other Reserves | Accumulated Income | Interim Dividends | Net Income |
| ThCh$ |
| ThCh$ | ThCh$ | ThCh$ | ThCh$ |
Beginning balance | 217,013,513 | 0 | (11,443,442) | 11,171,454 | (17,194,331) | 81,601,944 |
Distribution of prior year income | 0 | 0 | 0 | 64,407,613 | 17,194,331 | (81,601,944) |
Final dividend prior year | 0 | 0 | 0 | (7,288,372) | 0 | 0 |
Translation adjustment reserve | 0 | 0 | 5,062,516 | 0 | 0 | 0 |
Extraordinary dividend | 0 | 0 | 0 | (47,897,296) | 0 | 0 |
Capital revalued | 0 | 6,944,432 | (366,198) | 1,590,745 | 0 | 0 |
Income for the period | 0 | 0 |
| 0 | 0 | 38,456,554 |
Interim dividend | 0 | 0 |
| 0 | (5,588,018) | 0 |
Ending balance | 217,013,513 | 6,944,432 | (6,747,124) | 21,984,144 | (5,588,018) | 38,456,554 |
Price level restated balances | 223,523,918 | 7,152,765 | (6,949,538) | 22,643,668 | (5,755,659) | 39,610,250 |
28
Number of shares |
|
| |
Series | Subscribed shares | Paid in shares | Number of shares with voting rights |
A | 380,137,271 | 380,137,271 | 380,137,271 |
B | 380,137,271 | 380,137,271 | 380,137,271 |
Capital |
|
|
Series | Subscribed capital | Paid in capital |
| ThCh$ | ThCh$ |
A | 118,163,858 | 118,163,858 |
B | 118,163,858 | 118,163,858 |
Other Reserves |
|
|
|
|
|
|
|
|
|
Balance of Other Reserves is composed as follows: |
|
|
|
|
|
|
| 2009 | 2008 |
|
|
| ThCh$ | ThCh$ |
|
|
|
|
|
Reserve for cumulative translation adjustments(1) |
|
| (13,650,491) | (8,101,472) |
Reserve for technical reappraisal of property, plant and equipment |
| 68,856 | 71,523 | |
Other |
|
| 1,084,156 | 1,080,411 |
Total |
|
| (12,497,479) | (6,949,538) |
|
|
|
|
|
(1)The Reserve for cumulative translation adjustments was established in accordance with Technical Bulletin No. 64 issued by the Chilean Institute of Accountants and regulations specified under Circular letter No. 5,294 from the SVS. | ||||
|
|
|
|
|
|
|
|
|
|
|
|
The activity in the Reserve for cumulative translation adjustments was as follows: |
|
|
|
|
| ||
|
|
|
| Foreign exchange rate generated during the period | Reserve release / realized(*) |
|
|
|
|
| Balance | Balance |
| ||
Company |
|
| 1-Jan-09 | Investment |
| June 30, 2009 |
|
|
|
| ThCh$ | ThCh$ | ThCh$ | ThCh$ |
|
Rio de Janeiro Refrescos Ltda. |
|
| 4,396,520 | (13,527,718) | 61,226 | (9,069,972) |
|
Embotelladora del Atlántico S. A. |
|
| 3,297,354 | (7,877,873) | 0 | (4,580,519) |
|
Total |
|
| 7,693,874 | (21,405,591) | 61,226 | (13,650,491) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(*) Reserve realized resulted from dividends paid by our subsidiary Río de Janeiro Refrescos Ltda. |
29
Note 22 - Other Non-Operating Income and Expenses
Other non-operating income during the period was as follows: | 2009 | 2008 |
| ThCh$ | ThCh$ |
Reverse provision property, plant & equipment devalued | 0 | 4,426,045 |
Tax recovery prior years | 0 | 492,007 |
Gain on sale of property, plant and equipment | 98,645 | 58,528 |
Other income | 1,189,685 | 220,553 |
Sub-total | 1,288,330 | 5,197,133 |
Translation of financial statements(1) | 3,245,216 | 445,781 |
Total | 4,533,546 | 5,642,914 |
|
|
|
Other non-operating expenses during the period was as follows: |
| |
Conversion adjustment reserve realized(2) | (61,226) | (4,650,414) |
Bank taxes(3) | (1,075,837) | (1,084,825) |
Provision for labor and commercial lawsuits | (547,846) | (426,474) |
Provision loss of investment in Centralli | (29,395) | (56,640) |
Others | (530,058) | (813,438) |
Total | (2,244,362) | (7,031,791) |
|
|
|
(1)This refers to the effects of the translation of the financial statements corresponding to investment in foreign companies (translation of local currency to US dollars), in accordance with Technical Bulletin N°64 issued by the Chilean Institute of Accountants, which are presented as Other Non Operating Income and/or Expenses accordingly. | ||
(2)This refers to the release of conversion adjustment reserves due to dividend payments carried out at our subsidiary Rio de Janeiro Refrescos Ltda. and the remittance of capital and dividend distribution by Embotelladora del Atlántico S.A. during the 2009 and 2008 period, respectively. | ||
(3)This refers to taxes charged in the normal course of business due to banking Accounts movements in our foreign subsidiaries and are not related to the obtention of financial resources. |
30
Note 23 - Price-Level Restatement
| Adjustment index | 30-Jun-09 | 30-Jun-08 |
Assets - (charges)/credits |
| ThCh$ | ThCh$ |
Inventories | CPI | (223,483) | 9,387 |
Property, plant and equipment | CPI | (2,379,034) | 3,194,657 |
Investments in related companies | CPI | (4,174,303) | 4,651,886 |
Cash, Time Deposits, Marketable Securities | UF | (1,620,976) | 1,190,898 |
Cash, Time Deposits, Marketable Securities | CPI | (265,504) | 1,448,912 |
Short term accounts receivable from related companies | UF | (285,967) | 225,395 |
Short term accounts receivable from related companies | CPI | (794,418) | 285,456 |
Recoverable taxes | CPI | 895 | 7,244 |
Other current assets | CPI | (217,404) | 89,941 |
Other long term assets | UF | (7,687) | 14,761 |
Other long term assets | CPI | (3,457) | 82,701 |
Cost and expense accounts | CPI | (395,473) | 2,267,941 |
Total (charges) credits |
| (10,366,811) | 13,469,179 |
|
|
|
|
Liabilities - (charges)/credits |
|
|
|
Shareholders’ equity | CPI | 7,781,296 | (8,414,048) |
Short and long term bonds payable | UF | 1,881,186 | (2,343,734) |
Short and long term bonds payable | CPI | 0 | (69,922) |
Other current liabilities | UF | 128,655 | (227,004) |
Other current liabilities | CPI | 18,900 | (304,445) |
Other long term liabilities | CPI | 56,025 | (130,115) |
Short term accounts receivable from related companies | UF | 520,760 | 0 |
Short term accounts receivable from related companies | CPI | 412,198 | 0 |
Income accounts | CPI | 531,178 | (2,849,148) |
Total (charges) credits |
| 11,330,198 | (14,338,416) |
Price-level restatement (loss ) gain |
| 963,387 | (869,237) |
31
Note 24 - Foreign Exchange Gains/Losses
| Currency | 30-Jun-09 | 30-Jun-08 |
Assets - (charges)/credits |
| ThCh$ | ThCh$ |
Cash | US$ | 68,489 | (20,497) |
Time deposits | US$ | (604,688) | (1,696) |
Marketable securities (net) | US$ | (607,976) | 3,278,829 |
Trade accounts receivable | US$ | 0 | 460 |
Other debtors (net) | US$ | 0 | 43,893 |
Accounts receivable related companies short term | US$ | (7,246,561) | 1,392,911 |
Accounts receivable related companies short term | R$ | 482,077 | 467,715 |
Recoverable taxes | US$ | 0 | 85 |
Prepaid expenses | US$ | 0 | 216 |
Other current assets | US$ | 752,350 | 479,928 |
Other assets | US$ | 0 | (65,508) |
Total (charges)/credits |
| (7,156,309) | 5,576,336 |
|
|
|
|
Liabilities - (Charges) / credits |
|
|
|
|
|
|
|
Bonds payable | US$ | 0 | 153,870 |
Accounts payable | US$ | 100,013 | (52,512) |
Other creditors | US$ | 25 | 0 |
Notes and accounts payable related companies | US$ | (407,993) | (858,373) |
Provisions | US$ | (6,742) | (518,988) |
Income tax provision | US$ | 38,746 | 0 |
Prepaid income | US$ | 0 | 2,490 |
Bonds payable long term | US$ | 0 | (27,315) |
Total (charges) credits |
| (275,951) | (1,300,828) |
Foreign exchange gain (loss) on income |
| (7,432,260) | 4,275,508 |
Note 25 - Share and Debt Security Issue and Placement Expenses
Bond issue and placement expenses are presented in Other current assets and Other long-term assets and are amortized on a straight-line basis over the term of the debt issued. Amortization is presented as financial expenses.
Bonds issued in the US market:
Debt issue costs and discounts have all been amortized, as a result of the repurchase of Bonds reported in note 16.
Bonds issued in the local market:
Debt issue costs and interest rate differences net of amortization as of the end of the period amounted to ThCh$2,912,559 and ThCh$3,306,695 in 2008. Disbursements for risk rating reports, legal and financial advisory services, printing and placement fees are included as Debt issue costs.
Amortization for the period ended June 30, 2009 amounted to ThCh$121,525 and ThCh$199,955 in 2008.
32
Note 26 - Consolidated Statement of Cash Flows
For the projection of future cash flows, there are no transactions and events to consider which have not been revealed in these financial statements and accompanying notes.
The following table presents an itemization of the movement of assets and liabilities not affecting the cash flow in the period, but compromising future cash flows.
| 30-Jun-09 | Maturity date | 30-Jun-08 | Maturity date |
| ThCh$ | ThCh$ | ||
Expected cash outflow |
|
|
|
|
Expenses |
|
|
|
|
Dividend payment | (5,588,018) | 31-Jul-09 | (5,755,659) | 31-Jul-08 |
Addition to property, plant and equipment | (868,564) | 15-Aug-09 | (3,261,943) | 15-Aug-08 |
Addition to property, plant and equipment | (884,051) | 31-Jul-09 | 0 |
|
Addition to property, plant and equipment | (8,629) | 30-Sep-09 | 0 |
|
Total expenses | (7,349,262) |
| (9,017,602) |
|
|
|
|
|
|
Expected cash inflow |
|
|
|
|
Income |
|
|
|
|
Sale of property, plant and equipment | 30,471 | 31-Jul-09 | 20,813 | 31-Jul-08 |
Total income | 30,471 |
| 20,813 |
|
Total net | (7,318,791) |
| (8,996,789) |
|
33
Note 27 - Derivative Contracts
Derivative contracts at June 30, 2009 were as follows:
|
|
|
|
|
| Hedged item or Transaction | |
Derivative | Contract | Value | Maturity period | Specific Item | Position Purchase / Sale | Concept | Amount |
|
| ThCh$ |
|
|
|
| ThCh$ |
FR | CCTE | 4,808,997 | 3rd Quarter 2009 | US$ Exchange Rate | P | Suppliers foreign currency | 4,785,840 |
FR | CCTE | 7,537,830 | 4th Quarter 2009 | US$ Exchange Rate | P | Suppliers foreign currency | 7,786,485 |
| Assets / Liabilities | Effect on income | |
Hedged Item Value | Item | Amount | Unrealized |
ThCh$ |
| ThCh$ | ThCh$ |
0 | Other current assets & liabilities | 23,157 | 23,157 |
0 | Other current assets & liabilities | 248,655 | (248,655) |
34
Note 28 - Contingencies and Restrictions
a.
Litigation and other legal actions:
There are various judicial actions and other out-of-court claims pending against the Company incidental to its business and operations. Management believes, based on the opinion of its legal counsel, that none of these proceedings will have a material adverse effect on the Company’s financial position or result of operations.
Current lawsuits and other legal actions are described below.
1)
Embotelladora del Atlántico S.A. faces labor and other lawsuits. Accounting provisions to back any probable loss contingency arising from these lawsuits, amounts to ThCh$1,071,630 (ThCh$1,521,597 in 2008). In accordance with its legal counsel’s opinion, the Company deems improbable that contingencies without provisions may affect the results or equity of the Company.
2)
Rio de Janeiro Refrescos Ltda. faces labor, tax and other lawsuits. Accounting provisions to back any probable loss contingency arising from these lawsuits, amounts to ThCh$1,006,495 (ThCh$1,187,207 in 2008). In accordance with its legal counsel’s opinion, the Company deems improbable that contingencies without provisions may affect the results or equity of the Company.
3)
Embotelladora Andina S.A. faces, labor, tax, commercial and other lawsuits. Accounting provisions to back any probable loss contingency arising from these lawsuits, amounts to ThCh$7,026 (ThCh$15,082 in 2008). In accordance with its legal counsel’s opinion, the Company deems improbable that contingencies without provisions may affect the results or equity of the Company.
b.
Restrictions
The bond issue and placement on the US market for US$ 200 million is subject to certain restrictions against preventive attachments, sale and leaseback transactions, sale of assets, subsidiary debt and certain conditions in the event of a merger or consolidation.
The bond issue and placement in the Chilean market for UF 3,700,000 is subject to the following restrictions:
Leverage ratio, defined as the total financial debt/shareholder’s equity plus minority interest should be less than 1.20 times.
Financial debt shall be deemed Consolidated Finance Liabilities which include: (i) short-term bank liabilities, (ii) short-term portion of long-term bank liabilities, (iii) short-term bonds payable-promissory notes, (iv) short-term portion of bonds payable, (v) long-term bank liabilities, and (vi) long-term bonds payable. Consolidated equity means Total equity plus Minority Interest.
Consolidated assets are to be free of any pledge, mortgage or other encumbrance for an amount equal to at least 1.30 times the consolidated liabilities that are not guaranteed by the investee.
Andina must retain and, in no way, lose, sell, assign or dispose of to a third party the geographical zone denominated “Región Metropolitana”, as a franchised territory in Chile by The Coca-Cola Company for the preparation, production, sale and distribution of the products and brands in accordance with the respective Bottling agreement, renewable from time to time.
Andina shall not lose, sell, assign or dispose of to a third party any other territory in Brazil or Argentina that is currently franchised to Andina by The Coca-Cola Company for the preparation, production, sale and distribution of the products and brands of the franchisor, as long as the referred territory represents more than forty percent of the Company’s Consolidated Operating Cash Flows.
35
c.
Direct guarantees
Guarantees at June 30, 2009 are presented on the following table:
|
|
|
|
|
|
Guarantee creditor |
|
| Type of guaranty | Assets involved | |
| Debtor | Relation |
| Type | Accounting Value |
|
|
|
|
| ThCh$ |
Aga S.A. | Embotelladora Andina S.A. | Parent company | Guaranty receipt | Agreement | 0 |
Municipalidad de Santiago | Embotelladora Andina S.A. | Parent company | Guaranty receipt | Guaranty Receipt | 0 |
Escuela Militar | Embotelladora Andina S.A. | Parent company | Guaranty receipt | Guaranty Receipt | 0 |
Municipalidad de Maipu | Embotelladora Andina S.A. | Parent company | Guaranty receipt | Guaranty Receipt | 0 |
Estado Rio De Janeiro | Rio de Janeiro Refrescos Ltda. | Subsidiary | Mortgage | Real estate deposit | 11,975,883 |
Poder Judiciario | Rio de Janeiro Refrescos Ltda. | Subsidiary | Judicial deposit | Long term asset | 13,196,319 |
Aduana de Ezeiza | Embotelladora del Atlantico S.A. | Subsidiary | Guaranty insurance | Temporary export of molds | 18,626 |
Balances pending at June 30, | Guaranty release June 30, | ||
2009 | 2008 | 2010 | 2011 |
ThCh$ | ThCh$ | ThCh$ | ThCh$ |
159,528 | 162,549 | 0 | 159,528 |
11,713 | 11,673 | 0 | 11,673 |
1,525 | 1,343 | 1,525 | 0 |
0 | 104,364 | 0 | 0 |
11,065,025 | 13,419,576 | 0 | 0 |
0 | 0 | 0 | 0 |
0 | 0 | 0 | 0 |
Note 29 - Guarantees from Third Parties
Guarantees from Third Parties at June 30, 2009 were as follows:
Guarantor | Relationship | Type of Guarantee | Amount | Currency | Transaction |
|
|
|
|
|
|
Aga S.A. | Parent Company | Receipt | 600,000 | US$ | Supplier agreement |
Juan Pablo Galvez Figueroa y Cia Ltda. | Parent Company | Receipt | 200,400 | US$ | Supplier agreement |
Clientes Diversos | Subsidiary | Deposits | 1,816,612 | US$ | Guranty over containers |
Confab | Subsidiary | Mortgage | 15,952,800 | US$ | Purchase of Rio de Janeiro Refrescos Ltda. |
Ruseel W. Coffin | Subsidiary | Letter of Credit | 25,151,741 | US$ | Purchase of Nitvitgov Refrigerantes S.A. |
Mac Coke Dist. Beb.-208262 | Subsidiary | Mortgage | 116,538 | US$ | Distributor credit |
Zulemar Comercio de Bebidas -264945 | Subsidiary | Mortgage | 133,768 | US$ | Distributor credit |
Dist Real Cola - -229628 | Subsidiary | Mortgage | 80,871 | US$ | Distributor credit |
Soc. Com. Champfer-226909 | Subsidiary | Mortgage | 365,293 | US$ | Distributor credit |
Motta Distribuidora de Bebidas-264314 | Subsidiary | Mortgage | 554,238 | US$ | Distributor credit |
Franciscana Dist. 187645 | Subsidiary | Mortgage | 96,649 | US$ | Distributor credit |
Soberana de Carmo Dist Beb- 1747544 | Subsidiary | Mortgage | 65,576 | US$ | Distributor credit |
Aguiar Dist. de Bebidas- 187615 | Subsidiary | Mortgage | 154,234 | US$ | Distributor credit |
36
Asxt Fluminense Dist. Bebidas - 257392 | Subsidiary | Mortgage | 141,079 | US$ | Distributor credit |
Catering Argentina S.A. | Subsidiary | Guaranty Receipt | 124,964 | US$ | Supplier |
Ing y Ref San Martin de Tabacal Srl | Subsidiary | Guaranty Receipt | 5,670,382 | US$ | Supplier |
Compañía Azucarera Concepción | Subsidiary | Guaranty Receipt | 221,989 | US$ | Supplier |
Atanor | Subsidiary | Guaranty Receipt | 901,513 | US$ | Supplier |
Ecopreneur S.A. | Subsidiary | Guaranty Receipt | 206,564 | US$ | Supplier |
37
Note 30 - Local and Foreign Currency
Assets at each period end were composed of local and foreign currencies as follows:
|
| 30-Jun-09 | 30-Jun-08 |
Current Assets | Currency | ThCh$ | ThCh$ |
|
|
|
|
Cash | Indexed Ch$ | 0 | 639,807 |
- | Non-indexed Ch$ | 3,825,079 | 3,210,168 |
- | US$ | 2,777,331 | 151,550 |
- | AR$ | 606,089 | 1,209,064 |
- | R$ | 10,135,410 | 3,250,548 |
Time Deposits | Indexed Ch$ | 55,143,057 | 8,624,475 |
- | Non-indexed Ch$ | 13,125,024 | 22,776,618 |
- | R$ | 28,842 | 37,185 |
Marketable Securitoes (Net) | Non-indexed Ch$ | 20,902,080 | 6,818,392 |
- | US$ | 3,807,475 | 59,173,678 |
- | R$ | 398 | 91,245 |
Trade Accounts Receivable (Net) | Indexed Ch$ | 0 | 123,611 |
| Non-indexed Ch$ | 11,638,799 | 12,888,584 |
- | US$ | 714,458 | 698,313 |
- | AR$ | 2,031,549 | 1,890,707 |
- | R$ | 12,918,162 | 13,602,506 |
Notes Receivable | Non-indexed Ch$ | 5,015,528 | 5,253,350 |
- | AR$ | 305,156 | 595,056 |
- | R$ | 1,637,060 | 2,201,056 |
Other Debtors (Net) | Non-indexed Ch$ | 6,080,879 | 4,092,608 |
- | Indexed Ch$ | 0 | 956,713 |
- | US$ | 141,021 | 73,391 |
- | AR$ | 2,172,237 | 1,414,975 |
- | R$ | 3,089,047 | 10,285,834 |
Notes Receivable Related Companies | Non-indexed Ch$ | 639,066 | 903,981 |
Inventories | Indexed Ch$ | 4,220,855 | 2,165,150 |
| Non-indexed Ch$ | 2,961,890 | 4,206,984 |
- | US$ | 1,481,717 | 3,621,617 |
- | AR$ | 6,359,377 | 5,757,265 |
- | R$ | 10,006,574 | 11,896,407 |
Recoverable Taxes | Indexed Ch$ | 2,382,566 | 1,637,041 |
| Non-indexed Ch$ | 399,172 | 739,253 |
- | AR$ | 830,873 | 469,108 |
- | R$ | 224,490 | 205,041 |
Prepaid Expenses | Non-indexed Ch$ | 2,026,521 | 1,650,085 |
- | US$ | 0 | 127,352 |
- | AR$ | 350,730 | 281,984 |
- | R$ | 1,001,623 | 1,169,902 |
Deferred Taxes | Indexed Ch$ | 0 | 67,633 |
- | Non-indexed Ch$ | 381,155 | 710,301 |
- | AR$ | 439,686 | 369,780 |
- | R$ | 1,459,745 | 5,230,260 |
Other Current Assets | Indexed Ch$ | 0 | 1,521,483 |
- | Non-indexed Ch$ | 1,814,757 | 140,614 |
- | US$ | 742,133 | 454,107 |
- | AR$ | 773,805 | 979,999 |
- | R$ | 2,785,575 | 3,254,410 |
Property, Plant and Equipment |
|
|
|
Property, Plant and Equipment | Indexed Ch$ | 95,035,938 | 92,820,174 |
38
39
Note 30 - Local and Foreign Currency (continuation)
Current liabilities for the period ended June 30, 2009 and 2008, denominated in local and foreign currencies were as follows:
|
| Up to 90 days |
| |||
|
| 30-Jun-09 | 30-Jun-08 | |||
| Currency | Amount | Annual average interest rate | Amount | Annual average interest rate | |
Short term bank liabilities | Non-Indexed Ch$ | 8,197 | 8.64% | 218,310 | 8.58% | |
- | AR$ | 2,820,893 | 16.24% | 0 |
| |
Long term bank liabilities | R$ | 0 |
| 0 |
| |
Bonds payable | Indexed-Ch$ | 0 |
| 0 |
| |
- | US$ | 0 |
| 0 |
| |
Dividends payable | Non-Indexed Ch$ | 5,751,857 |
| 5,972,410 |
| |
- | AR$ | 4,703 |
| 5,768 |
| |
Accounts payable | Non-Indexed Ch$ | 24,209,678 |
| 21,889,440 |
| |
- | US$ | 743,327 |
| 1,947,274 |
| |
- | AR$ | 9,634,607 |
| 11,129,701 |
| |
- | R$ | 9,696,592 |
| 10,304,035 |
| |
- | EURO$ | 26,627 |
| 10,435 |
| |
Other creditors | AR$ | 116,445 |
| 69,146 |
| |
- | R$ | 3,727,661 |
| 6,002,774 |
| |
- | US$ | 95,280 |
| 97,086 |
| |
Notes and accounts payable related companies | Indexed-Ch$ | 9,642,963 |
|
|
| |
- | Non-Indexed Ch$ | 0 |
| 3,689,541 |
| |
- | AR$ | 834,935 |
| 2,032,068 |
| |
- | R$ | 2,156,658 |
| 1,531,255 |
| |
Provisions | Non-Indexed Ch$ | 944,993 |
| 748,556 |
| |
- | R$ | 0 |
| 0 |
| |
Withholdings | Non-Indexed Ch$ | 4,965,507 |
| 6,140,094 |
| |
- | AR$ | 5,562,646 |
| 6,822,941 |
| |
- | R$ | 0 |
| 0 |
| |
Income taxes | Indexed-Ch$ | 60,182 |
|
|
| |
- | Non-Indexed Ch$ | 40,877 |
| 5,430 |
| |
- | AR$ | 1,857,196 |
| 1,489,003 |
| |
- | R$ | 0 |
| 0 |
| |
Unearned income | Non-Indexed Ch$ | 0 |
| 132 |
| |
Other current liabilities | Non-Indexed Ch$ | 632,728 |
| 2,416,395 |
| |
- | US$ | 0 |
| 2,179,411 |
| |
Total current liabilities | Non-Indexed Ch$ | 36,553,837 |
| 41,080,308 |
| |
| AR$ | 20,831,425 |
| 21,548,627 |
| |
| R$ | 15,580,911 |
| 17,838,064 |
| |
| US$ | 838,607 |
| 4,223,771 |
| |
| Indexed-Ch$ | 9,703,145 |
| 0 |
| |
| EURO$ | 26,627 |
| 10,435 |
|
40
41
|
| 90 days to 1 year | ||||
|
| 30-Jun-09 | 30-Jun-08 | |||
| Currency | Amount | Annual average interest rate | Amount | Annual average interest rate | |
Short term bank liabilities | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | AR$ | 0 |
| 7,299,219 | 17.64% | |
Long term bank liabilities | R$ | 225,871 | 10.51% | 145,489 | 11.89% | |
Bonds payable | Indexed-Ch$ | 4,968,938 | 6.50% | 411,493 | 6.50% | |
- | US$ | 0 |
| 20,657 | 7.63% | |
Dividends payable | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | AR$ | 0 |
| 0 |
| |
Accounts payable | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | US$ | 0 |
| 0 |
| |
- | AR$ | 0 |
| 0 |
| |
- | R$ | 0 |
| 0 |
| |
- | EURO$ | 0 |
| 0 |
| |
Other creditors | AR$ | 41,221 |
| 45,808 |
| |
- | R$ | 0 |
| 0 |
| |
- | US$ | 0 |
| 0 |
| |
Notes and accounts payable related companies | Indexed-Ch$ | 0 |
|
|
| |
- | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | AR$ | 0 |
| 0 |
| |
- | R$ | 0 |
| 0 |
| |
Provisions | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | R$ | 3,101,787 |
| 3,633,425 |
| |
Withholdings | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | AR$ | 0 |
| 0 |
| |
- | R$ | 577,592 |
| 3,244,708 |
| |
Income taxes | Indexed-Ch$ | 0 |
|
|
| |
- | Non-Indexed Ch$ | 0 |
| 320,578 |
| |
- | AR$ | 0 |
| 0 |
| |
- | R$ | 597,872 |
| 445,687 |
| |
Unearned income | Non-Indexed Ch$ | 0 |
| 0 |
| |
Other current liabilities | Non-Indexed Ch$ | 0 |
| 0 |
| |
- | US$ | 0 |
| 0 |
| |
Total current liabilities | Non-Indexed Ch$ | 0 |
| 320,578 |
| |
| AR$ | 41,221 |
| 7,345,027 |
| |
| R$ | 4,503,122 |
| 7,469,309 |
| |
| US$ | 0 |
| 20,657 |
| |
| Indexed-Ch$ | 4,968,938 |
| 411,493 |
| |
| EURO$ | 0 |
| 0 |
|
42
Note 30 - Local and Foreign Currency (continuation)
Long term liabilities at June 30, 2009 were composed of local and foreign currencies as follows:
| Currency | 1 to 3 years | 3 to 5 years | ||
|
| Amount | Annual average interest rate | Amount | Annual average interest rate |
|
| ThCh$ |
| ThCh$ |
|
Long term bank liabilities | R$ | 301,616 | 10.42% | 0 |
|
Bonds payabale long term | Indexed Ch$ | 9,112,021 | 6.50% | 9,112,021 | 6.50% |
Other creditos | AR$ | 81,215 |
| 0 |
|
Notes and accounts payable related companies | Non-indexed Ch$ | 2,783,731 |
| 0 |
|
Provisions | Indexed Ch$ | 0 |
| 0 |
|
- | Non-indexed Ch$ | 1,075,055 |
| 0 |
|
- | AR$ | 1,097,716 |
| 0 |
|
- | R$ | 5,354,022 |
| 0 |
|
Deferred taxes | Non-indexed Ch$ | 82,717 |
| 0 |
|
- | AR$ | 0 |
| 788,418 |
|
- | R$ | 11,720,675 |
| 0 |
|
- | UF | 700,757 |
| 0 |
|
Other liabilities | Non-indexed Ch$ | 0 |
| 0 |
|
- | AR$ | 0 |
| 298,106 |
|
- | R$ | 4,103,826 |
| 0 |
|
Total long term liabilities | R$ | 21,480,139 |
| 0 |
|
- | Indexed Ch$ | 9,112,021 |
| 9,112,021 |
|
| AR$ | 1,178,931 |
| 1,086,524 |
|
| Non-indexed Ch$ | 3,941,503 |
| 0 |
|
| Indexed Ch$ | 700,757 |
| 0 |
|
43
| Currency | 5 to 10 years | Over 10 years | ||
|
| Amount | Annual average interest rate | Amount | Annual average interest rate |
|
| ThCh$ |
| ThCh$ |
|
Long term bank liabilities | R$ | 0 |
| 0 |
|
Bonds payabale long term | Indexed Ch$ | 22,780,051 | 6.50% | 31,892,087 | 6.50% |
Other creditos | AR$ | 0 |
| 0 |
|
Notes and accounts payable related companies | Non-indexed Ch$ | 0 |
| 0 |
|
Provisions | Indexed Ch$ | 0 |
| 7,618,471 |
|
- | Non-indexed Ch$ | 0 |
| 0 |
|
- | AR$ | 0 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
Deferred taxes | Non-indexed Ch$ | 0 |
| 40,595 |
|
- | AR$ | 0 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
- | UF | 0 |
| 0 |
|
Other liabilities | Non-indexed Ch$ | 4,307,688 |
| 0 |
|
- | AR$ | 2,682,957 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
Total long term liabilities | R$ | 0 |
| 0 |
|
- | Indexed Ch$ | 22,780,051 |
| 39,510,558 |
|
| AR$ | 2,682,957 |
| 0 |
|
44
| Non-indexed Ch$ | 4,307,688 |
| 40,595 |
|
| Indexed Ch$ | 0 |
| 0 |
|
45
Long term liabilities at June 30, 2008 were composed of local and foreign currencies as follows:
| Currency | 1 to 3 years | 3 to 5 years | ||
| Amount | Annual average interest rate | Amount | Annual average interest rate | |
|
| ThCh$ | % | ThCh$ | % |
Long term bank liabilities | $R | 793,604 | 10.67% | 0 |
|
Long term bonds payable | Indexed Ch$ | 9,080,359 | 6.5% | 9,080,359 | 6.5% |
- | US$ | 0 |
| 0 |
|
Other creditors | AR$ | 92,810 |
| 0 |
|
Notes and accounts payable related companies | Non-indexed Ch$ | 3,296,267 |
| 0 |
|
Provisions | Indexed Ch$ | 0 |
| 0 |
|
- | Non-indexed Ch$ | 775,741 |
| 0 |
|
- | AR$ | 1,567,245 |
| 0 |
|
- | R$ | 9,605,605 |
| 0 |
|
Deferred taxes | Non-indexed Ch$ | 0 |
| 0 |
|
- | AR$ | 0 |
| 480,097 |
|
- | R$ | 17,556,842 |
| 0 |
|
Other liabilities | Non-indexed Ch$ | 0 |
| 0 |
|
- | AR$ | 0 |
| 278,998 |
|
- | R$ | 6,067,867 |
| 0 |
|
Total long term liabilities | R$ | 34,023,918 |
| 0 |
|
| Indexed Ch$ | 9,080,359 |
| 9,080,359 |
|
| US$ | 0 |
| 0 |
|
| AR$ | 1,660,055 |
| 759,095 |
|
| Non-indexed Ch$ | 4,072,008 |
| 0 |
|
| Currency | 5 to 10 years | Over 10 years | ||
| Amount | Annual average interest rate | Amount | Annual average interest rate | |
|
| ThCh$ | % | ThCh$ | % |
Long term bank liabilities | $R | 0 |
| 0 |
|
Long term bonds payable | Indexed Ch$ | 22,700,899 | 6.5% | 36,321,461 | 6.50% |
- | US$ | 0 |
| 1,083,663 | 7.63% |
Other creditors | AR$ | 0 |
| 0 |
|
Notes and accounts payable related companies | Non-indexed Ch$ | 0 |
| 0 |
|
Provisions | Indexed Ch$ | 0 |
| 6,469,290 |
|
- | Non-indexed Ch$ | 0 |
| 0 |
|
- | AR$ | 0 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
Deferred taxes | Non-indexed Ch$ | 0 |
| 103,010 |
|
- | AR$ | 0 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
Other liabilities | Non-indexed Ch$ | 4,997,969 |
| 0 |
|
- | AR$ | 2,510,979 |
| 0 |
|
- | R$ | 0 |
| 0 |
|
Total long term liabilities | R$ | 0 |
| 0 |
|
| Indexed Ch$ | 22,700,899 |
| 42,790,751 |
|
| US$ | 0 |
| 1,083,663 |
|
| AR$ | 2,510,979 |
| 0 |
|
| Non-indexed Ch$ | 4,997,969 |
| 103,010 |
|
46
Note 31 – Penalties
The Company has not been subject to penalties by the SVS or any other administrative authority.
Note 32 - Subsequent Events
No finanacial or other matters have occurred between the end of period and the date of preparation of these financial statements that may significantly affect the assets, liabilities, and/or results of the Company.
Note 33 – Companies subject to special regulations
The Company and its subsidiaries are not subject to special regulations.
Note 34 – Environment
Disbursements and commitments for this period related to environmental issues were according to the following table:
Name of the project associated with the disbursement | Concept for which disbursement was realized or will be realized | Accounting record: Cost of Asset/ Expense | Description of asset or expense item | Amount Disbursed | Certain or expected date of disbursement |
| ThCh$ | ||||
Disbursements that are part of assets |
|
|
|
|
|
Argentina |
|
|
|
|
|
Effluents Plant | Investments in refurbishment of Effluents Plant (in the process of execution) | Property, plant & equipment | Works in progress | 199,705 | 1° Quarter 2009 |
Effluents Plant | Investments in refurbishment of Effluents Plant (in the process of execution) | Property, plant & equipment | Works in progress | 520,134 | 2° Quarter 2009 |
Effluents Plant | Investments in refurbishment of Effluents Plant (in the process of execution) | Property, plant & equipment | Works in progress | 586,453 | 3° and 4° Quarter year 2009 |
Total Argentina |
|
|
| 1,306,292 |
|
Brazil |
|
|
|
|
|
Improvements in water quality | Improvements in water quality | Cost of Asset | Ultraviolet environment desinfection system | 236,591,813 | 4/1/2009 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Enlargement project for capturing water from rain | 2,467,372 | 1/8/2009 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Enlargement project for capturing water from rain | 16,309,872 | 3/9/2009 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Enlargement project for capturing water from rain | 17,439,154 | 3/1/2009 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Water treatment capacity project | 55,332,840 | 4/8/2009 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Adiantamento - Ativo 3005833 | (160,011,864) | 9/2/2008 |
Improvements in water quality | Improvements in water quality | Cost of Asset | Adiantamento AF - 1100000387 | 1,020,723,578 | 6/9/2009 |
Total Brazil |
|
|
| 1,188,852,765 |
|
Chile |
|
|
|
|
|
Leak detection | Avoid contamination of underground water source | Cost of Asset | Leak detection equipment | 1,320 | 3° and 4° Quarter year 2009 |
Hand Held EquipmentsVendedores (110) | Avoid printing paper | Cost of Asset | Hand Held equipment | 90,422 | 6/12/2009 |
Hand Held EquipmentsVendedores (110) | Avoid printing paper | Cost of Asset | Hand Held equipment | 5,454 | 3° and 4° Quarter year 2009 |
Air conditioning equipments (SA) | Avoid air pollution | Cost of Asset | Air Condition equipments | 1,980 | 3/31/2009 |
Air conditioning equipments (SA) | Avoid air pollution | Cost of Asset | Air Condition equipments | 1,770 | 3° and 4° Quarter year 2009 |
Replacement of air compressors | Save energy | Cost of Asset | Latest technology compressors | 8,593 | 1/14/2009 |
Total Chile |
|
|
| 109,539 |
|
Total Assets |
|
|
| 1,190,268,596 |
|
47
Disbursements charged to expenses |
|
|
|
|
|
Argentina |
|
|
|
|
|
Ecological Island | Service of selective residue collection | Expense | Services | 56,881 | 1° Quarter 2009 |
Ecological Island | Collection of residues | Expense | Services | 8,609 | 1° Quarter 2009 |
Ecological Island | Crushing boxes | Expense | Services | 3,501 | 1° Quarter 2009 |
Ecological Island | AE rental | Expense | Rentals | 1,572 | 1° Quarter 2009 |
Effluents Plant | External analysis of effluents in Cordoba | Expense | Services | 639 | 1° Quarter 2009 |
Waste Managements | Anti-spill containers and kits and signs | Expense | Materials | 238 | 1° Quarter 2009 |
Legal counseling | Counseling on environment legislation | Expense | Fees | 420 | 1° Quarter 2009 |
Legal obligations | Rates / Taxes | Expense | Taxes | 55 | 1° Quarter 2009 |
Legal obligations | External analysis of effluents in Cordoba | Expense | Services | 414 | 1° Quarter 2009 |
Legal obligations | Emission and noise control AE and trucks Distribution Centers | Expense | Services | 587 | 1° Quarter 2009 |
Travel expenses | Travel expenses to Distribution Centers | Expense | Travel expenses | 113 | 1° Quarter 2009 |
Waste Managements | Desagotes CD | Expense | Services | 1,260 | 1° Quarter 2009 |
Ecological Island | Service of selective residue collection | Expense | Services | 55,564 | 2° Quarter 2009 |
Ecological Island | Collection of residues | Expense | Services | 7,015 | 2° Quarter 2009 |
Ecological Island | Crushing boxes | Expense | Services | 2,625 | 2° Quarter 2009 |
Ecological Island | AE rental | Expense | Rentals | 1,572 | 2° Quarter 2009 |
Effluents Plant | External analysis of effluents in Cordoba | Expense | Services | 3,959 | 2° Quarter 2009 |
Waste Managements | Anti-spill containers and kits and signs | Expense | Materials | 253 | 2° Quarter 2009 |
Waste Managements | Collection of dangerous residues at distribution centers | Expense | Services | 143 | 2° Quarter 2009 |
Legal counseling | Counseling on environment legislation | Expense | Fees | 420 | 2° Quarter 2009 |
Legal obligations | Rates / Taxes | Expense | Taxes | 55 | 2° Quarter 2009 |
Legal obligations | External analysis of effluents in Cordoba | Expense | Services | 0 | 2° Quarter 2009 |
Legal obligations | Emission and noise control AE and trucks Distribution Centers | Expense | Services | 662 | 2° Quarter 2010 |
Travel expenses | Travel expenses to Distribution Centers | Expense | Travel expenses | 100 | 2° Quarter 2009 |
Waste Managements | Desagotes CD | Expense | Services | 1,260 | 2° Quarter 2009 |
Hydric resource | SGA-Water fountain protection campaign (CSR) | Expense | Services | 771 | 2° Quarter 2009 |
Environment management systems | SGA - Maintenance audits ISO 14001 | Expense | Services | 1,941 | 2° Quarter 2009 |
Ecological Island | Service of selective residue collection | Expense | Services | 140,061 | 3° and 4° Quarter year 2009 |
Ecological Island | Collection of residues | Expense | Services | 8,395 | 3° and 4° Quarter year 2009 |
Waste Managements | Absorbent material | Expense | Materials | 336 | 3° and 4° Quarter year 2009 |
Waste Managements | Containers | Expense | Materials | 840 | 3° and 4° Quarter year 2009 |
Waste Managements | Anti-spill containers and kits and signs | Expense | Materials | 98 | 3° and 4° Quarter year 2009 |
Effluents Plant | External analysis of effluents in Cordoba | Expense | Services | 2,162 | 3° and 4° Quarter year 2009 |
Effluents Plant | Maintenance of fish habitat | Expense | Services | 336 | 3° and 4° Quarter year 2009 |
Effluents Plant | Mud extraction effluents plant | Expense | Services | 19,569 | 3° and 4° Quarter year 2009 |
Legal counseling | Counseling on environment legislation | Expense | Fees | 1,092 | 3° and 4° Quarter year 2009 |
Waste Managements | Collection of dangerous residues at distribution centers | Expense | Services | 560 | 3° and 4° Quarter year 2009 |
Travel expenses | Travel expenses to Distribution Centers | Expense | Travel expenses | 919 | 3° and 4° Quarter year 2009 |
Environment management systems | SGA - Maintenance audits ISO 14001 | Expense | Services | 1,980 | 3° and 4° Quarter year 2009 |
Hydric resource | SGA-Water fountain protection campaign (CSR) | Expense | Services | 1,260 | 3° and 4° Quarter year 2009 |
Waste Managements | Desagotes DC/ Unforeseen events | Expense | Services | 1,880 | 3° and 4° Quarter year 2009 |
Total Argentina |
|
|
| 330,117 |
|
48
Brazil |
|
|
|
|
|
Interaction - Operation of Materials Treatment Area | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Interaction - Operation of Materials Treatment Area | 462,730 | NA |
Lixo disposal | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Lixo disposal | 67,185 | NA |
Mud disposal | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Mud disposal | 3,826 | NA |
ETE maintenance/operation costs | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | ETE operation/maintenance costs | 74,422 | NA |
IBAMA quarterly rate | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | IBAMA quarterly rate | 827 | NA |
Tratamento biológico esgoto sanitário Prédio Administrativo e Industrial | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Tratamento biológico esgoto sanitário Prédio Administrativo e Industrial | 4,504 | NA |
Collection/disposal of ambulatory residues | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Collection/disposal of ambulatory residues | 883 | NA |
Acquisition of anaerobic mud for ETE | Verification and control of fulfillment of regulations and rules related to industrial procedures | Expense | Acquisition of anaerobic mud for ETE | 8,276 | NA |
Environment Consultancy - Customize ETE according to FEEMA and IEMA patterns | Improvements and/or investments in production processes | Expense | Environment Consultancy - Customize ETE according to FEEMA and IEMA patterns | 8,843 | NA |
Disposal of non-useful products | Improvements and/or investments in production processes | Expense | Disposal of non-useful products | 2,910 | NA |
Total Brazil |
|
|
| 634,406 |
|
Chile |
|
|
|
|
|
AGA gasification project | Save energy | Expense | Improvement of productive process capacity | 83,425 | 5/7/2009 |
Improvements in recovering condensation | Save energy | Expense | Improve energy efficiency | 14,402 | 7/2/2009 |
Improvements in recovering condensation | Save energy | Expense | Improve energy efficiency | 7,700 | 3° and 4° Quarter year 2009 |
Blowing equipments | Save energy | Expense | Improve energy efficiency | 17,482 | 5/4/2009 |
Blowing equipments | Save energy | Expense | Improve energy efficiency | 1,046 | 3° and 4° Quarter year 2009 |
Increase generating capacity-2nd stage | Save energy | Expense | Improve energy efficiency | 10,639 | 5/26/2009 |
Increase generating capacity-2nd stage | Save energy | Expense | Improve energy efficiency | 4,929 | 3° and 4° Quarter year 2009 |
Equipments for the increase of cold capacity | Save energy | Expense | Reduces energy consumption in the cooling process | 16,076 | 3/24/2009 |
Equipments for the increase of cold capacity | Save energy | Expense | Reduces energy consumption in the cooling process | 4 | 3° and 4° Quarter year 2009 |
Increase capacity of cooling equipments | Save energy | Expense | Reduces energy consumption in the cooling process | 38,792 | 4/20/2009 |
Increase capacity of cooling equipments | Save energy | Expense | Reduces energy consumption in the cooling process | 7,129 | 3° and 4° Quarter year 2009 |
Total Chile |
|
|
| 201,624 |
|
Total Expenses |
|
|
| 1,166,147 |
|
49
Note 35 – Time Deposits
The Company and its subsidiaries have invested in time deposits that are valued at the restated cost plus accrued interests as of the closing date of these financial statements, according to the following table:
Financial Institution | Currency | Rate | 30-Jun-09 | 30-Jun-08 |
ThCh$ | ThCh$ | |||
Banco BBVA | UF | 1.60% | 8,159,635 | 0 |
Banco BCI | UF | 2.00% | 6,580,530 | 0 |
Banco BCI | UF | 1.00% | 4,694,900 | 0 |
Banco Chile | UF | 3.20% | 2,999,797 | 0 |
Banco Estado | UF | 1.65% | 7,744,585 | 0 |
Banco Estado | UF | 0.50% | 5,805,946 | 0 |
Banco HSBC | UF | 2.55% | 11,293,311 | 0 |
Banco Chile | UF | 2.70% | 3,321,366 | 0 |
Banco Itaú | Ch$ | 2.16% | 4,335,776 | 0 |
Banco Santander | UF | 2.40% | 4,542,988 | 0 |
Banco Deutsche Bank | Ch$ | 0.60% | 8,789,247 | 0 |
Banco Votorantim | R$ | 13.61% | 28,842 | 37,185 |
Banco Chile | UF | 2.00% |
| 5,417,185 |
Banco Chile | UF | 0.70% |
| 3,207,290 |
Banco Santander | Ch$ | 7.32% |
| 14,695,077 |
Banco BBVA | Ch$ | 7.26% |
| 8,081,541 |
TOTAL |
|
| 68,296,923 | 31,438,278 |
50
Note 36 – Implementation of International Accounting Standards
It is of public knowledge that the country is committed to the development of a convergence plan to fully adopt International Financial Reporting Standards (IFRS), based on a progressive calendar as from year 2009. In accordance with the regulations established by the Chilean Institute of Accountants on this matter and what has been specifically established by circulars N°427 and N°485 of the Superintendencia de Valores y Seguros(Chilean Securities and Exchange Commission), the Company has chosen to present its financial statements for the year ended December 31, 2009 under the current norm, including only as pro-forma information within the 2009 the financial statements, the information adjusted in accordance to international accounting standards.
Consequently, 2010 will be the first year in which the Company will perform a complete application of IFRS. The Company is developing a plan to integrally face the impacts of this change.
51
I.
Analysis of Results for the Second Quarter of 2009 and the Period ended June 30, 2009
All figures are expressed under Chilean GAAP and in constant Chilean pesos as of June 30, 2009, therefore all variations are in real terms over yearly inflation of 3.0% (from June 2008 through June 2009).
–
Consolidated Sales Volume for the Second Quarter amounted to 99.7 million unit cases, an increase of 3.7% during the quarter.
–
Operating Income reached Ch$21,961 million during the Second Quarter of 2009, a 0.7% decrease in real terms compared to the same period of the previous year. Operating Margin was 13.7%.
–
Second Quarter EBITDA totaled Ch$29,886 million, a 3.2% decrease in real terms. EBITDA Margin was 18.7%.
–
Net Income for the Second Quarter of 2009 reached Ch$11,946 million.
–
Consolidated Sales Volume for the period ended June 30, 2009 totaled 219.7 million unit cases, an increase of 2.7%.
–
Consolidated Operating Income reached Ch$53,839 million during the period ended June 30, 2009, a 10.0% decrease in real terms. Operating Margin was 15.6%.
–
Consolidated EBITDA for the period ended June 30, 2009 amounted to Ch$69,824 million, a 9.3% decrease in real terms. EBITDA Margin was 20.3%.
–
Net Income for the First Half of 2009 reached Ch$34,628 million, a decrease of 12.6%.
Comments from the Chief Executive Officer, Mr. Jaime Garcia R.
“During this first semester of 2009, our consolidated volumes continued with a solid grow, of approximately 3% and our prices remained stable in real terms. Our financial results were affected mainly by the devaluation of local currencies in the three countries where we operate, which had accounting effects (due to the conversion of figures from Brazil and Argentina) as well as economic effects (due to our dollar-denominated costs). We do not foresee a worsened scenario of depreciated currencies for the rest of the year and as always, we remain very enthusiastic and optimistic to face the second half of 2009.”
CONSOLIDATED SUMMARY
During the second quarter and first half of 2009, currencies on average, devaluated in the three countries where we operate affecting our US dollar denominated costs. The Brazilian real and Argentine peso devalued with respect to the end of period closing exchange rate of the Chilean peso, resulting in a negative accounting effect over income and a positive effect over costs and expenses upon translation of figures, during the second quarter and first half of 2009
Second Quarter 2009 vs. Second Quarter 2008
Consolidated Sales Volume for the Quarter reached 99.7 million unit cases, an increase of 3.7% mainly driven by our Brazilian operation. Soft drinks increased 4.1% while juices, waters and beer (“other categories”) altogether remained stable.
Net Sales amounted to Ch$160,208 million, a 5.3% decrease in real terms, mainly due to the negative effect upon translation of figures from Brazil and Argentina, which more than offset the increased volumes recorded during the period and the adjustment of prices to local inflations.
Cost of Sales per unit case decreased 6.0%, mainly due to the effect upon translation of figures from Brazil and Argentina and lower PET resin prices in the three countries. This factor offset the following effects: (i) increased costs of main raw
52
materials due the devaluation of the three currencies during the quarter; (ii) increased concentrate costs in Brazil and Argentina due to higher prices, and (iii) increased labor costs in Argentina.
SG&A expenses decreased 12.9%, due to the effect upon translation of figures of our Brazilian and Argentine operations which more than offset the increased freight fees and labor costs in Argentina, as well as advertising investments resulting from launches during the quarter, particularly in Argentina.
Increased growth in volumes and local prices, impacts over expenses and costs and the effect upon translation of figures already explained, resulted in a Consolidated Operating Income of Ch$21,961 million, a 0.7% decrease. Operating Margin was 13.7% an increase of 60 basis points.
Finally, Consolidated EBITDA amounted to Ch$29,886 million, a 3.2% decrease. EBITDA Margin was 18.7%, an increase of 50 basis points.
First Half ended June 30, 2009 vs. First Half ended June 30, 2008
Consolidated Sales Volume amounted to 219.7 million unit cases, an increase of 2.7%. Soft Drinks grew 2.7%, while the other categories of, Juices, Waters and Beer together increased by 2.6%. In particular, the Juices segment recorded a significant 11.7% increase.
Net Sales amounted to Ch$344,630 million, a 6.2% decrease explained by the same reasons given for the quarter.
Cost of Sales per unit case decreased 4.6% mainly due to: (i) the effect upon conversion of figures of our Brazilian and Argentine operations, (ii) lower PET resin prices in the three countries, and (iii) lower sugar prices in Chile and Argentina. The aforementioned was partially offset by: (i) devaluation of the three currencies during the semester affecting dollar denominated costs, (ii) increased concentrate costs in Brazil and Argentina due to higher prices, and (iii) increased labor costs in Argentina.
SG&A expenses decreased 12.3% due the effect upon conversion of figures of our operations in Brazil and Argentina which more than offset the increased freight fees, higher labor costs in Argentina and the advertising investment due to launches carried our during the period in Chile and Argentina.
Consolidated Operating Income amounted to Ch$53,839 million, a 10.0% decrease. Operating Margin was 15.6%.
Consolidated EBITDA amounted to Ch$69,824 million, a decrease of 9.3%. EBITDA Margin was 20.3%.
SUMMARY BY COUNTRY
CHILE
Second Quarter 2009 vs. Second Quarter 2008
During the quarter, Sales Volume amounted to 32.8 million unit cases, a 1.4% growth. Towards the end of the quarter we launched a new brand HUGO, milk and fruit juice drink. Net Sales amounted to Ch$58,430 million, reflecting a growth of 0.7% in real terms.
Cost of Sales per unit case decreased 0.8%, mainly explained by lower PET resin prices and partially offset by the average devaluation of the Chilean peso (+21%). SG&A expenses increased 9.4% mainly explained by higher freight expenses.
Stable sales and costs and the impact upon expense already explained resulted in an Operating Income of Ch$10,245 million, a 9.3% decrease. Operating Margin was 17.5%.
EBITDA amounted to Ch$13,812 million, a 9.1% decrease in real terms. EBITDA Margin was 23.6%.
53
First Half ended June 30, 2009 vs. First Half ended June 30, 2008
During the First Half, Sales Volume amounted to 72.7 million unit cases a 1.2% growth. This growth was a result of increased soft drink volumes (+1.0%) as well as an increase in the Juices and Waters segment (+2.2%).
Net Sales amounted to Ch$128,490 million, a 1.3% improvement in real terms, as a result of higher volumes and constant prices in real terms.
Cost of Sales per unit case increased 1.8%, mainly explained by the average devaluation of the Chilean peso (+26%), partially offset by lower PET resin and sugar prices. SG&A expenses increased 3.3% mainly due to increased freight expenses and advertising investments.
Operating Income decreased 5.6% amounting to Ch$25,164 million. Operating Margin was 19.6%.
EBITDA amounted to Ch$32,505 million, a decrease of 5.0%. EBITDA Margin was 25.3%.
BRAZIL
The Brazilian real devalued with respect to the closing exchange rate of the Chilean peso as of June 2009, resulting in a negative accounting impact over income and a positive impact over costs and expenses upon translation of figures. Additionally, during 2009 the Brazilian real has devalued with respect to the U.S. dollar which has affected our U.S. dollar denominated costs.
Second Quarter 2009 vs. Second Quarter 2008
Sales Volume for the quarter amounted to 40.8 million unit cases, representing a 6.2% increase. This increase was driven by the soft drinks segment (+6.8%).
Net Sales reached Ch$66,721 million, representing a decrease of 12.4%. This decrease is explained by the negative effect upon translation of figures which more than offset the increased volumes and price adjustments in accordance with local inflation.
Cost of Sales per unit case decreased 9.4% mainly explained by the effect upon translation of figures and lower PET resin prices, offsetting the increased concentrate prices (resulting from price adjustments), aluminum and sugar prices; and the 25% average devaluation of the Brazilian real for the period.
SG&A expenses decreased 28.1% as a result of the effect upon translation of figures and decreased labor costs due to the expense rationalization that took place during the second quarter of 2008. This was partially offset by increased freight fees.
Increased volumes and prices along with the impact upon costs, expenses and the translation of figures resulted in an Operating Income of Ch$9,299 million, representing a 2.1% decrease. Operating Margin was 13.9%.
EBITDA amounted to Ch$11,820 million, a decrease of 5.0%. EBITDA Margin was 17.7%.
First Half ended June 30, 2009 vs. First Half ended June 30, 2008
Sales Volume amounted to 87.9 million unit cases, a 4.9% increase driven by the soft drinks segment (+5.3%).
Net Sales reached Ch$135,230 million, a 16.8% decrease, explained by the same reasons given for the quarter.
Cost of Sales per unit case decreased 11.0%, and for the same reasons set forth during the quarter, mainly due to the effect upon translation of figures and a decrease in PET resin prices, offset by increased prices of aluminum, sugar, concentrate (due to increased prices), and the 29% average devaluation of the Brazilian real during the period.
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Mainly due to effect upon translation of figures, Operating Income decreased 20.4%, amounting to Ch$20,559 million. Operating Margin was 15.2%.
EBITDA amounted to Ch$25,611 million, a decrease of 19.3%. EBITDA Margin was 18.9%.
ARGENTINA
The Argentine peso devalued with respect to the closing exchange rate of the Chilean peso as of June 2009, resulting in a negative accounting impact over income and a positive impact over costs and expenses upon translation of figures. Additionally, during 2009 the Argentine peso has devalued with respect to the U.S. dollar which has affected our U.S. dollar denominated costs.
Second Quarter 2009 vs. Second Quarter 2008
Sales Volume for the quarter increased 2.9% reaching 26.1 million unit cases. This growth resulted from an increase in soft drinks volumes (+2.1%) and the Juices and Waters categories (+62.9%). The significant increase of the Other Categories was driven by the creation of the new Juices and Isotonic Division in Argentina (which has resulted in an increased market share in this segment from 7% to 15%) and by new launches of Powerade Mountain Blast, Aquarius (in three flavors), and Quatro Livian Pomelo.
Net Sales reached Ch$35,769 million, an increase of 0.6% explained by higher volumes and significant price adjustments in accordance with local inflation, which was almost completely offset by the negative effect upon translation of figures.
Cost of Sales per unit case decreased 6.4%, mainly explained by the effect upon translation of figures and lower sugar and PET resin prices. This was partially offset by increased concentrate costs (resulting from higher prices), increased labor costs and the effect of the devaluation of the Argentine peso during the period (+20%).
SG&A expenses decreased 2.3% mainly due the effect upon translation of figures, which more than compensated increased salaries, freight costs and advertising investments carried out during the period as a result of new products launchings and a stronger advertising effort focused on the Juices and Isotonic segment.
Increased volumes and prices along with the effects upon costs and expense resulted in a 69.6% increase of Operating Income which amounted to Ch$3,163 million. Operating Margin was 8.8%.
EBITDA reached Ch$4,999 million, an increase of 32.6%. EBITDA Margin was 14.0%.
First Half ended June 30, 2009 vs. First Half ended June 30, 2008
Sales Volume for the First Half reached 59.1 million unit cases, an increase of 1.2%. The Soft drinks category increased 0.8% while Juices and Waters increased 34.3%.
Net Sales reached Ch$82,069 million, representing an increase of 3.8%. This increase is explained by higher volumes and price adjustments that took place during the period, partially offset by the effect upon translation of figures.
Cost of Sales per unit case decreased 2.8%, mainly explainedfor the same reasons set forth during the quarter by the effect upon translation of figures and lower sugar and PET resin prices. This was partially offset by increased concentrate costs (due to price increases), increased labor costs and the effect of the devaluation of the Argentine peso during the period (+16%).
SG&A expenses increased 10.9% mainly due to higher freight costs, increased salaries, and advertising investments. This was partially offset by the effect upon translation of figures.
Operating Income amounted to Ch$9,760 million, a significant 14.4% increase. Operating Margin was 11.9%, 110 basis points higher than 2008.
55
EBITDA reached Ch$13,353 million, an increase of 9.2%. EBITDA Margin was 16.3%.
NON-OPERATING RESULTS
First Half ended June 30, 2009 vs. First Half ended June 30, 2008
Non-Operating Results totaled a loss of (Ch$6,953) million, which compares positively to a higher accumulated loss of (Ch$8,120) million recorded during 2008. This decreased loss in the non-operating result line is best explained by:
o
Financial Expense/Income (Net): Strongly impacted by a positive variation basically resulting from losses in financial hedging agreements that took place during 2008.
o
Price Level Restatement and Effect upon Translation of Figures: Resulted in a loss compared to a profit recorded during 2008, basically due to a decrease of the exchange rate during the period December 2008-June 2009 over the Company’s U.S. Dollar asset position.
o
Other Non Operating Income/Expenses: Resulted in a profit compared to the previous period explained by the accounting reversals realized during 2008, against earnings from the conversion adjustment reserve as a result of dividends received from foreign subsidiaries.
Finally, net income amounted to Ch$34,628 million, representing a 12.6% decrease.
ANALYSIS OF THE BALANCE SHEET
As of June 30, 2009, the Company’s Net Cash Position amounted to US$54.8 million. Accumulated excess cash is invested in short term time deposits with top of the line banks and money markets.
During 2008 the company carried out hedge operations for a portion of its U.S. dollar-denominated investments so as to match part of the debt denominated in UFs (Unidad de Fomento*) with the financial assets. Upon maturity of these hedging operations we have converted our financial assets to UFs or to Chileanpesos, permanently reducing our balance sheet exposure to the U.S. dollar. As a result, the Company holds 50.1% of its financial assets in UFs, 34.3% in Chileanpesos, 9.2% in Brazilianreais, 3.6% in U.S. dollars, and 2.8% in Argentinepesos. Total financial assets amounted to US$207.5 million.
Financial debt level as of June 30, 2009 amounted to US$152.7 million, 95.9% of which is UF-denominated, 3.5% in Argentinepesos, and 0.7% is in Brazilianreais.
56
II.
Main Indicators
The main indicators contained in the table reflect for both periods the solid financial position and profitability of Embotelladora Andina S.A.
INDICATORS | Unit | June- 2009 | Dec-2008 | June 2008 | Variance | |
LIQUIDITY |
|
|
|
|
| |
| Current Ratio | Times | 2.12 | 1.94 | 2.07 | 0.05 |
| Acid Tests | Times | 1.85 | 1.71 | 1.79 | 0.06 |
| Working Capital | MCh$ | 19,095 | 16,649 | 20,881 | -1,785 |
ACTIVITY |
|
|
|
|
| |
| Investments | MCh$ | 26,213 | 65,068 | 31,674 | (5,461) |
| Inventory turnover | Times | 7.08 | 14.91 | 7.08 | 0.00 |
| Days of inventory on hand | Days | 50.82 | 24.15 | 50.84 | -0.03 |
INDEBTEDNESS |
|
|
|
|
| |
| Debt to equity ratio | % | 69.54% | 73.06% | 83.20% | -13.66% |
| Short-term liabilities to total liabilities | % | 44.52% | 51.83% | 43.01% | 1.51% |
| Long-term liabilities to total liabilities | % | 55.48% | 48.17% | 56.99% | -1.51% |
| Interest charges coverage ratio | Times | 42.17 | 37.01 | 35.95 | 6.22 |
PROFITABILITY |
|
|
|
|
| |
| Return over equity | % | 10.84% | 29.07% | 13.67% | -2.83% |
| Return over total assets | % | 6.32% | 16.01% | 7.30% | -0.98% |
| Return over operating assets | % | 12.09% | 32.53% | 14.77% | -2.68% |
| Operating income | MCh$ | 53,838 | 135,458 | 59,815 | -5,977 |
| Operating margin | % | 15.62% | 16.09% | 16.28% | -0.66% |
| EBITDA (1) | MCh$ | 67,201 | 164,871 | 73,490 | -6,288 |
| EBITDA margin | % | 19.50% | 19.58% | 20.01% | -0.51% |
| Dividends payout ratio - Serie A shares | % | 6.03% | 7.67% | 12.43% | -6.39% |
| Dividends payout ratio - Serie B shares | % | 5.60% | 6.96% | 12.75% | -7.15% |
1Earnings before income taxes, interests, depreciation, amortization and extraordinary items.
Liquidity indicators remain stable with the composition of the short term balance as of June 30, 2009 very similar to the previous period.
Indicators of indebtedness reflect a slight decrease mainly due to the increase in Shareholders’ equity resulting from the effect of exchange rate diference over the foreign subsidiaries of the company and from the amortizations realized of the local bond. During the period net financial expenses amounted to Ch$1,139 million and earnings before interests and taxes amounted to Ch$48,024 million, achieving an interest coverage of 42.17 times.
At the closing of the period ended June 30, 2009, operating profitability indicators were affected by the reasons explained in paragraph I.
III.
Analysis of Book Values and Present Value of Assets
With respect to the Company’s main assets the following should be noted:
Given the high rotation of the items that compose working capital, book values of current assets are considered to represent market values.
57
Fixed asset values in the Chilean companies are presented at restated acquisition cost. In the foreign companies, fixed assets are valued in accordance with Technical Bulletin N° 64 issued by the Chilean Institute of Accountants (controlled in historical dollars).
Depreciation is estimated over the restated value of assets along with the remaining useful economic life of each asset.
All fixed assets that are considered available for sale are held at their respective market values.
Investments in shares, in situations where the Company has a significant influence on the issuing company, are presented following the equity method. The Company’s participation in the results of the issuing company for each year has been recognized on an accrual basis, and unrealized results on transactions between related companies have been eliminated.
In summary, assets are valued in accordance with generally accepted accounting standards in Chile and the instructions provided by the Chilean Securities Commission, as shown in Note 2 of the Financial Statements.
IV.
Analysis of the Main Components of Cash Flow
| Jun-2009 | Jun-2008 | Variation MCh$ | Variation % |
MCh$ | MCh$ | |||
Operating | 60,863 | 72,346 | (11,483) | -16% |
Financing | (53,533) | (65,111) | (11,578) | 18% |
Investment | (25,628) | (31,197) | 5,569 | 18% |
Net cash flow for the Period | (18,298) | (23,962) | 5,664 | 24% |
The Company generated negative net cash flow of MCh$18,298during the quarter, analyzed as follows:
Operating activities generated a positive cash flow of MCh$60,863 representing a negative variation of MCh$11,483 mainly explained by higher financial income resulting from the liquidation of cross currency swap agreements during 2008 which did not occur during 2009.
Financing activities generated a negative cash flow of MCh$53,533; with a positive variation of MCh$11,578 regarding the previous year, mainly due to lower extraordinary dividend payments during 2009 regarding the previous year.
Investment activities generated a negative cash flow of MCh$25,628 with a positive variation of MCh$5,569 regarding the previous year, mainly because lesser additions to property, plant and equipment during 2009 with respect to the previous year.
V.
Analysis Of Market Risk
Interest Rate Risk
As of June 30, 2009 and 2008, the Company held 100% of its debt obligations at fixed-rates. Consequently, the risk fluctuation of market interest rates regarding the Company’s cash flow remains low.
Foreign Currency Risk
Income generated by the Company is linked to the currencies of the markets in which it operates. For the period the breakdown for each is the following:
Chilean peso:
37%
Brazilian real:
39%
Argentine peso:
24%
58
Since the Company’s sales are not linked to the United States dollar, the policy adopted for managing foreign exchange risk, this is the mismatch between assets and liabilities denominated in a given currency, has been to maintain financial investments in dollar-denominated instruments, for an amount at least equivalent to the dollar-denominated liabilities.
Additionally, it is Company policy to maintain foreign currency hedge agreements to lessen the effects of exchange risk in cash expenditures expressed in US dollars which mainly correspond to payment to suppliers for raw materials.
Accounting exposure of foreign subsidiaries (Brazil and Argentina) for the difference between monetary assets and liabilities, those denominated in local currency, and therefore, exposed to risks upon translation to the US dollar, are only covered when it is foreseen that it will result in significant negative differences and when the associated cost of said coverage is deemed reasonable by management.
Commodity Risks
The Company faces the risk of price changes in the international markets for sugar, aluminum and PET resin, all of which are necessary raw materials for preparing beverages, and that altogether represent between 30% and 35% of our operating costs. In order to minimize and/or stabilize such risk, supply contracts and advanced purchases are negotiated when market conditions are favorable. Likewise commodity coverage instruments have also been utilized.
********
Embotelladora Andina is among the ten largest Coca-Cola bottlers in the world, servicing franchised territories with 37 million people, delivering over 7 million liters of soft drinks, juices, and bottled waters on a daily basis. It is a stock corporation controlled in equal parts by the Garcés Silva, Hurtado Berger, Said Handal and Said Somavía families.
In Chile, Andina has the franchise to produce and commercialize Coca-Cola products through Embotelladora Andina Chile; in Brazil through de Rio de Janeiro Refrescos; and in Argentina through Embotelladora del Atlántico. The company’s value creation proposal is to be the market leader for non-alcoholic beverages, developing an excellent relationship with the consumers of its products as well as with its employees, clients, suppliers and with Coca-Cola, its strategic partner.
This release may contain forward-looking statements reflecting Embotelladora Andina’s good faith expectations and are based upon currently available data; however, actual results are subject to numerous uncertainties, many of which are beyond the control of the Company and any one or more of which could materially impact actual performance. Among the factors that can cause performance to differ materially are: political and economic conditions on consumer spending, pricing pressure resulting from competitive discounting by other bottlers, climatic conditions in the Southern Cone, and other risk factors applicable from time to time and listed in Andina’s periodic reports filed with relevant regulatory institutions.
59
Material Events
During the period between January 1, 2009 and June 30, 2009, the following material events were filed:
1.
Appointment of new General Manager of Chilean Soft Drinks Operation
The Board of Directors of Embotelladora Andina S.A. has appointed Mr. Abel Bouchon Silva as new General Manager of the Chilean Soft Drink Operation. Mr. Bouchon will begin office on March 1, 2009.
2.
New Subsidiary Incorporated
The Board of Directors of Embotelladora Andina S.A. has agreed to incorporate a new subsidiary corporation to be engaged in the industrial and commercial areas. Its corporate capital will be Ch$10,000.000, and 99% of its capital stock will be owned by Embotelladora Andina S.A.
3.
Regular Shareholders’ Meeting
The Board of Directors of Embotelladora Andina during its regular session held February 26, 2009, resolved the following:
I.
To convene a Regular Shareholders’ Meeting for April 14, 2009, at 10:30 a.m., at the Company’s offices located at Av. Carlos Valdovinos Nº560, Borough of San Joaquín.
II.
The following matters will be discussed at the Regular Shareholders’ Meeting:
1.
The Annual Report, Balance and Financial Statements for the year 2008; as well as the Report of Independent Auditors with respect to the Financial Statements;
2.
Earnings distribution and dividend payments;
3.
Present Company dividend distribution policy and inform about the distribution and payment procedures utilized;
4.
Renewal of the Board of Directors
5.
Determine the compensation for directors and committee members pursuant to Law N° 19,705; and the Audit Committee established by the Sarbanes Oxley Act.
6.
Appoint the Company’s independent auditors for the year 2009;
7.
Appoint the Company’s rating agencies;
8.
Report on Board agreements which took place after that last Shareholders’ Meeting, relating to operations referred to by Article 44 of Law N° 18,046; and
9.
In general, to resolve every other matter under its competency and any other matter of Company interest.
III.
Propose to the Meeting, the distribution of a final dividend, on account of the fiscal year ending December 31, 2008 (that together with the amounts already paid would complete 30% of the income for the period):
a) Ch$14.13 (Fourteen pesos and 13/100) per Series A Shares and;
b) Ch$15.543 (Fifteen pesos and 543/100) per Series B Shares
If the Shareholders’ Meeting approves payment of this dividend, it will be paid on account of income from the 2008 fiscal year and will be available to shareholders beginning April 30, 2009. The Shareholders’ Registry will close on April 24, 2009 for payment of this dividend.
4.
Special Meeting of the Board of Directors
The Board of Directors during its session held March 13, 2009 agreed to the following:
Propose to the Shareholders Meeting, the distribution of an Additional Dividend Nº 166 on account of the Retained Earnings Fund.
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a) Ch$43.00 (forty three pesos) per each Series A share and;
b) Ch$47.30 (forty seven pesos and 30/100) per each Series B share.
If approved by the Shareholders’ Meeting, this dividend will be available to shareholders beginning May 28, 2009.
The Shareholders’ Registry will close on May 22, 2009.
5.
Composition of the Board of Directors
The General Shareholders’ Meeting held April 14, 2009, approved the following, among other matters:
1.
Changes in the Board of Directors, proceeding to renew the Board as follows:
Director | Alternate Director |
Juan Claro González (Chairman) | Ernesto Bertelsen Repetto |
Gonzalo Said Handal (Vice Chairman) | Jose Maria Eyzaguirre Baeza |
José Antonio Garcés Silva (junior) | Patricio Parodi Gil |
Arturo Majlis Albala | Cristian Alliende Arriagada |
Salvador Said Somavia | José Domingo Eluchans Urenda |
Bryan J. Smith | Jorge Hurtado Garretón |
Heriberto Urzúa Sánchez | Gonzalo Parot Palma |
6.
Dividends distributed during the period ended June 30, 2009
Number | Payment Date | Ch$ per Series A Shares | Ch$ per Series B Shares |
| |||
165 | April 24, 2009 | 14.13 | 15.543 | Final | |||
166 | May 28, 2009 | 43.00 | 47.30 | Additional | |||
167 | July 30, 2009 | 7.00 | 7.70 | Interim |
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Embotelladora Andina S.A. | ||||||||||||||||
Second Quarter Results for the period ended June 30, Chilean GAAP | ||||||||||||||||
(In million constant 06/30/09 Chilean Pesos, except per share) | ||||||||||||||||
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| |||||||||
| 06/30/2009 | 06/30/2008 |
| |||||||||||||
| Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | % Ch. | |||||||
VOLUME TOTAL BEVERAGES (Million UC) | 32.8 | 40.8 | 26.1 | 99.7 | 32.3 | 38.4 | 25.4 | 96.1 | 3.7% | |||||||
Soft Drink | 27.6 | 38.3 | 25.5 | 91.5 | 27.0 | 35.8 | 25.0 | 87.9 | 4.1% | |||||||
Mineral Water | 1.4 | 0.5 | 0.2 | 2.1 | 1.4 | 0.6 | 0.2 | 2.3 | -5.9% | |||||||
Juices | 3.7 | 1.1 | 0.4 | 5.2 | 3.9 | 0.9 | 0.1 | 4.9 | 5.9% | |||||||
Beer | NA | 0.9 | NA | 0.9 | NA | 1.0 | NA | 1.0 | -17.0% | |||||||
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| |||||||
NET SALES | 58,430 | 66,721 | 35,769 | 160,208 | 58,049 | 76,128 | 35,554 | 169,252 | -5.3% | |||||||
COST OF SALES | (33,731) | (37,717) | (21,094) | (91,830) | (33,534) | (39,230) | (21,901) | (94,186) | -2.5% | |||||||
GROSS PROFIT | 24,699 | 29,004 | 14,675 | 68,378 | 24,515 | 36,897 | 13,653 | 75,066 | -8.9% | |||||||
Gross Margin | 42.3% | 43.5% | 41.0% | 42.7% | 42.2% | 48.5% | 38.4% | 44.4% |
| |||||||
SELLING AND ADMINISTRATIVE EXPENSES | (14,454) | (19,705) | (11,512) | (45,671) | (13,215) | (27,402) | (11,788) | (52,406) | -12.9% | |||||||
CORPORATE EXPENSES (4) | 0 | 0 | 0 | (746) | 0 | 0 | 0 | (534) | 39.7% | |||||||
OPERATING INCOME | 10,245 | 9,299 | 3,163 | 21,961 | 11,300 | 9,495 | 1,865 | 22,127 | -0.7% | |||||||
Operating Margin | 17.5% | 13.9% | 8.8% | 13.7% | 19.5% | 12.5% | 5.2% | 13.1% |
| |||||||
EBITDA (1) | 13,812 | 11,820 | 4,999 | 29,886 | 15,193 | 12,439 | 3,771 | 30,869 | -3.2% | |||||||
Ebitda Margin | 23.6% | 17.7% | 14.0% | 18.7% | 26.2% | 16.3% | 10.6% | 18.2% |
| |||||||
NON OPERATIONAL RESULTS |
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| |||||||
FINANCIAL EXPENSE/INCOME (Net) |
|
|
| (946) |
|
|
| (11,259) | -91.6% | |||||||
RESULTS FROM AFFILIATED |
|
|
| 67 |
|
|
| 45 | 48.6% | |||||||
AMORTIZATION OF GOODWILL |
|
|
| (1,588) |
|
|
| (1,625) | -2.3% | |||||||
OTHER INCOME/(EXPENSE) |
|
|
| 2,935 |
|
|
| (4,344) | -167.5% | |||||||
PRICE LEVEL RESTATEMENT (3) |
|
|
| (4,978) |
|
|
| 16,286 | -130.6% | |||||||
NON-OPERATING RESULTS |
|
|
| (4,511) |
|
|
| (897) | 402.7% | |||||||
|
|
|
|
|
|
|
|
|
| |||||||
INCOME BEFORE INCOME TAXES; AMORTIZATION OF |
|
|
|
|
|
|
|
|
| |||||||
NEGATIVE GOODWILL AND MINORITY INTEREST |
|
|
| 17,450 |
|
|
| 21,229 | -17.8% | |||||||
|
|
|
|
|
|
|
|
|
| |||||||
INCOME TAXES |
|
|
| (5,503) |
|
|
| (3,088) | 78.2% | |||||||
MINORITY INTEREST |
|
|
| (0) |
|
|
| 0 | NA | |||||||
AMORTIZATION OF NEGATIVE GOODWILL |
|
|
| 0 |
|
|
| 0 | NA | |||||||
NET INCOME |
|
|
| 11,946 |
|
|
| 18,141 | -34.1% | |||||||
Net Margin |
|
|
| 7.5% |
|
|
| 10.7% |
| |||||||
|
|
|
|
|
|
|
|
|
| |||||||
WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
| 760.3 |
|
|
| 760.3 |
| |||||||
EARNINGS PER SHARE |
|
|
| 15.7 |
|
|
| 23.9 |
| |||||||
EARNINGS PER ADS |
|
|
| 94.3 |
|
|
| 143.2 | -34.1% | |||||||
(1) EBITDA: Operating Income + Depreciation | ||||||||||||||||
(2) Total may be different from the addition of the three countries because of intercountry eliminations | ||||||||||||||||
(3) Includes: Monetary Correction + Conversion Effect to Balance Sheet + Income Statement Accounts + Exchange rate gains & losses. | ||||||||||||||||
(4) Corporate expenses partially reclassified to the operations. |
62
Embotelladora Andina S.A. | |||||||||||||||||
Second Quarter Results for the period ended June 30, Chilean GAAP | |||||||||||||||||
(In million nominal US$, except per share) | |||||||||||||||||
|
|
|
|
| |||||||||||||
| Exch. Rate : | $ 531.76 |
| Exch. Rate : | $ 526.05 | ||||||||||||
|
|
|
|
|
|
|
| ||||||||||
| 06/30/2009 | 06/30/2008 |
| ||||||||||||||
| Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | % Ch. | ||||||||
VOLUME TOTAL BEVERAGES (Million UC) | 32.8 | 40.8 | 26.1 | 99.7 | 32.3 | 38.4 | 25.4 | 96.1 | 3.7% | ||||||||
Soft Drink | 27.6 | 38.3 | 25.5 | 91.5 | 27.0 | 35.8 | 25.0 | 87.9 | 4.1% | ||||||||
Mineral Water | 1.4 | 0.5 | 0.2 | 2.1 | 1.4 | 0.6 | 0.2 | 2.3 | -5.9% | ||||||||
Juices | 3.7 | 1.1 | 0.4 | 5.2 | 3.9 | 0.9 | 0.1 | 4.9 | 5.9% | ||||||||
Beer | NA | 0.9 | NA | 0.9 | NA | 1.0 | NA | 1.0 | -17.0% | ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
NET SALES | 109.9 | 125.5 | 67.3 | 301.3 | 107.1 | 140.5 | 65.6 | 312.4 | -3.6% | ||||||||
COST OF SALES | (63.4) | (70.9) | (39.7) | (172.7) | (61.9) | (72.4) | (40.4) | (173.8) | -0.7% | ||||||||
GROSS PROFIT | 46.4 | 54.5 | 27.6 | 128.6 | 45.2 | 68.1 | 25.2 | 138.5 | -7.2% | ||||||||
Gross Margin | 42.3% | 43.5% | 41.0% | 42.7% | 42.2% | 48.5% | 38.4% | 44.4% |
| ||||||||
SELLING AND ADMINISTRATIVE EXPENSES | (27.2) | (37.1) | (21.6) | (85.9) | (24.4) | (50.6) | (21.8) | (96.7) | -11.2% | ||||||||
CORPORATE EXPENSES (4) | 0.0 | 0.0 | 0.0 | (1.4) | 0.0 | 0.0 | 0.0 | (1.0) | 42.3% | ||||||||
OPERATING INCOME | 19.3 | 17.5 | 5.9 | 41.3 | 20.9 | 17.5 | 3.4 | 40.8 | 1.1% | ||||||||
Operating Margin | 17.5% | 13.9% | 8.8% | 13.7% | 19.5% | 12.5% | 5.2% | 13.1% |
| ||||||||
EBITDA (1) | 26.0 | 22.2 | 9.4 | 56.2 | 28.0 | 23.0 | 7.0 | 57.0 | -1.4% | ||||||||
Ebitda Margin | 23.6% | 17.7% | 14.0% | 18.7% | 26.2% | 16.3% | 10.6% | 18.2% |
| ||||||||
NON OPERATIONAL RESULTS |
|
|
|
|
|
|
|
|
| ||||||||
FINANCIAL EXPENSE/INCOME (Net) |
|
|
| (1.8) |
|
|
| (20.8) | -91.4% | ||||||||
RESULTS FROM AFFILIATED |
|
|
| 0.1 |
|
|
| 0.1 | 51.4% | ||||||||
AMORTIZATION OF GOODWILL |
|
|
| (3.0) |
|
|
| (3.0) | -0.4% | ||||||||
OTHER INCOME/(EXPENSE) |
|
|
| 5.5 |
|
|
| (8.0) | -168.8% | ||||||||
PRICE LEVEL RESTATEMENT (3) |
|
|
| (9.4) |
|
|
| 30.1 | -131.1% | ||||||||
NON-OPERATING RESULTS |
|
|
| (8.5) |
|
|
| (1.7) | 412.2% | ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
INCOME BEFORE INCOME TAXES; AMORTIZATION OF |
|
|
|
|
|
|
|
|
| ||||||||
NEGATIVE GOODWILL AND MINORITY INTEREST |
|
|
| 32.8 |
|
|
| 39.2 | -16.2% | ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
INCOME TAXES |
|
|
| (10.3) |
|
|
| (5.7) | 81.6% | ||||||||
MINORITY INTEREST |
|
|
| (0.0) |
|
|
| 0.0 | NA | ||||||||
AMORTIZATION OF NEGATIVE GOODWILL |
|
|
| 0.0 |
|
|
| 0.0 | NA | ||||||||
NET INCOME |
|
|
| 22.5 |
|
|
| 33.5 | -32.9% | ||||||||
Net Margin |
|
|
| 7.5% |
|
|
| 10.7% |
| ||||||||
|
|
|
|
|
|
|
|
|
| ||||||||
WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
| 760.3 |
|
|
| 760.3 |
| ||||||||
EARNINGS PER SHARE |
|
|
| 0.03 |
|
|
| 0.04 |
| ||||||||
EARNINGS PER ADS |
|
|
| 0.18 |
|
|
| 0.26 | -32.9% | ||||||||
(1) EBITDA: Operating Income + Depreciation | |||||||||||||||||
(2) Total may be different from the addition of the three countries because of intercountry eliminations | |||||||||||||||||
(3) Includes: Monetary Correction + Conversion Effect to Balance Sheet + Income Statement Accounts + Exchange rate gains & losses. | |||||||||||||||||
(4) Corporate expenses partially reclassified to the operations. |
63
Embotelladora Andina S.A. | ||||||||||||||
Six Months Results for the period ended June 30, Chilean GAAP | ||||||||||||||
(In million constant 06/30/09 Chilean Pesos, except per share) | ||||||||||||||
| 06/30/2009 | 06/30/2008 |
| |||||||||||
| Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | % Ch. | |||||
VOLUME TOTAL BEVERAGES (Million UC) | 72.7 | 87.9 | 59.1 | 219.7 | 71.8 | 83.8 | 58.3 | 214.0 | 2.7% | |||||
Soft Drink | 61.2 | 82.5 | 57.9 | 201.6 | 60.6 | 78.4 | 57.5 | 196.4 | 2.7% | |||||
Mineral Water | 3.9 | 1.2 | 0.4 | 5.5 | 4.0 | 1.5 | 0.6 | 6.1 | -9.1% | |||||
Juices | 7.6 | 2.1 | 0.7 | 10.4 | 7.3 | 1.8 | 0.2 | 9.3 | 11.7% | |||||
Beer | NA | 2.1 | NA | 2.1 | NA | 2.1 | NA | 2.1 | -3.8% | |||||
|
|
|
|
|
|
|
|
|
| |||||
NET SALES | 128,490 | 135,230 | 82,069 | 344,630 | 126,852 | 162,561 | 79,062 | 367,348 | -6.2% | |||||
COST OF SALES | (73,666) | (76,265) | (46,699) | (195,472) | (71,483) | (81,727) | (47,443) | (199,527) | -2.0% | |||||
GROSS PROFIT | 54,823 | 58,965 | 35,370 | 149,158 | 55,369 | 80,833 | 31,618 | 167,821 | -11.1% | |||||
Gross Margin | 42.7% | 43.6% | 43.1% | 43.3% | 43.6% | 49.7% | 40.0% | 45.7% |
| |||||
SELLING AND ADMINISTRATIVE EXPENSES | (29,660) | (38,406) | (25,610) | (93,676) | (28,724) | (54,991) | (23,084) | (106,799) | -12.3% | |||||
CORPORATE EXPENSES (4) | 0 | 0 | 0 | (1,644) | 0 | 0 | 0 | (1,207) | 36.2% | |||||
OPERATING INCOME | 25,164 | 20,559 | 9,760 | 53,839 | 26,645 | 25,843 | 8,535 | 59,815 | -10.0% | |||||
Operating Margin | 19.6% | 15.2% | 11.9% | 15.6% | 21.0% | 15.9% | 10.8% | 16.3% |
| |||||
EBITDA (1) | 32,505 | 25,611 | 13,353 | 69,824 | 34,225 | 31,728 | 12,229 | 76,974 | -9.3% | |||||
Ebitda Margin | 25.3% | 18.9% | 16.3% | 20.3% | 27.0% | 19.5% | 15.5% | 21.0% |
| |||||
NON OPERATIONAL RESULTS |
|
|
|
|
|
|
|
|
| |||||
FINANCIAL EXPENSE/INCOME (Net) |
|
|
| 21 |
|
|
| (7,231) | 100.3% | |||||
RESULTS FROM AFFILIATED |
|
|
| 397 |
|
|
| 344 | 15.3% | |||||
AMORTIZATION OF GOODWILL |
|
|
| (3,191) |
|
|
| (3,250) | -1.8% | |||||
OTHER INCOME/(EXPENSE) |
|
|
| 2,289 |
|
|
| (1,835) | -224.8% | |||||
PRICE LEVEL RESTATEMENT (3) |
|
|
| (6,469) |
|
|
| 3,852 | -267.9% | |||||
NON-OPERATING RESULTS |
|
|
| (6,953) |
|
|
| (8,120) | -14.4% | |||||
|
|
|
|
|
|
|
|
|
| |||||
INCOME BEFORE INCOME TAXES; AMORTIZATION OF |
|
|
|
|
|
|
|
|
| |||||
NEGATIVE GOODWILL AND MINORITY INTEREST |
|
|
| 46,885 |
|
|
| 51,696 | -9.3% | |||||
|
|
|
|
|
|
|
|
|
| |||||
INCOME TAXES |
|
|
| (12,257) |
|
|
| (12,085) | 1.4% | |||||
MINORITY INTEREST |
|
|
| (1) |
|
|
| (0) | NA | |||||
AMORTIZATION OF NEGATIVE GOODWILL |
|
|
| 0 |
|
|
| 0 | NA | |||||
NET INCOME |
|
|
| 34,628 |
|
|
| 39,610 | -12.6% | |||||
Net Margin |
|
|
| 10.0% |
|
|
| 10.8% |
| |||||
|
|
|
|
|
|
|
|
|
| |||||
WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
| 760.3 |
|
|
| 760.3 |
| |||||
EARNINGS PER SHARE |
|
|
| 45.5 |
|
|
| 52.1 |
| |||||
EARNINGS PER ADS |
|
|
| 273.3 |
|
|
| 312.6 | -12.6% | |||||
(1) EBITDA: Operating Income + Depreciation |
|
|
|
|
|
|
| |||||||
(2) Total may be different from the addition of the three countries because of intercountry eliminations |
|
| ||||||||||||
(3) Includes: Monetary Correction + Conversion Effect to Balance Sheet + Income Statement Accounts + Exchange rate gains & losses. | ||||||||||||||
(4) Corporate expenses partially reclassified to the operations. |
64
Embotelladora Andina S.A. |
|
|
|
|
|
| |||||||||
Six Months Results for the period ended June 30, Chilean GAAP |
|
|
|
|
|
| |||||||||
(In million nominal US$, except per share) |
|
|
|
|
|
| |||||||||
| Exch. Rate : | $ 531.76 |
|
| Exch. Rate : | $ 526.05 | |||||||||
|
|
|
|
|
|
| |||||||||
| 06/30/2009 | 06/30/2008 |
| ||||||||||||
| Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | Chilean Operations | Brazilian Operations | Argentine Operations | Total (2) | % Ch. | ||||||
VOLUME TOTAL BEVERAGES (Million UC) | 72.7 | 87.9 | 59.1 | 219.7 | 71.8 | 83.8 | 58.3 | 214.0 | 2.7% | ||||||
Soft Drink | 61.2 | 82.5 | 57.9 | 201.6 | 60.6 | 78.4 | 57.5 | 196.4 | 2.7% | ||||||
Mineral Water | 3.9 | 1.2 | 0.4 | 5.5 | 4.0 | 1.5 | 0.6 | 6.1 | -9.1% | ||||||
Juices | 7.6 | 2.1 | 0.7 | 10.4 | 7.3 | 1.8 | 0.2 | 9.3 | 11.7% | ||||||
Beer | NA | 2.1 | NA | 2.1 | NA | 2.1 | NA | 2.1 | -3.8% | ||||||
|
|
|
|
|
|
|
|
|
| ||||||
NET SALES | 241.6 | 254.3 | 154.3 | 648.1 | 234.1 | 300.0 | 145.9 | 678.0 | -4.4% | ||||||
Rev. Per UC | 3.3 | 2.9 | 2.6 | 3.0 | 3.3 | 3.6 | 2.5 | 3.2 |
| ||||||
COST OF SALES | (138.5) | (143.4) | (87.8) | (367.6) | (131.9) | (150.8) | (87.6) | (368.2) | -0.2% | ||||||
GROSS PROFIT | 103.1 | 110.9 | 66.5 | 280.5 | 102.2 | 149.2 | 58.4 | 309.7 | -9.4% | ||||||
Gross Margin | 42.7% | 43.6% | 43.1% | 43.3% | 43.6% | 49.7% | 40.0% | 45.7% |
| ||||||
SELLING AND ADMINISTRATIVE EXPENSES | (55.8) | (72.2) | (48.2) | (176.2) | (53.0) | (101.5) | (42.6) | (197.1) | -10.6% | ||||||
CORPORATE EXPENSES (4) | 0.0 | 0.0 | 0.0 | (3.1) | 0.0 | 0.0 | 0.0 | (2.2) | 38.8% | ||||||
OPERATING INCOME | 47.3 | 38.7 | 18.4 | 101.2 | 49.2 | 47.7 | 15.8 | 110.4 | -8.3% | ||||||
Operating Margin | 19.6% | 15.2% | 11.9% | 15.6% | 21.0% | 15.9% | 10.8% | 16.3% |
| ||||||
EBITDA (1) | 61.1 | 48.2 | 25.1 | 131.3 | 63.2 | 58.6 | 22.6 | 142.1 | -7.6% | ||||||
Rev. Per UC | 0.8 | 0.5 | 0.4 | 0.6 | 0.9 | 0.7 | 0.4 | 0.7 |
| ||||||
Depreciación | 13.8 | 9.5 | 6.8 | 30.1 | 14.0 | 10.9 | 6.8 | 31.7 |
| ||||||
CAPEX | 23.4 | 18.7 | 7.2 | 49.3 | 30.2 | 24.1 | 4.1 | 58.5 |
| ||||||
Capex/dep | 1.70 | 1.96 | 1.06 | 1.64 | 2.16 | 2.22 | 0.60 | 1.85 |
| ||||||
Ebitda Margin | 25.3% | 18.9% | 16.3% | 20.3% | 27.0% | 19.5% | 15.5% | 21.0% |
| ||||||
NON OPERATIONAL RESULTS |
|
|
|
|
|
|
|
|
| ||||||
FINANCIAL EXPENSE/INCOME (Net) |
|
|
| 0.0 |
|
|
| (13.3) | 100.3% | ||||||
RESULTS FROM AFFILIATED |
|
|
| 0.7 |
|
|
| 0.6 | 17.5% | ||||||
AMORTIZATION OF GOODWILL |
|
|
| (6.0) |
|
|
| (6.0) | 0.0% | ||||||
OTHER INCOME/(EXPENSE) |
|
|
| 4.3 |
|
|
| (3.4) | -227.1% | ||||||
PRICE LEVEL RESTATEMENT (3) |
|
|
| (12.2) |
|
|
| 7.1 | -271.1% | ||||||
NON-OPERATING RESULTS |
|
|
| (13.1) |
|
|
| (15.0) | -12.7% | ||||||
|
|
|
|
|
|
|
|
|
| ||||||
INCOME BEFORE INCOME TAXES; AMORTIZATION OF NEGATIVE GOODWILL AND MINORITY INTEREST |
|
|
| 88.2 |
|
|
| 95.4 | -7.6% | ||||||
|
|
|
|
|
|
|
|
|
| ||||||
INCOME TAXES |
|
|
| (23.0) |
|
|
| (22.3) | 3.3% | ||||||
MINORITY INTEREST |
|
|
| (0.0) |
|
|
| (0.0) | NA | ||||||
AMORTIZATION OF NEGATIVE GOODWILL |
|
|
| 0.0 |
|
|
| 0.0 | NA | ||||||
NET INCOME |
|
|
| 65.1 |
|
|
| 73.1 | -10.9% | ||||||
Net Margin |
|
|
| 10.0% |
|
|
| 10.8% |
| ||||||
|
|
|
|
|
|
|
|
|
| ||||||
WEIGHTED AVERAGE SHARES OUTSTANDING |
|
|
| 760.3 |
|
|
| 760.3 |
| ||||||
EARNINGS PER SHARE |
|
|
| 0.09 |
|
|
| 0.10 |
| ||||||
EARNINGS PER ADS |
|
|
| 0.51 |
|
|
| 0.58 | -10.9% | ||||||
(1) EBITDA: Operating Income + Depreciation | |||||||||||||||
(2) Total may be different from the addition of the three countries because of intercountry eliminations | |||||||||||||||
(3) Includes: Monetary Correction + Conversion Effect to Balance Sheet + Income Statement Accounts + Exchange rate gains & losses. | |||||||||||||||
(4) Corporate expenses partially reclassified to the operations. |
65
Consolidated Balance Sheet | ||||||||
(In million constant 06/30/09 Chilean Pesos) | ||||||||
|
|
|
|
|
|
|
|
|
ASSETS | 06/30/2009 | 06/30/2008 | %Ch |
| LIABILITIES & SHAREHOLDERS' EQUITY | 06/30/2009 | 06/30/2008 | %Ch |
|
|
|
|
|
|
|
|
|
Cash + Time deposits + market. Securit. | 110,351 | 105,983 | 4.1% |
| Short term bank liabilities | 2,829 | 7,518 | -62.4% |
Account receivables (net) | 46,383 | 54,981 | -15.6% |
| Current portion of long term bank liabilities | 226 | 145 | 0.0% |
Inventories | 25,030 | 27,647 | -9.5% |
| Current portion of bonds payable | 4,969 | 432 | 1049.8% |
Other current assets | 15,613 | 19,008 | -17.9% |
| Trade accounts payable and notes payable | 66,683 | 64,727 | 3.0% |
Total Current Assets | 197,377 | 207,619 | -4.9% |
| Other liabilities | 18,341 | 27,446 | -33.2% |
|
|
|
|
| Total Current Liabilities | 93,048 | 100,268 | -7.2% |
Property, plant and equipment | 667,655 | 632,197 | 5.6% |
|
|
|
|
|
Depreciation | (464,312) | (440,401) | 5.4% |
| Long term bank liabilities | 302 | 794 | -62.0% |
Total Property, Plant, and Equipment | 203,343 | 191,796 | 6.0% |
| Bonds payable | 72,896 | 78,267 | -6.9% |
|
|
|
|
| Other long term liabilities | 42,736 | 53,803 | -20.6% |
Investment in related companies | 29,461 | 26,713 | 10.3% |
| Total Long Term Liabilities | 115,934 | 132,863 | -12.7% |
Investment in other companies | 130 | 154 | -15.9% |
|
|
|
|
|
Goodwill | 51,486 | 58,943 | -12.7% |
| Minority interest | 11 | 9 | 15.8% |
Other long term assets | 27,752 | 28,140 | -1.4% |
|
|
|
|
|
Total Other Assets | 108,828 | 113,950 | -4.5% |
| Stockholders' Equity | 300,556 | 280,225 | 7.3% |
|
|
|
|
|
|
|
|
|
TOTAL ASSETS | 509,548 | 513,366 | -0.7% |
| TOTAL LIABILITIES & SHAREHOLDERS' EQUITY | 509,548 | 513,366 | -0.7% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Highlights |
| |||||||
(In million constant 06/30/09 Chilean Pesos) |
| |||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADDITIONS TO FIXED ASSETS | 06/30/2009 | 06/30/2008 |
|
| DEBT RATIOS | 06/30/2009 | 06/30/2008 |
|
|
|
|
|
|
|
|
|
|
Chile | 12,463 | 16,382 |
|
| Financial Debt / Total Capitalization | 0.21 | 0.24 |
|
Brazil | 9,925 | 13,076 |
|
| Financial Debt / EBITDA L12M | 0.49 | 0.55 |
|
Argentina | 3,825 | 2,216 |
|
| EBITDA L12M / Interest Expense (net) L12M | 19.13 | 22.61 |
|
| 26,213 | 31,674 |
|
| L12M: Last twelve months |
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* As of June 30, 2009, the Company registered a positive net cash position of US$ 55 million. Total debt amounted to US$ 153 million. |
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Total Cash amounted to US$ 208 million. |
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66
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Santiago, Chile.
EMBOTELLADORA ANDINA S.A.
By:/s/ Osvaldo Garay
Name: Osvaldo Garay
Title: Chief Financial Officer
67