Embotelladora Andina S.A. Annual Report 2019

Plain-text annual report

Integrated Annual Report 8EXHIBITS7CORPORATEINFORMATIONchapter.one | 2 ANDINA AT A GLANCE HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATION1WHAT DO WE DO? 102-6, 102-7, 102-8 3 A t Coca-Cola Andina we are present in four South American countries (Argentina, Brazil, Chile and Paraguay) and we have 17,586 collaborators to cover a population of approximately 54 million inhabitants. This allows us to reach 267 thousand customers. We are a Company committed to the production and distribution of soft drinks, water, juices and other products and our concern is to generate value to all our stakeholders. We want to be present at every moment or occasion of hydration of our consumers, generating close relationships and providing options to each according to their lifestyle. Our success is sustained on having a great team, which is committed to providing value and delivering quality products. INDICATOR Volume Sales M US$ Ebitda M US$ Ebitda Margin (%) Net income (Income attributable to the owners of the controller ) MM US$ Liters of water per liter of produced beverage (2) Percentage of sales returnable formats (3) Percentage of sales reduced or zero sugar (4) Percentage recycled residue (5) Used energy ratio (6) Internal environment favorability (7) (1) UC: Unit Cases 5.678 liters per each unit case. (2) Liters used / liters of produced beverage (3) Volume sold in returnable formats / total volume. (4) portfolio % reduced or zero sugar contents. 2018 2019 UC 751 million (1) UC 746 million 2,569 502 19.52% 149 2.01 31.3% 18.5% 84.5% 0.33 69% 2,495 491 19.68% 247 1.96 31.7% 20.8% (8) 88.7% 0.32 72% (5) Tons recycled residue / tons total residue generated. (6) MJ/liters of produced beverage. (7) Biannual climate survey. (8) In 2019 mid-cal sale (less than 5 gr of sugar per each 100 ml) plus the sale of zero sugar was 28.5% 4,238 M liters sold 17,586 collaborators 54 million consumers 267 thousand clients HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATION SUSTAINABLE VALUE CREATION MODEL ALONG THE VALUE CHAIN 102-9 We create long term sustainable value for all involved in our value chain. We are actively responsible for delivering quality service to our customers and consumers, for which we have a committed team. UPSTREAM The Coca-Cola Company (TCCC). At Coca-Cola Andina we produce and distribute The Coca-Cola Company (TCCC) licensed products in Argentina, Brazil, Chile and Paraguay. Suppliers of raw materials and services We are responsible for promoting a chain of suppliers that is environmentally responsible and has respect for their employees. These include suppliers of raw materials, such as water, energy, sugar, among others. Coca-Cola Andina: bottling and packaging Process that includes bottling, packaging, all administrative and logistics tasks. M A E R T S N W O D 4 OPERATION AND LOGISTICS Consumers, recycling and recovery At Coca-Cola Andina we take care of the complete cycle of our packaging, it is part of our value creation model. Clients we generate shared value with the fundamental links of the chain, service models and the delivery of a differentiated service according to the requirements and needs of our customers. Distribution Process that includes distribution to customers and distribution centers, optimizing routes with efficient truck fleets (own and third party). HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONGENERATED AND DISTRIBUTED VALUE: 201-1 2019 generated and distributed value chart: *All figures expressed in Ch$ millions 5 "Materiality goes far beyond economics. It involves the impacts the Company generates on stakeholders, regardless of the economic relevance that this implies." GONZALO SAID Vice Chairman of the Board of Directors HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONBROAD PORTFOLIO 102-1 F rom Coca-Cola brand soft drinks to organic teas and plant-based beverages, we offer some of the world's most popular beverages. Our portfolio is evolving to have beverages for all tastes and occasions, with or without sugar. 6 Beer and spirits Juices and others Water 2.6% 9.9% 11.1% Soft drinks 76.5% Note: Percentages correspond to sales volume distribution for Coca-Cola Andina as of 12.31.2019. HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONLEADERS IN THE REGION 102-6, 102-7 9% 9% 24% 22% 12% 16% 32% Volume 34% Revenues Ebitda 38% 34% 35% 35% Argentina Brazil Chile Paraguay Extension (in kilometers): ARGENTINA CHILE 7 • Territory: Córdoba, Mendoza, San Juan, San Luis, Neuquén, almost all of the province of Santa Fe, Entre Ríos, Western province of Buenos Aires, La Pampa, Chubut, Río Negro, Santa Cruz and Tierra del Fuego. • Territory: Antofagasta, Atacama, Coquimbo, Metropolitan Region, San Antonio, Cachapoal, Aysén and Magallanes. • Population: 9.9 million. • Population: 13.9 million. • Total volume 2019: 239.6 million UC. • Total volume 2019: 178.2 million UC. BRAZIL PARAGUAY • Territory: Majority of the state of Rio de Janeiro, Espírito • Territory: All of the Paraguayan territory. Santo, part of São Paulo and part of Minas Gerais. • Population: 23.1 million. • Total volume 2019: 259.3 million UC. • Population: 7.2 million. • Total volume 2019: 69.3 million UC. HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONCONTACT INFORMATION 102-53, 102-3; 102-4; SCOPE OF THE INTEGRATED ANNUAL REPORT 102-45, 102-46 Corporate office Av. Miraflores 9153, Piso 7, Renca, Santiago de Chile Tel. (56 2) 2338 0520 | www.koandina.com ABOUT OUR INTEGRATED ANNUAL REPORT 102-49 PREPARATION CRITERIA 102-46; 102-52, 102-54;102-12 Investor relations contact information Paula Vicuña | Investor Relations Manager | andina.ir@koandina.com Miraflores 9153, Piso 7, Renca, Santiago de Chile Telephone: (56 2) 2338 0520 Sustainability contact information Consuelo Barrera | informesanuales@koandina.com Ruta Nacional 19, Km. 3,7, Córdoba, Argentina Telephone: (54) 351 496 8304 In 2019 we present our Second Integrated Annual Report, which reflects the advances in integrating sustainability into our business model and how it is present in each of the decisions we make • It follows the guidelines developed by the GRI (Global Reporting Initiative – GRI) standard, under the comprehensive compliance option. "Being a multinational company raises the standard, as well as being part of the Coca-Cola System" • Guidelines of the International Integrated Reporting Council (IIRC) Integrated Reporting Framework. • The mandatory requirements of General Standard No. 30 of Chile’s Financial Market Commission have been considered. • Principles set out in AA1000-APS 2008 Accountability Standard of inclusiveness, relevance and response to stakeholders. GONZALO SAID Vice Chairman of the Board of Directors • In addition, this Report is a communication on how Coca-Cola Andina links its performance with the Sustainable Development Goals (SDGs) of the United Nations Global Compact. 8 #GOPAPERLESS Our 2019 Integrated Annual Report will be available in digital version on our market communication channels: the website and investor relations app, which you can install on your phones through the App Store and Google Play. This is part of our commitment to reduce paper consumption and, as we understand it is in everyone's interest, we want you to join us in this decision. DESIGN PREPARATION PROCESS 102-46 The design of the Coca-Cola contour bottle, elements of Coca-Cola marketing campaigns, logos and every reference to the brands of The Coca-Cola Company contained in this Report are registered property by The Coca-Cola Company. All artistic compositions and photographs contained in this Integrated Report are the property of Embotelladora Andina S.A. For the preparation of our second Integrated Report we formed a team composed of multiple areas, both from our Corporate office and each of the operations. Once the Report was prepared, it was reviewed and approved by the Chief Executive Officer and the Board of Directors. HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONMESSAGE FROM THE CHAIRMAN OF THE BOARD OF DIRECTORS 102-14, 102-16, 102-7, 102-23; 102-102-15 9 A fter being part of the Coca-Cola system for more than 70 years, at Coca Cola Andina we continue offering sources of pride and satisfaction to our shareholders, directors and collaborators who belong to this great Company. And so, I am pleased to share with you our Second Integrated Annual Report. JUAN CLARO GONZÁLEZ Chairman of the Board of Directors 2019 has been another year of consistent operating achievements and outstanding financial results given the execution of a solid strategy and thanks to our collaborators. We faced huge challenges in the territories where we operate: political, social and economic instability in Chile and political changes and its consequent economic volatility in Argentina. Our business was no stranger to this situation and, thanks to a robust market position, vast distribution network and the determination of a great work team, we managed to accompany our customers and the community, meeting corporate goals and generating shared value. I am very proud of the Company we are building and the ties we are building with all our stakeholders to accomplish the positive impact we set out to achieve. I invite you to review our pillars of sustainable value creation and most recent achievements. LEADERSHIP IN ORGANIC AND INORGANIC GROWTH During 2019 we continued to promote growth through a unique and diversified product portfolio that allows us to participate in a wide range of beverage categories and thus continue developing as a "Total Beverage Company". In this sense, we launched 36 new products and added the brands of "Cooperativa Capel", leaders in the pisco market. This agreement, together with the one reached with Diageo in 2018, allows us to optimize our extensive commercial, logistics and distribution network in Chile. We are a Company that is constantly expanding and transforming to offer suitable options for every consumption occasion and lifestyle, which is reflected in our 2019 results: sales volume of 746 million unit cases with a 6.3% increase in sales (Ch$1,779,025 million). These results place us as the third bottler of Coca-Cola brand soft drinks in Latin America and the ninth largest in the world in terms of volume, consolidating as the largest Coca-Cola bottler in Chile, Argentina and Paraguay and the third in Brazil. LEADERSHIP IN COSTS & MARKET POSITION The continuous cost leadership in our operations, an efficient and integrated supply chain and an extensive distribution network allowed us to serve with excellence more than 267 thousand customers distributed in 2.9 million square kilometers and achieve a strong competitive position in all markets in which we operate. • In Chile, our leadership in the category of soft drinks continues and we have a strong position in waters and juices and others, growing in both categories compared to the previous year. In 2019 we became leaders in the plain water segment during the second half of the year and we continue to grow consistently in Monster compared to the previous year. • In Brazil, we lead the sector in soft drinks and juices and others. In 2019 we started marketing mineral water produced at our Duque de Caxias plant, achieving significant growth in that category. On the production side, for the third consecutive year we received the Supply Chain Award, which recognizes best practices in the supply chain among Coca-Cola bottlers in Brazil. • In Argentina, we lead the category of soft drinks, juices and others. In addition, we were recognized with the first place in the Global Customer and Commercial Leadership Awards 2018 in the Route to Market category, for the digitization and innovation program developed and that has allowed us to gain market share in most categories in a country facing a strong economic downturn. • Finally, in Paraguay we lead all categories and in 2019 we achieved important growth in each of them. For the eighth consecutive year we won the Top of Mind recognition, for being the most remembered and preferred brand by consumers. HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATION ECONOMIC VALUE CREATION The EBITDA of Ch$348,869 million in 2019 involved an increase of 7.4% compared to 2018 and the EBITDA Margin of 19.6%, meant an expansion of 19 basis points. Income attributable to Coca-Cola Andina’s controllers was Ch$173,722 million, 79.8% higher than in the previous period, and net margin reached 9.8%. SOCIAL COMMITMENT AND SUSTAINABLE DEVELOPMENT Another key pillar of the strategy is our strong commitment to sustainable development. At Coca-Cola Andina we adhere to the Global Compact, support the principles of the Global Compact and develop the Sustainable Development Goals (SDGs). This Integrated Annual Report reflects the progress in each of them: Our ambitious goal of consolidating ourselves as a total beverage company, diversifying the product portfolio, urges us to be agile and flexible to actively respond to the needs and trends of our consumers. In this sense, we have a reduced or sugar-free version for each of our products and this has been our growth engine in 2019, with increases in the mix of sales of light, mid-cal and sugar-free products and the reduction of the calorie indicator per liter of beverage sold in all our operations. As water stewards, in the continuous search for more efficient and sustainable processes to reduce consumption, in 2019 and for the second year in a row, we have managed to lower the water ratio used for each liter produced from 2.01 to 1.96 at the aggregate level of our four operations, mainly due to the investment in the Duque de Caxias' effluent treatment plant. We also continue boosting projects in communities where we operate, such as Water Conservation at the Mbaracayú Reserve in Paraguay, the Safe Water program at rural schools in the territory of Coca-Cola Andina Argentina and the Reforestation project of the Renca hills Metropolitan Park in Chile. At Coca Cola Andina we have an important role and a great responsibility in achieving a World Without Waste. For this reason: • We are strengthening our returnable bottle strategy throughout all operations, making it the best performing packaging in a circular economy. In 2019 its relevance grew in most of our franchises, driven by the launch of the single bottle for all flavors and by the capitalization of investments made at the Duque de Caxias plant in Brazil, with an increase of more than 2 points in the returnables mix in that country and with huge opportunities to continue growing in 2020. • In addition, we continue promoting initiatives to collect single- use bottles. We founded, together with 20 companies, the First Integrated Management System in Chile that has already launched three packaging collection pilots in municipalities of Santiago. We continue with the "Coca Cola Andina -Kyklos Environmental Education Program”, "Recycling for Brazil" and the sponsorship of cooperatives in Argentina. In four years, we managed to almost triple the amount of tons collected (6,234 tons) and increase the amount of recycled material incorporated in the bottles in our operations in Argentina and Brazil (5.7% average). Also, in our plants and distribution centers we carried out extensive work of awareness of waste segregation at source achieving highly positive results, such as Coca-Cola Andina Chile where five distribution centers obtained the "zero waste" certification. • The sustainable management of our packaging is a commitment that inspires us to be protagonists for many years; constantly redesigning our packaging to be 100% recyclable achieving our goals set year by year in this area. We continue to make great efforts to reduce the energy we use. In 2019, with a more complex and diverse product portfolio, we achieved a 3% reduction in the energy we use (Mj/liters produced). In addition, we lowered the weight of the bottles, which meant a lower emission of 1,015 Tn CO2 equivalent. In 2019 and for the fourth consecutive year, we were ratified as part of the Dow Jones Sustainability Index Chile and, for the third consecutive year, as part of the Latin American Integrated Market Sustainability Index. This demonstrates the importance of shared value in our Company, for our investors and for all our stakeholders. 10 PASSIONATE ABOUT WHAT WE DO All this is possible thanks to the efforts of a team of people who work every day with experience, talent, discipline and passion with the objective of positioning our Company as a beverage market leader. We firmly believe that our team is the cornerstone of business sustainability to promote an agile and dynamic culture that supports growth goals. At Coca-Cola Andina, we make sure their voices are heard and, in 2019, the organizational climate survey reflected this deep commitment given its satisfaction level, with a historical adhesion figure of 93% and growing the overall favorability from 58% to 72% since it was implemented in 2012. These results encourage us to remain focused on promoting a culture that supports a safe, innovative and inclusive work environment, which promotes empowered and motivated collaborators to capitalize on opportunities. INCLUSION AND DIVERSITY Inclusion and diversity are core values of our Company. In 2019 we made progress in this area by creating the Policy of Respect for the Person, Diversity and Inclusion, achieving the goal in Chile of 1% of people with disabilities in our payroll and boosting female presence in different areas and positions, as is the case of truck drivers in Brazil and plant operators in Chile. In this line, in Paraguay we empowered more than 2,500 women in our value chain through the "Start-Up Together" program. 2020 CHALLENGES AND OPPORTUNITIES Our strategy continues alive and dynamic, with positive results for more than 70 years. During 2020 we will renew our commitment to growth, setting challenging financial, market, social, environmental and corporate governance objectives, within a framework of ethics and transparency. Latin America is the fastest growing region worldwide in terms of consumption of Coca-Cola products and second in terms of size. Our franchises present great opportunities to continue developing, especially in Brazil, Argentina and Paraguay where per capita consumption rate has the most potential. I wish to continue building together a strong Company, with a culture of efficiency and ready to capture opportunities. There is much to be done and we are aware of the social, economic and environmental volatility and complexity in which we are immersed. However, we will continue focused on building a sustainable future, creating long-term value for all stakeholders and the communities where we operate. I invite you to renew together this commitment for this year. that is beginning. HOME1 ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS2019 INTEGRATED ANNUAL REPORT8EXHIBITS7CORPORATEINFORMATIONchapter.two | 11 OUR HISTORY HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT2HISTORICAL REVIEW 1946: Embotelladora Andina S.A. is established with the license to produce and distribute Coca-Cola products in Chile. 1955: Andina is listed on the Santiago Stock Exchange. 1985: Current controlling shareholders acquire 50% of the Company. 1994: Andina listed on NYSE. Acquisition of Rio de Janeiro Refrescos in Brazil. 1995-96: Acquisition of Coca-Cola bottler in Rosario and Mendoza, and packaging business in Buenos Aires. 1996: TCCC acquires 11% of Andina. 2000: Acquisition of Niteroi, Vitoria and Governador Valadares (NVG) Coca-Cola bottler. 2007-08: Joint venture (50/50) with the Coca-Cola System for the water and juice business in Brazil and Chile. 2019 12 2008: Andina incorporates Benedictino to its water portfolio. 2011: New Plant in Chile begins operations. 2012: Merger with Coca-ColaPolar (new territories in Argentina, Chile and Paraguay). Andina acquires 40% ownership in Sorocaba Refrescos in Brazil. 2013: Andina acquires Ipiranga, a Coca-Cola bottler in Brazil. 2017: Andina begins distributing Ades products, reinforcing the growth of new categories. 2018: Acquisition of Guallarauco. New agreement with Diageo for the distribution of alcoholic beverages, The new Duque de Caxias plant begins operating in Brazil. 2019: New agreement for the distribution of Pisco Capel in Chile. 2016: Creation of the Coca-Cola del Valle Ventures S.A. joint venture along with Coca-Cola de Chile S.A. and Embonor for the production and distribution of non- carbonated and still beverages. For more information on the company's timeline visit our website. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT1946chapter.three | SUSTAINABLE VALUE CREATION STRATEGY 13 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT3MARKET ENVIRONMENT AND REGULATORY FRAMEWORK T he Labeling Act is a clear example that we should be part of something bigger and that all industries have a shared responsibility to make this world a better place. The third stage of Law No. 20,606 (1) entered into force on June 7, 2019, increasing demands for the reduction of critical nutrients in food. 417-1 (1) : Law No. 20,606 on Labelling, is applicable to the operation in Chile. Significant and rapid changes in consumer preferences are being observed in the food industry. This is a challenge to which we must anticipate in an agile and flexible way, incorporating consumer knowledge into decision- making processes in order to adapt to the different scenarios. EXPANDING THE MIX OF SUGAR-FREE PRODUCTS At Coca-Coca Andina we have been preparing for this change for many years and an example of this was the Master Brand transformation, so that the consumer would dare to drink Coca-Cola without sugar with no impact on the label. With this, we began increasing product availability and coverage. Then, in all the countries where we operate we launched a strong campaign to boost the consumption of sugar-free products and reduced the composition of sugar across the entire product mix. Flavors of soft drinks and juices were reformulated, which led to changes in the product mix, growing consumption of sugar-free products. Increased Relevance of Stills(1) Our portfolio has grown significantly in recent years and Chile has led this progress. Currently, per capita consumption of regular soft drinks is very high; however, there is a transfer of consumers from soft drinks to other beverage categories. On the other hand, the previously mentioned situation is accentuated by the entry of new consumers who are migrating mostly to the water market, where there is a double-digit increase. What is happening with higher value-added products, such as juices is also relevant. We have observed stagnation in the juice segment containing 5% or less of fruit, a situation that is repeated in most of the countries in which we operate. Mainstream juices show strong growth, mainly in the premium segment, which has expanded by approximately 25% per year. In addition to the migration to the water market, there is an increase in other plant based products, tea and mate in the markets in which we operate. MIX SUGAR FREE SSD´S 2010 2019 MIX STILLS Argentina Brazil Chile Paraguay 8% 10% 18% 7% 17% 14% 31% 18% Argentina Brazil Chile Paraguay 2010 4% 4% 13% 5% 2019 15% 13% 29% 19% (1) Stills: this segment encompasses all non-soft drink beverages. Limits on liquid foods Chile 1ST STAGE 2ND STAGE 3RD STAGE CALORIES 100 (kcal/100ml) 80 (kcal/100ml) 70 (kcal/100ml) 30% SODIUM 100 (mg/100ml) 100 (mg/100ml) 100 (mg/100ml) SUGAR 6 (g/100ml) 5 (g/100ml) 5 (g/100ml) 16,7% SATURATED FATS 3 (g/100ml) 3 (g/100ml) 3 (g/100ml) % corresponds to the variation between the first and third stage 14 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTENVIRONMENTAL CARE Sustainability awareness in consumption is a clear trend. Milestones of the REP (1) Act GRI: 417-1 The REP Act is an economic instrument for waste management, requiring all producers to organize and finance waste management derived from the products they commercialize. In a recent Nielsen research (FMCG and Retail Insights, 2019), 73% of people globally acknowledged being willing to change their consumption habits to reduce impact on the environment. Today, sustainability considerations determine consumers’ choices, especially among younger and price-sensitive consumers. This is accentuated in a context where globalization and the media provide greater awareness of environmental and socioeconomic crises around the world. Sustainable practices can develop greater consumer confidence towards businesses, increasing brand and customer loyalty and strengthening their competitive advantage. REP Bill is presented Act 20,920 is officially published 2015 Executive enters the bill and it is approved by legislators Regulating rules are issued First product declaration The Supreme Decree draft for packaging and containers is issued in June June – August draft public consultation process Public consultation for Ecodesign plan 2018 15 At Coca-Cola Andina our responsibility in the care of the environment is also clear. We have taken on this responsibility with more strength since January 2018, when The Coca-Cola Company’s CEO James Quincy spoke of the importance of recycling and collecting packaging within the framework of the World Economic Forum. As a bottler, this keeps us working hard to meet commitments to achieve a waste-free world. Supreme Decree for packaging and containers expected for March 2020 2022 Obligation to meet goals Global goals: Sub-categories: Plastic: 3% Glass: 11% Soft drinks cardboard: 5% (1): Law No. 20,929. Sets the Framework for Waste Management, Extended Producer Responsibility and Promotion of Recycling. This regulation applies to Chile. GROWTH OF DIGITAL CHANNELS A pace of life with less time availability and a change in consumption habits have meant significant growth in digital channels. To a greater or lesser extent, this has also occurred in the countries in which we operate and that has led us to pay attention to the actors that have become relevant in that business, such as Rappi, Pedidosya, etc. The digital channel is very relevant since brands play a key role. This is mainly because when consumers use this route they do not do so with a generic product, such as a soft drink or coffee in mind, but they go after a specific brand. With the increase of e-commerce and remote channels allowing people more time, consumers take advantage of these new leisure instances to be outside home more often. This, in turn, leads to an increase in consumption in restaurants, cafes and hotels. In this context, we are activating the use of several digital channels, using a cooperative approach with our customers and investing in new training for operating teams. micoca-cola.cl users grew by9,300 clients compared with the previous year. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT20132017202020162019STRATEGY AND BUSINESS MODEL GRI: 102-14; 102-15, 102-16-102-17 To achieve our mission, at Coca-Cola Andina we developed the following strategy: Beverage benefits Energy management and climate protection MISSION 102-14; 102-15, 102-16-102-17 Add value by growing in a sustainable way, refreshing our consumers and sharing moments of optimism with our clients. VISION 102-14; 102-15, 102-16-102-17 Lead the beverage market by being recognized for our management of excellence, people and welcoming culture. VALUES 102-14; 102-15, 102-16-102-17 • Integrity • Teamwork • Attitude • Austerity • Results-oriented • Customer Focus 16 Sustainable packaging Water stewardship Community Work environment Corporate Governance HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSTRATEGIC PILLARS GRI: 102-14; 102-15, 102-16-102-17 SUSTAINABLE GROWTH We care about giving our shareholders a long term profitable and sustainable growth opportunity. At Coca-Cola Andina we create sustainable value for our shareholders and stakeholders: • Increasing productivity in asset utilization and cost structure optimization. • Growing in a sustainable, organic and inorganic way, in an environment of ethics and transparency. • Leading the beverage market, refreshing our consumers and sharing moments of optimism with them. • Gaining their preference with high quality products to diversify consumption habits and occasions, offering high level of availability, accessibility and service. • Creating shared value with our stakeholders. • Constantly developing processes of excellence and efficiency in the use of resources, driving permanent innovation in new and better ways to build economic, social and environmental value. 17 To achieve it, our strategy is based on five pillars: AGILITY Is a key element to get ahead of the changing requirements of consumers in the markets where we operate. This requires listening and adapting quickly. We are aware of the role our stakeholders play in the value chain. They are a key link in growing the business and continuing to be positive leaders for those around us. PEOPLE LEADERSHIP Cola-Cola Andina has defined a strategic agenda that seeks to attract, develop and retain the best talent in order to respond to business challenges. The work environment management and human capital development agenda involves a balanced offer of work well-being, which we consider key to ensuring that the best people want to develop their career at Coca-Cola Andina. • Promoting high levels of human capital management performance, knowledge and information systems. • Fostering well-being and development in the workplace. As change makers, we recognize that it is key to give opportunities by making inclusive hires, offering conditions so that they can be professionally productive and being part of this more diverse and valuable great team. OPERATING EFFICIENCY The Company aims to continue the search for efficiencies in all its processes, particularly in production and logistics. With the addition of new technologies, together with the correct investment assessment, we can focus on cost reduction, resource use and risk mitigation. MANAGE FUTURE PORTFOLIO It aims to capture the multiple opportunities and challenges in each of the markets in which Coca-Cola Andina operates. The Company has focused on continuing to expand its portfolio, in order to accompany the needs of our consumers. OPTIMIZE COST MANAGEMENT Within the framework of ability development and knowledge management process, we plan and manage to coordinate the work of our four operations in an orderly and synergist manner. With the development of multi-operating work teams, we carry out simultaneous deployments. In this way, the most experienced countries support and share this knowledge with the rest of the organization, standardizing the practices of excellence in all the territories where Coca-Cola Andina operates, capturing value and knowledge and reducing the time to implement improvements and innovations. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTValue creation for our stakeholders GRI: 102-44, 102-40 At Coca-Cola Andina we understand that managing our environmental and social performance is fundamental to our long-term success. We network with the sustainability committees of each of our operations to identify and interact with their different stakeholders: The Coca-Cola Company, collaborators, clients, investors and shareholders, community and governments. Thus, our Company will be sustainable in the long term, making them participate and creating shared value with its stakeholders. MATERIALITY AND RISKS MATERIALITY 102-44 18 A ccording to the Global Reporting Initiative (GRI), materiality refers to "those aspects that reflect the significant, social, environmental and economic impacts of the organization or those that could exert substantial influence on the assessments and decisions of stakeholders". The topics we identify as our material topics are those that matter to our stakeholders and those that subsequently affect the creation of value for all of them. This year we made a cross between the material issues and our risk matrix, to highlight those subjects that are being addressed from risk management. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTPERIODICITY A materiality study update is carried out every two years at Coca-Cola Andina. The last was made in 2018 and each result is submitted to the Ethics and Sustainability Committee for validation. Beverage benefits • Product quality and excellence • Product well-being • Responsible marketing Community • Client development • Supplier development • Economic and social development of local communities • Human rights Corporate Governance • Transparency in business management • Relationship with stakeholders • Risk management Energy management and climate protection • Efficient product distribution • Energy management Sustainable packaging • Sustainable packaging and waste management Work environment • Management of internal work environment, life quality and people development Water stewards • Water management RISK MATRIX COMPARISON 102-44, 102-40; 102-15 Material topics were crossed with the risk matrix of Coca-Cola Andina. This matrix is defined for each of the countries in which the Company operates. The risk matrix contains the specific individual risks identified. For the purposes of the current comparison, several similar risks or risks with very small differences between them were consolidated, resulting in a list of 30 global risks, which were related to each material topic. s r e d l o h e k a t s r o f e c n a v e l e R 19 Corporate Governance Water management Beverage benefits Sustainable packaging Energy management and climate protection Work environment Community Importance in Coca-Cola Andina's strategy The above chart shows that both the stakeholders and the management of Coca-Cola Andina place greater importance on the issues of water management, sustainable packaging, corporate governance and beverage benefits. SUMMARIZED MATERIALITY MATRIX 102-44, 102-40 While the prioritization of topics has evolved, they remain the most relevant and important to our stakeholders and our business. This year we have consolidated the material topics into seven large groups, with subtopics in each of them. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT COMMITMENTS OF MATERIAL ISSUES GRI: 102-44, 102-40; 102-15 his year we have reviewed the risk matrix and linked it to the materiality matrix. We grouped key topics into seven groups that the Company must prioritize and manage. As part of the Global Compact and our commitment to furthering the Sustainable Development Goals (SDGs), we have linked the management of our material issues with the latter. Consequently, each chapter identifies the SDG to which it is contributing in the management of our material issues. MATERIAL ISSUE SDG OUR VIEW HOW WE MANAGE IT WHY IT IS MATERIAL RELATIONSHIP WITH OUR RISKS Beverage Benefits 103-1, 103-2, 103-3 Material subtopics • Quality, product excellence. • Product well-being • Responsible marketing 3 12 Our commitment is to provide options to be and feel good in the categories of energy, hydration, nutrition and relaxation. We are a total beverage Company and we have a wide and diverse portfolio that allows us to connect with all our consumers, in their changing consumption habits, at different times of the day. • Kilocalories sold over total liters sold. • Light and zero sales over total beverages sold. • Calories sold compared to the total number of liters sold. We understand that one of the concerns of our stakeholders is the amount of calories and sugar in our beverages, the quality of our products, as well as that our marketing practices are responsible. It is an important issue for consumers and for business sustainability. • Portfolio diversity. • Failure to supply raw materials. • Product production and distribution failures. • Sales and advertising restrictions. • Perception of health harmful products. 20 Sustainable packaging 103-1, 103-2, 103-3; 310-1, 301-2 • Sustainable packaging and waste management 11 12 13 14 We focus our packaging on reducing, recycling and reusing materials. • Solid waste generation: grams of waste per liter of beverage produced. Our commitment, along with The Coca-Cola Company is to help collect and recycle one bottle or one can per each one we sell by the year 2030 (“World Without Waste” commitment). • Solid waste recycling: percentage of recycled waste to waste generated. • Mix of returnables. • Collection: tons of PET bottles collected. • Recycled resin: tons of resin recycled from the total used. Government and community concerns about caring for the environment and reducing the effects of climate change. • Supply of returnable bottles. • Claims for non-collection/ recycling of packaging. They are key aspects to manage for business sustainability. • Failures or non-compliances in waste treatment. • Pollution. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTMATERIAL ISSUE SDG OUR VIEW HOW WE MANAGE IT WHY IT IS MATERIAL RELATIONSHIP WITH OUR RISKS 6 13 15 7 11 5 8 15 Water management 103-1, 103-2, 103-3; 303-1,303-2, 303-3, 303-4, 303-5 Energy management and environmental protection 103-1, 103-2, 103-3; 302-1,302-2, 302-3, 302- 4, 302-5 • Efficient distribution of our products. • Energy management Work environment GRI: 103-1, 103-2, 103-3; 102-7, 102-8, Management of the internal work climate, quality of life and development of people Water is a fundamental resource for life and, aware of it, we seek responsible use, develop processes that allow greater efficiency in its consumption and replenish this vital resource to nature. Coverage is total, because it reaches each of our operations and also all the communities with which we interact. We have a strategy that has four strategic focuses: Reduce, Reuse, Recycle and Replenish. Each country has a different reality of both quality and quantity, which offers us different challenges. • Water consumption efficiency: the amount of liters needed to produce one liter of beverage. Water is an essential resource for life and access to this resource is a human right. • Water availability • Claims/community opposition • Water replenishment: each project has a third party that audits. . • Access to water: number of beneficiaries. • Pollution At Coca-Cola Andina we understand that it is key to identify and manage the environmental impacts of our operations throughout the value chain. We work continuously to optimize our processes, through a more efficient use of our resources and incorporation of new technologies that allow us to reduce greenhouse gas (GHG) emissions in our operations. • Efficiency in energy consumption: Energy used (megajoules) per each liter of beverage produced. • Equivalent carbon dioxide emissions. Scope 1; Scope 2 and Scope 3. • Emissions per packaging lifecycle. The efficient use of energy not only generates economic benefits for the Company, but also for the community at large, as it makes available a scarce resource and public good. Therefore, all our stakeholders have conveyed to us their concerns about this, the responsible use of this resource and the active protection of climate change. • Energy efficiency • Availability of raw materials and supplies • Sales and advertising restrictions • Thefts (facilities and on route) • Production and distribution failures We promote a safe and welcoming work environment. We believe that motivated people form the basis of business sustainability, which allows to build a better company. • Occupational safety. • LTIR (number of accidents). • LTISR (accident severity). • Turnover. • Internal work climate: biannual survey • A succession plan is monitored to ensure the sustainability of work environments. • Relationships with collaborators • Accidents • Non-compliance with rules / regulations • Strikes • Claims / community opposition • Relationship with contractors Nothing big has been done in the world without great passion and teamwork, where the whole is more than the sum of the parts. That is the synergy that characterizes us and the one that we continue to strengthen, confident that when we surround ourselves with people passionate to pursue a common purpose, anything is possible. We are 17,586 employees throughout the four operations. We seek to provide our employees with the best place to work, convinced that happiness in the workplace is fundamental to the development of our activities, the well-being of our people, economic growth and, ultimately, the success of organization. 21 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT MATERIAL ISSUE SDG OUR VIEW HOW WE MANAGE IT WHY IT IS MATERIAL RELATIONSHIP WITH OUR RISKS Community 103-1, 103-2, 103-3; • Client development • Supplier development • Economic and social development of local communities • Respect for Human Rights Corporate Governance 103-1, 103-2, 103-3 • Transparency in business management. • Relationship with its stakeholders (Coca-Cola, customers, community, etc.). • Risk management 22 11 8 We seek to contribute to the progress of the communities where we develop our activities, through programs to foster local economies, generate opportunities and improve people's quality of life. • Customer satisfaction. • Percentage of domestic suppliers compared to the total. • Percentage of human rights evaluated suppliers. • Number of people impacted by the benefits of developed programs. At Coca-Cola Andina we have taken on the role to provide for the development of communities, contributing to public goods, which improve the quality of life of people. • Political-social conflicts • Reputation • Complaints/opposition from the community • Relationships with contractors • Price discrimination • Strikes • Taxes (selective consumption and municipal) 5 8 10 12 16 It is essential for us to safeguard ethical and responsible action in all the places where we operate. We have a strong Corporate Governance structure. • Audit approvals • Investor relations metrics. • Percentage of risk tolerance. Our Corporate Governance system and management become an essential part of creating value not only for shareholders, but for all our stakeholders. • Collusion / Corruption / Bribery. • Abuse of dominant position. • Price discrimination. • Taxes (selective consumption and municipal). • Rules/regulatory violations. Risk management: • Natural disasters. • Fires and explosions. • Emanations. • Raw material supply failures. • Non-compliance. Rules/regulation. • Relationships with contractors. • Strikes. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTFORWARD LOOKING STATEMENTS GRI: 102-44, 102-40; 102-15 23 e are convinced of the value of transparency and therefore we will continue to take on the challenge of improving the quality and scope of our reports, increasing the corporate, environmental and social governance aspects, as stakeholders require it. We continue adhering to GRI (Global Reporting Initiative) guidelines in a Comprehensive manner and developing our Integrated Annual Report. From the seven groups of material topics and with the aim of continuing to grow sustainably, we propose challenging next steps: FINANCIAL MARKET We will expand the development of policies and procedures to provide information on the evolution of our businesses, our current and future view of the Company. We will strengthen the Investor Relations Area, which does this work under the principles of equality, transparency and fluency, adding investor communication channels, as well as online tools to respond to the needs of public information. We will actively participate in discussions with regulatory bodies to develop ESG management indicators and reports, which allow benchmarking and dissemination of good practices to the financial market. CONSUMERS We will investigate and conduct different surveys and inquiries that allow us to anticipate needs and changes in consumer tastes, as well as new requirements, in addition to always ensure the supply of high quality products and services in the market, making constant investments that allow us to maintain and improve our standards. ENERGY AND CLIMATE The new regulations and concerns of our stakeholders drive us to continue furthering work on an environmentally friendly business model. In this sense, we will assume the leadership to make an efficient implementation of the REP Law in Chile, in pursuit of the objectives of regulation and responding to the demands of society in general. We believe that is what corresponds to our role in the industry. We will expand the measurement of our carbon footprint and implement projects that positively impact those most critical processes. We will develop actions and processes to expand the implementation of clean energy for all our operations We will make investments to increase distribution fleets efficiently in the use of fuels and we will place cold equipment in customer facilities that reduce their energy consumption. SUSTAINABLE PACKAGING We will increase the supply of quality packaging with the environment in mind and the ease of recycling and implement greater scope in the collection models, with the aim of strengthening the circular economy and the value of such packaging. We will increase the use of recycled resin (Bottle to Bottle) in our PET bottles, extending the reach to all operations. Recycling projects will be monitored in the community to achieve sustainability and autonomy for recyclers. The objective is to understand the chain and improve the operating conditions of these key links, not only from an environmental point of view, but because of the role it has in improving the social, economic and family conditions of collectors, working together with other social actors, NGOs and public bodies. WATER We will update the diagnosis of risks and opportunities to optimize and redesign water use according to the current and future water quality and conditions of the territories where we operate. We will increase the demands and objectives in the control of water use management, incorporating measurements at each stage of the process: entry, use and disposal. We will invest in innovative technologies to use less water in the production of our products, with the challenge of maintaining the incorporation of new categories into the portfolio and returning the water used in our operations to the environment with a quality fit for animal life. We will train key teams in water resource management, deepening awareness of the responsibility of the water resource. We will activate projects to reuse treated water as a raw material, seeking the synergy of our efforts with other initiatives. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTchapter.four | VALUE CREATION 24 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT4ETHICS & COMPLIANCE 102-16; 102-17; 205-1; 205-2 A t Coca-Cola Andina we are committed to building a culture of integrity, focused on doing things right, where the dignity of people, the orientation towards the common good, the values and the sense of mission of the Company, are our way of doing things. 25 We take care of measuring and detecting our opportunities and threats. It is essential for us to safeguard ethical and responsible action in each of our activities and in all the places where we operate. In accordance with the previous, the Company is constantly concerned with training all its employees in the knowledge of this Prevention Model and of disseminating internal policies and processes, to generate an ethical and transparency culture. Every day we strongly encourage those actions that allow us to return to society what it has given us. In this sense, we are responsible for supporting the development and improvement of the communities where we are present. With this is mind, our corporate governance system and corporate governance management become an essential piece to create value not only for shareholders, but for all our stakeholders. Commitment to sustainable value creation within a framework of transparency, ethics and corporate responsibility is a strategic objective of our Corporate Governance. For this we have a structure that allows us to integrate our policies and procedures in all our operations, which is achieved, among other things, through the mitigation of risks, with reliable information and adequately safeguarding assets. Consequently, at Coca-Cola Andina we have of Crime Prevention Model according to the provisions of Law No. 20,393, which was certified by the company MC Compliance S.A. Training hours per collaborator on compliance issues 205-2 1.06 hrs 91% Percentage of collaborators that consider work conditions to be ethical, honest and transparent. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTCORPORATE GOVERNANCE 102-14, 102.-16, 102-18; 102-19; 102-20, 102-21;102-22;102-23; 102-24; 102-26; 102-33; 102-34; 102-36; 102-36; 26 (1) OBJECTIVES OF OUR CORPORATE GOVERNANCE MODEL INCLUDE: 102-20, 102-33 • Ensure the generation of sustainable value of the Company, both economically and financially, socially and environmentally. • To foster a culture of business ethics that helps the Board and management prevent potential irregularities. • Provide an effective framework for transparency, control and responsible management, establishing policies and rules for decision-making. • Take care of corporate reputation to contribute to long term value creation. • To enhance the transparency and reliability of the Company's financial information. • Control management efficiency, process improvement and regulatory compliance. COMPANY OWNERSHIP 102-5; 102-19 Total % Ownership Controlling Group (1) 406,505,843 43.0% Others 340,283,287 35.9% Coca-Cola 69,348,241 7.3% AFP-Chilean Pension Funds 108,019,189 11.4% ADR Total 22,414,044 2.4% 946,570,604 100.0% 1 See description of Controlling Group in chapter 7, page: 93. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT(1) Corporate Officers and General Managers TWELVE MAIN SHAREHOLDERS AS OF 12.31.2019 102-5 TWELVE MAIN SHAREHOLDERS Series A Series B Total Shares Ownership (%) Coca-Cola de Chile S. A. 67,938,179 0 67,938,179 Inversiones Cabildo SpA* 52,987,375 49,650,863 102,638,238 Inversiones SH Seis Limitada* 52,989,375 37,864,863 Banco de Chile on account of third parties 26,109,840 33,172,846 Banco Santander - JP Morgan 9,439,722 42,056,015 Inversiones El Olivillo Limitada* Inversiones Nueva Delta S.A.* 46,426,645 46,426,645 0 0 90,854,238 59,282,686 51,495,737 46,426,645 46,426,645 Banco Itaú on account of Investors 13,955,137 32,449,429 46,404,566 Inversiones Nueva Sofía Ltda.* 2,985,731 25,678,583 Inversiones Playa Amarilla SpA* 13,513,594 8,513,594 The Bank Of New York Mellon 2,461,146 19,952,898 Inversiones Los Robles Limitada* 9,788,363 6,638,363 28,664,314 22,027,188 22,414,044 16,426,726 7.2 10.8 9.6 6.3 5.4 4.9 4.9 4.9 3.0 2.3 2.4 1.7 Total 345,021,752 255,977,454 600,999,206 63.4 *Company related to Controlling Group RIGHT TO VOTE AND ELECTION OF DIRECTORS 102-19 Directors may or may not be shareholders, they will last three years in their position and may be reelected for an indefinite number of periods. Our social capital is divided in Series A and Series B shares, both preferred and without nominal value, with the following characteristics, rights and privileges: 27 Holders of the Series A have the right to choose 12 of the 14 directors. Holders of the Series B shares have the right to choose two directors. The preference of Series B consists only of the right to receive all and any dividends that the Company distributes per share whether interim, final, mandatory minimum, additional or eventual, increased by 10%. The preference of Series A and Series B shares will last for the term that expires on December 31, 2130. Upon expiration of this term, Series A and B will be deleted and the shares which form them will be transformed into common stock without any preference NOMINATION AND ELECTION PROCESS 102-18; 102-24 At Coca-Cola Andina we do not have a policy other than the one established by Chilean law regarding the proposal by a shareholder of any candidate to be director of the Company. Accordingly, any interested shareholder may attend the Shareholders ‘ Meeting and express their proposal for a particular candidate for director, when an election takes place. COMPOSITION OF THE BOARD OF DIRECTORS AND DIVERSITY 102-18; 405-1 Our management is exercised by a Board of Directors composed of 14 members, elected every three years by shareholders at the General Shareholders' Meeting. The last election of directors took place at the General Shareholders' Meeting held April 19, 2019. They are elected to the Board by separate votes of Series A and Series B shareholders, as follows: Series A shareholders elect 12 directors and Series B shareholders elect 2 directors. Directors may or may not be shareholders of the Company, shall last three years in their duties and may be re-elected indefinitely. The Company's Board of Directors meets monthly, according to a previously established agenda. The topics to be addressed in each session are determined according to the interests and needs of the Company, and in order to cover all those matters that are relevant to the development of the business. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTEDUARDO CHADWICK CLARO Director / Civil Industrial Engineer Year of entry: 2012 RUT: 7.011.444-5 GEORGES DE BOURGUIGNON ARNDT Director / Economist Year of entry: 2016 RUT: 7.269.147-4 JOSÉ ANTONIO GARCÉS SILVA Director / Business Administrator Year of entry: 1992 RUT: 8.745.864-4 COMPOSITION OF THE BOARD OF DIRECTORS(1) 102-8; 102-18; 102-22; 102-23; 102-27; 405-1 GONZALO SAID HANDAL Vice Chairman of the Board / Business Administrator Year of entry: 1993 RUT: 6.555.478-K JUAN CLARO GONZÁLEZ Chairman of the Board / Entrepreneur Year of entry: 2004 RUT: 5.663.828-8 G J F P E 28 M FELIPE JOANNON VERGARA Director / Economist Year of entry: 2018 RUT: 6.558.360-7 ENRIQUE RAPETTI Director / Accountant Year of entry: 2016 Foreign Citizen E A S PILAR LAMANA GAETE* Director / Business Administrator Year of entry: 2017 RUT: 8.538.550-K *Independent director of the Company. ARTURO MAJLIS ALBALA Director / Attorney at Law Year of entry: 1997 RUT: 6.998.727-3 G R R ROBERTO MERCADÉ Director / Economist Year of entry: 2019 Foreign Citizen J G GONZALO PAROT PALMA* Director / Civil Industrial Engineer Year of entry: 2009 RUT: 6.703.799-5 *Independent director of the Company MARIANO ROSSI Director / Business Administrator Year of entry: 2012 Foreign Citizen SALVADOR SAID SOMAVÍA Director / Business Administrator Year of entry: 1992 RUT : 6.379.626-3 RODRIGO VERGARA MONTES Director / Business Administrator Year of entry: 2018 RUT: 7.980.977-2 (1) :The date of appointment of this Board of Directors was April 19, 2019 and Mr. Roberto Mercadé was appointed on April 24, 2019. Note: The Board of Directors incurred in expenses totaling Ch$ 566,259,838, for training, consultancy and audit expenses, among others. RUT: Chilean tax ID Following we identify those people who are not currently directors of the Company, but who were directors within the last two years: SUSANA TONDA MITRI Business administrator-Argentinean RUT: 5.500.244-4 Elected on April 21, 2016 as director. Date of termination in office: March 13, 2018. JUAN ANDRÉS FONTAINE TALAVERA Business Administrator-Chilean RUT: 6.068.568-1 Elected on April 26, 2013 as director. Date of termination in office: February 27, 2018. KARIM YAHI Auditor-French-Foreign citizen Elected on April 26, 2017 as director. Date of termination in office: April 19, 2018. MANUEL ARROYO Business administration and law degree.. Spanish - Foreign Citizen Elected on April 19, 2018 as director. Date of termination in office: April 24, 2019. The Directors Messrs. Eduardo Chadwick Claro, José Antonio Garcés Silva, Gonzalo Said Handal and Salvador Said Somavía hold an ownership interest in the Company, a detail of which is presented on page 94 of this document. The Director Mr. Arturo Majlis Albala holds an indirect ownership of 0.00045% of the Series A shares and a direct and indirect interest of 0.0011% and 0.00045%, respectively of the Series B shares of the Company. None of the other directors of the Company hold Company shares. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT DIRECTORS´ COMMITTEES 102-18; 102-22; Executive committee T he Company has an Executive Committee, which was created by unanimous agreement of the Company’s Board of Directors during session held April 22, 1986. This Committee is in charge of permanently supervising the general operation and control of the Company’s business holding periodic sessions and is also in charge of proposing guidelines regarding the management of the Company’s business. The Executive Committee of the Board of Directors of Embotelladora Andina S.A. is currently comprised by the following Directors: Messrs. Eduardo Chadwick Claro, Arturo Majlis Albala, José Antonio Garcés Silva (junior), Gonzalo Said Handal, and Salvador Said Somavía, who were elected during general Board Session held April 26, 2018. The Executive Committee is also comprised by the Chairman of the Board, Mr. Juan Claro González and the Company’s Chief Executive Officer, Mr. Miguel Ángel Peirano, who participate by their own rights. This Committee meets monthly throughout the year and during 2019 did not incur any expenses. Culture, Ethics and Sustainability Committee 102-20; 205-2; 102-32 Directors' Committee 102-22 The Company has a Culture, Ethics and Sustainability Committee, which was established by the Company’s Board of Directors at its session held January 28, 2014. The following are within its duties and responsibilities: receive, know and investigate the reports of irregularities referred to in Law No. 20,393 on crime prevention and recommend actions to follow in each of the cases; establish and develop procedures aimed at fostering the ethical conduct of the Company’s collaborators; monitor compliance with the Code of Ethics and resolve the queries and conflicts that its application may generate; and establish mechanisms for the dissemination of the Code of Ethics and general matters of an ethical nature. The Culture, Ethics and Sustainability Committee of Embotelladora Andina S.A. meets monthly with guests of the various operations, who expose what is done in the field. The current members of the Culture, Ethics and Sustainability Committee are Messrs. José Antonio Garcés Silva, Gonzalo Said Handal and Felipe Joannon Vergara, in addition to the Chairman of the Board, who integrates it by his own right. During the year 2019, the Culture, Ethics and Sustainability Committee did not incur any expenses. Number of sessions held - Culture, Ethics and Sustainability Committee (2019): 9 Percentage of average attendance of the Culture, Ethics and Sustainability Committee 96.3% Pursuant to Article 50 bis of Chilean Company Law No. 18,046 and in accordance to the dispositions of Circular No. 1956 and Circular No. 560 of the Chilean Financial Market Commission a new Directors’ Committee was elected during Board Session held on April 26, 2018. The directors Mrs. Pilar Lamana Gaete and Mr. Gonzalo Parot Palma (both as Independent Directors), and Mr. Salvador Said Somavía comprise the Committee. Mr. Gonzalo Parot Palma is the Chairman of the Company’s Directors’ Committee. Between April 30, 2013 and April 26, 2017, the Directors’ Committee was comprised by Mr. Gonzalo Parot Palma (as Chairman and independent Director), Arturo Majlis Albala and Salvador Said Somavia. Between April 26, 2017 and April 26, 2018, it was composed by Pilar Lamana, Gonzalo Parot (both as independent Directors, and the latter in his capacity as Chairman) and Salvador Said Somavia. Pursuant to article 50 bis of Chile´s Corporate Law No. 18,046, we report on the duties performed by the Directors’ Committee of Embotelladora Andina S.A., informing that during 2019 the Committee developed, among others, the following activities: • Review external auditors’ reports, the balance sheet and other financial statements submitted by the directors of the Company, ruling on them before submitting to shareholders for their approval. • Analyze and prepare the proposal of external auditors and private rating agencies to the Board of Directors, which were suggested to the respective Shareholders’ Meeting. • Examine information regarding the operations referred to by Title XVI of Law No. 18,046 and issue a report on those operations. • Examine salary systems and compensation plans of the Company’s managers, principal officers and employees. • Review anonymous reports. • Review and approve the 20F annual report and compliance with Rule 404 of the Sarbanes-Oxley Act. • Prepare the budget proposal for the Committee’s operation. • Review Internal Audit Reports. • Periodically interview the Company’s external auditors’ representatives. 29 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT• Interview Human Resources Managers. • Review operating budget between Related Companies (production Joint Ventures). • Review Internal Control Model. • Analyze and approve the Internal Audit certification processes. • Review and approve press releases that refer to the Company’s communications. • Review the Company’s four Operations’ Internal Control Standards, including Critical Risks in accounting processes, compliance of corporate policies, tax contingencies, IT and status of Internal and External Audit observations. • Analyze Management and Risk Control Model. • Analyze IAS 29. 30 • Review Crime Prevention Model Law No. 20,393. • Review progress on implementation of IT systems. • Review corporate insurances, including cyber-safety. • Review Judicial Contingencies in the four Operations. • Review Impairment Test Model. • Review judicial procedures and contingency analysis. • Review relevant tax risks. • Analyze possible improvements to Corporate Governance. • Prepare the Annual Management Report. Finally, it is reported that during 2019, the Directors' Committee incurred expenses totaling Ch$ 122,657,510 which related to audits and legal counsel among other expenses. Sarbanes-Oxley Audit Committee 102-22; 102-34 In accordance with NYSE and SEC requirements regarding compliance with the Sarbanes-Oxley Act, the Board of Directors established an Audit Committee on July 26, 2005. The current Audit Committee was elected during Board Session held on April 26, 2018. The Committee is composed of the directors Pilar Lamana Gaete, Gonzalo Parot Palma, and Salvador Said Somavía determining that Mrs. Pilar Lamana Gaete and Mr. Gonzalo Parot Palma fulfill the independence standards set forth in the Sarbanes-Oxley Act and SEC and NYSE regulations. Also, Mr. Parot was appointed by the Board of Directors as the financial expert in accordance with the definitions of the listing standards of the NYSE and the Sarbanes-Oxley Act. The resolutions, agreements and organization of the Sarbanes-Oxley Audit Committee are governed by the rules relating to Board Meetings and to the Company’s Directors’ Committee. Since its creation, the sessions of the Sarbanes-Oxley Audit Committee have been held together with the Directors’ Committee since some of the functions are very similar and the members of both of these Committees are the same. The Sarbanes-Oxley Audit Committee is responsible for analyzing the Company’s financial statements; supporting the financial supervision and rendering of accounts; ensuring that management develops reliable internal controls; ensuring compliance by the Audit Department and external auditors of their respective roles; and reviewing the Company’s auditing practices. The Sarbanes-Oxley Audit Committee Charter that is available on our website: www.koandina.com, defines the duties and responsibilities of this Committee. During 2019, the Sarbanes-Oxley Audit Committee incurred expenses totaling Ch$ 46,904,316. Percentage of average attendance of the Board of Directors at the Audit Committee during the period 86.1% Sessions held 2019: 12 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTPARTICIPATION IN COMMITTEES 120-18 120-22 Executive Committee Culture, Ethics and Sustainability Committee Directors' Committee pursuant to Article 50 bis of Chilean Company Law No. 18,046 Sarbanes-Oxley Audit Committee Date created Committee Chairman Composition election SERIES A Juan Claro González Chairman Roberto Mercadé Eduardo Chadwick Claro José Antonio Garcés Silva Felipe Joannon Vergara Arturo Majlis Albala María del Pilar Lamana Gaete Gonzalo Parot Palma Enrique Rapetti Director Director Director Director Director Director Director Director Gonzalo Said Handal Vice Chairman Salvador Said Somavía Rodrigo Vergara Montes 31 SERIES B Mariano Rossi Georges de Bourguignon OFFICER Miguel Ángel Peirano Director Director Director Director Chief Executive Officer April 22, 1986 January 28, 2014 July 27, 2001 July 26, 2005 - José Antonio Garcés Silva Gonzalo Parot Palma Gonzalo Parot Palma Board session held 04/26/2018 Board session held 05/29/2018 Board session held 04/26/2018 Board session held 04/26/2018 Activities of the Board of Directors during the period 102-29 Our Board of Directors holds yearly scheduled sessions, which are held at least once a month, while special meetings are agreed upon when they are convened by the Chairman or requested by one or more directors. The quorum for a Board session is established by the presence of an absolute majority of the Directors. Resolutions are approved with the affirmative vote of the absolute majority of those Directors present in the session, except in those cases in which the law or the by-laws require a greater quorum, and the Chairman is the one who settles a result against any tie. The main duty of the Board of Directors is to ensure, above all other considerations, the interests of Company. The average attendance for the 2019 period was 85.1%. Number of Board sessions 12 85.1% Average Board attendance percentage HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Meeting with external audit firm The Board of Directors of Coca-Cola Andina has agreed to meet quarterly with the external audit firm. To this end, the external audit firm is invited to participate quarterly in the Board sessions to discuss and report, among others, the audit plan; possible differences identified in the audit with respect to accounting practices, administrative and internal audit systems; possible serious deficiencies that have been identified and all those irregular situations that, due to their nature, must be communicated to the competent auditing bodies; results; and possible conflicts of interest that may exist in the relationship with the audit firm or its staff, both for the provision of other services to the Company or to the companies of its business group, and for other situations. Audit reports were reviewed in four Board sessions during the period. BOARD INDUCTION AND EDUCATION 102-17; 102-27 Induction At Coca-Cola Andina we have an induction procedure for new Directors, in order to facilitate the process of understanding and knowledge of their position and the Company. This procedure consists of the Company's Chief Executive Officer providing each new Director with an Induction Folder within 15 days of becoming Company director. It contains documents and information on the following subjects: mission, vision, strategic objectives, principles and values that guide the Company, policies of inclusion, sustainability, diversity and risk management approved by the Board, and the framework applicable to the Company, the Board and its principal officers. It also contains an explanation of the duties of care, reserve, loyalty, diligence and information, which under the current legislation rest with each member of the Board, indicating, by way of example, failures, sanctions or pronouncements at the local level with respect to these duties; and indicates what a conflict of interest is for this Board of Directors under the Company's Conflict of Interest Policy. It also includes an explanation of business, subjects and risks, including sustainability, and the reasons why the Board of Directors considers that they have such a condition. In addition, it points out the relevant stakeholders that the Company has identified, and the main mechanisms that are used to know their expectations and maintain a stable and lasting relationship with them. The induction procedure considers bring to the attention of the new Director the main agreements adopted in the last two years, and the reasons why such agreements were taken or other options were ruled out, as well as the most relevant aspects of quarterly and annual Financial Statements, together with their explanatory notes and other accounting criteria. In addition to the aforementioned Induction Folder, the induction procedure includes a meeting of each new Director with Company officers that depend on the Chief Executive Officer, Corporate Legal Officer, Audit Unit and Chief Financial Officer, pursuant to the request of each new Director. Education At Coca-Cola Andina we have a formal training mechanism for the members of the Board of Directors, which includes lectures, expositions and delivery of materials. During 2019 the Executive Committee visited the four operations participating in lectures with experts, economic analysts and political analysts. Corporate Structure 102-18; Administratively Embotelladora Andina S.A. is structured as a holding company made up of a Corporate Office and an Operation in each of the countries it is present. Management Structure FABIÁN CASTELLI General Manager Argentina RENATO BARBOSA General Manager Brazil JOSÉ LUIS SOLÓRZANO General Manager Chile FRANCISCO SANFURGO General Manager Paraguay 1 Fernando Jaña replaced Tomás Vedoya, who was in office until January 31, 2019. ANDRÉS WAINER Chief Financial Officer FERNANDO JAÑA(1) Chief Strategic Planning Officer MIGUEL ÁNGEL PEIRANO CHIEF EXECUTIVE OFFICER JAIME COHEN Chief Legal Officer MARTÍN IDÍGORAS Chief Information Technology Officer GONZALO MUÑOZ Chief Human Resources Officer 32 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSUMMARY OF EACH OFFICER 102-27 MIGUEL ÁNGEL PEIRANO • Chief Executive Officer • RUT: 23.836.584-8 • Electrical Engineer • In office since January 1, 2012. JAIME COHEN • Chief Legal Officer • RUT: 10.550.141-2 • Attorney at Law • In office since September 30, 2008. ANDRÉS WAINER • Chief Financial Officer • RUT: 10.031.788-5 • Economist • In office since November 1, 2010 MARTÍN IDÍGORAS • Chief Information Technology Officer • RUT: 22.526.397-7 • Systems Engineer • In office since November 5, 2018. FERNANDO JAÑA • Chief Strategic Planning Officer • RUT 12.167.257-K • Civil Industrial Engineer • In office since May 1, 2019 GONZALO MUÑOZ • Chief Human Resources Officer • RUT: 7.691.376-5 • Certified Public Accountant • In office since January 5, 2015. FABIÁN CASTELLI • General Manager Embotelladora JOSÉ LUIS SOLÓRZANO • General Manager Embotelladora RENATO BARBOSA • General Manager Rio de Janeiro Atlántico S.A. • Argentinean Operation • DNI 17.744.981 • Industrial Engineer • Foreign Citizen • In office since April 1, 2014. Andina S.A. • Chilean Operation • RUT: 10.023.094-1 • Business Administrator • In office since April 1, 2014. Refrescos Ltda. • Brazilian Operation • Economist • Foreign Citizen • In office since January 1, 2012. FRANCISCO SANFURGO • General Manager Paresa • Paraguayan Operation • RUT: 7.053.083-K • Mechanical Engineer • In office since January 1, 2005. Note: None of the principal officers holds ownership interest in Embotelladora Andina S.A. as of 12.31.2019. MANAGEMENT DIVERSITY CHART 405-1 33 Nationality 6 1 4 3 1 1 2 3 Age 5 Seniority 2 2 Argentinean Brazilian Chilean Between 41 and 50 Between 51 and 60 Less than 3 years Between 3 and 5 years Between 61 and 70 Between 6 and 8 years Between 9 and 12 years More than 12 years HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTPRINCIPAL OPERATIONS 102-4, 102-18, 405-1 ARGENTINA BRAZIL CHILE PARAGUAY General Manager Fabián Castelli DNI: 17.744.981 Industrial Engineer In office since April 1, 2014 General Manager Renato Barbosa Foreign citizen Economist In office since January 1, 2012 General Manager José Luis Solórzano RUT: 10.023.094-1 Business Administrator In office since April 1, 2014 Administration and Finance Manager Fernando Ramos Administration and Finance Manager David Parkes Administration and Finance Manager Alejandro Zalaquett Commercial Manager Diego Garavaglia Human Resources Manager Paola Rolando(1) Strategic Planning Manager(2) Commercial Manager Rui Barreto 34 Operations Manager Pablo Bardin Human Resources Manager Max Ciarlini Supply Chain and Logistics Manager Santiago López Novotny Legal Manager Ariel Molina General Manager Andina Empaques S.A. Daniel Caridi Legal and Institutional Relations Manager Fernando Fragata Operations Manager Rodrigo Klee Growth, Strategic and Digital Transformation Manager(3) Rodrigo Ormaechea People Manager Rodrigo Marticorena Legal Manager Javier Urrutia Operations Manager Alejandro Vargas(4) Market Manager(5) Rodolfo Peña General Manager Francisco Sanfurgo RUT: 7.053.083-K Mechanical Engineer In office since January 1, 2005 Finance, Administration, Information Systems and Procurement Manager Eduardo Yulita Commercial Manager Melina Bogado Quality Manager Leonardo Calvete Human Resources Manager María Teresa Llamosas Industrial Manager Carlos Stuardo Logistics & Supply Chain Manager Julio Fiandro Public Affairs and Community Manager Ángel Almada (1) Lilia Hidalgo leaves the company on 04/30/2019, the position is occupied by Paola Rolando. (2) Marcio Greco leaves the company 03/31/2019, without replacement. (3) In June 2019, the office of the Commercial Manager was transformed into the office of the Growth, Strategy & Digital Transformation Manager in charge of Rodrigo Ormaechea. Alejandro Palma left the company in May 2019. (4) Cecilia Facetti, S&OP Manager, leaves the company in June 2019. The office of the S&OP Manager becomes dependent on the office of the Operations Manager and the Customer Service area that belonged to this Management area is integrated to the office of the Growth, Strategy and Digital Transformation Manager. (5) In June 2019, the office of the Regions Manager was eliminated and transformed into the office of the Market Manager, in charge of Rodolfo Peña. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTREMUNERATION POLICY 102-35; 102-36; Remuneration - Principal officers With respect to principal officers, remuneration plans consist of a fixed remuneration and a performance bonus, which try to adapt to the reality and competitive conditions of each market, and the amounts of which vary according to the position and/or responsibility exercised. Such performance bonuses are payable only to the extent that the personal goals of each principal officer and those of the Company are met, which are previously defined for each particular case. For the year ended December 31, 2019, the amount of fixed remuneration paid to Coca-Cola Andina's principal officers amounted to Ch$4,167 million (Ch$3,782 million in 2018). Similarly, the amount of remuneration paid for performance bonuses amounted to Ch$2,407 million (Ch$2,517 million in 2018). During the year ended December 31, 2019, the amount paid for severance indemnities to managers and principal officers of Embotelladora Andina S.A. was Ch$55 million. During the year ended December 31, 2018, the amount paid for severance indemnities to managers and principal officers of Embotelladora Andina S.A. was Ch$52 million. Note: we do not publicly communicate compensation of our principal officers on an individual basis, as Chilean law does not require disclosure of such information. 35 Remuneration - Board of Directors 102-35; 102-36 2019 Board of Directors Compensation ThCh$ Executive Committee ThCh$ Directors´and Audit Committee ThCh$ Juan Claro González (1) 144,000 72,000 72,000 72,000 72,000 72,000 Arturo Majlis Albala Gonzalo Said Handal José Antonio Garcés Silva Salvador Said Somavía Eduardo Chadwick Claro Gonzalo Parot Palma (2) Manuel Arroyo Prieto (3) Rodrigo Vergara Montes Roberto Mercadé Rovira(4) Mariano Rossi Georges de Bourguignon Arndt Enrique Rapetti María del Pilar Lamana (2) Felipe Joannon Vergara 72,000 72,000 72,000 72,000 72,000 72,000 22,600 72,000 49,400 72,000 72,000 72,000 72,000 72,000 Total Gross 1,080,000 360,000 24,000 24,000 24,000 72,000 (1) Includes an additional Ch$72 million as Chairman of the Board of Directors. (2) Independent director of the Company, pursuant to current regulations. (3) Left the Board of Directors in 2019. (4) Joins the Board of Directors in 2019. 2018 Board of Directors Compensation ThCh$ Executive Committee ThCh$ Directors´and Audit Committee ThCh$ Juan Claro González (1) 144,000 72,000 72,000 72,000 72,000 72,000 Arturo Majlis Albala Gonzalo Said Handal José Antonio Garcés Silva Salvador Said Somavía Eduardo Chadwick Claro Gonzalo Parot Palma (2) Manuel Arroyo Prieto (4) Rodrigo Vergara Montes (4) Juan Andrés Fontaine Talavera (3) Mariano Rossi Susana Tonda Mitri (3) Georges de Bourguignon Arndt Enrique Rapetti Karim Yahi (3) María del Pilar Lamana Gaete (2) Felipe Joannon Vergara (4) 72,000 72,000 72,000 72,000 72,000 72,000 60,000 54,000 12,000 72,000 18,000 72,000 72,000 24,000 72,000 54,000 Total Gross 1,086,000 360,000 24,000 24,000 24,000 72,000 Total MCh$ 144,000 144,000 144,000 144,000 168,000 144,000 96,000 22,600 72,000 49,400 72,000 72,000 72,000 96,000 72,000 1,512,000 Total MCh$ 144,000 144,000 144,000 144,000 168,000 144,000 96,000 60,000 54,000 12,000 72,000 18,000 72,000 72,000 24,000 96,000 54,000 1,518,000 (1) Includes an additional Ch$72 million as Chairman of the Board of Directors. (2) Independent director of the Company, pursuant to current regulations. (3) Left the Board of Directors in 2018. (4) Joins the Board of Directors in 2018. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT SHAREHOLDERS' MEETINGS 102-18 General Shareholders' Meetings are held once a year, within the first four months following the date of the annual balance sheet. Special Shareholders' Meetings may be set at any time and in accordance with corporate needs to discuss and decide any matter that is of its competence, as long as indicated in the notice. The only condition to participate in a Shareholders' Meeting is to hold shares in the Company. Andina does not have a defined policy regarding the attendance of directors to Shareholders' Meetings, but the custom is that they are voluntarily present during the course of those Meetings. Likewise, the Company does not maintain a policy other than that established by Chilean law, regarding the proposal of any candidate to be director of the Company by any shareholder. Accordingly, any interested shareholder may attend the Meeting and manifest their proposal for a particular director candidate, where an election is appropriate. According to Chilean law, Andina does not require, as in other countries, a permanent Directors’ Appointment Committee. We include more information regarding Corporate Governance issues and the difference with the standards of the United States of America (hereinafter and interchangeably “U.S.”) on Form 20-F, which is filed with the Securities and Exchange Commission (SEC) annually, which will be available beginning April 30, 2020 on our website www.koandina.com. Summary and Comments of Shareholders and the Directors’ Committee As prescribed in General Standard No. 30 of Chile’s Superintendence of Securities and Insurance - now the Financial Market Commission - and Article 74 of Law No. 18,046, it is reported that neither the Directors’ Committee, nor shareholders or groups of shareholders who represent or own 10% or more of the shares issued with voting rights, have made comments or propositions regarding the running of the Company's business. Notwithstanding the foregoing, the minutes of the 2019 General Shareholders' Meeting recorded that the floor was offered to the shareholders to respond to any concerns they had, but no motions, inquiries or additional doubts were expressed. Diversity in the Board of Directors 405-1 GENDER NATIONALITY AGE RANGE SENIORITY Male Female Chilean Foreign Less than 30 Between 30 and 40 Between 41 and 50 Between 51 and 60 Between 61 and 70 More than 70 Less than 3 years Between 3 and 6 years Between 6 and 9 years Between 9 and 12 years More than 12 years 13 1 11 3 0 0 1 11 2 0 4 2 2 1 5 36 hile the Company does not have formal process in place for shareholders to send communications to Directors, shareholders who so wish may express their opinions, considerations or recommendations before or during the General Shareholders’ Meeting, which will be heard and attended by the Chairman of the Board or by the Chief Executive Officer of the Company, and shall be submitted for consideration by the shareholders present during the Meeting. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT RISK MANAGEMENT 102-11; 012-15, 201-2 Our risk management model is based on COSO, aiming to continuously improve for the purpose of achieving a mature management model within five years. It is a ongoing process consisting of the following stages: RISK MANAGEMENT A t Andina we understand that good Corporate Governance practices required by the market and driven by the regulatory bodies are key to risk management, since they directly contribute to meeting our objectives and to the sustainability of our business. In addition to financial risks, we have focused on those nonobvious risks, prioritizing those that may affect the Company’s operating continuity. 37 Ongoing collection and oversight Risk response improvement and implementation plans Design risk management strategy Design structure, policy and methodology Collection, identification, evaluation and detailed explanation of mitigation plans. Our risk identification considers possible events in each of the countries in which the Company operates. In that regard, each country's experience is critical in defining a standard in terms of what risk is being specifically assessed and how it is being measured; this is how the country with the greatest experience or know-how in relation to each risk proposes the standard to be applied at the corporate level, which is ratified by the risk committee. Once the standard is defined, mitigation measures are defined for each of the identified risks. Approval risk response plan Critical analysis, benchmarking and feedback HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTOngoing collection and oversight: Actions undertaken in risk management are incorporated into the processes, considered in strategies and budgets, and permanently monitored in order to ensure their continuity and effectiveness. Design risk management strategy The objective of this stage is to develop a culture and risk management processes relevant to the business, so that, if such uncertain facts materialize, the impact is manageable and there are plans for it. Design structure, policy and methodology At this stage, the organizational structure and regulatory body necessary to achieve adequate process governance was established, including the definition of a common language and a standard methodology for all operations, to facilitate the preparation and monitoring of risk maps. Collection, identification, evaluation and detailed explanation of mitigation plans. For each identified risk, the probability and impact of their potential materialization is estimated, allowing them to be prioritized according to their criticality and to establish preventive and/or contingency actions that could be taken. Critical analysis, benchmarking and feedback This stage involves detailed analysis for the incorporation of new risks and the review of mitigation plans, stressing on the benchmarking between operations, seeking to standardize risk mitigation plans and identify synergies, taking the best practices from one operation to another. 38 Approval risk response plan At this stage, high critical risks are escalated to the Corporate Office and to Board in order to obtain approval of mitigation plans and residual risks and evaluate the incorporation of new corporate standards. Improvement and implementation of risk response plans. Annually, Internal Audit verifies mitigation plans and issues their finding reports. The respective risk managers define remediation action plans to close the gaps, periodically monitoring their progress status. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTRelationship between material issues and principal risks 103-1; 103-2; 103-3; 201-2 We are exposed to different risks associated with economic, political, social and competitive conditions, as well as operating risks linked to our production processes. The following table shows the relationship between the main risks managed by us and the material issues identified by management and our main stakeholders. 39 PRINCIPAL RISKS DESCRIPTION IMPACT ON THE BUSINESS MITIGATION ACTIONS RELATED MATERIAL ISSUE Supply of returnable bottles. Failure in the supply of returnable bottles. Plant stoppage Impact on sales Fail to collect/recycle bottles. Lack of efficiency in collecting/ recycling bottles Pollution from waste. Pollution from failure or noncompliance of waste treatment. Damage to corporate image Negative exposure on advertising/social media Impact on sales Sanctions, fines Damage to corporate image Negative exposure on advertising/social media Impact on sales Sustainable packaging and waste management. Sustainable packaging and waste management. Sustainable packaging and waste management. Matrix of strategic suppliers, with existing mitigation actions, such as: stock policies, alternative suppliers, maintaining a stock in suppliers, analysis of new suppliers Encourage consumption of Returnables. Dissemination of good internal waste management practices and support for initiatives with stakeholders Communication of actions carried out on own and third party social networks, and Coca-Cola Journey. Comprehensive Waste Management Program, which ensures the correct conditioning and final disposal of waste generated in plants. Periodic external audits of legal compliance of industrial processes and internal audits of legal compliance. Contractors Regulations include environmental policies, supplier audits and fines for non-compliance. Portfolio diversity. Changes in brand image and product quality. We depend on maintaining an adequate diversity of products to meet the preferences and demands of customers Perception that products are not of good quality or are damaging to health, affecting the brand's image Damage to corporate image Negative exposure on advertising/social media Impact on sales Impact on sales. Constant development of products in line with changes in the consumption habits of the population. Quality, product excellence. Instability in the supply of raw materials and oil prices. PET bottles are manufactured on the basis of oil by-products. Volatility in the costs of PET bottles. Failures in the production and/or distribution of products. Our products are not available to customers/ consumers. Damage to corporate image Negative exposure on advertising/social media Impact on sales Scarcity, pollution and poor water quality. Water is one of the main raw materials for our products. Increased production costs to ensure the quality of products offered. Dependence on the relationship with The Coca-Cola Company (TCCC). Andina purchases concentrate from TCCC pursuant to a bottling and distribution agreement. Inability to access concentrate for soft drinks and loss of TCCC marketing support. Detailed information regarding the risks we face can be found in Chapter 7.4 Exhibits/Risk Factors in this document and in our 20-F report on www.sec.gov. Portfolio Development: strengthen healthy, low or sugar-free proposals. Delivery of the nutritional information of our products. Assessments of brand reputation, environmental and community programs. Communication of actions carried out on own and third party social networks, and Coca-Cola Journey. Encourage the use of bottles with rPET resin (recycled). Preventive equipment maintenance plans and critical spare parts policies. Finished Product Stock Policy. Third Party Management Model: comprehensive evaluation of transportation providers Ensure stable sources of supply and increase efficiency/reduce production use. Joint planning process with Coca- Cola, coordination of campaigns and launches, joint execution of projects. Participation in the CEPG for the planning and development of purchases of critical supplies. Quality, product excellence. Quality, product excellence. Quality, product excellence. Water management. Relationship with stakeholders. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTchapter.five | WE OPERATE WITH INTEGRITY 40 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT541 At Coca-Cola Andina we are committed to developing actions that contribute to the management of Sustainable Development Goals" 102-16, 102-14, 103-1, 102-13 Our vision inspires us to achieve sustainable management, with a view to preparing for the future, formalizing goals, objectives and indicators with expected values in the medium and long term. Aligned with The Coca-Cola Company, Coca-Cola Andina bases its development on seven priority axes that seamlessly converse with the United Nations Sustainable Development Goals. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTBEVERAGE BENEFITS 103-1, 103-2, 103-3 Ensure a healthy life style and promote universal well-being. Being close to our consumers offering them products that contribute to their well-being. 42 Why is it important? The good health of the population is directly related to nutrition and in that sense, we want to offer products of excellence, affordable throughout the territory we operate. Ensuring healthy lifestyles and promoting well being is important for building prosperous societies. Ensure sustainable consumption and production. Why is it important? This is positive for individual prosperity, but it will increase demand for natural resources, which are already limited. If we do not act to change our consumption and production methods, we will cause irreversible damage to the environment. At Coca-Cola Andina we care about protecting and ensuring the safety and quality of our products. Our commitment is permanent and it is the most important responsibility we have with our consumers, which we specify through different programs, such as: • Safety assessments: all our packaging components are subjected to safety assessments and should be allowed for use by health authorities, in all countries where our products are commercialized. The Coca-Cola Company has its own audit body called GAO (Global Audit Organization), which maintains a review structure. • Certification of our plants: 100% of our production plants and major distribution centers in the four countries in which we operate have certifications (see table for detail). • Sensory analysis program: this program seeks to make every partner a true brand ambassador to ensure the quality of our products. The quality area of each operation carries out all the management of Sensory Analysis. During 2019 we highlight the following results: 100% of SKUs analyzed and 390 trained panelists. • KORE Management System: is a demanding program developed by The Coca-Cola Company for our activity, which incorporates standards and requirements that go beyond the scope of ISO certifications and that is mandatory for any own or franchised Coca-Cola operation in the world. Number of trained panelists and SKUs analyzed: COUNTRY Argentina Brazil Chile Paraguay Number of trained panelists 167 83 80 60 % of SKU analyzed 100% 100% 100% 100% SKU: Production Unit 2019 plant certifications COUNTRY Argentina Brazil Chile Paraguay Quality ISO 9001 Environment ISO 14001 Health and Safety OHSAS 18001 Food Safety FSSC 22.000 GAO, The Coca-Cola Company Corporate Requirements HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT OUR PORTFOLIO 102-2; 102-6 SOFT DRINKS JUICES AND OTHERS WATER 43 BEER Reduced or zero calories portfolio 48% 27% Portfolio with added vitamins or nutrients HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSPIRITS PRODUCT WELLNESS 103-1, 103-2; 103-3 Ensure a healthy life style and promote universal well-being. Being close to our consumers offering them products that contribute to their well-being. Why is it important? The good health of the population is directly related to nutrition and in that sense, we want to offer products of excellence, affordable throughout the territory we operate. Ensuring healthy lifestyles and promoting well being is important for building prosperous societies. Ensure sustainable consumption and production. Why is it important? This is positive for individual prosperity, but it will increase demand for natural resources, which are already limited. If we do not act to change our consumption and production methods, we will cause irreversible damage to the environment. 44 We are a total beverage Company and we have a wide and diverse portfolio that allows us to connect with all our consumers, in their changing consumption habits, at different times of the day. Our proposal is to provide options in the categories of energy, hydration, nutrition and relaxation. We aim to adapt, being flexible to the needs of our consumers, modifying recipes, incorporating sugar-free beverages, providing a multiplicity of options and ensuring their availability to all our customers. In this line, in 2015 we took the first step with our global single brand strategy and in 2018 the next step was to incorporate Coca-Cola without sugar or with reduced sugar, advancing to be much more direct and clear when communicating the sugar-free attribute. The aim was to make available to our consumers an original version and another without sugar matching the exquisite taste of Original Coca-Cola. Today we have a democratized portfolio for any type of person, a 100% sustainable offer. Since there is a sugar-free version for each of our products, we can reach 100% of our consumers with sugar-free or reduced sugar versions, thus responding to the problems related to calorie intake. In Chile, five years ago we used 110 thousand tons of sugar. Today we are at approximately 54 thousand. % of sugar-free soft drinks compared to total soft drinks Argentina Brazil Chile 15.7% 17.2% 10.3% 13.7% 2019 IMPROVEMENTS 417-1, 417-2, 417-3 Percentage of the portfolio sugar reduced/added nutrients Paraguay YEAR % of the portfolio sugar free or sugar reduced 2018 53,3% 2019 48,4% % of the portfolio with vitamins or added nutrients 16,3% 27,1% For more detail, review chapter 6, our metrics 2018 2019 30.1% 31.1% 17.1% 18.2% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT INITIATIVES 103-2, 203-2 Healthy Cooking Workshops Argentina During 2019 Healthy Cooking Workshops were held, a project that result from the Fundación Banco de Alimentos de Córdoba and which counted with the contribution of the school of gastronomy and hotel "Black Pepper" and was sponsored by Coca-Cola Andina. The Banco de Alimentos – whose fundamental mission is to contribute to reducing hunger by recovering food, as well as educating about healthy eating habits in and around the city of Cordoba - proposed this instance to train 135 food organizations with recipes and advice that would allow better nutrition for children who come to these institutions. In addition, the Banco de Alimentos receives inputs with high nutritional value that are not taken into account, because it is unknown how to add them to the daily menus of the organizations. Healthy Cooking workshops improved the nutrition quality of 1,892 children and young people from 70 social organizations. During 2019 we became allies to the Banco de Alimentos with the "Family to the Table" program, which aims to restore low-income families to the habit of lunch/dinner as a family. We know that there are many family members who attend picnic areas or community canteens and this does not allow them to be present at any family's iconic times. Thus, the program provided tools and knowledge to 51 mothers and 102 children, managing to revalue the time of the meal as well as to give a nutritional follow-up. 45 Innovation and nutrition Coca-Cola Andina, along with The Coca- Cola Company, is always mindful of the idea of improving the quality and variety of its portfolio. That is why the innovation team is made up of professionals from different areas and works in synergy with other sectors of the Company, bringing collaboration, inspiration, information on innovation and agility in the development of new products. Guallarauco Ice Cream Chile In October 2018, the agreement to make the premium juices firm part of Coca- Cola del Valle materialized, Coca-Cola del Valle is a company composed of Coca-Cola Chile, Coca-Cola Andina and Embonor. This agreement allowed to significantly extend the portfolio of the Company, as Guallarauco is a leading brand in frozen fruits, juices and bottled nectars and fruit desserts. In 2019 we made progress and multiplied our share of Guallarauco ice cream. Multiplied our share of Guallarauco ice cream x5 Stills Growth Brazil Coca-Cola Andina Brazil set itself the interesting challenge of growing in categories that go beyond soft drinks. This had excellent results, achieving double-digit increases in juices, teas, energy and water. And this is due to the virtues of these products, since they respond very well to consumer demand: tea-related beverages are rich in vitamins and antioxidants and provide options for cold or hot drinks. Our Del Valle juices were also protagonists of this growth, transforming their packaging from tetrapack presentations to PET bottles. In addition, their formulation now has more fruit juice and vitamin C and has no added sugar or preservatives. Del Valle Frut is synonymous with quality and trust with an excellent price for all Brazilian families. (1) Among the brands of products to be distributed are Alto del Carmen®, Capel®, Artesanos del Cochiguaz®, Monte Fraile®, Sensus®, Inca de Oro® and Francisco de Aguirre®, among others. We grew in spirits through a new alliance Diageo - Capel Distribution Chile As part of our growth and diversification strategy, we signed a distribution agreement with Cooperativa Agrícola, Pisquera Elqui Ltda. and Viña Francisco de Aguirre S.A. This agreement will allow us to incorporate new alternatives for our consumers in the territories of the Metropolitan Region of Santiago and the provinces of Cachapoal and San Antonio, as well as in the regions of Antofagasta, Atacama, Coquimbo, Aysén and Magallanes. (1) Verde Campo, new member of the Coca-Cola family Brazil Verde Campo, a company with great innovative spirit, started becoming a member of the Coca-Cola family hand in hand with the operations ins Brazil. The products stand out for their quality and taste, as is the case, for example, of the Lacfree line, the first lactose-free line in that region. Another emblem of the brand is Natural Whey Shake, with zero added sugar, zero lactose and zero fats. It is sweetened with stevia and has 14 grams of protein, which helps the recovery of muscle tissue after physical activities. The product does not need refrigeration. Thanks to the Company's efficient distribution system, Verde Campo products can now reach all regions of the country. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTCLIENT DEVELOPMENT 417-1; 416-1, 102-2 ustomers are a key link in our value chain, because in addition to the social impact they generate for the growth of local economies, they are responsible for a significant percentage of the Company's sales. B2B Channel ( www.micoca-cola.cl) We are proud to grow in the MiCoca-Cola business model, with which we directly reach our consumers. It is a long-term bet that Coca-Cola Andina Chile strategically proposed, with the aim of positioning itself as an alternative for online shopping and direct home delivery to consumers. Buying trends and behaviors show the need to be present in all possible purchasing channels. We know that we offer great added value with our sales force that visits customers understanding their problems and offering solutions / promotions that benefit them. But in recent years we have been facilitating the channels so that each client chooses the option that best suits their schedules and needs. In this context the web channel was born and in the last year it grew by 150%, incorporating 9,300 customers. We are aware that much remains to be done and we are preparing to respond quickly to market changes. That is why we seek to accompany them with development programs that enhance their results. Thus, in 2019 we imparted more than 2,400 hours of training, with a 2.5% average growth of the businesses benefiting from those training hours. In Chile, our miCoca-Cola.cl channel grew by 150% with 9,300 new clients Sales by Channel 46 4% 31% 32% 33% 17% 28% 15% 13% Argentina Brazil Chile Paraguay 32% 28% 24% 11% 46% 34% On-premise Mom & Pops Wholesales Supermarkets 25% 28% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTCustomer service SERVICE Claims Orders (sales) Requests (services, visits, etc.) Inquiries Percentage 9% 35% 21% 34% 47 RESPONSIBLE MARKETING 417-1 NUTRITIONAL LABELLING 417-1 We have a responsible marketing policy, which stipulates that no advertising is directed to children under the age of 12 for any of the Company's products, advertising is not done in media whose audience of children under 12 is greater than 35% and to children under the age of 12 are not shown drinking any of the products without the presence of a responsible adult. We use the Daily Food Guides (DFA), which are a nutritional information tool presented in tablet format in product labeling. According to the global policy of The Coca-Cola Company, all labels (except glass and water) must include DFA. In Latin America we present the amount of calories, along with the percentage of the Daily Value (%VD) on the front of the packaging, being consistent with the commitment to provide consumers with transparent nutritional information in their products. In addition, a panel of nutritional information provides additional data on proteins, carbohydrates, fiber and, when the product contains them, minerals and vitamins. Non-caloric sweeteners used in the Company's light/zero soft drinks are safe for the entire population, including children over the age of two, pregnant and breastfeeding women. Chile Chile implemented Law No. 20,606 on Labelling, which requires the labeling of the packaging with the warning seal "High in", which indicates that this product contains high levels of sugars, sodium, saturated fats and/or calories; and restricts advertising for these foods to children under the age of 14, in addition to restricting sale, promotion and free delivery in educational establishments. It is key for Coca-Cola Andina to have an active and responsible role with our community and for this reason we provide objective, meaningful and understandable nutritional information about all our products. We know the importance of informing consumers through our labels. Kcal/liters sold Argentina 345,1 Brazil 344,8 Chile 219,6 Paraguay 336,8 327,4 334,3 216,7 329,0 2018 2019 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSUSTAINABLE PACKAGING 103-1, 103-2, 103-3; 301-1, 302-1 A RELATIONSHIP THAT IS CHANGING Ensure sustainable consumption and production Why is it important? This is positive for individual prosperity, but it will increase demand for natural resources, which are already limited. If we do not act to change our consumption and production methods, we will cause irreversible damage to the environment. Adopt urgent measures to combat climate change and its effects Why is it important? Climate change is a consequence of human activity and it is threatening our way of life and the future of our planet. Tackling climate change will enable us to build a sustainable world for all. But we must act now. 48 Conserve and sustainably use the oceans, seas and marine resources for sustainable development. Why is it important? Oceans provide critical natural resources such as food, medicine, biofuels and other products. They contribute to molecular decomposition and waste disposal and contamination; in addition, their coastal ecosystems act as buffers to reduce storm damage. Maintaining ocean health helps in efforts to adapt to climate change and mitigate its effects Plastic has been fundamental in people's daily lives around the world. However, this relationship has been changing in recent years given the effects of its massive presence. In the current linear model, 78 million tons of plastic packaging are produced globally every year, but after use 40% goes to landfills, 14% is burned to produce energy, while 32% remains in the environment. Of the remaining percentage, which corresponds to recycled plastic, only 2% is circularly used, reused as raw material to make new products. (1) (1) Source: https://www.cocacoladechile.cl/historias/medio-ambiente-los-cuatrocompromi- sos-del-pacto-por-los-plasticos Through the New Plastics Economy initiative, the Ellen MacArthur Foundation has brought together businesses and governments behind a positive vision of a circular economy for plastics. All business and government signatories have signed a clear set of 2025 objectives supported by shared definitions. They will report annually on their progress to ensure transparency and will be reviewed every 18 months. The goal is to be increasingly ambitious in the coming years. Commitment Nº1: Take action to remove single-use plastic packaging that is problematic or unnecessary, through redesign, innovation and alternative reuse models. Commitment Nº2: Make 100% of the material used in plastic packaging recyclable, reusable or compostable. Commitment Nº3: Work to make one-third of plastic packaging - both household and non-household- effectively recycled, reused or composted. Commitment Nº4: To ensure that, on average, a quarter of the material contained in new plastic packaging is effectively from recycled material. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTThe Coca-Cola Company is firmly committed to managing its goal to drastically reduce the impact of bottles and packaging waste in the environment with a sense of focus and energetically. 301-1, 301-2; 301-3 Its efforts for a world without waste began long before the initiative was announced. Since its launch in January 2018, the Company has progressed with greater focus on three pillars: design, recycle and partner, setting goals for each one. Design: make our packaging 100% recyclable worldwide by 2025 and use at least 50% recycled material in our packaging by 2030. Recycle: collect and recycle one bottle or can for each one we sell by 2030. Partner: work together to support a healthy, waste-free environment. Life cycle of bottles 49 PLASTIC PACKAGING DESIGN The plastic containers we use today are much lighter than glass, this is reflected in a smaller carbon footprint of the packaging, comparatively analyzing the life cycles. But we want to reduce that weight of the bottles even further, because every gram of plastic saved means less energy expenses in our supply chain. Another key initiative is the use of recycled resin. Replacing virgin resin with recycled resin is an all-year challenge that, in turn, brings benefits in greenhouse gas emissions. Coca-Cola Andina adheres to the commitments proposed by The Coca-Cola Company and works in partnership to meet these challenges. A world without waste is one of the most cross-cutting challenges we have faced as a Company, since it not only requires the effort of different areas of the Company, but the community plays an important role in achieving it. It is therefore key that we can establish the appropriate partnerships and that all stakeholders see the benefits of acting as soon as possible. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTPROGRESS IN WASTE MANAGEMENT (gr/liters of beverage) 301-1, 301-2, 301-3 Solid waste generation (gr/lt of beverage) 2019 20.2 19.2 14.7 7.4 Percentage of recycled waste 50 87.3% 91.4% 84.0% 89.1% RETURNABLE CONTAINERS Returnable packaging is very environmentally friendly because, in terms of carbon emissions, water footprint and waste impact, it has a better performance compared to disposable glass and plastic. This is due to its lightweight material, its reuse and final destination, since it can be 100% recycled. The returnable Coca-Cola bottle is the most circular container that exists and an example of application of the Reuse focus, since through this system you can extend the life of a plastic or glass container. The classic returnable glass bottle is used 35 times, emptying and filling again before being recycled, while the PET plastic bottle circulates between 12 and 16 times. The returnable bottle is generally chosen by consumers who are aware of the care of the environment. This initiative is part of The Coca-Cola Company's comprehensive strategy of "A World Without Waste". Percentage of sales in returnable packaging regarding total volume (%)1 COUNTRY 2017 2018 2019 Argentina 40.6% 39.5% 40.9% Brazil Chile 18.0% 20.1% 37.0% 34.7% Paraguay n/d 37.4% 22.0% 33.8% 37.5% 1 Corresponds to percentage regarding total volume, not only soft drinks Percentage of soft drinks sales in returnable packaging (%)2 In recent years, the Company has confirmed its intention to grow the sale in returnable formats, so it is within that logic that it created the Single Bottle. The initiative was born in Brazil and has been awarded worldwide: it won the Global Innovation Awards 2018, which recognizes the successes undertaken by Coca-Cola leaders and their teams that challenge the status quo, create capabilities and help drive sustainable growth. COUNTRY 2017 2018 Argentina 48.0% 46.9% Brazil Chile 20.0% 22.6% 48.0% 45.3% 2019 48.1% 25.2% 44.7% Paraguay 45.9% 45.4% 46.3% 2 Corresponds to percentage regarding only soft drinks, and what was reported until 2018 Annual Report What sets the Single Bottle apart: it is much more than a container, as it is a returnable bottle - from PET or glass - that uses less plastic and whose design is the same for all flavor varieties. In addition, it is 100% recyclable. Investment: during the last two years we have invested ThUS$ 26,442 million in the unification of the design of plastic returnable bottles (REFPET) in the expansion of the reuse infrastructure (washing machines and labelers) as part of the aspiration to significantly increase reusable packaging by 2030. Benefits: the main benefits of the project are efficiency, savings and flexibility, significantly reducing washing, filling and the cost of reverse logistics. At the same time, it reduces carbon emissions, which is directly aligned with our strategy. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT BOTTLE TO BOTTLE 301-1, 301-2, 301-3 Is a project that seeks to increase the percentage of recycled resin in our plastic packaging, subsequently enhancing recovery for an adequate transformation into food grade recycled resin. As members of the Coca-Cola system we encourage our packaging to be recycled, either to reintegrate into our own processes or in other industries. In recent years there have been very competitive prices of recycled resin in some of the operations, reducing one of the main barriers to increase its use over virgin resin. In this context, in 2018 we reached 5.4% recycled resin in our bottles, while in 2019 it was 3.6%. On the other hand, we can point out that we have had a very good experience with the returnable packaging cases, which are made with the same scrap of those that end their useful life. We have also obtained great results with glass bottles, since more than 70% of the glass they contain is recycled. Regarding the design, every year we have formats that still have the possibility of reducing their weight according to the line where they are being produced. During 2019, efforts to relieve packaging led to: 51 resin savings 445 tons per year This also meant saving 712,037 USD Environmental education with Kyklos Chile Zero Waste Chile The "Coca-Cola Andina Kyklos Environmental Education Program" was designed with an aim of delivering educational tools and raising awareness of environmental care and, in particular, recycling. What we seek is to generate and leave a culture of recycling installed in each of the schools, empowering children, parents and employees, transforming them into "environmental leaders of their community", contributing to improve their personal and academic development as well as the well-being of their community. We have been in partnership with Kyklos for three years, impacting more than 32,000 environmental leaders and we recovered more than 30,952 kilos (kg) of waste, of which 6,339 kg were PET. Thus, from the school communities, reincorporating the material to the production cycle has been enhanced to prevent their final destination to landfills. During the last three years we trained more than: 32,000 environmental leaders. After committing to do so, Coca-Cola Andina Chile managed to have five zero waste distribution centers. This is a great work of awareness and investment to classify waste at source in the best way, resulting in none of them being aimed at landfills. This effort was made under the Clean Production Agreement (CPA). During 2019, Coca-Cola Andina recorded 241,611 kg of waste that was properly allocated, managing to avoid sending waste from five distribution centers to landfill. This also reduces our carbon footprint, as all waste is used for reuse, composting or power generation 44% Zero waste distribution centers 54% Reutilization Composting Alternative fuels 2% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Recycle for Brazil Brazil The Recycling for Brazil platform, created in October 2017 in an alliance between competitors Coca-Cola Brasil and Cervejaria Ambev, welcomed the new members. Nestlé Brasil and Vigor joined beverage companies to expand the scope of the program's activities and improve investments targeting the country's recycler cooperatives, in partnership with the National Recyclers Association (ANCAT). Coca-Cola Andina Brasil participates as a member of the Coca-Cola System: being an active partner of the initiative, which in this new version supports 160 cooperatives in 17 states, directly impacting 3,000 recyclers. That means a 25% larger investment, which increases the impact by 45%, making Recycling through Brazil the largest inclusive recycling program in the country. The main challenges facing the initiative are related to the development of cooperatives and to providing them with greater infrastructure, management and social assistance. The results in the operation of Coca-Cola Andina Brasil show a breakthrough in two main aspects to prevent bottles from ending up in landfills: 10.31% recovery of single-use disposable packaging and 2.4% in the sale in returnable formats. https://www.cocacolabrasil.com.br/imprensa/release/reciclar-pelo-brasil-criado-pelacerve- jaria-ambev-e-coca-cola-brasil-ganha-adesao-de-nestle-e-vigor Post-Consumption Recycling (tons) > 301-3, 306-2 52 23.1 53.8 51.4 6,105 tons recovered by Coca-Cola Andina Brazil in conjunction with the alliances of the Recilar pelo Brasil program In the four countries in which we are present, and thanks to the initiatives developed, 6,234 tons of post-consumption waste were recovered. Sponsorship of cooperatives Argentina We have been sponsoring the "Los Carreros" cooperative in Villa Urquiza, in the city of Córdoba, for three years. It has a team of 15 people, who are key to locating material at the ecopoints, selecting them and compacting them in the best way and then valuing them. Today 12 ecopoints remain active in large areas (supermarkets, hypermarkets, educational institutions and building complexes) to make recyclable materials more efficient. We have continued to build alliances with different organizations, clients and other companies, as well as municipalities committed to recycling and social development. Since the beginning of the program, 44,131 kg of PET have been collected in the ecopoint network available for the member of the cooperative "Los Carreros". This resulted in a significant increase in their annual income, from Ar$ 14,306 in 2016 to Ar$ 136,240 in 2019. Beyond providing them with tools for job safety and training, we were able to increase incomes and that has a direct. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTWATER STEWARDS 103-1, 103-2, 103-3, 301-3,303-2, 303-3, 303-4, 303-5 Context Water is the main ingredient of our products; we aim to permanently improve our efficiency in the use of that resource and understand the social context in which we operate. Future trends in terms of climate variability and risks pose an increasing challenge to countries in water management. Any business that uses water as a raw material has a responsibility to the environment around it. The strategy of Coca-Cola Andina is to be present with plans that contribute throughout the chain of this resource, take care of the sources of origin, be efficient in its use and treat the effluents with the best technology available. Goal Ensure water availability, sustainable management and sanitation for all. Why is it important? Access to water, sanitation and hygiene is a human right. However, thousands of millions of people continue facing tremendous difficulties to access the most basic services every day. Efficiency in the use of water (Liters of water used per liter of beverage produced lt/lt) Argentina 2.32 1.52 2.33 1.53 Brazil Chile 53 As part of the Coca-Cola System we share a commitment to replenish 100% of the water used. Paraguay Regarding water efficiency, the 2019 target(1) was 1.92lt/lt. We did not achieve it, but with a lot of effort we reached 1.96 lt/lt. At Coca-Cola Andina we have worked consistently and have managed to progress from 2.13 lt/lt to 1.96 lt/lt between 2014 and 2019 down more than 8% throughout the entire operation. Chile's operations were leaders in this progress, with a 20% reduction, followed by Paraguay with 15%; and Brazil with 14%. 2.33 1.87 2.26 1.85 2018 2019 (1) Weighted target by individual goals of each country. For further details, review chapter 6, our metrics HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTOrigin of water supply 303-1 Water is the main raw material of our products. Therefore, we focus on the need to ensure the sustainability of the resource both in terms of availability and quality. It is also a shared natural resource with all the communities where we operate; and so, we have an obligation to promote care for water not only inside our plants, but also within the groups in which we interact. We are concerned that communities know and develop cultural awareness regarding the importance of care for water, so we do not become affected by the pollution of this resource, the lack of it or its misuse. We are proud that our effluent treatment plant at Duque de Caxias has ultrafiltration and osmosis systems that allow to reuse 10,800 m3/month of water. Consumption of water by origin by country 2019 (% of total) Effluent treatment (% of total) 4.6% 95.4% 0.02% 17.5% 45.9% 36.6% 12.2% 0.1% 3.7% 87.8% 99.9% 96.3% 100% 82.8% 100% 17.2% Underground water (wells) Network water (municipal) Surface water Rainwater Own plant Public plant Note: the wastewater we evacuate to municipal systems complies with local regulations and the “Coca-Cola Operational Requirements” (KORE). 54 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTINITIATIVES 103-1, 103-2, 103-3, 301-3,303-2, 303-3, 303-4, 303-5 Reduce Chile Duque de Caxias Brazil We are proud of the team's perseverance to seek new solutions for reducing water use. This forces us to work hard with rejections generated in the extraction and treatment processes. The main actions focused on the equipment of the Nano filtration and Ultra filtration rooms. On the other hand, everything related to measurement and management of key processes in real time, which allows us to act quickly and minimize the waste of water. The Duque de Caxias plant began operating during 2018 and in 2019 it began increasing production as well as efficiency. The fine tuning of the entire facility takes a while, but always keeping in mind the efficiency of all resources used. The project gives great importance to the Taquara River, protecting all the riverbank that is in our area. So much so, that we developed stormwater dispensing containers to mitigate impacts on the riverbed. In addition, we recovered 320 cubic meters of rainwater. 55 Lastly, we can comment that the change in the production mix seriously affects water consumption. For this reason, Chile’s team optimized production planning by avoiding waste in CIP processes (taste change cleanings). During 2020 we continue training key personnel, of cleaning and maintenance areas, among others, which allows us to grow in the culture of care and control of this fundamental resource. Coca-Cola Andina Chile achieved a 2.15 l/l ratio, which means a reduction of more than 20% compared to 2014. The effluent treatment station, which has a capacity of 48 cubic meters per hour, ends with an osmosis process that allows the reuse of water delivering 15 cubic meters per hour. We are proud to have one of the best plants in Latin America and that this is the horizon that shows us best practices, both in terms of process as well as environmental care. A project milestone was the recovery of the dam located on the property which has a capacity of 156,000 cubic meters of water. 2019 water reused (m3) Brazil 125,848 2,002 158,638 Chile Paraguay REPLENISH Reforestation Renca hills Metropolitan Park in Chile Chile While trees need water to live, the water cycle could not sustain itself without soil vegetation. That is why some projects seek to keep certain ecosystems green that are crucial to preserving freshwater sources, both rural and urban. In this context, an initiative was carried out that is not only important from the environmental point, but also because of the increased access to green areas that it provides to a part of the population. It is the reforestation of the Renca Hills Metropolitan Park, one of the lungs of the city. The activity, took place in December, had hundreds of volunteers, who planted 15 thousand native species. It is the first part of a process that will culminate in mid-2020, with another planting day reaching 30 thousand trees. We joined Fundación Cultiva, Fundación Avina and the Municipality of Renca to make this challenging project that implies a long-term commitment. But in addition to Cerro Renca, a decade ago the Company took on the challenge of replenishing 100% of the water used in the production of its products. Therefore, we are constantly working on other projects, some of which we describe ahead and which meant meeting the goal by the end of 2018. https://www.coca-colaafrica.com/videos/la-reforestacion-del-emblematico-cerro-renca- ytwd24i6zyyxi HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSafe Water - Water Access Argentina 103-1, 103-2, 103-3, 301-3,303-2, 303-3, 303-4, 303-5 Water Tender Process Argentina Mbaracayú Reserve Paraguay 56 Durante 2019: We continue working with rural and semi-urban schools so they can access safe water. This year we reached 6,806 young people from schools located within the territory of Coca-Cola Andina Argentina which already count with water filtering technologies to eliminate bacteria and parasites. 29 educational establishments participated in our workshops on healthy hygiene habits and water care. The actions are part of the joint work carried out by Coca-Cola de Argentina, its bottling partner Andina, in partnership with the social enterprise Proyecto Agua Segura, and in alliance with the ministries of Social Development, Education and Agroindustry of the Nation and civil society associations across the country. The pillars of this initiative are the promotion of proposals to take care of water sources or ensure their access allowing to generate changes in vulnerable communities in the country. The tender process is managed through Fundación Vida Silvestre Argentina (FVS) and Coca- Cola Argentina. Since its inception in 2006, the contest has financed 30 projects, which have directly and indirectly benefited: 641,601 people. We continue to promote the Water Conservation project in the Mbaracayú Reserve with the Moisés Bertoni Foundation and the Avina Foundation. The objective of this project focuses on water replenishment based on sustainable agriculture in the Mbaracayú Forest Biosphere Reserve area, Canindeyú Department, in eastern Paraguay. The core area of the reserve has 64,000 hectares with lush vegetation. It promotes the infiltration of rainwater that naturally recharges the aquifer. Man's mishandling of soil causes its gradual impoverishment and erosion, preventing rainwater from infiltrating and affecting the aquifer reservoir. In its third year of implementation, the project benefited more than: 213 producers and their families in 240 hectares contributing to replenish the water we use in our products to the ecosystems and communities. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTEnsure access to affordable, secure, sustainable and modern energy for all Why is it important? A well-established energy system supports all sectors, from business, medicine and education to agriculture, infrastructure, communications and high technology Adopt urgent measures to combat climate change and its effects. Why is it important? Climate change is threatening the future, which affects all people on the planet. Companies are no stranger to this threat that will affect their results if they do not take immediate action. 57 ENERGY MANAGEMENT 103-1, 103-2, 103-3; 302-1, 302-3, 302-4, 302-5 OUR COMMITMENT AND HOW WE MEASURE IT We are committed to growing in our industrial and commercial activities in harmony with the environment, being proactive and innovative. Energy efficiency is a commitment that we have strongly instilled in each of our decisions. That is why we must comply with the 0.35 megajoules(1) per liter of beverage produced by 2020. We count with reports on environmental management indicators as well as teams dedicated to identifying risks and, specifically, working on mitigating the risks associated with climate change. The value chain is key to articulate initiatives that reduce carbon emissions, and for this reason we work together to achieve this. Use of energy ratio (Mj/liters produced)- 2019 Argentina In the last five years we have reduced energy used in production by 7%, while volume in that period only decreased by 1% due to the portfolio growth complexity. ENERGY ORIGIN Coca-Cola Andina's commitment to the environment is tied to the rational use of natural resources. For this reason, we strive to increase the use of renewable sources, both by growing those sources that we already have and by an incursion into new alternatives. Currently we have access to boilers that run on biomass, others that use biogas from our effluent, solar and wind treatment plants that began as performance tests, but are already participating in our energy used. On the other hand, we depend on the availability and energy matrix of the country where the plants are operating. That is why we aim for the growth of the industrial and commercial activities of the plants to be carried out in harmony with the ecosystems of the areas of operation, being innovative and proactive. 0.36 0.36 0.28 0.28 0.30 0.26 Brazil Chile Paraguay 72% 0.51 0.50 3% 19% Energy sources 2019 5% 2018 2019 For more information review chapter 6, our metrics Biogas Wind Hydroelectric Biomass Non-renewable sources HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT1%INITIATIVES 103-1, 103-2, 103-3; 302-1, 302-3, 302-4, 302-5 100% renewable electric energy Chile During 2019 there was evidence of the clean energy contract both in the energy matrix used as in emissions reduction. 58% of the energy used by Coca-Cola Andina Chile's operation comes from renewable origin. This is a milestone for our franchise and proof that decisions are made with both economic, social and environmental variables. The contract includes certified energy (international certification IREC) and the plants involved are the operations of Embotelladora Andina, Envases Central, Vital Jugos and Vital Aguas, which are located in Santiago and Antofagasta. Scope 2 carbon foot print emissions reduced by 1,398 tons annual. PACKAGING, THE PROTAGONISTS OF CHANGE The great efforts the Company is making to mitigate the impact of packaging brings obvious benefits in the battle to reduce the effects of climate change. One of these initiatives is the light weighting of PET bottles. It is a permanent challenge to reduce the weight of bottles and maintain the quality as well as the shelf life of the products on the market. However, validation teams are prepared and motivated for these changes. In the last year, Argentina, Brazil and Paraguay have performed exercises to introduce lighter preforms for the usual products. 58 Clearly, this decrease in raw material use has an impact on costs. For 2019, savings were US$712,037. 445 tons of virgin resin were saved, directly benefitting a reduction of 1,356 CO2 eq Tn. in emissions. Tons of resin saved445 1,356 CO₂ eq Tn saved through light weighting Recycle and reuse for climate change in mind Use of recycled resin As part of the packaging strategy, the Company decided to gradually replace virgin resin with recycled resin. This brings not only challenges for the development of the supplier chain, but also to achieve agreements with competitive prices between the two resins. Currently, only two of the four operations of Coca-Cola Andina have national regulations that allow us to move forward with the initiative. In Chile and Paraguay, we are working to make the government become part of the change the world needs. In Brazil and Argentina, the percentages of recycled resin increased. We are very proud of the progress that the quality areas achieve in synergy with the suppliers of preforms and resin. During 2019 we increased the volumes of recycled resin by 5%, which has a significantly lower carbon footprint than virgin resin. Therefore, the emission reduction for 2019 was 5,980 CO2 eq. tons. Returnable options are an excellent alternative for taking care of the planet. We seek to increase transactions in returnable bottles. because these perform excellently, both in emissions, in water footprint and waste generation. Each 2-liter bottle of returnable PET can be used between 12 and 16 times. This means that each bottle avoids marketing between 12 and 16 disposable PET 2-liter bottles. In conclusion, each 2-liter returnable bottle saves 1.17 CO2 Eq. kg Replacing virgin resin with recycled resin saved 5,980 CO₂ eq tons 7% 6% 4% 2% For more information review chapter 6, our metrics 2018 2019 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT GAS EMISSIONS 305-1, 305-2, 305-3, 305-4, 305-5, 305-6, 305-7 In order to help prevent the greenhouse effect, at Coca-Cola Andina we implemented initiatives to reduce the carbon footprint, promote energy savings and promote good practices, from the time the beverage is produced until it reaches the family table. The measurement of Scope 1 includes direct emissions from fuel consumption in production processes and/or in equipment owned or controlled by the Company. In the case of fleet vehicles, only those owned by the Company are considered. Scope 2 means indirect emissions from the consumption of electricity in processes, commercial and logistics activities or by equipment owned or controlled by the Company. Scope 3 emissions are defined as other indirect sources associated with waste treatment and fuel used by our distributors. Total emissions - CO2 (Eq) tons - 2019 Total emissions CO2 (EQ)- 2019 A1 A2 A3 Total 45,977 55,413 210,013 311,405 COMMITMENT TO OUR CLIENTS Our business strategy involves investing and installing refrigerators at our customers' locations. The decision to purchase energyefficient equipment takes several years. Thanks to maintenance and renovation management, the refrigerator pool that saves up to 49% energy grows every year. Our customers are the direct beneficiaries of savings, mainly the traditional channel, helping thousands of entrepreneurs reduce their energy costs. However, it is important to note that emissions savings are a contribution to the entire society. 2018 2019 Cold equipment with energy savings 61% Cold equipment without energy savings 39% 79% 21% Evolution measured in this chart is proof that we are strongly committed to the environment, beyond any economic-commercial variable. Cold equipment CO2 (EQ): Tn CO2 eq 161,088 Evolution cold equipment installed. Argentina 2010 2011 2012 2013 2014 2015 2018 2019 59 20,911 27,478 32,167 39,940 48,618 50,140 50,666 2,000 24,949 26,949 Total 6,100 6,802 6,802 6,802 9,402 6,700 9,450 38,334 38,334 38,300 65,355 Total 72,614 Total 72,269 Total 37,800 84,542 Total 36,500 36,568 37,732 94,520 Total 93,408 Total 97,848 Total Equipment without controller Equipment with EMS 55+ controller Equipment with Led illumin. EMS 55+ controller HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT WORK ENVIRONMENT 103-1, 103-2, 103-3, 401-1, 401-2,401-3 Our team 2019 Achieve gender equality and empower all women and girls. Why is it important? We want to be an active part of the change the world must make regarding gender equality, as both women and men must achieve a work-life balance. As a Company we work to adapt to new social models, we propose to break down judgments and standards so that each gender can discover new roles. Coca-Cola Andina not only gives employment and joy to millions of people, but is also able to enter the home, tables and environments of employees. Hence the responsibility to care for our people and their families. Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all. Why is it important? Social equality is very important for the development of societies. Companies must promote fair conditions for employees, with the aim that they can play their social role as citizens. We also believe that this ethical behavior with the people we relate to is replicated as part of a healthy product chain for its growth. We are thousands of collaborators throughout the four operations, in which we care about providing our employees with the best place to work, convinced that the realization of work is fundamental for the development of our activities, the well-being of our people, economic growth and, ultimately, the success of the organization. 60 COUNTRY MEN WOMEN TOTAL Argentina 264 2,795 3,059 Brazil 1,083 6,949 8,032 Chile 575 4,233 4,808 Paraguay 181 1,465 1,646 Holding 19 22 41 Total 2,122 15,464 17,586 Citizenship Seniority Age Argentinean Brazilian Chilean Paraguayan Other citizenships Between 9 and 12 years Between 3 and 6 years More than 6 and less than 9 years More than 12 years Less than 3 years More than 70 years Between 41 and 50 years Between 61 and 70 years Between 18 and 29 years Between 51 and 60 years Between 30 and 40 years *citizens of their respective operations. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT20%27%22%39%10%2%1%43%7%12%18%4%17%46%24%9% INTERNAL WORK CLIMATE MANAGEMENT 103-1, 103-2, 103-3, 401-1, 401-2,401-3 Employment satisfaction is a strategic priority. Therefore, since 2008 we have tools to get to know what is the satisfaction and motivation levels, such as the climate survey. The survey is performed every two years in all our operations simultaneously, In 2019 we reached a favorability rate of 72%; also it is noteworthy to mention that we reached a historical regional participation figure at Coca-Cola Andina of 93%. % of favorability Among the factors surveyed, there is a consistent growth with strategic HR initiatives and consistent with business focus and sustainable growth. In terms of responses, it points out that more than 85% of those surveyed would like to remain in the Company for more than 5 years, 86% believe that the Company engages with the community and protects the environment, while 76% estimate that their employment enables to balance work responsibilities with their personal life. Sustainability (2019) (1): % of favorability Diversity and inclusion (2019) (2): % of favorability 88% 77% 75% 74% 87% 80% 74% 70% 61 58 % 64 % 69 % 72 % 2012 2015 2017 2019 For more information review chapter 6, our metrics (1) In my position I have opportunities and alternatives to take care of natural resources such as water and energy, as well as use material resources efficiently. (2) I believe the company is committed to diversity, integrating people with different skills, different religions, races and cultures, sexual identity, etc. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTPEOPLE DEVELOPMENT 103-1, 103-2, 103-3, 401-1, 401-2,401-3 F or Coca-Cola Andina, people make up one of the basic pillars of the business and a factor of future success. Respecting them by offering them a development perspective balanced on their professional and personal aspects. Comprehensive talent management and people development is a relevant topic for our employees and for the Company. That is why it is key to develop, enhance and retain talent to ensure business continuity through the excellence of its teams. Given the above, the focus is on five strategic initiatives: 62 • Identify skill gaps and develop learning circuits • Continue talent development management and supervision • Implement a diversity and inclusion strategy • Position Coca-Cola Andina as the best employer brand • Implement a talent agenda for the entire HR team During 2019, the most significant actions taken were related to gender equality, disability and generations. At Coca-Cola Andina we are convinced that having a diverse team and an inclusive culture have great benefits for people and the business. Not only do we accept diversity, but we actively value and promote it, prioritizing respect for the dignity of each person, regardless of race, sex, origin, age, religion, marital status, sexual orientation, gender identity and/or expression, disability, veteran status, education, life experience, opinions, ideas and beliefs. DIVERSITY AND INCLUSION 404-1, 402-1, 403-1 2019 Improvements Creation and dissemination of the Policy of Respect for Persons, Diversity and Inclusion. The operation in Chile achieved the target by mid-2019, reaching 1% of people with disabilities in its payroll. 30 25 20 15 10 5 0 l e p o e p f o r e b m u N y r a u n a J y r a u r b e F h c r a M l i r p A y a M e n u J y l u J t s u g u A 2018 2019 r e b o t c O r e b m e v o N r e b m e c e D r e b m e t p e S HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT GENDER EQUALITY 103-1, 103-2, 103-3, 401-1, 401-2,401-3 Program “X mí” ("For me") Argentina Program focused on the employment inclusion of women, promoted by the Government of the Province of Córdoba. Oriented to promote internships in the company, which allows to train and gain experience to face the formal labor market in the future. Aimed at women over the age of 25 who serve as heads of household. The experience was very positive, as it allowed to assign tasks in different sectors of the production process in which there is a very low female presence, such as warehouses, engineering and distribution. Since July 1, 2019, 13 women have entered. Female leadership and empowerment Brazil A conversations program on female leadership and empowerment took place with the participation of Renata Abreu, author of the book "Female Happiness". This initiative reached more than 180 women in middle management, that participated in person as well as via streaming in all units of Coca-Cola Andina Brazil. Brazil's operation demonstrates its commitment to boosting the female presence in the company's various units, giving everyone the possibility to apply for existing vacancies, regardless of gender. In this context, seven female drivers were incorporated in 2019, who were excellently received by the distribution team. 63 Let's start-up together Paraguay The vulnerability women's empowerment program through workshops and training has enabled their economic independence to be boosted, improving their quality of life and that of their family. The scope of this initiative has enabled more than 3,500 women artisans, recyclers, traders and homeowners to train. During 2019, it focused on digital-age strategies for entrepreneurships supported by the Central Bank of Paraguay and the office of the nation's First Lady. The program also geographically expanded, reaching areas such as Itaguá, where small traders received management, leadership and self-esteem tools. Throughout the project, indicator management is performed, which responds to personal finances as well as education and motivation aspects. This initiative is part of the 5by20 commitment, which seeks to empower five million women by 2020 worldwide. Incorporating women to the production process Chile The entry of female operators to the plant is a new milestone of the operation in Chile, as there were no female staff in those positions. In 2019, six women joined, who, while holding fixed-term positions to this day, the experiences of both the women involved as well as their peers and supervisors have been very positive. Awareness-raising workshops Chile, Paraguay Since 2018, a series of workshops of this type have been held, in which more than 600 collaborators have taken part. These have taken place in Chile (Antofagasta, Coquimbo, Santiago and Punta Arenas) and Paraguay (Asunción). As part of the trainings, we provide support and accompaniment in the accreditation process to people with current disabilities, improve accessibility to our facilities and analyze each job to consider necessary adequacy. At the end of 2019 we partnered with the Tacal Foundation to develop an open course for people with disabilities on tools for job insertion, thinking about those who have not had this opportunity. Job reinsertion initiatives Chile The program has been operating for three years and seeks to generate cooperation networks for recruitment and selection. To this end, work was carried out in conjunction with the Support Centre for Social Integration (CAIS), which promotes processes of individual, family, sociolabor and community reinsertion, of those who have presented legal problems and who are in a voluntary process of eliminating a criminal record or on parole under the control of Chilean Gendarmerie. People who go through CAIS manage to reduce their re-offense rate from 70% to 10%. Since 2017, 107 people have gone through the program and 13 remain currently working. TRAINING HOURS 2019 404-1 Training hours imparted Training hours imparted to women 288,897 48,229 16.4 Average training hours per employee For more information review chapter 6, our metrics HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTCOMPENSATION AND BENEFITS 412-1, 412-2, 412-3 They are aimed at health care and prevention; development of a healthy life style and the progress and enjoyment of the family. The compensations and benefits offered by Coca-Cola Andina provide for the requirements of labor legislation in each of the countries in which we have operations, but year after year the areas strive to go further. 75% of operations 100% of operations Health Maternity and paternity leave (in addition to legally mandatory) Work gymnastics: Access to plans of physical activities in own installations or by agreement, for comprehensive care and recreation Medical assistance and insurance. Life insurance additional to legally mandatory. Complete annual medical check-up for managers, heads of areas and supervisors. 50% of operations Health Dental Plan. Nutritionist at plant. Conferences, workshops and speeches of the interest of the collaborators and family groups. Maternity leave and paid lactation time (six months of decrease to half a day of work without salary reduction for women reinstated after maternity leave). Extended paternity leave for 7 consecutive days (including legal requirement). Preventive vaccination programs (dengue, influenza, yellow fever, hepatitis A, etc.). Discount programs with health institutions and pharmacies 25% of operations Health Health insurance or social work plan. Includes the employee and family group, being the Company who absorbs all the differences that involve the value of the plan versus legal contributions. Food re-education Programs. Discount programs with nutrition companies and others. Snack: Fruit and yogurt for administrative positions. Economic Free Beverages. Christmas care package. Product availability for employee for internal consumption Supplementary annual salary. Economic Economic Economic Payment day (last business day of the month or previous Friday). Free soft drinks for birthdays of the children of collaborators. Hotel expense reimbursement to DCCT workers with a cap. Life insurance additional to legally mandatory. School Kit, bonus for children under the age of 18. Cafeteria service. End of year gift Discount in the purchase of company products University or tertiary degree for DCCT(1) workers. Special Entertainment (Labor Day, woman’s day, child’s day, secretary’s day, etc.) Special bonus for retirees Shuttle service for all personnel Discount club (vehicles, real estate, services, etc.) Contest for children of collaborators with best grades. Extraordinary advance of salary Gift for birth of a child. Subsidy payment medical leaves for first three days not covered by health plan. Optional auto/home Insurance with the Company’s insurance broker Banco Galicia branch office at Montecristo plant 12 additional salaries to the collective life insurance at a very low cost and/or incorporate the spouse into the insurance coverage 64 Education Discounts on the rates of different education programs for employees. Social Leave for marriage, death of close family member, siblings and grandparents. Special Entertainment (Labor Day, woman’s day, child’s day, secretary’s day, etc.) Casual Friday. Social Tickets to participate in events. (1) In a collective bargaining agreement. (2) Out of collective bargaining agreement. Education Leave for rendering exams. Education Academic excellence scholarships for children of workers for University career. Social Social Flexible working hours for areas where the operation is not affected. Additional week of vacation for heads of areas and above positions Internal library Accompaniment of retired employees Summer and winter garments for supporting personnel. 4 day leave of absence for spouse’s death. 1 day leave of absence for blood donation. Enjoyment of holiday while on vacation period. 1 day leave of absence for moving into new home Christmas party for worker and family. Half day off on birthday FCCT(2) Paid holiday license with holiday bonus Additional two-day holiday allowance for travel over 1,000 km for a minimum of 10 days (DCCT) One day leave extension for indirect family death (mandatory law grants one day) One day extended paternity leave (the law mandates two days, we give three) Breastfeeding room Nursery Christmas gift for children of workers HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTHEALTH AND SAFETY, A CHALLENGE FOR ALL > 403-1; 403-2; 403-3; 404-4 LTIR LTISR All of the operations of Coca-Cola Andina have a Behavior Based Safety Management Program. Its main objective is to implement Safety Culture through the commitment and responsibility of senior management and its managers, as well as the effective participation of employees, third parties and service providers. The program has three instances: • Phase I consists of requirements 1 to 5: Commitment Letter, Golden Rules, Integration, Communication Program and Accident and Incident Management. • Phase II is composed of requirements 6 to 13: Recognition Program, Disciplinary Measures, Behavioral Observation, Security Dialogues, Safety Academy, Training, Management Analysis and Classification. • Phase III is the last requisite for Certification and is composed of requirements 14 to 16: Family Safety Program, Third Party Safety Program and Quality of Life Program. 2.61 3.11 75.50 87.38 0.44 0.39 1.62 0.78 0.38 0.52 5.53 4.83 1.73 3.5 27.39 20.6 Incident rate, number of incidents per each 200,000 hours worked Incident severity rate, number of days lost per each 200,000 hours worked 2018 2019 65 LTIR: Chile 4 1 0 2 5 1 0 2 6 1 0 2 7 1 0 2 8 1 0 2 9 1 0 2 "We reduced incidents in the operation of Coca-Cola Andina Chile" HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT2.43%0.78%1.62%2.6%4.19%6.5%LABOR RELATIONS > 102-41, 402-1; 403-4 At Coca-Cola Andina we respect and encourgae the right to freedom of association in every country we operate. We maintain ongoing dialogue with trade unions to which our collaborators belong. Wage updates are negotiated with trade unions on the dates specified through categories, and all collaborators, whether affiliated or not with a trade union, are covered by the collective bargaining agreements of activity branch to which they belong. During the last years we worked not only on the economic benefits, but also on the non-economic ones, seeking to adapt to the new needs of our employees. We hold regular meetings with trade union organizations to prevent significant impacts on employees; so, if there is a project that impacts them, changes and forms of implementation are previously agreed upon. In the following table you can review the adhesion of collaborators by contract type. Relationship between beginning minimum wage (basic salary without additional items) and legal local minimum wage % Unionized personnel (2019) 372% 329% 173% 118% 124% 66 120% 106% 106% 2018 2019 Argentina Brazil Chile Paraguay 66% 10% 44% 25% % collaborators with performance evaluation (2019) Argentina Brazil Chile Paraguay 87% 100% 97% 58% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTMaking cities and human settlements inclusive, safe, resilient and sustainable Why is it important? We assume Sustainable Development Goal #11 supporting the communities in which we operate. We pay special attention to developing programs that support young people and women, generating skills and opportunities so that they can develop Because we seek to contribute to the progress of the communities where we develop our activities, through programs to foster local economies, generate opportunities and improve the quality of life of people. Ensure modalities of sustainable consumption and production. Consumption and sustainable production consist of promoting the efficient use of resources and energy, building infrastructures that do not harm the environment, improving access to basic services and creating ecofriendly jobs, with fair pay and good working conditions Why is it important? At Coca-Cola Andina we believe that our suppliers are a key link in our value chain. For this reason, we work together with those who share our values and operate ethically to achieve excellence 67 COMMUNITY 103-1, 103-2, 103-3, 203-1, 203-2, 413-1, 413-2 Community investment MUS$ 142 136 265 264 t Coca-Cola Andina we understand our responsibility to the communities in which we operate, so we focus on establishing long term trust-based relationships and contribute value in the issues that are relevant to each of them. Building these trust relationships allows us to be increasingly ambitious in addressing society's challenges. We also encourage volunteer actions in our employees. During 2019 the Company achieved 1,737 hours of support for community programs thanks to the predisposition and passion of our employees. This not only has a positive impact on our communities, but also generates bonds of trust, learning opportunities, networking between different staff members, motivation and pride of belonging to Coca-Cola Andina. The focus on the community is primarily with our neighbors, emphasizing the communities close to the operations we have. During 2019 community investment was MUS$ 1.7. The most prominent initiatives are geared towards empowerment, education and nutrition. 586 474 441 418 2018 2019 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTOUTSTANDING INITIATIVES 2019 103-1, 103-2, 103-3, 203-1, 203-2, 413-1, 413-2 Argentina Healthy cooking workshop with Banco de Alimentos and Pimienta Negra Workshop Families at the table - Banco de Alimentos. Brazil Coletivo Jovem: Training and education to enter the labor market, aimed at young people between 16 and 25 years old. Project in partnership with NGOs of the communities of Rio de Janeiro and Ribeirão Preto. Ações do Kolabora (Volunteer Program) – The mission is to graduate young people. The goal of making a celebration taking the opportunity to give them an approach to the company. 23 collaborators participated to work voluntarily at a graduation party. Serving approximately 100 young people from the coletivo Cidade de Deus. 23 volunteers - 100 impacted. Agua mais acesso Program: in 2019 we expanded our performance to 29 communities in the states of: Amazonas (3), Ceará (10), Espirito Santo (3), Minas Gerais (3), Pará (5), Pernambuco (3) and Piauí (2). Employability workshops. Plant visits31.350 Installation of filters for access to water in vulnerable areas. Solidarity Christmas Action to Different Institutions with Employees: Cordoba, Rosario. Solidarity Fairs Iconic dates (Friend's Day, Mother's Day, Christmas): Inclusive Work. Fonbec: Sponsoring children to accompany in their schooling. Junior Achievement: Women Entrepreneurs, Skills for success, Learning to undertake in the environment, Challenge and Innovation, Fie Scholarships. Techo, Construction of three seed houses. WWW- Association with Municipalities to increase PET recovery: Villa Allende, Unquillo, Rio Cuarto, Rosario, Junin, Godoy Cruz Argentina's Altas de bancos de alimentos WWW- Unquillo Municipality Training Program PET recovery. Ril Donation of Water for places in environmental emergency 68 Scrap donations 400 cold equipment CONIN Recuperando Ando School Competition. 8 Cordoba Schools Corporate volunteering at Inclúyeme Food Bank, inclusion program in the company's activities. Inclusive supplier- Omas scraps of fabrics. Summer action recovering PET at bus stops: Monte Hermoso, Santa Fe, Cordoba. Chateau Park cleaning and afforestation with Greentech Sponsoring women's empowerment events Kiosquera Women Empowerment Program Beverage donation to NGOs and public good institutions PET recovery actions in marathons and public events Awareness Media Campaign for Municipalities Chile "Renca, Play and Learn in Community" Program, in partnership with Fútbol más and the Municipality of Renca Environmental education in Schools in alliance with Kyklos and the Municipalities of Renca, Maipú, Puente Alto and San Joaquín. Open door programs: Coca-Cola Andina Cinema; Happiness factory First place in Urban Municipal Initiatives Award (PIMU) in the category "Public-Private Alliance" Finalists in "Zero Garbage Awards" in the educational establishment category We have four years of partnership with the Food Network Annual perception measurement of the Renca community with ClioDinamica Contribution to Renca's community recycling network with PET containers. We have served for two years in the Clean Production Agreement "Zero Waste to Disposal" We adhere as the Coca-Cola System to "Pact for Plastics" We adhere as a Coca-Cola System to the Clean Production Agreement "Eco-labeling of Containers and Packaging". Paraguay Encourage community participation for protection of the Arroyo Pa'I Ñu basin through the environmental awareness campaign led by the H2O Orchestra of Ñemby. This project was integrated into the internal recycling campaign implemented at PARESA for collaborators of the company with the aim of boosting PET waste recycling to subsequently materialize what was raised in the donation of musical instruments for the Ñemby Orchestra. http://https/www.coca-coladeparaguay.com.py/historias/comunidad- vecinos-se-suman-a-la-limpieza-del-arroyo-pai-nu-para-recuperar- Raise awareness of the preservation of forests and country native species of trees, implement national reforestation campaigns in wildlife depopulated areas driven by the NGO A Todo Pulmon Paraguay Respira Link Boost the EcoPoints network (waste recovery zones) in conjunction with the company Soluciones Ecológicas through the ASU Recicla project, Competition in 10 Asunción neighborhoods with the aim of incentivizing separation in source of waste through awareness-raising days and accompaniment in participating neighborhoods. link Installation of containers for PET waste recovery in brandsponsored events, such as: runs, intercollegiate sport events, etc. https://www.solucionesecologicas.com.py/#servicios Collection of PET bottle caps for donation to the NGO LUCHA, which leads initiatives for children with cancer. https://es-la.facebook.com LuchaLuchandoUnidosContraElCancer/ Finance and Management Trainings to more than 2,500 vulnerable women to strengthen their economic independence, through the Emprendemos Juntas program, promoted together with Fundación Paraguaya. link Water replenishment based on sustainable agriculture with 149 producers in the Mbaracayú Reserve (Canindeyú) to achieve greater water infiltration to groundwater, in conjunction with Fundación Moisés Bertoni and Fundación Avina http://https://www.coca-coladeparaguay.com.py/historias/ comunidad-un-viaje-al-corazon-de-la-reserva-mbaracayu Improved access to safe water and generation of change in people's behavior for adopting good practices related to water, sanitation and hygiene in 56 communities and 9 cities through the Ykuaá project, implemented by Fundación Moisés Bertoni in collaboration with SENASA, with the following strategic allies: One Drop, BID, Fundación Coca- Cola and Fundación FEMSA. https://www.lazosdeagua.org/y-kuaa HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTENTITIES/NGOS WE SUPPORTED IN 2019 103-1, 103-2, 103-3, 203-1, 203-2, 413-1, 413-2, 102-11, 102-12 Argentina IARSE http://www.iarse.org/ FONBEC http://fonbec.org/ Banco de alimentos Córdoba Banco de alimentos Rosario https://bancodealimentoscba.org.ar/ Banco de alimentos Bahía Blanca Banco de alimentos Santo Tomé Banco de alimentos Mendoza Banco de alimentos San Rafael CONIN https://bancodealimentoscba.org.ar/ Junior Achievement https://junior.org.ar/ Techo Agua Segura Cooperativa Los Carreros Empate FC Asociación Hospital Infantil 69 OMAS Entre Costuras Hospital San Roque Hospital de Niños Fundadoras Greentech 7 Reinas Manos Abiertas Brazil Instituto Coca-Cola Brasil Chile AB Chile, https//www.cocacolabrasil.com.br/institutococacolabrasil ) http://abchile.cl/ Instituto Coca-Cola Brasil https//www.cocacolabrasil.com.br/institutococacolabrasil ) AFBCC - Associação Fabricantes Brasileiros de Coca Cola http://www.afbcc.com.br/ ACRJ- Associação Comercial do Rio de Janeiro ABIR - Associação Brasileira das Indústrias de Refrigerante https://abir.org.br/ CIESP - Centro de Indústria do Estado de São Paulo CIRJ - Confederação das Industrias do Rio de Janeiro https://www.firjan.com.br/cirj/ ARBERISA – Associação Recreativa e Beneficiente dos Empregados de Companhia de Bebidas Ipiranga SOFOFA, https://web.sofofa.cl/ Fundación Fútbol Más, http://futbolmas.org/ Empresa B Kyklos, https://www.kyklos.cl/ Red de alimentos, http://www.redalimentos.cl/ Empresa B Triciclos, http://www.triciclos.net/es/ AGIP, https://www.agipchile.cl/ AIA, https://www.aia.cl/ Cámara de Comercio de Santiago, https://www.ccs.cl/ ANDA, https://www.anda.cl/ Confederación Gremial de Comercio Detallista y Turismo de Chile Fundación Volando en V https://dos.volandoenv.cl/ Fundación Dulzura para el Alma, http://dulzuraparaelalma.cl/ Fundación Huella Local, http://www.huellalocal.cl/ Empresas Sumando Valor, https://sumandovalor.cl/ Fundación Las Rosas, http://www.fundacionlasrosas.cl Paraguay A Todo Pulmón https://atodopulmon.org/ ADEC: Asociación de Empresarios Cristianos https://www.adec.org.py/ Asociación Tierranuestra ASOFAM: Asociación de familias del BID Banco de Alimentos https://bancodealimentos.org.py/ BID: Banco Interamericano de Desarrollo Bomberos Voluntarios CAP: Cámara de Anunciantes del Paraguay https://cap.org.py/ Club de Ejecutivos del Paraguay https://www.clubdeejecutivos.org.py/ Cruz Roja Paraguaya Defensores del Chaco: water and youth forum Doctores de la Risa: assistance in public hospitals Enseña Paraguay: strengthening education in public schools Fundación Gabriela Duarte: to promote music Fundación Dequeni: actions to promote education Fundación Pa'i Puku: foundation that runs the school in el Chaco Fundación Paraguaya/Programa de Empoderamiento de la Mujer Fundación Saraki Fundación SONICA Paraguay: empowering young people through music FUPADI: Paraguayan Diabetes Foundation ONG GOOD NEIGHBORS: NGO working with people in poverty situation Habitat para la Humanidad Sistema B Paraguay: NGO that certifies companies with environmental impact Techo Paraguay Teleton Paraguay HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTINITIATIVES 103-1, 103-2, 103-3, 203-1, 203-2, 413-1, 413-2 Education support program Argentina Coletivo Joven Project Brazil Las Omas Organizations Argentina The bottling plant located in Córdoba is neighbor to the Chacras de la Merced neighborhood, whom we met three years ago providing infrastructure for sanitation and construction of toilets for some families in need. From that moment we started a relationship that benefited the community, being part of the safe water project through which they received water purifying filters. We also work with the women of the neighborhood, through trainings imparted by Junior Achievement, introducing entrepreneurs to management tools. During 2019 this relationship yielded one of the best results, starting a commercial link with the Company. Work was performed on developing a program that allowed to support the women, to giving them fabric scraps from the plant, representing more than 1,710 kilos of fabric. With them, ten families organized an entrepreneurship, through which they managed to earn revenues of Ar$126,500, allowing them to find new opportunities for each of them. They are now still suppliers with great growth potential. In 2019, Coca-Cola Andina and Junior Achievement developed five educational programs in seven municipalities of the country, their main focus being entrepreneurship as a motivation tool for the challenges of life. All the trainings – attended by 150 people – seek to generate the entrepreneurial spirit among the participants, providing them with management and innovation tools. Another educational initiative carried out in Argentina was together with the Municipality of Córdoba, Urbacor and Universidad Siglo 21: the competition "Recuperando Ando" was held, in six institutions (schools and clubs). The aim is to educate and train institutions as responsible waste generators. In the three months of the competition, 2,243 kg of PET bottles were recovered. For the third year in a row, we have grown the sponsorship initiative for children and young people so that they can continue their academic studies; generating a bond between sponsor and sponsee. In the economic contexts that the country lives, the help of the sponsor is a great contribution to families and an incentive to continue studying. In 2019 there were 91 sponsees and 102 collaborators, four more than the previous year. In 2019 Coca-Cola Brazil Institute turned 20 years old and its contribution is undisputed, so we are proud to belong to the Coca- Cola System and be part of the work achieved. Promoting and expanding social impact is the organization's main mission and achieves its goal using one of the strengths of Coca-Cola, the network of alliances. In these years it was successfully impacted more than 294 thousand people from all over Brazil, mainly with the following programs: • Coletivo Jovem, generating work opportunities and increase the income of young people. • Safe water access in rural areas 30% of young people get their first job Achieve to increase by 40% family income 70 Volunteering Brazil Andina Brazil joined the initiative proposed by The Coca-Cola Company, hand in hand with the Coca-Cola Brazil Institute, seeking the challenge of the cultural change of our collaborators as well as of approaching communities with purposeful actions. The volunteer program connects the social action platform with bottler contributors to generate shared value. We were present in the trainings imparted under the Coletivo Jovem program in Cidade de Deus, where 84 company employees supported the training of 134 young people. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTChildren of Coquimbo, change makers Chile 103-1, 103-2, 103-3, 203-1, 203-2, 413-1, 413-2 The program focuses on developing a culture of energy efficiency in children, true change makers, with an eye on the future. It is carried out in collaboration with Ineergias, the program of the Universidad de La Serena that embarked on the training of teachers of schools of the Fourth Region, to spread example in their educational communities. Ineergias also provided support for schools to develop their own energy efficiency projects, an instance where the Coca-Cola Andina plant in Coquimbo has been a strategic ally. The Company made recyclable material available to schools - between PET packaging, caps and pallets - to collaborate with the creative ideas of students and teachers. Another emblematic program of Chile's operation is Kyklos, which has been running since 2016 and through which we seek the transformation of the community by educating children and leading to a change in the curriculum mesh of schools. Students are change makers of their community as they incorporate recycling and material reduction practices; new skills that contribute to improving the quality of life and well-being of society. 71 Beneficiaries 28schools 16,746 816training hours 28.3 5.8 tons of waste recovered tons of plastic PET Also noteworthy is the Fútbol Más alliance, which is part of the program "Renca, plays and learns in community". It seeks to improve coexistence within the municipal schools in the area, through the methodology of five values of Fútbol Más: joy, responsibility, teamwork, respect and creativity. The success of the initiative achieves that children want to continue the project in their schools, as it generates a great integration between boys and girls and a healthy coexistence and interaction between the schools and the neighborhoods to which they belong. 794 children participated in the initiative and 69% attended the socio-sporting workshops. Emprendemos Juntas (We start-up together) Paraguay At Coca-Cola Andina we are aware that women's empowerment has a lot to do with the success of the community in which you live. When women are skilled and treated fairly, society and the economy immediately benefit and a more sustainable future is created for all. In line with the global initiative - 5 million empowered women by 2020: the ambitious goal of our 5by20 program - Coca-Cola Paresa and Fundación Paraguaya promote "Emprendemos Juntas", a program, which in 2017 trained a total of 750 women, and that during 2018 benefited 2,500 Paraguayan women from our value chain, including customers, suppliers, recyclers and artisans. During 2019, the number exceeded 5,000 women, extending the initiative to 25 municipalities across the country. A milestone of the year was the signing of a cooperation agreement with the First Lady of the Nation to continue empowering more women. The training they received in management and administration allowed them to project an entrepreneurship or improve the one they already had in place. This program is focused on providing training and tooling opportunities to vulnerable women, so that they can have a more active role in the development of their entrepreneurship. Our goal is for women to earn income, diversify them, save and access credit, to be development agents in their communities. In three years we trained 5.000 women. Recovering public space Paraguay The Pa’i Ñu stream, which flows into the Paraguay River, no longer looks the same. Authorities are concerned about its contamination, who are working on the recovery of the stream. In order to assist in this task, the “Sonidos de la Tierra” program organized the environmental marathon "Somos H2O" to collaborate with the cleaning of the stream. Students, volunteers of Fundación Tierranuestra, musicians of the H2O Sonidos de Ñemby Orchestra and collaborators of Coca-Cola Andina Paraguay toured the Pa’i Ñu neighborhood inviting neighbors to join this great environmental crusade. Participants of the initiative formed working groups to perform riverside cleanup actions, visit the homes of neighbors, distribute decals, and plant native trees. At the end of the day, the participants collected 1,000 kilos of waste, which was collected by the Municipality of Ñemby to be recycled. https://www.coca-coladeparaguay.com.py/historias/comunidad- vecinos-se-suman-a-la-limpieza-del-arroyo-pai-nu-para-recuperar- HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTSUPPLIER DEVELOPMENT 103-1, 103-2, 103-3, 308-1, 308-2 Ensure sustainable consumption and production.Sustainable consumption and production consist of promoting the efficient use of resources and energy, building infrastructures that do not harm the environment, improving access to basic services and creating green jobs, paid and with good working conditions. Why is it important? At Coca-Cola Andina we believe that our suppliers are a key link in our value chain. Consequently, we work together with those who share our values and operate ethically to achieve excellence 72 Our commitment to suppliers and how we manage it For Coca-Cola Andina, our suppliers are a key part of the value chain. Therefore, we focus on establishing trusting and long-term relationships with those who share our values and principles, in order to achieve excellence ethically and responsibly with our stakeholders. We also take care of having a safe and sustainable supply of raw materials required in the process. Supplier Guiding Principles (SGP) The Coca-Cola Company has developed a set of Supplier Guiding Principles (SGP), a vital pillar of The Coca-Cola Company’s human rights and workplace accountability programs. These programs are driven by the belief that good corporate citizenship is essential to our long-term business success and must be reflected in our relationships and actions and of those who are authorized to directly supply our business. Recognizing that there are differences in laws, customs, and economic conditions that affect the different operations, we believe that shared values must serve as the foundation for relationships us and our suppliers, starting with the commitment to respect all human rights. At Coca-Cola Andina we are committed to defending the fundamental principles of international human rights in the workplace, wherever we operate. Our commitment to human rights is formalized by respecting the United Nations Declaration of Human Rights, the Declaration of Fundamental Principles and Rights in the Workplace of the International Labor Organization and the principles of the United Nations Global Compact. The Company's policy on this topic is reflected in the "Supplier Guiding Principles". The Supplier Guiding Principles communicate our values and expectations and emphasize the importance of responsible workplace practices that comply, at a minimum, with applicable laws. The main suppliers of Coca-Cola Andina must comply with the requirements provided for in the document and then undergo regular evaluations carried out by accredited and independent firms. Our suppliers must comply with following requirements Freedom of association and collective bargaining Prohibit child labor Prohibit forced labor and abuse of labor Eliminate discrimination Work hours and wages Provide a safe and healthy workplace Protect the environment Business integrity Grievance procedure and remedy Management systems for ensuring lawful compliance and respect for all human rights Human rights self-assessment The Coca-Cola Company has developed self-assessment checklists on human rights. The self-assessment checklists assist with awareness and due diligence to address impacts that, experience has shown, may be present in the value chain. By conducting such assessments at the outset, with periodic follow-ups, human rights risks are identified and mitigated. If an issue is identified, community engagement is expected to be at the heart of any mitigation strategy. These self-assessment tools are only one piece of the Company’s ongoing Human Rights due diligence process. Coca-Cola Andina, as part of The Coca-Cola Company system, collaborates with the follow up. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORTWe prioritize hiring local suppliers We seek to make acquisitions and purchases from local suppliers based in the cities where we have the production plants and the main distribution centers. Essentially, this decision seeks to promote the local development of supply companies, generate integration with the supply chain, reduce delivery time and the risk of exposure to variations in foreign currency rates. The added value that the Coca-Cola System generates, together with its entire value chain, is significant, accounting for 0.3% of the GDP of the countries where it operates. The joint task with suppliers favors greater economic and social and environmental benefits. Argentina Brazil Chile Paraguay Supplier assessment We care about building a Win-Win relationship with our suppliers, supporting their activities and giving way to key partnerships with those who are critical to the operation. Our policy is to encourage their growth, betting on their continuous improvement and those who achieve greater development in quality, social responsibility and care of the environment are the ones who prevail at the time of choosing our suppliers. Suppliers assessed ARGENTINA BRAZIL CHILE 2018 238 40 19 2019 278 36 146 2,325 4,160 1,850 1,186 Note: The scope of this information covers the operations of Argentina, Brazil and Chile. We do not have metrics in Paraguay yet. For more details review chapter 6, our metrics Coca-Cola Andina Argentina held a new workshop for suppliers The Company is actively and responsibly involved with the actors that are part of its value chain, focusing on well-being, the environment and communities. Supply Chain Committees We participate in the bottler sourcing committees of The Coca- Cola Company, where we work on joint initiatives to enhance business volumes and good business practices. Reaching agreements for the development of suppliers of strategic raw materials and adaptation to our quality standards. Number of suppliers % national suppliers % expense on national suppliers 96.3% 99.7% 96.8% 89.0% 94.9% 98.4% 98.9% 62.0% SUPPLIER CLASSIFICATION 103-1, 103-2, 103-3, 308-1, 308-2 At Coca-Cola Andina we classify suppliers as critical and noncritical. Critical suppliers Suppliers of raw materials directly related to our beverages. 73 Percentage of spend evaluated suppliers: 40% 21% Thus, in September, the second workshop for suppliers was held at the Coca-Cola plant, located on the way to Monte Cristo. This activity, organized by the procurement area, aims to encourage companies that work with the Company to innovate and grow sustainably, sharing information and trends that help generate new and better business. More than 70 local, national and international suppliers from different areas participated, addressing topics related to the Company, on purchasing, marketing and sustainability, posing the challenges that the future demands. 70% During the workshop, dynamics were generated among the attendees in order to create links, share good practices and detect opportunities that can translate into contributions of value. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT DIALOGUE WITH STAKEHOLDERS 102-40, 102-42, 102-43, 102-44 RELEVANT TOPICS FOR STAKEHOLDERS Identification We followed AA1000 Accountability standards regarding dialogue with these groups, in addition to GRI, to identify stakeholders, i.e. those individuals or groups who are directly or indirectly affected by the Company's activity. To achieve this purpose, the first thing was to separate them according to their specific interests and then prioritize their participation in the preparation of this report. Then, we validated whether sustainability standards and internal policies meet the expectations of the different stakeholders, as well as emerging issues and/or concerns that have been identified through communication channels. Permanently, through the sustainability committees and the network they form, the identified audiences are reviewed to ensure their representativeness year after year, validating whether there were variations in their expectations. The following table reflects the seven stakeholders we engage with that have the ability to influence our strategy, management and dialogue channels. We seek to know their expectations and identify opportunities to generate shared value. Prioritization of relevant topics During 2018, a process of both internal and external interviews and meetings was conducted with some stakeholders, updating their materiality study. Validation The most prominent subjects with the greatest potential for influence in the activities and strategy of the group, were subjected to a validation process by stakeholders - through interviews and work meetings - with the aim of knowing their position on those subjects and the importance they assign to them. Review Materiality analysis results are periodically reviewed and updated as part of the process of preparing the Integrated Annual Report. Material topics that are relevant to management are monitored with more than 40 indicators that apply to the entire Company and the responsibility for this lies with the Management Control area. On a quarterly basis, improvements are reviewed and proposed. 74 STAKEHOLDERS COMMUNICATION CHANNELS WHY IT IS IMPORTANT Shareholders and Investors General Shareholders' Meeting Special Shareholders' Meeting Conference calls Meetings Visits Integrated Annual Report 20F Annual Report Quarterly Press Releases Website - Investor section Coca-Cola Andina's IR Application Emailing Internal emails reporting on relevant news. We periodically perform Organizational Climate Collaborators measurements, which allow us to recognize our main strengths and improvement opportunities. Internal magazine Face-to-face meetings Anonymous reporting channel Regular communication Meetings Participation in joint initiatives Direct relationship with specific areas Building joint plans Audits Anonymous reporting channel Corporate website Integrated Annual Report The Coca Cola Company It is essential for us to provide information about the evolution of our businesses, our current and future view of the Company. It is a key function of the Investor Relations area to perform this task under the principles of equality, transparency and fluency. At Coca-Cola Andina, our partners form the basis of business sustainability and allow us to build a better company. We take care of managing industrial relations, we care that people feel valued and can develop their skills. The partner that develops the beverage brands we bottle and sell. A supplier and a shareholder. There is ongoing interaction to develop joint initiatives, planning and participation of other groups that have a direct focus on certain subjects. Regular communication through channels established by regulation standards in each country Meetings with different government levels Government and Regulating Entity Integrated Annual Report Anonymous reporting channel Through the web platform of the CMF (Financial Market Commission) At Coca-Cola Andina we want and seek to accompany the trends of government regulations. We have teams dedicated to proactively participating in public consultations as well as responding to the inquiries we receive. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT COMMUNICATION CHANNELS WHY IT IS IMPORTANT STAKEHOLDERS 102-40, 102-42, 102- 43, 102-44 Suppliers Regular communication channels Digital channels Periodic meetings Interviews Corporate website Biddings Training Integrated Annual Report Anonymous reporting channel Regular communication channels Digital channels Training Interviews Corporate website Biddings Clients Integrated Annual Report Reporting line meetings with commercial and sales teams Satisfaction surveys and analysis 75 Client development and service centers, call centers Plant visits Anonymous reporting channel Digital channels Corporate website Integrated Annual Report Satisfaction surveys and analysis Consumers Client development and service centers, call centers Plant visits Anonymous reporting channel Perception and assessment surveys and analysis Relationship activities One of the most relevant stakeholders for Coca-Cola Andina, in terms of Generated Economic Value, are our suppliers. It is important for us to be able to share knowledge and experience and find ways to use all our resources as efficiently as possible, reducing costs. But also giving the opportunity to suppliers who are part of our neighboring community. This is part of the way we understand the integration of sustainability into our business model. Coca-Cola Andina has a wide range of sales points which include supermarkets, wholesalers, hotels, restaurants, cafes, cinemas, e-commerce and retailers, among others, which sell our products to consumers. All the people who consume our products in the countries where we operate. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT chapter.six | OUR MAIN METRICS 76 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT6OUR MAIN METRICS t Coca-Cola Andina we have been reporting our metrics for seven consecutive years and reviewing industry trends, a period in which we have advanced to empathize with stakeholders who read this Integrated Annual Report and to demonstrate, through it, our vocation for management transparency. This year we have developed a special chapter dedicated to metrics and trends, because they allow us to monitor and manage in the most agile way possible the impact of our activity in the financial field and in ESG aspects (Environmental, Social and Corporate Governance). This is an essential part of the financial sustainability of our supply chain and business. "We have developed KPIs of all topics, which we periodically monitor. In addition, in recent years we have been incorporating those key indicators into the incentives of the Company's principal officers." ANDRÉS WAINER Chief Financial Officer 77 2016 2017 2018 2019 2016 2017 2018 2019 2016 2017 2018 2019 2016 2017 2018 2019 Clients ('000) 64 64 60 59 79 89 86 85 63 65 67 64 53 57 55 58 Argentina Brazil Chile Paraguay Sales volume (M UC) 218.8 211.4 201.9 178.2 266.1 248.9 249.2 259.3 232.2 231.0 231.4 239.6 62.0 65.0 68.2 69.3 % soft drinks market share 61.6% 62.3% 63.0% 62.9% 63.4% 63.2% 63.3% 61.7% 68.2% 67.5% 66.8% 66.7% 67.7% 68.9% 71.6% 73.4% % juices market share 46.2% 46.2% 47.6% 45.3% 31.4% 27.7% 25.1% 48.7% 34.6% 35.4% 36.6% 37.8% 39.5% 39.5% 37.0% 59.0% % water market share 14.5% 16.3% 17.4% 17.4% 8.2% 10.7% 13.8% 18.3% 42.9% 41.2% 41.3% 42.2% 44.5% 33.4% 30.9% 47.6% Number of bottling plants Number of other plants Number of distribution centers 3 1 23 3 1 45 3 1 45 3 1 47 2 0 16 2 0 16 3 0 17 3 0 18 4 3 17 4 3 17 4 3 17 4 3 17 1 0 3 1 0 4 1 0 6 1 0 6 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT BEVERAGE BENEFITS Quality and excellence of our products Countries Quality ISO 9001 Environment ISO ISO 14001 Health and Safety OHSAS 9001 Food Safety FSSC22 GAO The Coca Cola Company corporate requirements Quality and excellence of products 2018 2019 Number of trained panelists Argentina Brazil Chile Paraguay SKUs analyzed Argentina Brazil Chile 140 179 138 74 85.0% 95.0% 88.0% 167 83 80 60 100.0% 100.0% 100.0% 100.0% Paraguay 100.0% 2016 371.8 382.7 276.2 367.4 9.7% 7.7% 32.0% 2.9% 2017 354.7 370.3 253.9 355.4 12.5% 6.5% 27.4% 13.4% 2018 345.1 344.8 219.6 336.8 15.7% 10.3% 30.1% 17.1% 2019 327.4 334.3 216.7 329.0 17.2% 13.7% 31.1% 18.2% Argentina Brazil Chile Paraguay Product wellness Kcal/liters sold Argentina Brazil Chile Paraguay 78 Percentage of sugar-free soft drinks sold Argentina Brazil Chile Paraguay % of portfolio (brands) reduced or without sugar Total Coca-Cola Andina 36% 35% 53% 48% % of portfolio (brands) with vitamins or added nutrients Total Coca-Cola Andina 28% 30% 16% 27% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Client development Number of clients (´000) 2015 2016 2017 2018 2019 Argentina Brazil Chile Paraguay 66 97 65 53 64 79 63 53 66 89 65 57 60 86 67 55 59 85 64 58 Total Coca-Cola Andina 281 259 277 268 267 Client satisfaction (%) 2017 2018 2019 Argentina 86.7% 90.4% 90.8% Brazil* Chile Paraguay (biannual starting 2019) * Without information for Brazil - - - 61.0% 52.0% 52.0% 85.5% 83.0% 83.0% 79 Percentage client service through Call-Center Claims Orders (sales) Requests (services, visits, etc.) Inquiries Total calls 2015 13.6% 14.4% 25.6% 46.4% 2016 11.4% 18.2% 22.3% 48.1% 2017 9.9% 32.7% 25.9% 31.5% 2018 9.7% 35.9% 20.8% 33.6% 2019 9.1% 35.4% 21.0% 34.5% 675,309 745,046 987,149 993,561 1,061,212 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT SUSTAINABLE PACKAGING 80 Generation of solid waste (gr/L of beverage) Argentina Brazil Chile Paraguay Recycling of solid waste (% over total) Argentina Brazil Chile Paraguay Recycled resin (tons) Argentina Brazil Total recycled resin Pet savings Total tons saved Total US$ saved *2018 includes APET aseptic line project Recycled postconsumption (tons) Argentina Brazil Chile Paraguay 2015 2016 2017 2018 2019 13.0 10.9 14.8 26.0 92.2% 90.1% 83.3% 75.3% 14.0 6.5 19.1 25.3 89.7% 88.7% 80.2% 71.9% 2018 1,023 328 1,351 15.7 6.3 18.8 22.4 89.6% 88.2% 80.6% 73.1% 14.7 7.4 20.2 19.2 91.4% 87.3% 89.1% 84.0% 14.3 6.8 17.5 19.6 90.8% 83.1% 83.5% 74.3% 2019 1,129 884 2,013 2017 236 2018 1.345 406,346 1,737,476 2019 445 712,037 2016 0 2,428 3 0 2017 20 3,070 29 12 2018 22 5,511 45 9 2019 54 6,106 51 23 Total Coca-Cola Andina 2,431 3,131 5,587 6,234 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Raw materials used (tons) Virgin plastic PET Recycled plastic PET Virgin glass Recycled glass Aluminum Tetrabrik Virgin plastic caps Recycled plastic caps Virgin plastic cases Recycled plastic cases Plastic stretch film + shrink film Wood pallets Sugar Fructose CO2 (raw material) Chapadur (hardboard) Generation of solid waste (tons) Paper / Carboard Glass Caps Metal (all except aluminum) Aluminum PET Plastic (all except PET and PP caps) Wood Organic Other recyclables Other non-recyclables Hazardous waste (tons) 81 ARGENTINA BRAZIL 2017 2018 2019 2017 2018 2019 2017 17,604 17,026 14,097 14,077 15,670 21,335 13,540 1,240 3,492 2,875 - - 2,009 - 353 824 1,907 3,288 1,023 8,823 3,911 - 487 1,309 28 599 986 2,313 115,573 1,129 3,013 1,313 658 392 5,426 1,420 - - - 1,525 2,200 - 348 296 1,791 3,353 - 569 - 2,696 2,958 328 283 - 6,946 901 1,995 - 356 - 2,777 1,840 884 - 2,650 8,167 - - - - 3,694 814 2,749 - 774 - 2,882 3,394 1,529 1,755 1,819 - 313 - 399 - - - - 285 - - - - 1,315 - CHILE 2018 11,158 - 4,163 1,784 - - PARAGUAY 2019 12,070 - 2017 5,592 - 2018 6,196 - 10,281 102,471 102,233 1,629 2,086 - - - 94,596 88,716 77,713 111,571 107,139 111,267 73,619 60,503 53,823 9,484 8,685 289 7,394 1,480 7,134 - - 9,812 9,514 3,939 1,215,328 3,087 - - - 9,677 3,746 - - - - 7,808 7,399 7,085 2,814 - - 68 - - - 810 - 19,606 6,535 906 23,709 33,156 - 976 717 - 304 101 152 24,884 29,595 4,056 2,868 411 ARGENTINA BRAZIL 2017 2018 2019 2017 897 4,555 278 140 8 2,828 1,415 950 - 4,287 2,247 2018 1,049 3,406 264 278 18 2,774 1,493 2,263 - 3,151 2,539 2019 1,016 2,884 316 292 53 2,811 1,532 2,395 - 2,446 149 880 423 213 448 72 1,114 631 2,889 - 154 920 951 545 229 379 57 1,288 666 2,716 7 253 966 790 263 390 40 1,421 774 3,371 587 68 2017 747 5,954 395 55 10 1,837 816 3,096 364 - CHILE 2018 544 2019 785 6,460 10,527 410 62 6 1,374 707 3,189 255 - 403 112 13 1,582 831 2,182 - 354 PARAGUAY 2017 454 3,149 29 259 - 327 400 893 - - 2018 546 2,742 47 452 - 294 444 950 - 13 1,455 1,274 2,988 2,357 1,850 2,181 1,905 2019 6,076 - 3,498 2,351 - 411 813 - 185 61 962 662 23,872 11,752 2,817 830 2019 581 2,820 82 572 1 450 490 987 - 311 971 Treated by local third parties 100% of hazardous waste is treated nationally in each operation ARGENTINA 2017 1,039 2018 795 2019 878 2017 46 BRAZIL 2018 46 2019 89 2017 216 CHILE 2018 218 PARAGUAY 2019 207 2017 12 2018 3 2019 24 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT WATER STEWARDS Total water consumption (m3) 2014 2015 2016 2017 2018 2019 Argentina 2,661,572 2,692,833 2,752,281 2,831,418 2,661,129 2,327,439 Brazil Chile 1,906,945 2,422,473 2,197,955 2,028,498 1,934,800 2,058,065 2,570,379 2,454,498 2,360,736 2,162,181 2,075,851 2,106,349 Paraguay 768,418 772,119 746,510 707,882 707,098 722,056 Total Coca-Cola Andina 7,907,314 8,341,923 8,057,482 7,729,979 7,378,878 7,213,909 Liters of beverage produced (m3) 2014 2015 2016 2017 2018 2019 Argentina 1,311,119 1,335,959 1,241,385 1,189,129 1,141,747 1,003,119 Brazil Chile 1,083,492 1,402,407 1,289,843 1,235,574 1,261,005 1,354,318 951,992 940,421 940,269 877,766 890,193 931,476 Paraguay 359,074 352,902 355,665 362,496 377,328 389,699 82 Total Coca-Cola Andina 3,705,677 4,031,689 3,827,162 3,664,965 3,670,273 3,678,612 Liters of water / liter of beverage produced Argentina Brazil Chile Paraguay Total Coca-Cola Andina 2014 2015 2016 2017 2018 2019 2.03 1.76 2.70 2.19 2,13 2.02 1.73 2.61 2.19 2,07 2.22 1.70 2.51 2.10 2.11 2.38 1.64 2.46 1.95 2.11 2.33 1.53 2.33 1.87 2.01 2.32 1.52 2.26 1.85 1.96 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Water source (m3) Underground Network Surface Rain Internally treated effluent 2016 6,251,284 1,806,198 0 0 0 2017 6,164,458 1,564,021 0 1,499 0 2018 5,815,873 1,413,471 147,865 1,668 0 2019 5,545,021 1,307,319 360,527 999 44 Total water used 8,057,482 7,729,978 7,378,877 7,213,910 Reused water (m3) Argentina Brazil Chile 2018 0 2019 0 163,089 125,848 2,343 2,002 Water used in production process (m3) Beverages Auxiliary services Total water used Effluent disposal (m3) Own treatment Third-party treatment Total effluent disposal 2016 3,827,162 4,230,320 8,057,482 2016 2,026,306 1,579,916 3,606,222 2017 3,664,965 4,065,013 7,729,979 2017 2,775,067 1,150,113 3,925,181 Wastewater discharge into own treatment plants by country (m3) 83 Argentina Brazil Chile Paraguay Total Coca-Cola Andina 2016 1,093,905 542,863 0 389,538 2,026,306 2017 1,581,459 655,179 195,132 343,298 2,775,068 2,647,029 Wastewater discharge into third party treatment plants by country (m3) Argentina Brazil Chile Paraguay 2016 67,070 199,486 1,313,360 0 2017 60,830 0 1,089,283 0 2018 53,666 0 967,606 0 Total Coca-Cola Andina 1,579,916 1,150,113 1,021,272 1,016,768 2018 3,670,273 3,708,604 7,378,877 2018 2,647,028 1,021,272 3,668,300 2018 1,464,347 655,503 197,409 329,770 Paraguay 55,910 158,638 Total water reused 221,342 286,488 2019 3,678,612 3,535,297 7,213,910 2019 2,547,336 1,016,768 3,564,104 2019 1,297,443 716,166 201,370 332,357 2,547,336 2019 50,079 0 966,689 0 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT ENERGY MANAGEMENT Energy consumption (MJ) Argentina Brazil Chile Paraguay 2015 2016 2017 2018 2019 436,258,051 415,967,650 417,306,969 409,235,774 361,853,002 532,914,688 300,542,078 344,041,575 351,777,338 384,559,873 263,317,813 270,778,919 231,575,870 271,475,113 246,493,622 210,805,200 192,605,335 193,164,293 192,404,299 193,682,342 Total Coca-Cola Andina 1,443,295,751 1,289,852,382 1,186,088,706 1,224,892,525 1,186,588,839 Energy consumption from renewable sources (MJ) Biomass Hydroelectric Solar Wind Biogas 2015 2016 2017 2018 2019 153,580,443 65,478,287 64,704,645 64,156,777 62,670,042 128,975,580 109,958,400 111,280,320 149,584,111 224,277,140 1,059 0 600 0 605 0 202 0 0 32,491,559 12,636,824 1,365,725 11,399,241 17,114,813 13,059,101 84 Total Coca-Cola Andina 295,193,906 176,803,012 187,384,811 230,855,903 332,497,842 Energy use ratio (MJ/L produced) Argentina Brazil Chile Paraguay 2015 2016 2017 2018 2019 0.33 0.38 0.28 0.60 0.34 0.23 0.29 0.54 0.35 0.28 0.28 0.53 0.36 0.28 0.30 0.51 0.36 0.28 0.26 0.50 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT EMISSIONS TRANSPORTATION Emissions (kg CO2 equivalent) Number of trucks 2017 2018 2019 Total scope 1 53,155,332 74,307,183 45,977,832 Own trucks Total scope 2 61,189,906 37,073,614 55,413,868 Third party trucks Total scope 3* 107,159,092 203,339,429 210,013,782 Total trucks 2018 999 1,735 2,734 2019 1.123 1,706 2,829 Total kg CO2 equivalent emitted 221,504,331 314,720,226 311,405,482 *Scope 3 includes cold equipment, third-party fleet, recycled waste and waste destined to landfills. Emissions (gr CO2 / liter produced)* Scopes 1 + 2 + 3* Scopes 1 + 2 * does not include cold equipment Cold equipment 2017 60.52 31.20 85 Cold equipment with energy savings (%) 2018 47.41 30.35 2018 61% 2019 40.86 27.56 2019 79% 43% of trucks used are low carbon (5 euro or similar) Kilometers travelled 2018 2019 Own trucks 12,863,964 13,592,446 Total kg CO2eq emitted per cold equipment 140,716,949 223,592,450 Third party trucks 69,728,243 70,550,198 Total kilometers travelled 82,592,207 84,142,644 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT WORKING ENVIRONMENT Internal Climate Evaluation (% favorability) Collaborators by operation and gender These figures are FTEs 2015 2016 2017 2018 2019 2017 2018 2019 Argentina 64% 64% 64% 64% 69% Mujeres Hombres Total Mujeres Hombres Total Mujeres Hombres Total 66% 66% 72% 72% 76% Argentina 279 2,967 3,246 272 2,904 3.176 264 2.795 3.059 Brazil Chile 60% 60% 66% 66% 67% Paraguay 66% 66% 64% 64% 70% 86 Brazil Chile Paraguay Holding 826 6,954 7,780 1,000 6,895 7.895 1.083 6.949 8.032 413 151 17 3,006 3.419 436 2,919 3.355 575 4.233 4.808 1,430 1,581 167 1,433 1.600 181 1.465 1.646 22 39 17 22 39 19 22 41 Total collaborators 1,686 14,379 16,065 1,892 14,173 16.065 2.122 15.464 17.586 Wage Gap The proportion of the average base gross salary of female executives to male executives is 77.2%, while the proportion of average base gross salary of female workers to male workers is 87.8%. Note: The position group used is based on the "Hay Grading" methodology that considers the equivalent accountability in each position Of the Company's total employees, 15,464 are men and 2,122 women. Of these, 4,246 are Chileans and 13,340 foreign citizens. Of the foreign citizens, 3,024 are Argentines, 8,012 are Brazilian, 1,627 are Paraguayans and 677 of other nationalities. Of the Company's total employees, 4,712 are under the age of 30, 6,906 are between 30 and 40 years old, 3,821 between 41 and 50 years old, 1,732 between 51 and 60 years old, 286 between 61 and 70 years old, and 130 over 70 years old. Of total employees, 7,496 have held their position for less than three years, 3,552 between three and six years, 2,103 for more than six and less than nine years, 1,290 between nine and 12 years and 3,145 for over 12 years. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Collaborators by gender and category, 2019 Argentina Brazil Chile Paraguay Women Men Women Men Women Men Women Men Managers and principal officers (N; N-1; N-2) Professionals and technicians in charge of staff (N-3) 12 45 Professionals and technicians not in charge of staff (N-3) 101 Other workers Seasonal 65 41 85 412 180 1,817 301 10 58 313 702 0 43 201 409 6,296 0 Total collaborators 264 2,795 1,083 6,949 21 45 140 313 56 575 61 219 258 3,045 649 15 31 71 64 0 23 146 87 1,055 155 4,232 181 1,466 Collaborators by gender and age, 2019 Argentina Brazil Chile Paraguay Women Men Women Younger than 18 Between 18 and 29 Between 30 and 40 Between 41 and 50 Between 51 and 60 Between 61 and 70 Older than 70 Total collaborators 0 43 145 64 12 0 0 264 New hirings by age and gender, 2019 0 426 1,294 842 213 20 0 25 435 392 157 58 5 11 Men 16 1,928 2,769 1,436 618 78 104 Women 0 170 225 121 57 2 0 Men 0 895 1,468 1,007 672 176 14 Women Men 0 83 64 24 10 0 0 0 688 534 160 80 4 0 2,795 1,083 6,949 575 4,232 181 1,466 Argentina Brazil Chile Paraguay Women Men Women Men Women Men Women Men 87 30 years old and younger Between 30 and 50 Older than 50 Total collaborators 10 4 0 14 31 24 0 55 163 146 8 317 778 835 61 1,674 18 23 1 42 113 131 24 268 13 4 1 18 20 22 1 43 Distribution by seniority, 2019 Less than 3 years Between 3 and 6 years Between 6 and 9 years Between 9 and 12 years More than 12 years Total collaborators Argentina 572 365 527 263 1,332 3,059 Brazil 3,966 1,897 982 402 785 8,032 Chile 2,297 874 469 407 761 4,808 Paraguay 650 409 115 215 257 1,646 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT PEOPLE DEVELOPMENT Training and education Training hours women Training hours men Total training hours Average training hours women Average training hours men Average training hours per employee Education distribution by topic Development of work skills Development of abilities and employability Work safety Sustainability and environment Ethics and code of conduct 2017 35,466 194,769 230,235 20.8 13.5 14.3 2017 48.0% 28.0% 17.0% 4.0% 3.0% 2018 34,828 294,563 329,391 18.4 19.0 19.0 2018 44.0% 25.0% 23.0% 3.0% 5.0% 2019 48,229 240,668 288,897 15.6 22.7 16.4 2019 41.6% 19.7% 26.7% 5.9% 6.2% 88 Education hours by gender and category, 2019 Argentina Brazil Chile Paraguay Women Men Women Men Women Men Women Managers and principal officers (N; N-1; N-2) Professionals and technicians in charge of staff (N-3) 969 779 6,723 490 1,348 80 470 737 9,748 2,353 8,939 2,000 6,297 1,222 4,542 Professionals and technicians not in charge of staff (N-3) 4,393 7,431 6,527 8,595 4,135 4,019 820 956 Other workers Seasonal 1,471 31,815 13,861 105,431 6,246 21,908 1,468 16,191 504 3,664 0 0 8 40 0 1,313 Total collaborators 8,115 59,381 23,232 124,313 12,469 32,734 4,247 24,119 Men 1.117 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Percentage of collaborators with performance evaluation Base salary1 / legal minimum wage ratio 2017 2018 2019 Argentina 65.7% 88.5% 87.0% Argentina Brazil Chile 100.0% 100.0% 100.0% 96.0% 100.0% 97.3% Brazil Chile 89 Paraguay 61.0% 57.9% 58.0% Paraguay 1. Base salary without additional Unionization rate Turnover rate 2017 2018 2019 Argentina 67.4% 66.0% 66.0% Argentina Brazil Chile 9.7% 12.2% 52.5% 50.9% Paraguay 35.0% 35.5% 9.6% 44.0% 24.9% Brazil Chile Paraguay 2015 297.0% 112.0% 100.0% 100.0% 2015 0.49 2.84 2.04 0.50 2016 2017 281.0% 361.0% 108.0% 106.0% 100.0% 100.0% 117.0% 116.0% 2018 372.0% 106.0% 120.0% 118.0% 2019 329.2% 106.4% 173.3% 124.1% 2016 2017 2018 2019 0.38 2.71 2.60 0.45 0.51 2.14 1.50 0.37 0.40 2.29 1.23 0.43 0.44 1.90 1.28 0.26 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT DIVERSITY AND INCLUSION HEALTH AND SAFETY People with disabilities and social minorities* Absenteeism rate Brazil Chile Total Coca-Cola Andina * Chile is recorded beginning 2018 2015 2016 2017 2018 2019 2015 2016 2017 147 - 147 173 - 173 220 - 220 356 14 370 348 31 379 Argentina 3.21% 3.09% 2.85% Brazil Chile 2.27% 3.19% 1.78% 1.50% 3.30% 4.00% Paraguay 1.57% 1.62% 1.30% 2018 2.46% 1.35% 4.03% 1.76% 2019 2.37% 1.56% 3.35% 1.69% Number of collaborators who took leave of absence (maternity and paternity) Accident rate (LTIR) 2015 2016 2017 2018 2019 2018 2019 Women Men Women Men Argentina Brazil Chile Paraguay 22 38 30 10 Total Coca-Cola Andina 100 90 118 192 90 56 456 22 33 25 17 97 104 220 109 65 498 Argentina 6.14 Brazil Chile 0.53 4.19 Paraguay 0.59 5.07 0.58 2.60 0.46 4.03 0.60 2.43 0.61 Number of collaborators that continue working after leave of absence (maternity and paternity) 2018 2019 Women Men Women Men 22 30 28 10 90 118 173 n/d 54 345 21 30 18 17 86 101 198 n/d 61 360 Argentina Brazil Chile Paraguay Total Coca-Cola Andina LTISR Days of leave due to accident rate 2015 2016 2017 Argentina 202.10 143.08 124.00 Brazil Chile 6.94 52.99 Paraguay 3.84 6.61 47.95 3.73 6.60 53.32 6.85 2.61 0.44 1.62 0.38 2018 75.50 5.53 27.39 1.73 3.11 0.39 0.78 0.52 2019 87.38 4.83 20.60 3.50 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT COMMUNITY SUPPLIER DEVELOPMENT Number of suppliers Argentina Brazil Chile Paraguay 2015 2,444 4,383 1,666 2016 2,749 4,831 1,861 2017 2,369 4,130 2,249 1,192 Total Coca-Cola Andina 8,493 9,441 9,940 Percentage national suppliers 91 Argentina Brazil Chile Paraguay 2015 97.1% 99.8% 95.6% 87.0% Percentage spent on national suppliers Argentina Brazil Chile Paraguay 2015 98.9% 99.9% 97.5% 54.0% 2016 97.0% 99.7% 95.1% 85.9% 2016 99.9% 99.8% 97.5% 40.0% 2017 97.0% 99.7% 95.4% 87.8% 2017 98.6% 99.3% 98.9% 64.5% 2018 2,409 4,011 1,764 1,197 9,381 2018 96.8% 99.8% 95.5% 90.2% 2018 95.9% 98.5% 97.0% 60.4% 2019 2,325 4,160 1,850 ,186 9,521 2019 96.3% 99.7% 96.8% 89.0% 2019 94.9% 98.4% 98.9% 62.0% Number of suppliers evaluated Argentina Brazil Chile Paraguay* 2018 238 40 19 - Total Coca-Cola Andina 297 * Without information for Paraguay 2019 278 36 146 - 460 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT Number of beneficiaries in the community 2016 2017 2018 2019 Argentina 140,294 422,245 224,991 228,283 Brazil Chile 6,526 7,000 4,956 8,364 99,100 480,425 1,325,795 353,038 Paraguay 13,573 824 28,638 11,864 Total Coca-Cola Andina 252,967 910,494 1,584,380 601,549 Hours of volunteer work Argentina Brazil Chile Paraguay 2016 2017 407 - 1,045 - 324 - 974 12 2018 2,496 - 1,525 12 2019 1,111 322 180 124 92 Total Coca-Cola Andina 1,452 1,310 4,033 1,737 Liters of beverage donated 2016 2017 2018 2019 Argentina 282,909 210,376 663,304 407,851 Brazil Chile - - 4,713 3,279 281,650 360,221 985,433 610,710 Paraguay 10,870 4,178 12,189 27,510 Total Coca-Cola Andina 575,429 574,775 1,665,639 1,049,350 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS8EXHIBITS7CORPORATEINFORMATION2019 INTEGRATED ANNUAL REPORT chapter.seven | CORPORATE INFORMATION 93 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT7COMPANY IDENTIFICATION 94 Corporate Name: Embotelladora Andina S.A. COMPANY BACKGROUND Company Incorporation 102-5 Fictitious Name: Not Applicable Company Description 102-5; 102-18 Type of Corporation: Open Stock Corporation Legal Address: Miraflores 9153, comuna de Renca, Santiago Embotelladora Andina S.A. (hereinafter “Coca-Cola Andina” or the “Company”) is the largest Coca-Cola bottler Argentina, Chile and Paraguay and the third Coca-Cola bottler in Brazil. It serves franchised territories with almost 54 million people, delivering 4,238 million liters of soft drinks, juices, and bottled waters during 2019. Chilean Tax ID: 91.144.000-8 ADDRESSES Argentina: Ruta Nacional 19, Km 3,7, Córdoba Tel: (54 351) 496 8800 Brazil: Rua André Rocha 2299, Tanquara, Jacarepaguá, Rio de Janeiro Tel: (55 21) 2429 1530 Mira􆙬 Chile: 􆙬es 9153, comuna de Renca, Santiago Tel: (56 2) 2611 5838 Paraguay: Acceso Sur, Km 3,5, San Lorenzo, Asunción Tel: (596 21) 959 1000 Coca-Cola Andina has the franchise to produce and commercialize Coca-Cola products in certain territories of Argentina (through the company Embotelladora del Atlántico S.A., hereinafter “EDASA” or “Coca-Cola Andina Argentina”), Brazil (through the company Rio de Janeiro Refrescos Ltda., hereinafter “Coca-Cola Andina Brazil”), Chile (through the company Embotelladora Andina S.A., hereinafter “Coca-Cola Andina Chile”) and in the entire Paraguayan territory (through the company Paraguay Refrescos S.A., hereinafter “Coca-Cola Paresa”). The Company is controlled in equal parts by the Chadwick Claro, Garcés Silva, Hurtado Berger, Said Handal and Said Somavía families. The company's value generation proposal is to be a leader in the non-alcoholic beverage market, developing a relationship of excellence with consumers of its products, as well as with its workers, customers, suppliers, the community in which it operates and with its strategic partner The Coca-Cola Company. For additional Company corporate information visit the website: www.koandina.com Embotelladora Andina S.A. is an open stock corporation, incorporated by means of a public deed dated February 7, 1946, before the Notary Public of Santiago, Mr. Luciano Hiriart Corvalán. An abstract of this deed is registered on page 768, N° 581 of the Santiago Registry of Commerce of 1946, and was published in the Official Daily Newspaper issue N° 20,413 dated March 25, 1946. The Company’s bylaws were approved by Supreme Decree N°1,364 of March 13, 1946, which is registered on page 770 N°582 of the Santiago Registry of Commerce of 1946. The latest amendment to the Company’s bylaws was approved at the Special Shareholders’ Meeting held June 25, 2012. The minutes thereof were brought into a public deed dated July 12, 2012 before the Notary Public of San Miguel, Ms. Patricia Donoso Gomien. An abstract thereof is registered on page 49,151 N°34,479 of the Santiago Registry of Commerce of 2012, and was published in the Official Daily Newspaper dated August 1, 2012. Subsequently, by public deed dated October 14, 2013, granted by the notary public of Santiago, Mr. Eduardo Avello Concha, evidence was noted of a full-fledged equity decrease according to the provisions of article 27 of Chilean Company Law N° 18,046 . An abstract of this deed is scored aside from the company’s social inscription on the Santiago Registry of Commerce, dated October 16 of the same year. In accordance with the above, the share capital decreased by Ch $21,724,544, and was divided into 473,289,301 Series A shares and 473,281,303 Series B shares. For additional Company corporate information visit the website: www.koandina.com HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGENERAL INFORMATION 102-34, 102-44, 103-2 STOCK INFORMATION Chile 150 140 130 120 110 100 90 80 7 1 0 2 CHILE 2019 Santiago Stock Exchange1 Chile Electronic Exchange1 8 1 0 2 Andina A Andina B IPSA ANDINA A Total traded (ThCh$) Average price (Ch$) 3,949 4,984 2,220 6,470 330 613 2,230 2,074 2,055 1,804 2,200 2,057 Shares traded (million) 1.8 2.4 1.1 3.7 0.2 0.3 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 95 he Company's shares have been traded on the Santiago Stock Exchange since December 19, 1955. In addition, the Company's shares have been traded on Chile's Electronic Exchange since November 2, 1989. The registration number in the Securities Register is 00124, in the Securities Register of the Financial Market Commission (CMF). In 1997 Coca-Cola Andina held a stock split into Series A and Series B shares. Mnemonic codes both for the Santiago Stock Exchange and for the Electronic Exchange, are Andina-A and Andina-B, each corresponding to the respective series of shares. The Stock Department in Chile is managed by SerCor (www.sercor.cl). The following chart shows the evolution of the Company's Series A and B share prices and IPSA for a two-year period ended December 31, 2019 (base 100). 3rd Quarter without transactions without transactions without transactions 4th Quarter 0.0 40 1,590 Source: Certificates issued by the respective Stock Exchanges CHILE 2018 Santiago Stock Exchange1 Chile Electronic Exchange1 Shares traded (million) 11.46 7.93 7.30 11.45 0.04 0.13 0.05 0.04 ANDINA A Total traded (ThCh$) Average price (Ch$) 30,885 20,393 16,502 24,945 103 334 113 95 2,695 2,572 2,260 2,178 2,758 2,664 2,273 2,183 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Source: Certificates issued by the respective Stock Exchanges 9 1 0 2 ANDINA B Total traded (ThCh$) Average price (Ch$) 113.564 42.214 33.332 37.216 10.496 4.473 1.279 1.822 ANDINA B Total traded (ThCh$) 311,838 149,922 60,324 129,444 6,829 3,014 3,878 6,691 2.507 2.430 2.350 2.160 2.494 2.430 2.370 2.100 Average price (Ch$) 2,960 2.,837 2,586 2,499 2,958 2,793 2,587 2,480 Shares traded (million) 45,4 17,4 14,2 17,3 4,2 1,8 0,5 0,9 Shares traded (million) 105.45 52.83 33.61 51.80 2.31 1.08 1.50 2.70 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT 150 140 130 120 110 100 90 80 7 1 0 2 U.S.A. 2019 THE NEW YORK STOCK EXCHANGE (NYSE) The Company's ADRs have been traded on the New York Stock Exchange since 1994. An ADR is equivalent to six common shares. The mnemonic codes for the NYSE are AKO/A and AKO/B. The depositary bank for ADRs is The Bank of New York Mellon (www.bnymellon.com). This chart shows the daily price behavior of Series A and Series B ADRs compared to the Dow Jones index for a two-year period ended December 31, 2019 (base 100). New York Stock Exchange 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 96 (1) Total Traded calculated as the average price times volume of ADRs traded (Source: Bloomberg). U.S.A. 2018 New York Stock Exchange ADR traded (million) 0.32 0.19 0.10 0.17 AKO A Total traded(1) (ThUS$) 8.33 4.70 1.99 3.20 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter (1) Total Traded calculated as the average price times volume of ADRs traded (Source: Bloomberg). 8 1 0 2 9 1 0 2 AKO/A AKO/B Dow Jones ADR traded (million) 0.02 0.02 0.04 0.26 AKO A Total traded(1) (ThUS$) 0.35 0.44 0.69 3.79 Average price (US$) 19.89 18.45 17.36 14.78 Average price (US$) 26.31 24.13 20.28 19.24 ADR traded (million) 0.54 0.59 0.68 0.62 ADR traded (million) 1.51 1.14 1.74 1.80 AKO B Total traded(1) (MUS$) 12.05 12.46 13.47 10.66 AKO B Total traded(1) (ThUS$) 44.44 31.51 40.60 39.32 Average price (US$) 22.41 21.16 19.78 17.24 Average price (US$) 29.36 27.66 23.27 21.81 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT DIVIDEND POLICY AND DIVIDENDS PAID The dividend distribution policy has consisted of distributing a percentage of at least 30% of net earnings of the period. Historically, the Company has paid dividends through interim dividends and a final dividend, after its approval during the month of April by the General Shareholders’ Meeting following the end of the year. Since the year 2000, the Company has paid additional dividends annually, as approved by the General Shareholders’ Meeting. During 2019, Distributable Earnings equaled Earnings for the fiscal year. Series A and Series B are mainly differentiated by their political and economic rights. DIVIDENDS (nominal Ch$) January 2019 May 2019 August 2019 Octobre 2019 Total 2019 Total 2018 Total 2017 Total 2016 Total 2015 Interim Final Additional Interim Series A (Ch$ per share) Series B (Ch$ per share) Total paid (MCh$) 21.50 21.50 21.50 21.50 86.00 86.00 76.00 68.00 54.00 23.65 23.65 23.65 23.65 94.60 94.60 83.60 74.80 59.40 21,369 21,369 21,369 21,369 85,475 85,475 75,536 67,584 53,670 While series A shares have the right to elect 12 of the 14 directors, Series B shares have the right to receive all and any dividends per share that are distributed by the Company, whether interim, final, mandatory minimums, additional or eventual, increased by 10%. The preferences of the Series A and Series B shares will last for the period expiring on December 31, 2130. Once this period has expired, the Series A and B will be eliminated, and the shares that form them automatically will be transformed into common stock without any preference. 97 INDEXES Dow Jones Sustainability Index Score ANDINA-A is part of Chile’s General Stock Price Index (S&P/CLX IGPA) of the Santiago Stock Exchange. Meanwhile, ANDINA-B, integrates Chile’s Selective Stock Price Index (S&P/CLX IPSA), the Inter-10 Index (S&P/CLX INTER-10), the General Mid Cap Stock Price Index (S&P/CLX IGPA MID) and the General Stock Price Index (S&P/CLX IGPA), all of these indexes of the Santiago Stock Exchange. 63 72 70 In 2019 we were ratified in the Sustainability Index of the Santiago Stock Exchange (Dow Jones Sustainability Index Chile) for the fourth consecutive year. Also, for the third consecutive year we were ratified in the Latin American Integrated Market Sustainability Index (DJSI - MILA). 41 The score obtained in the evaluation has been increasing steadily over the years. This is a result and reflection of our conviction in the generation of shared value and efforts to lead new market trends in corporate sustainability. 2016 2017 2018 2019 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT External Auditors EY Servicios Profesionales de Auditoría y Asesorías SpA. (RUT:77.802.430-6) are the external auditors of the company. Rating agencies: Bonds issued in the Chilean market on December 31, 2019 have the following rating: AA: by ICR Clasificadora de Riesgo Ltda. AA: by Fitch Chile Clasficadora de Riesgo Limitada Bonds issued in the international market on December 31, 2019 have the following rating: BBB: by Standard&Poors Global Ratings. BBB+: by Fitch Ratings Inc. SUMMARY AND COMMENTS OF SHAREHOLDERS Pursuant to General Rule No. 30 of Chile’s Financial Market Commission (CMF) and article 74 of Law No. 18,046, it is reported that neither the Directors’ Committee, nor shareholders or groups of shareholders that represent or possess 10% or more of the shares issued with voting rights, have made comments or proposals regarding the progress of the Company’s business. Notwithstanding the foregoing, in the Minutes of the General Shareholders’ Meeting of 2019, recorded all observations made by shareholders that expressed their opinion during that meeting. 98 COMPANY OWNERSHIP 102-18 Series B shareholders.A t December 31, 2019 there are 772 Series A shareholders and 1,138 CONTROLLING GROUP 102-5; 102-18 Embotelladora Andina S.A. (“Andina”) is controlled by the following group of natural and legal persons: Controlling Group Inversiones SH Seis Limitada (“SH6”), Inversiones Cabildo SpA (“Cabildo”), Inversiones Lleuque Limitada (“Lleuque”), Inversiones Nueva Delta S.A. (“Nueva Delta”), Inversiones Nueva Delta Dos S.A. (“Nueva Delta Dos”), Inversiones Playa Amarilla SpA (“Playa Amarilla”), Inversiones Playa Negra SpA (“Playa Negra”), Inversiones Don Alfonso Limitada (“Don Alfonso”), Inversiones El Campanario Limitada (“Campanario”), Inversiones Los Robles Limitada (“Los Robles”) and Inversiones Las Niñas Dos SpA (“Las Niñas Dos”). The Controlling Groups acts pursuant to a joint acting agreement entered into by the parties (the”Agreement”). Under the Agreeement, SH6 holds 50,001,664 Andina Series A shares, Cabildo holds 50,001,664 Andina Series A shares, Lleuque holds 50,001,664 Andina Series A shares, Nueva Delta holds 46,426,645 Andina Series A shares, and Nueva Dela Dos holds 3,574,999 Andina Series A. Playa Amarillia holds 13,513,594 Andina Series A shares, Playa Negra holds 515,939 Andina Series A shares and Don Alfonso, Campanario, Los Robles and Las Niñas Dos each hold 9,788,363 Andina Series A shares. The final controllers of the aforementioned companies are the persons and representatives for management listed below. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTSHAREHOLDERS OR PARTNERS OF THE COMPANIES THAT ARE PART OF THE CONTROLLING GROUP 1. 2. 3. SH6: Inversiones SH Seis Limitada, RUT 76.273.760-4. Direct and indirect ownership of this company is held by: Cabildo: Inversiones Cabildo SpA, RUT 76.062.133-1. Direct and indirect ownership of this company is held by: (a) Inmobiliaria e Inversiones Punta Larga Limitada, RUT 96.580.490-0, owner of 14.2069% of share capital. This company is 99.92% directly owned by Jaime Said Handal, C.N.I. 4.047.015-8; (a) IInversiones Delfín Uno S.A., RUT 76.005.604-9, owner of 2.13% of share capital. This company is 99.9999% owned by Mrs. Isabel Margarita Somavía Dittborn, C.N.I. 3.221.015-5; (b) Inversiones Bullish Limitada, RUT 76.167.252-5, owner of 14.2069% of share capital. This company is 97.2873% indirectly owned by Gonzalo Said Handal, C.N.I. 6.555.478-K; (b) Inversiones Delfín Dos S.A., RUT 76.005.591-3, owner of 2.13% of share capital. This company is 99.9999% owned by Mr. José Said Saffie, C.N.I. 2.305.902-9; (c) Inversiones Berklee Limitada, RUT 77.077.030-0, owner of 14.2069% of share capital. This company is 99% directly owned by Javier Said Handal, C.N.I. 6.384.873-5; (c) Inversiones Delfín Tres S.A., RUT 76.005.585-9, owner of 38.30% of share capital. This company is 99.0196% owned by Mr. Salvador Said Somavía, C.N.I. 6.379.626-3; 99 (d) Inversiones Harvest Limitada, RUT 77.077.250-8, owner of 14.2069% of share capital. This company is 69.66% directly owned by Bárbara Said Handal, C.N.I. 4.708.824-0; (e) Inversiones Oberon Limitada, RUT 76.126.745-0, owner of 14.2069% of share capital. This company is 90.0885% indirectly owned by Marisol Said Handal, C.N.I. 6.384.872-7; (f) Inversiones Rinascente Limitada, RUT 77.077.070-K, owner of 14.2069% of share capital. This company is 94.0580% directly owned by Cristina Said Handal; C.N.I. 5.522.896-5; (g) Jaime, Gonzalo, Javier, Bárbara, Marisol and Cristina Said Handal, each own 0.00006175% of share capital; and (h) Inmobiliaria Pro Seis Limitada, RUT 76.268.900-6, owner of 14.7581% of share capital. This company is indirectly owned in equal parts by Jaime, Gonzalo, Javier, Bárbara, Marisol and Cristina Said Handal. (d) Inversiones Delfín Cuatro S.A., RUT 76.005.582-4, owner of 19.15% of share capital. This company is 99.0196% owned by Mrs. Isabel Said Somavía, C.N.I. 6.379.627-1; (e) Inversiones Delfín Cinco S.A., RUT 76.005.503-4, owner of 19.15% of share capital. This company is 99.0196% owned by Mrs. Constanza Said Somavía, C.N.I. 6.379.628-K; and, (f) Inversiones Delfín Seis S.A., RUT 76.005.502-6, owner of 19.15% of share capital. This company is 99.0196% owned by Mrs. Loreto Said Somavía, C.N.I. 6.379.629-8. Lleuque: Inversiones Chucao Limitada was dissolved through the conveyance of all of its social rights in Inversiones Lleuque Limitada pursuant to the transfer of rights and social dissolution as evidenced by a public deed dated December 20, 2016, granted by the Notary Public of Santiago of Mr. Eduardo Diez Morello, an abstract of which is registered on page 12,282 No. 6.839 of the Public Registry of Commerce of the City of Santiago of the year 2017. The management of this company corresponds to its members acting jointly; and the social rights of Inversiones Lleuque Limitada correspond equally to Mrs. Pamela Hurtado Berger, C.N.I. 7.050.827-3 and Mrs. Madeline Hurtado Berger, C.N.I. 7.050.867-2. 4. Nueva Delta: Inversiones Nueva Delta S.A., RUT 76.309.233-K, 80.05% owned by Inversiones Nueva Sofía S.A., today Nueva Sofía Limitada, RUT 76.366.690-5. Direct and indirect ownership of this company is held by: (a) 7.01% of Mr. José Antonio Garcés Silva (senior), C.N.I. 3.984.154-1, who also maintains political rights pursuant to a special series of shares in the parent company; (b) 1.34% of Mrs. María Teresa Silva Silva, C.N.I. 3.717.514-5; (c) 18.33% of Mrs. María Teresa Garcés Silva, C.N.I. 7.032.690-6; (d) 18.33% of Mrs. María Paz Garcés Silva, C.N.I. 7.032.689-2; (e) 18.33% of Mr. José Antonio Garcés Silva (junior), C.N.I. 8.745.864-4; (f) 18.33% of Mr. Matías Alberto Garcés Silva, C.N.I. 10.825.983-3; and (g) 18.33% of Mr. Andrés Sergio Garcés Silva, C.N.I. 10.828.517-6. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTDirect or indirect ownership in Coca-Cola Andina held by members of the Controlling Group or related persons(1) 102-18 Series A Series B Inversiones SH Seis Limitada 52,989,375 37,864,863 Sucesión de Jaime Said Demaría - 49,600 Participación por Serie: 11.1960% 8.0109% Inversiones Cabildo SpA 52,987,375 49,650,863 José Said Saffie - 49,600 Participación por Serie: 11.1956% 10.5013% Inversiones Lleuque Limitada(2) 50.001.644 Inversiones HB S.A.(3) 1.569.731 - - Alberto Hurtado Fuenzalida† - 49.600 Participación por Serie: 10,8964% 0,0148 % Inversiones Nueva Delta S.A. 46,426,645 Inversiones Nueva Delta Dos S.A. 3,574,999 - - Inversiones Nueva Sofía Limitada 2,985,731 25,678,583 José Antonio Garcés Silva - 49,600 Participación por Serie: 11.1956% 5.4361% Inversiones Playa Amarilla SpA 13,513,594 13,513,594 Inversiones Playa Negra SpA 515,939 515,939 Inversiones El Campanario Ltda 9,788,363 9,788,363 Inversiones Los Robles Limitada 9,788,363 9,788,363 Inversiones Las Niñas Dos SpA 9,788,363 9,788,363 Inversiones Don Alfonso Limitada 9,788,363 9,788,363 Ownership by Series: 11.20% 11.20% Los Robles: Inversiones Los Robles Limitada, RUT 76.273.886-4, 79.854746% owned by María Carolina Chadwick Claro, 0,107735% owned by Felipe Tomás Cruzat Chadwick, 0.107735% owned by Carolina María Errázuriz Chadwick, 0.107735% owned by Jacinta María Errázuriz Chadwick, 6.607349% owned by Inversiones Bocaleón Limitada (99.9902% controlled by Felipe Tomás Cruzat Chadwick), 6.607349% owned by Inversiones Las Dalias Limitada (99.993% controlled by Carolina María Errázuriz Chadwick) and 6.607349% owned by Inversiones Las Hortensias Limitada (99.9903% controlled by Jacinta María Errázuriz Chadwick), whose final controller (as manager) is Mrs. María Carolina Chadwick Claro. Las Niñas Dos: Inversiones Las Niñas Dos SpA, RUT 76.273.943-7, 100% owned by Inversiones Las Niñas Limitada (96% controlled by María Eugenia Chadwick Braun, María José Chadwick Braun, Alejandra María Chadwick Braun and Magdalena María Chadwick Braun), whose final controller (as management representative) is Eduardo Chadwick Claro. 1 Nominal ownership of 23 Andina Series A shares held by Inversiones Freire S.A. and 4 Andina Series A shares held by Inversiones Freire Dos S.A. is excluded. 2 Inversiones Lleuque Limitada, RUT 76.312.209-3, legal continuator of the company Inversiones Chucao Limitada under the merger agreed by public deed of December 20, 2016, granted in the Notary of Santiago of Mr. Eduardo Diez Morello. 3 Inversiones HB S.A., RUT 96.842.220-0 is controlled (100% indirect ownership) by the following people: Alberto Hurtado Fuenzalida, C.N.I. 2.593.323-0; Pamela Hurtado Berger, C.N.I. 7.050.827-3; and Madeline Hurtado Berger, C.N.I. 7.050.867-2. 5. 6. 7. 8. 9. 100 Nueva Delta Dos: Inversiones Nueva Delta Dos S.A., RUT 76.309.244-5, 99,95% owned by Inversiones Nueva Sofía S.A., today Nueva Sofía Limitada (Direct and indirect ownership of this company is the same as the one described in the previous paragraph for Nueva Delta). 10. Playa Amarilla: Inversiones Playa Amarilla SpA, RUT 76.273.887-2,100% owned by Las Gaviotas SpA, whose final controller (as management representative) is Mr. Andrés Herrera Ramírez. Playa Negra: Inversiones Playa Negra SpA, RUT 76.273.973-9, 100% owned by Patricia Claro Marchant. Don Alfonso: Inversiones Don Alfonso Limitada, RUT 76.273.918-6, 73.40437% owned by María de la Luz Chadwick Hurtado, 0.05062% owned by Carlos Eugenio Lavín García- Huidobro and 26.54501% owned by Inversiones FLC Limitada (99.5% controlled by Francisco José Lavín Chadwick), whose final controller is Mrs. María de la Luz Chadwick Hurtado (as management representative). Campanario: Inversiones El Campanario Limitada, RUT 76.273.959-3, 86.225418% owned by María Soledad Chadwick Claro, 6.888107% owned by Inversiones Melitta Limitada (99.99% controlled by Josefina Dittborn Chadwick) and 6.886475% owned by Inversiones DV Limitada (99.99% controlled by Julio Dittborn Chadwick), whose final controller is (as manager) Mrs. María Soledad Chadwick Claro. 11. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT 101 Series A Series B Coca-Cola de Chile S.A. 69,348,241 Ownership by Series: 14.65% - - Note: Corresponds to direct and indirect ownership held by The Coca Cola Company. RELEVANT CHANGES IN THE COMPANY'S OWNERSHIP 102-5 In 2019, Coca-Cola de Chile S.A. transferred its ownership interest of the Company’s Series B shares. According to the Agreement, the Controlling Group shall jointly exercise Andina’s control to ensure the majority of votes at shareholder meetings and Board sessions. The resolutions of the Controlling Group are approved by at least four of the five parties, except for certain matters that require unanimity. On the other hand, and subject to the fulfillment of the rules of the Securities Market Law in Chile, the Agreement sets forth sale options of each party with respect to the other at a market price plus a premium of 9.9% and 25%, with 30-days window to exercise in June every year, and in June of 2017 and 2027 respectively; and in the case that all but one of the parties decide to sell, the Agreement regulates a right of first option to purchase for a period of one year. The Agreement is formalized through a private instrument signed between the parties and has an indefinite duration. In connection with The Coca-Cola Company’s investment in Andina, The Coca-Cola Company and the Controlling Group entered into a Shareholders’ Agreement dated September 5, 1996, providing for certain restrictions on the transfer of Andina’s capital stock by the Controlling Group. Specifically, the Controlling Group is restricted from transferring its Series A shares without the prior authorization of The Coca-Cola Company. The Shareholders’ Agreement also provides for certain corporate governance matters, including The Coca-Cola Company’s right to elect two members among our directors so long as The Coca-Cola Company and its subsidiaries collectively own a certain percentage of Series A shares. In addition, in related agreements, the Controlling Group granted The Coca-Cola Company an option, exercisable upon the occurrence of certain changes in the beneficial ownership of the Controlling Group, to acquire 100% of the Series A shares held by them at a price and in accordance with procedures established in such agreements. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT BUSINESS AREAS RESULTS 102-2; 102-7 Annual percentage of EBITDA distribution: 2015 2016 2017 2018 2019 Argentina Brazil Chile Paraguay 25% 32% 32% 11% 23% 31% 35% 11% 23% 32% 34% 11% 19% 33% 38% 12% 16% 34% 38% 12% Weight of subsidiary within total 2019 102 % of our assets % of net sales Argentina Brazil Chile Paraguay 10% 40% 38% 12% 22% 35% 34% 9% PRINCIPAL PRODUCTS COMMERCIALIZED BY COUNTRY 102-2; 102-6; 102-7 Argentina: Coca-Cola Andina Argentina produces and commercializes the following products licensed by The Coca-Cola Company: Coca-Cola, Coca-Cola Light, Coca-Cola Zero, Fanta Naranja, Fanta Naranja Zero, Fanta Limón, Fanta Pomelo, Sprite, Sprite Zero, Quatro Liviana, Schweppes Citrus, Schweppes Tónica, Schweppes Pomelo, Schweppes Zero, Crush Naranja, Crush Pomelo Crush Lima Limón, Kin with and without gas, Bonaqua with and without gas (mineral water), Aquarius and Aquarius Cero. Additionally it produces and commercializes Cepita juices, Powerade, Powerade Zero and in certain provinces it commercializes Amstel, Budweiser, Heineken, Sol, Imperial, Palermo, Schneider, Bieckert, Kunstmann, Isenbeck and Miller beer. Additionally it commercializes AdeS products in its entire franchise territory. These products are commercialized in returnable and nonreturnable glass and PET containers, as post mix syrup, in cans and Tetra Pak. Chile: Coca-Cola Andina Chile produces and distributes the following products licensed by The Coca-Cola Company: Coca-Cola, Coca-Cola Light, Coca-Cola Zero, Fanta Naranja, Fanta Naranja Zero, Fanta Uva, Fanta Guaraná, Fanta Piña, Inca Kola, Inca Kola Zero, Nordic Mist Agua Tónica, Nordic Mist Ginger Ale, Nordic Mist Zero, Quatro, Sprite, Sprite Zero, Cantarina, Limon & Nada and Guallarauco Agua de Fruta. It distributes VJ products : Andina del Valle, Andina del Valle Light, Andina del Valle Nutridefensas, Kapo, LIMON & NADA NARANJA, Quatro Pomelo Zero, Coca-Cola Plus Café, Coca-Cola Energy; Vital Aguas products: Vital (with and without gas), Smartwater, Benedictino, Aquarius, Aquarius Cero, Café Blak. Through Koolife business unit it commercializes GoldPeak, GoldPeak Diet, Core Power and Zico among others. Additionally it distributes Monster and commercializes AdeS products in its entire franchise territory. It also commercializes Guinness beer, Tanqueray gin, 􆙬 􆙬vodka,JohnnieWalkerwhisky, Don Julio tequila and Baileys among others. These products are commercialized in returnable and nonreturnable glass and PET containers, as post mix syrup in cans and Tetra Pak. Brazil: Coca-Cola Andina Brasil commercializes The Coca-Cola Company and Heineken products. Brands of The Coca-Cola Company produced, sold and distributed are: Coca-Cola, Coca-Cola Zero, Kuat, Kuat Zero, Fanta Laranja, Fanta Laranja Zero, Fanta Uva, Fanta Guaraná, Fanta Zero, Sprite, Sprite Zero, Schweppes Tónica, Schweppes Citrus, Del Valle 100%, Del Valle Frut, Del Valle Mais, Del Valle Mais Light, Kapo, Sabores Caseros, Del Valle Nutri, Crystal (mineral water, with and without gas), I9, Powerade, Powerade Zero, Fuze Ice Tea, Fuze Ice Tea Zero, Fuze Mate Leão, Fuze Mate Leão Zero, Guaraná Leão, Matte Leão, and Matte Leão Zero. It also distributes the following beer brands: Amstel, Bavaria, Heineken, Kaiser, Murphy´S, Sol and Xingu. Additionally it commercializes AdeS products, Verde Campo (Shake Whey, Lacfree y Minilac) and distributes Monster and Burn in its entire franchise territory. These products are commercialized in returnable and non- returnable glass and PET containers, as post mix syrup in cans and Tetra Pak. Paraguay: Coca-Cola Paresa produces and distributes the following products licensed by The Coca-Cola Company: Coca-Cola, Coca-Cola Zero, Fanta Naranja, Fanta Naranja Zero, Fanta Naranja Mandarina, Fanta Guaraná, Fanta Piña, Schweppes, Schweppes Tónica, Schweppes Citrus, Schweppes Pomelo, Sprite, Sprite Zero, Crush Naranja, Crush Piña, Crush Pomelo, Frugos Manzana, Frugos Durazno, Frugos Naranja, Frugos Naranja Light, Frugos Pera, Frugos Naranja Casera, Aquarius, Dasani (with and without gas), Powerade and Burn. Additionally it commercializes AdeS products. These products are commercialized in returnable and non- returnable glass and PET containers, bag-in-box syrup in cans and Tetra Pak. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT􆙬 􆙬 LICENSE AGREEMENTS BY COUNTRY 102-2, 102-9 ARGENTINA BRAZIL CHILE PARAGUAY General Description License Agreements are international standard contracts that The Coca-Cola Company enters into with bottlers outside the United States of America for the sale of concentrates and beverage basis for certain soft drinks and nonsoft drink beverages. In accordance with these contracts, we have the right to produce and commercialize soft drinks bearing the trademarks of The Coca-Cola Company in our franchise territory. Although this is not an exclusive right, The Coca-Cola Company has never authorized any other entity to produce or commercialize soft drinks or other beverages bearing the trademarks of The Coca-Cola Company in this territory. License Agreements are international standard contracts that The Coca-Cola Company enters into with bottlers outside the United States of America for the sale of concentrates and beverage basis for certain soft drinks and nonsoft drink beverages. In accordance with these contracts, we have the right to produce and commercialize soft drinks bearing the trademarks of The Coca-Cola Company in our franchise territory. Although this is not an exclusive right, The Coca-Cola Company has never authorized any other entity to produce or commercialize soft drinks or other beverages bearing the trademarks of The Coca-Cola Company in this territory. License Agreements are international standard contracts that The Coca-Cola Company enters into with bottlers outside the United States of America for the sale of concentrates and beverage basis for certain soft drinks and nonsoft drink beverages. In accordance with these contracts, we have the right to produce and commercialize soft drinks bearing the trademarks of The Coca-Cola Company in our franchise territory. Although this is not an exclusive right, The Coca-Cola Company has never authorized any other entity to produce or commercialize soft drinks or other beverages bearing the trademarks of The Coca-Cola Company in this territory. License Agreements are international standard contracts that The Coca-Cola Company enters into with bottlers outside the United States of America for the sale of concentrates and beverage basis for certain soft drinks and nonsoft drink beverages. In accordance with these contracts, we have the right to produce and commercialize soft drinks bearing the trademarks of The Coca-Cola Company in our franchise territory. Although this is not an exclusive right, The Coca-Cola Company has never authorized any other entity to produce or commercialize soft drinks or other beverages bearing the trademarks of The Coca-Cola Company in this territory. Territories This Agreement states as franchise territory the provinces of Córdoba, Mendoza, San Juan, San Luis , Entre Ríos, as well as part of the provinces of Santa Fe and Buenos Aires, Chubut, Santa Cruz, Neuquén, Río Negro, La Pampa, Tierra del Fuego, Antartic and South Atlantic Islands. This Agreement states as franchise territory, the majority of the state of Rio de Janeiro, the entire state of Espíritu Santo and part of the states of São Paulo and Minas Gerais. This agreement states as franchise territory the entire country of Pargauay. The License Agreement of Embotelladora Andina S.A. states as franchise territory, the Metropolitan Region (“Región Metropolitana”); the province of San Antonio, in Region V; the province of Cachapoal including the commune of San Vicente de Tagua-Tagua, in Region VI; Antofagasta Region II; Atacama Region III, Coquimbo Region IV; Aysén del General Carlos Ibáñez de Campo Region XI and Magallanes and Chilean Antartic Region XII. The term of the License Agreement with The Coca-Cola Company has been extended until September 30, 2022.. The term of the License Agreement with The Coca-Cola Company has been extended until October 4, 2022. The term of the License Agreement with The Coca-Cola Company has been extended until January 1, 2023. The term of the License Agreement with The Coca-Cola Company has been extended until September 1, 2020. The Coca-Cola Company, Cervejarías Kaiser S.A., Molson Inc. and the Brazilian Association of Coca-Cola Manufacturers entered into an agreement of understanding and a convention regarding the distribution of beer produced or imported by Kaiser, through Coca-Cola’s distribution system. Although the term of these agreements are currently under judicial discussion, Coca-Cola Andina understands that the distribution agreements signed after May 30, 2003 have a duration of 20 years and are renewable. 103 Term Others HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTPRODUCTION AND DISTRIBUTION BY COUNTRY 102-2, 102-9 104 Argentina Coca-Cola Andina Argentina operates three production plants: (i) one located in Córdoba with 15 lines ii) another in Bahía Blanca (Province of Buenos Aires) with 4 lines, and (iii) the third located in Trelew (Province of Chubut) that has 3 lines. Additionally, in June 2012 a plant was launched for the treatment of raw sugar, with a nominal processing capacity of approximately 370 tons per day and, since 2017, approval for the use of 100% raw sugar, is maintained, reaching a plant utilization of 57.0%. The distribution of products is carried out through 95 third-party transport companies, with a fleet of 797 trucks. Brazil Coca-Cola Andina Brazil operates 3 production plants: (i) one plant in Jacarepaguá, in the state of Rio de Janeiro, that has 12 production lines (ii) one plant in Ribeirão Preto, in the state of São Paulo, that has 13 production lines. Additionally, in December 2017 the Duque de Caxias plant began operating in December 2017 (iii), in the state of Rio de Janeiro, that has 3 production lines. The distribution of products is carried out through own transport companies (889 trucks) and 4 third-party transport companies (78 trucks). Chile Coca-Cola Andina Chile operates 4 plants throughout Chile (i) one plant in Renca that has 10 production lines (ii) one plant in Coquimbo with 3 production lines (iii) one plant in Antofagasta with 6 production lines and (iv) one plant in Punta Arenas with 3 production lines. The distribution of products is carried out through own transport companies (234 trucks) and 57 third-party transport companies (491 trucks). Paraguay Coca-Cola Paresa operates one production plant in the city of Asunción, with 10 bottling lines , 6 for soft drinks, 4 lines are used for juices, and 1 line is used for water. The distribution of products is carried out through an outsourced fleet (47 companies), which consists of 340 trucks for the delivery of our products to customers throughout Paraguay. for more information see 20F HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT12 PRINCIPAL CLIENTS BY COUNTRY 102-2, 102-6, 102-9 Argentina: S.A. Imp. y Exp. de la Patagonia, Jumbo Retail Argentina S.A., Inc Sociedad Anónima, Wal-Mart Argentina S.R.L., Mistura S.A., Sita S.A., Pont Andrés Roberto, Garzon S.R.L., Cooperativa Obrera Ltda C y V, Cencosud S.A., Manzur Fortunato Alberto, Lopéz Hnos. S.R.L ; Switch Company S.A.. and Día Argentina S.A. Brazil: Companhia Brasileira De Distribuição Cdb S.A., Assai, Atacadao S.A., Rede Integra, Supermercados Mundial Ltda., Cencosud Brasil Comercial Ltda., Super Market, Super Mercado Zona Sul S.A., Marko Atacadista S.A., Guanabara, Savegnago Supermercados Ltda. and Carrefour Comércio e Indústria Ltda. None of the clients individually concentrate more than 10% of total sales carried out. None of the clients individually concentrate more than 10% of total sales carried out. Chile: Walmart Chile Comercial S.A., Cencosud Retail S.A., Rendic Hermanos S.A., Alimentos Fruna Ltda., Hipermercados Tottus S.A., Arcos Dorados Restaurantes DE, Aramark Servicios Mineros y Remotos, Alvi Supermercados Mayoristas S.A., Supermercado y Dist. Uno Market, Distrib. y Com. Tilicura S.A., Supermercados Montserrat S.A.C., Super 10 S.A. and Compras Catering S.A. Walmart Chile Comercial S.A. individually concentrates more than 10% of total sales carried out. Paraguay: Cadena de Supermercados Super 6, Cadena de Supermercados Stock, Cadena de Supermercados Real, Tienda de Conveniencia Petrobras, Cadena de Tiendas de Cercanía City Market, Cadena de Supermercados Gran Vía, Cadena de Supermercado Salemma, Autoservice Sonia, Cadena de Tiendas de Cercanía Biggie, Mayorista Lekaja S.R.L, Mc Donald’s and Cadena de Supermercados Luisito. None of the clients individually concentrate more than 10% of total sales carried out. 12 PRINCIPAL SUPPLIERS BY COUNTRY 102-2, 102-6, 102-9 Argentina: Concentrate: Servicios y Productos para Bebidas Refrescantes S.R.L.(1) | Sweetner: Complejo Azucarero Concepción | Containers (resin): Dak Americas Argentina S.A.| Packaging (preforms - cases): Andina Empaques Argentina S.A.(2) and Ball Beverage Can south americ | Thermo-contractible: Río Chico S.A | Electric energy: Compañía Administradora del Mercado Mayorista Eléctrico S.A., EPEC (Empresa Pcial Energia Cba) and Termoandes S.A. | Glass bottles: Cattorini Hnos S.A.C.I.F.E I. | Carbonic gas: Praxair Argentina S.R.L. Brazil: Reselling of products: Cervejarias Kaiser S.A., |Concentrate: Recofarma Industrias do Amazonas Ltda.(1) | Sweetner: Usina Alta Mogiana S.A. Açúcar e Alcool | Containers (cans): Ball Embalagens LTDA | Containers (preforms): Lorenpet industria e comercio de plastico LTDA, Riopet embalagens SA and Bericap do Brasil LTDA. | Electric energy/gas: Ecogen Rio solucoes energéticas S.A., | Containers (paper): Tetra Pak LTDA | Thermo-contractible: Patena Ind C R Filmes Plastico Ldta. | Juices: Citrus Juice LTDA. Chile: Concentrate: Coca-Cola de Chile S.A.(1) | Containers (bottles): Envases CMF S.A.(2), Cristalerías de Chile S.A. and Cristalerías Toro S.A.C.I. | Caps: Sinea S.A. y Alucaps Mexicana S.A. de C.V. | Sweetner: Iansa Ingredientes S.A., Sucden Chile S.A. and Comercializadora de Productos PANOR | Carboni gas: Linde Gas Chile S.A. Coca-Cola de Chile S.A.(1), and Envases CMF S.A.(2) concentre at least 10% of total purchases carried out. (1) Shareholder (2) Equity investee 105 Servicios y Productos para Bebidas Refrescantes S.R.L.(1) individually concentrates at least 10% of total purchases carried out. Cervejarias Kaiser S.A., Recofarma Industrias do Amazonas Ltda.(1) concentrate at least 10% of purchases carried out. (1) Shareholder (2) Subsidiary (1) : Related to shareholder Coca-Cola de Chile S.A. Paraguay: Concentrate: Servicios y Productos Argentina(1) and Recofarma Industrias do Amazonas Ltda.(2) | Sugar: Industria Paraguaya de Alcoholes S.A. and Azucarera Paraguaya S.A. | Preforms: Industrias PET S.A. | Reselling of products: Alimentos de Soja SAU and Embotelladora del Atlantico S.A (2) | Containers (bottles): Cattorini Hnos.(glass) | Tetra raw materials: Tetra Pak Ltda. | Plastic caps: Andina Empaques Argentina S.A.(2) and Sinea S.A. | Fructose: Ingredion Argentina S.R.L. | Electric Energy: ANDE Administración Nacional de Electricidad. Industria Paraguaya de Alcoholes S.A., Recofarma Industrias do Amazonas S.A.(2), Servicios y Productos Argentina(1) and Azucarera Paraguaya S.A. concentrate at least 10% of total purchases carried out. (1) Shareholder (2) Related company HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTINFORMATION SUMMARY BY COUNTRY DETAIL OF OTHER OPERATIONS ARGENTINA BRAZIL CHILE PARAGUAY Total Sales Volume M UC 178.2 259.3 239.6 Soft drinks 149.7 206.8 158.2 Juices and other non-alcoholic Waters Beer and other alcoholic 10.0 18.5 0.0 22.3 11.5 18.7 36.1 44.6 0.6 69.3 56.2 5.2 7.9 0.0 Total annual per capita consumption (8 oz bottles) 373.00 264,80 521,70 232,20 Soft drinks 257.0 214.7 371.8 188.1 Juices and other non-alcoholic Waters Beer and other alcoholic Sales by format 17.0 29.0 70.0 19.0 11.7 19.4 53.0 95.3 1.6 18.0 26.1 0.0 % family size non-returnable 40.40% 57.75% 37.56% 41.21% % family size returnable 46.80% 22.99% 40.93% 42.98% % single-serve non-returnable 10.20% 14.46% 13.60% 11.30% ANDINA EMPAQUES ARGENTINA S.A. Andina Empaques Argentina S.A. (hereinafter also “AEA”), is a company formed in 2011 from the division of Embotelladora del Atlántico S.A. for the purpose of designing, manufacturing, and commercializing plastic products, mainly bottles. In developing its activities in the packaging division and aligned with our strategy to become the supplier of Coca-Cola Andina’s group of companies, during 2019 AEA supplied Coca-Cola Andina Argentina with non-returnable preforms, plastic caps, cases and returnable PET bottles. Production and sales by format Andina Empaques Argentina operates one plant for the production of preforms, returnable PET bottles, plastic cases and caps located at Tigre in the province Buenos Aires, Argentina. The plant has 13 injection lines, three blowing lines, one line for cases and two lines for caps. Average utilization capacity during 2019 was 67.3% for injection lines, 42.0% for blowing lines, 67.6% for cases and 54.3% for plastic caps. Sales by format during 2019 were 24.9 million Ref PET bottles and 598.8 million preforms for non-returnable bottles, 0.5 million cases and 588.6 million plastic caps. Principal Clients % single-serve returnable 1.30% 2.19% 3.72% 3.32% • Embotelladora del Atlántico S.A. (Subsidiary) % post mix Sales by channel % mom & pops % wholesales % supermarkets % on-premise Sales by flavor in soft drinks % Coca-Cola % other sugary 1.30% 2.61% 4.19% 1.19% 33.10% 23.69% 46.46% 28.40% 31.98% 27.78% 10.66% 33.90% 31.06% 31.76% 27.84% 13,20% • Coca-Cola Femsa S.A. • Paraguay Refrescos S.A. (Subsidiary) • Reginald Lee S.A • Grupo Arca • Andina Chile (Associate) • Montevideo Refrescos S.A. Embotelladora del Atlántico S.A. (Subsidiary), Coca-Cola Femsa S.A., Paraguay Refrescos S.A. and Grupo Arca individually concentrate at 3.86% 16.77% 15.04% 24.50% least 10% of total sales carried out . 61.42% 70.54% 51.02% 54.50% Resin: DAK Americas Argentina S.A. Principal suppliers 21.39% 15.74% 17.91% 27.40% DAK Americas Argentina S.A. individually concentrates at least 10% of total purchases carried out % Coca-Cola without sugar 11.29% 7.15% 24.78% 3.30% % other light 5.91% 6.57% 6.29% 14.90% 106 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT VJ S.A. VITAL AGUAS S.A. In agreement with The Minute Maid Co. and Coca-Cola de Chile S.A., VJ produces nectars, fruit juices, fantasy drinks and isotonics under the brands: Andina del Valle (fruit juices and fruit nectars), Kapo (fantasy drink) FUZE tea (ready-to-drink tea), Powerade (isotonic); and Glaceau Vitamin Water (flavored water with added vitamins and). Andina del Valle juice brands are commercialized in Tetra Pak packaging, glass bottles (returnable and non-returnable). Kapo is commercialized in sachets; FUZE Tea is commercialized in non-returnable glass bottles; Glaceau Vitamin Water in non-returnable PET bottles and Powerade in non-returnable PET bottles. In January of 2011, the juice production business is restructured allowing the incorporation of the other Coca-Cola bottlers in Chile to the ownership of Vital S.A., which changes its corporate name to Vital Jugos S.A. (currently denominated VJ S.A. and also identified in this document as VJ). As a result of the merger by absorption of Embotelladoras Coca-Cola Polar into Embotelladora Andina materialized on October 1, 2012, the ownership structure of VJ S.A. was amended beginning November 2012 as follows: Andina Inversiones Societarias 50%, Embonor S.A. 35% and Embotelladora Andina S.A. 15%. 107 Juice bottler agreement In 2005, VJ S.A. and The Coca-Cola Company entered into a Juice Bottler Agreement to produce, prepare and bottle in packaging previously approved by The Coca-Cola Company the abovementioned brands. Andina and Embonor have the right to purchase products from VJ S.A. Said agreement was renewed on January 1, 2019 and it expires on December 31, 2020. Additionally, Andina, VJ and Embonor have agreed with The Coca-Cola Company the respective agreements and authorizations to produce, package, and commercialize these products at their respective plants. Production and distribution VJ operates one production plant located in Santiago, where it has eight lines for preparing Andina del Valle, FUZE tea, Powerade, Aquarius and Glaceau Vitamin Water; and seven lines for the production of Kapo. During 2019 average utilization capacity was 61.50%.In Chile VJ products are exclusively distributed by Coca-Cola bottlers in the country, in each of their respective franchise territories. Principal suppliers Concentrate: Coca-Cola de Chile S.A.(1) | Sweetner: Embotelladora Andina S.A.(2) | Fruit pulp: Sucocitrico Cutrale Ltda.-Brasil | Comercializadora Tradecos Chile Ltda. | Aconcagua Foods S.A. | Containers, Bottles and Cans: Tetra Pak de Chile Ltda. | International Paper Cartones Ltda. | Envases CMF S.A.(3) | Caps: Sinea S.A. | Alucaps Mexica de Occidente S .A. de C.V. | Portola Packaging Inc. (SILGAN) | Packaging material: Plásticos Arpli Ltda., Plásticos Eroflex S.A., Plastyberg Industrial Ltda. Labels: Multicor Chile S.A. ; Morgan Impresoras S.A., Codepack S.A. Tetra Pak, Envases CMF S.A.(3) and Coca-Cola de Chile S.A.(1) each individually concentrate at least 10% of total purchases of raw materials carried out. Principal clients Embotelladora Andina S.A.1 and Coca-Cola Embonor S.A. In agreement with The Coca-Cola Company, Vital Aguas S.A. prepares and bottles Vital (mineral water) in the versions with gas and without gas. As a result of the merger by absorption of Embotelladoras Coca-Cola Polar into Embotelladora Andina which took place at the end of 2012, the ownership structure of Vital Aguas was amended beginning November 2012 as follows: Embotelladora Andina S.A. 66.5% and Embonor S.A. 33.5%. Water Manufacturing and Packaging Agreement In 2005, The Coca-Cola Company and Vital Aguas S.A. entered into a Water Manufacturing and Packaging Agreement for the preparation and packaging of beverages regarding the brands Vital, Chanqueahue, Vital de Chanqueahue and Dasani; incorporating in early 2008 the Benedictino brand to the product portfolio elaborated by Vital Aguas S.A. in accordance to this agreement. The agreement was renewed on January 1, 2019 and it expires on December 31, 2020. Production and distribution Vital Aguas operates three lines for the production of mineral water and purified water at the Chanqueahue plant, located in the commune of Rengo in Chile. In 2019 production lines operated at an average 58.2% of installed capacity. In Chile, the products of Vital Aguas are distributed exclusively by Andina and Embonor in each of their respective franchise territories. Principal suppliers Concentrate: Coca-Cola de Chile S.A. Carbonic gas: Linde Gas Chile S.A. Labels: Resinplast S.A. /Empack Flexible S.A./Adhesol Ltda. Material de empaque: Plastyveg Industrial Ltda. / Casala Industrial S.A. / AR Pack SAC Caps: Envases CMF S.A. / Importadora y Exportadora de Embajales SPA. IMPORTADORA and Alusud Embalajes Chile Ltda. Containers (preforms)/ Envases CMF S.A. Envases CMF S.A.(2) and Coca-Cola de Chile S.A.(1) individually concentrate at least 10% of total purchases of raw materials carried out. (1) Shareholder (2) Parent company (3) Associate (1) Shareholder (2) Associate HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTENVASES CENTRAL S.A. ENVASES CMF S.A The Company is mainly focused on the production of the following brands of soft drinks: Coca-Cola, Fanta and Sprite, Aquarius (pear, apple, lemon, grape and peach) and the energy drink Burn. The canning of these products is in 350 ml, 310 ml 250 ml and 220 ml cans, and in plastic PET bottles of 250 ml, 500 ml, 580 ml, and 1.5 lt (only Aquarius). The bottlers of the Coca-Cola System in Chile, along with Coca-Cola de Chile, share the ownership of Envases Central. Andina holds a 59.27% stake, Embonor holds a 34.31%, and Coca-Cola de Chile holds a 6.42% stake. License Agreement License Agreements are international standard contracts that The Coca-Cola Company enters into with bottlers outside the United States of America for the sale of concentrates and beverage basis for certain soft drinks and non-soft drink beverages. The term of the License Agreement with The Coca-Cola Company is effective until March 31, 2021. Envases CMF is mainly dedicated to the production of returnable and non-returnable bottles, returnable and nonreturnable preforms and caps. Since 2012, Envases CMF is owned by Andina Inversiones Societarias S.A. (50%) and by Embonor Empaques S.A. (50%). Production and sales by format Envases CMF operates one plant for the manufacture of PET bottles located in Santiago. The plant has 13 preform injection lines, 11 blowing lines, 16 lines for conventional injection, seven injector blowing lines and four extraction- blowing lines. During 2019, average utilization capacity of the production lines was 65.00%, 53.00%, 84.00%, 63.00% and 92.00%, respectively. Sales by format during 2019 were 163 million non-returnable PET bottles, 26 million returnable PET bottñes, 701 million preforms for nonretunrable bottles and 899 million products by conventional injection. Principal clients Production and distribution Envases Central operates one production plant in Santiago, with one canning line and one line for bottling PET formats. In 2019, canning and bottling lines operated at an average utilization capacity of 34%. In Chile the products of Envases Central are distributed exclusively by the Coca-Cola bottlers in the country in each of their respective franchise territories. • Embotelladora Andina S.A.1, Coca-Cola Embonor S.A., VJ S.A., Vital Aguas S.A., Envases Central S.A., Embonor Empaques S.A., Nestlé Chile S.A., Tres Montes S.A., Empresas Demaria S.A., Embotelladoras Bolivianas Unidas S.A., Fábrica de Envases Plásticos Artel S.A.I.C. Embotelladora Andina S.A.(1) and Coca-Cola Embonor S.A., individually represent at least 10% of total sales carried out . 108 Principal clients • Embotelladora Andina S.A.(1) and Coca-Cola Embonor S.A. Embotelladora Andina S.A.(1) and Coca-Cola Embonor S.A. individually represent at least 10% of total sales carried out. Principal suppliers Aluminum cans and caps: Ball Chile S.A. Concentrado: Coca-Cola de Chile S.A. Fruit pulp: Vital Jugos S.A., Comercializadora Tradecos Chile SPA. Sweetener: Embotelladora Andina S.A. Plastic bottles and caps: Envases CMF S.A., BERICAP S.A. Labels: MULTI-COLOR CHILE S.A. Packaging material: COPACK S.A., CORRUPAC S.A., PLASTYVERG INDUSTRIAL LTDA. Ball Chile S.A., Coca-Cola de Chile S.A.2, Vital Jugos S.A. individually concentrate at least 10% of raw material purchases carried out. (1) Parent Company (2) Shareholder (3) Associate Principal suppliers Resina: Jiangyin Xingyu New Material Co., Far Eastern Textile Ltd., Dak Americas LLC USA, Dark Americas Argentinas S.A., Tricon Energy Ltda. and China Resourses. Jiangyn Xingyu New Material Co., Dak Americas LLC USA, China Resources and Far Eastern Textile LTD., individually concentrate at least 10% of raw material purchases carried out. Parent Company Embotelladora Andina S.A.1 and Coca-Cola Embonor S.A., individually reresent at least 10% of total sales carried out. Jiangyn Xingyu New Material Co., Dak Americas LLC USA, China Resourses y Far Eastern Textile LTD., individually represent at least 10% of total raw material purchases carried out. (1) Parent Company HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTCOMPANY STRUCTURE 35.00% Coca-Cola Del Valle New Ventures S.A. 59.27% Envases Central S.A. 66.5% Vital Aguas S.A. EMBOTELLADORA ANDINA S.A. 99.9998% Andina Inversiones Societarias S.A. 0.00011% 0.01% 99.99% 99.99% Transportes Polar S.A. 0.00007% Comercializadora Novaverde S.A. 0.15% 99.9% Red de Transportes Comerciales Ltda. 0.0041% 99.9959% Transportes Andina Refrescos Ltda. 0.10% 99.90% Servicios Multivending Ltda. 0.00005% 0.10% 50.0% 99.99995% Embotelladora Andina Chile S.A. 99.90% Andina Bottling Investments S.A. 15.0% VJ S.A. 50.0% Envases CMF S.A. 0.10% 99.90% Andina Bottling Investments Dos S.A. 99.99% 0.1% Abisa Corp 99.07% 0.91% Embotelladora del Atlántico S.A. 0.003% 99.98% 0.003% Andina Empaques Argentina S.A. 109 14.3% Alimentos de SOJA S.A. Argentina Brazil Chile Paraguay British Virgin Islands Parent Company Consolidating subsidiaries Associates Investments without significant influence 0.70% Aconcagua Investing Ltd. 99.30% 97.7533% 0.07697% Paraguay Refrescos S.A. 99.99% Rio de Janeiro Referescos Ltda. Sorocaba Refrescos Ltda. 40.00% Leão Alimentos e Bebidas Ltda. 10.26% Trop Frutas do Brasil Ltda. 7.52% Kaik Participações Ltda. 11.32% SRSA Participações Ltda. 40.00% UBI 3 Participações Ltda. 8.50% HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTSUBSIDIARIES, EQUITY INVESTEES AND ASSOCIATES Embotelladora del Atlántico S.A.(o) Andina Empaques Argentina S.A.(o) Alimentos de SOJA S.A. Rio de Janeiro Refrescos Ltda. Kaik Participações Ltda. Address: Ruta Nacional 19, Km 3,7, Córdoba Address: Austria 650 - General Pacheco – Partido de Tigre Address: Marcelo T. de Alvear 684, Piso 1°, Ciudad Autónoma de Buenos Aires Address: Rua André Rocha 2299, Taquara, Jacarepaguá, Rio de Janeiro Address: Av. Maria Coelho de Aguiar 215, bloco A, 1° Andar, Jardim São Luis, São Paulo CUIT: 30-71213488-3 CUIT: 33-715-23028-9 CNPJ: 00.074.569/0001-00 CNPJ: 40.441.792/0001-54 Telephone: (54-11) 4715 8000 Telephone: (54-11) 5196 8300 Telephone: (55-21) 2429 1779 Telephone: (55-11) 2102 5563 Paid-in and subscribed capital (at 12/31/19) AR$ 2,533,613. Paid-in and subscribed capital (at 12/31/19) AR$ 136,749,248. Paid-in and subscribed capital (at 12/31/19) R$ 532,134,973.45 Paid-in and subscribed capital (at 12/31/19) R$ 999.94. % the investment represents in the Parent Company's assets 0.48% % the investment represents in the Parent Company's assets 0.47% % the investment represents in the Parent Company's assets 14.42% % the investment represents in the Parent Company's assets 0.06% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 99.8830%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 14.305%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 9.99%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 11.32%. CUIT: 30-52913594-3 Telephone: (54-351) 496 8888 Paid-in and subscribed capital (at 12/31/19) AR$ 136,749,248. % the investment represents in the Parent Company's assets 6.8% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0.91% Indirectly: 98.9739%. Corporate purpose: Manufacture, bottle, distribute and commercialize non-alcoholic beverages. Manufacture, bottle and sell any other beverage and derivatives. Corporate purpose: Design, produce and commercialize plastic products, mainly packaging. Commercial relationship: Coca-Cola bottler in Argentina. Commercial relationship: Supplier of plastic bottles and preforms. Board of Directors / Management Council: Gonzalo Manuel Soto (3) Fabián Castelli (2) Jaime Cohen (1) Laurence Paul Wiener (A) Board of Directors / Management Council: Gonzalo Manuel Soto (3) Fabián Castelli (2) Jaime Cohen (1) Laurence Paul Wiener (A) 110 General Manager: Fabián Castelli (2) General Manager: Daniel Caridi Notes Argentina: o Corporation. *No ownership variations during the last year (1) Embotelladora Andina S.A. officer (2) Embotelladora del Atlántico S.A. officer (3) External counsel. (A) Alternate. Corporate purpose: Invest in other companies with own resources. Commercial relationship: Board of Directors / Management Council: Luiz Eduardo Tarquinio Carlos Eduardo Correa Ricardo Vontobel Francisco Miguel Alarcón Renato Barbosa (2) Corporate purpose: Manufacture and commercialize beverages in general, powdered juices and other related semi processed products. Commercial relationship: Coca-Cola bottler in Brazil. Board of Directors / Management Council: Renato Barbosa (2). Fernando Fragata (2). Rodrigo Klee (2). David Parkes (2). Antonio Rui de Lima Barreto Coelho (2) . Max Fernandes Ciarlini (2) General Manager: Renato Barbosa (2). Corporate purpose: On its account, or that of third parties or associated with third parties, in this Republic or abroad, perform the following activities: manufacture, marketing, import, export, processing, fractionation, packaging, distribution of food products for human consumption and beverages in general and their raw materials and respective related products and by-products, in their different stages and processes. Commercial relationship: produce soy-based products for Coca-Cola bottlers in Argentina. Board of Directors / Management Council: Gerardo Beramendi Paulo Dias Luisa Ortega Omar Carlos Kiriadre Sergio Bernabé Giménez Jorge Luis López Fabián Castelli (2) Javier Sanchez Carranza David Lee Mercedes Rodriguez Canedo (A) Maria Sol Jares Canovas (A) Francisco Jeldres (A) Diana Rosas (A) María Fernanda Causarano (A) Ruben Sergio Coronel (A) Fernando Ramos Meneghetti (A) Teodoro Federico Kundig (A) Esteban Eduardo Mele (A) General Manager: José Marquina HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTLeão Alimentos e Bebidas Ltda Sorocaba Refrescos Ltda. Trop Frutas do Brasil Ltda. SRSA Participações Ltda. UBI 3 Participações Ltda. Address: Rua Apes Leme, nº 524 - 10º andar, São Paulo, São Paulo Address: Rod.Raposo Tavares, Km 104, Jardim Jaraguá, Sorocaba, São Paulo Address: Avenida PRF Samuel Batista Cruz, 9853, 115.591.0060 M2, CEP 29909-900, Linhares. Espirito Santo Address: Rua Antonio Aparecido Ferraz, 795, Sala 01, Jardim Itanguá, Sorocaba, São Paulo Address: Rua Teonilio Niquine nº 30, Galpão B, Jardim Piemonte, Betim, Minas Gerais CNPJ: 72.114.994/0001-88 CNPJ:45.913.696/0001-85 CNPJ: 10.359.485/0001-68 CNPJ: 27.158.888/0001-41 CNPJ: 07.757.005/0001-02 Telephone: (55-27) 2103 8300 Paid-in and subscribed capital (at 12/31/19) R$ 393,115,883.80. % the investment represents in the Parent Company's assets 0.27% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 7.52%. Corporate purpose: Manufacture, commercialize and export natural fruit pulp and coconut water. Commercial relationship: Produces products for Coca-Cola bottlers in Brazil. Board of Directors / Management Council: Dirk Schneider Bruna Aronne Sekeff General Manager: Dirk Schneider Telephone: (55-15) 3229 9906 Telephone: (55-21) 2559.1032 Paid-in and subscribed capital (at 12/31/19) R$ 20,000 Paid-in and subscribed capital (at 12/31/19) R$ 10,432. % the investment represents in the Parent Company's assets 0,00% % the investment represents in the Parent Company's assets 0,00% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 40%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 8.50%. Corporate purpose: Purchase and sale of real estate investments and property management. Commercial relationship: Business supporting company Board of Directors / Management Council: Renato Barbosa (2) Luiz Lacerda Biagi General Manager: Cristiano Biagi Corporate purpose: Invest in other companies with own resources. Purchase and sale of real estate investments and property management Commercial relationship: produces soy-based products for Coca-Cola bottlers in Brazil. Board of Directors / Management Council: Fernanda Paula Ruiz Lia Marques Oliveira Neuri Amabile Firgotto Pereira Telephone: (55-11) 3809 5000 Telephone: (55-15) 3229 9930 Paid-in and subscribed capital (at 12/31/19) R$ 1,142,611,886. Paid-in and subscribed capital (at 12/31/19) R$ 71,808,495.66 % the investment represents in the Parent Company's assets 0.79% % the investment represents in the Parent Company's assets 1.08% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 10.26%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0 % Indirectly: 40%. Corporate purpose: Manufacture and commercialize food and beverages in general, and beverage concentrate. Invest in other companies. Corporate purpose: Manufacture and commercialize food and beverages in general, and beverage concentrate. Invest in other companies. Commercial relationship: Produces sensible products for Coca-Cola bottlers in Brazil. Commercial relationship: Coca-Cola bottler in Brazil. 111 Board of Directors / Management Council: Henrique Braun Claudia Lorenzo Alexandre Fernandes Delgado Marcelo Gil Renato Barbosa (2) Neuri Pereira Ian Craig Emerson Vontobel Mario Veronezi Ruben Schneider Sérgio Ferreira Bruno Arrone Sekeff General Manager: Dirk Schneider Board of Directors / Management Council: Renato Barbosa (2) Cristiano Biagi Giordano Biagi Miguel Ángel Peirano (1) Cláudio Sergio Rodrigues Luiz Lacerda Biagi General Manager: Cristiano Biagi Notes Brazil: (*) No ownership variations in the last year. (Ω) This company was incorporated in 2018 (1) Embotelladora Andina S.A. officer (2) Rio de Janeiro Refrescos Ltda. officer HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEmbotelladora Andina Chile S.A.(°) VJ S.A.(°). Vital Aguas S.A.(°) Coca-Cola del Valle New Ventures S.A.(°) Transportes Andina Refrescos Ltda.(°°°). Address: Av. Miraflores 9153, Renca, Santiago Address: Av. Américo Vespucio 1651, Renca, Santiago Address: Camino a la Vital 1001, Comuna de Rengo Address: Av. Miraflores 8755, Renca, Santiago Address: Av. Miraflores 9153, piso 4, Renca, Santiago RUT: 76.070.406-7 Telephone: (56-2) 2611 5838 Paid-in and subscribed capital (at 12/31/19) Th$ 27,208,276 % the investment represents in the Parent Company's assets 1.68% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.99995% Indirectly: 0.00005%. Corporate purpose: Manufacture, bottle, distribute and commercialize non-alcoholic beverages. Commercial relationship: leasing of production infrastructure Board of Directors / Management Council: Miguel Ángel Peirano (2) Andrés Wainer (2) Jaime Cohen (2) 112 General Manager: José Luis Solórzano (2) RUT: 93.899.000-K RUT: 76.389.720-6 Telephone: (56-2) 2620 4100 Telephone: (56-2) 2346 4245 Paid-in and subscribed capital (at 12/31/19) Th$ 20,675,167 Paid-in and subscribed capital (at 12/31/19) Th$ 4,331,154 % the investment represents in the Parent Company's assets 0.99% % the investment represents in the Parent Company's assets 0.24% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 15.00%. Indirectly: 49.9999% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 66.5% Indirectly: 0% Corporate purpose: Manufactures, distribute and commercialize all kinds of food products, juices and beverages. Corporate purpose: manufactures, distributes and commercializes all kinds of water and beverages in general. Commercial relationship: produces juices for Coca-Cola bottlers in Chile. Commercial relationship: produces mineral water for Coca-Cola bottlers in Chile. Board of Directors / Management Council: José Luis Solórzano (2) Alejandro Zalaquett (2) Cristián Hohlberg Jaime Cohen (2), (A) José Domingo Jaramillo Andrés Wainer (2) Fernando Jaña (A) Rodrigo Ormaechea (2), (A) General Manager: Alberto Moreno Board of Directors / Management Council: José Luis Solórzano (2) Alejandro Zalaquett (2) José Domingo Jaramillo Jaime Cohen (2), (A) Andrés Wainer (2), Fernando Jaña (2), (A) Rodrigo Ormaechea (2), (A) Vacante hasta la próxima Junta Ordinaria de Accionistas. General Manager: Alberto Moreno RUT: 76.572.588-7 Paid-in and subscribed capital (at 12/31/19) Th$ 84,442,243. RUT: 78.861.790-9 Telephone: (56-2) 2611 5838 Paid-in and subscribed capital (at 12/31/19) Th$ 12,620,628 % the investment represents in the Parent Company's assets 0.54% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.9959%; Indirectly: 0.00041%. Corporate purpose: Provide administration services and management of domestic and foreign ground transportation. Commercial relationship: provides ground transportation services. Board of Directors / Management Council: No Aplica. % the investment represents in the Parent Company's assets 1.41% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 35% Indirectly: 0% Corporate purpose: manufactures, distributes and commercializes all kinds of juices, water and beverages in general. Commercial relationship: produces water and juices for Coca-Cola bottlers in Chile. Board of Directors / Management Council: Miguel Ángel Peirano (2) José Luis Solórzano (2) Alfredo Mahana (A) Rodrigo Ormachea (2) Cristián Hohlberg Paulo Dias José Jaramillo Joao Santos Roberta Cabral Diana Rosas Alejandro Zalaquett (2) (A) Rodolfo Peña( 2)(A) Juan Paulo Valdés (A) Mercedes Rodríguez (A) Maria Sol Jares (A) Francisco Jeldres (A) Omar Kiriadre (A) Fernando Jaña (2) Gerardo Beramendi General Manager: Alejandro Palma Notes Chile: (°) Closed stock corporation * No ownership variations during the last year (°°°) They are limited liability companies in which the management of the company corresponds to Embotelladora Andina S.A. throu- gh specially appointed agents or representatives. (Ω) : This company was incorporated in 2018 (1): Director and member of the Controlling Group of Embotelladora Andina S.A. (2): Embotelladora Andina S.A. officer (A) Alternate HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTTransportes Polar S.A.° Servicios Multivending Ltda.°°° Envases CMF S.A.° Envases Central S.A.° Andina Bottling Investments S.A.° Address: Av. Miraflores 9153, piso 4, Renca, Santiago Address: Av. Miraflores 9153, piso 4, Renca, Santiago Address: La Martina 0390, Pudahuel, Santiago Address: Av. Miraflores 8755, Renca, Santiago RUT: 96.928.520-7 RUT: 78.536.950-5 Telephone: (56-2) 2611 5838 Telephone: (56-2) 2611 5838 Paid-in and subscribed capital (at 12/31/19) Th$ 1,619,315 Paid-in and subscribed capital (at 12/31/19) Th$ 862,248 % the investment represents in the Parent Company's assets 0.15% % the investment represents in the Parent Company's assets 0.04% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.99%; Indirectly: 0.01%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.90%; Indirectly: 0.10%. 113 Corporate purpose: Freight transportation in general in the beverage industry and other processed goods. Commercial relationship: provides ground transportation services. Board of Directors / Management Council: José Luis Solórzano (2) Rodolfo Peña (2) Alejandro Zalaquett (2) General Manager: Alejandro Vargas (2) Corporate purpose: Commercialize products through equipment and vending machines. Commercial relationship: Provides commercialization of products through vending machines. Board of Directors / Management Council: No Aplica. Notes Chile: (°) Closed stock corporation * No ownership variations during the last year (°°°) They are limited liability companies in which the management of the company corresponds to Embotelladora Andina S.A. through specially appointed agents or representatives. (Ω) : This company was incorporated in 2018 (1): Director and member of the Controlling Group of Embotelladora Andina S.A. (2): Embotelladora Andina S.A. officer (A) Alternate RUT: 86.881.400-4 RUT: 96.705.990-0 Telephone: (56-2) 2544 8222 Telephone: (56-2) 2599 9300 Paid-in and subscribed capital (at 12/31/19) Th$ 32,981,986 Paid-in and subscribed capital (at 12/31/19) Th$ 7,562,354 % the investment represents in the Parent Company's assets 0.84% % the investment represents in the Parent Company's assets 0.56% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0.0%; Indirectly: 49.9999%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 59.27% Indirectly: 0%. Corporate purpose: Manufacture and sale of plastic products and bottling services and beverage containers. Corporate purpose: Manufacture and packaging of all kinds of beverages, and commercialize all kinds of packaging. Commercial relationship: supplier of plastic bottles, preforms and caps. Board of Directors / Management Council: Salvador Said (1) Andrés Vicuña Cristián Hohlberg Matías Mackenna Andrés Wainer (2) Commercial relationship: produces cans and some small formats for the Coca-Cola bottlers in Chile. Board of Directors / Management Council: José Luis Solórzano (2) Alejandro Zalaquett (2) Cecilia Facetti José Jaramillo Cristián Hohlberg Roberta Cabral Valenca Andrés Wainer (2) (A) Jaime Cohen (2) (A) Fernando Jaña (2) (A) Juan Paulo Valdés (A) Thiago Santos (A) Vacante hasta prox. JOA General Manager: Isabel León Address: Av. Miraflores 9153, piso 7, Renca, Santiago RUT: 96.842.970-1 Telephone: (56-2) 2338 0520 Paid-in and subscribed capital (at 12/31/19) Th$ 311,727,581 % the investment represents in the Parent Company's assets 99.9% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.90% Indirectly: 0.10%. Corporate purpose: Manufacture, bottle and commercialize beverages and food in general Invest in other companies Commercial relationship: Investment vehicle Board of Directors / Management Council: Miguel Ángel Peirano (2) Andrés Wainer (2) Jaime Cohen (2) Martín Idígoras (2) (A) Fernando Jaña (2) (A) Gonzalo Muñoz (2) (A) General Manager: Miguel Ángel Peirano (2) HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTAndina Bottling Investments Dos S.A.(°) Andina Inversiones Societarias S.A.(°) Red de Transportes Comerciales Ltda.(°°°) Comercializadora Novaverde S.A. (Ω) Address: Av. Miraflores 9153, piso 7, Renca, Santiago Address: Av. Miraflores 9153, piso 7, Renca, Santiago Address: Av. Del Valle Norte 937, of. 554, Ciudad Empresarial, Huechuraba Address: Carretera General San Martín Km. 16.5, Calle Simón Bolívar, Sitio 19, Colina, Santiago RUT: 96.972.760-9 RUT: 96.836.750-1 RUT: 76.276.604-3 RUT: 77.526.480-2 Telephone: (56-2) 2338 0520 Telephone: (56-2) 2338 0520 Telephone: (56-2) 2993 9704 Telephone: (56-2) 24110150 Paid-in and subscribed capital (at 12/31/19) Th$ 665,000. Paid-in and subscribed capital (at 12/31/19) Th$ 30,082,325 Paid-in and subscribed capital (at 12/31/19) Th$ 2,200,313. Paid-in and subscribed capital (at 12/31/19) Th$ 14,856,772 % the investment represents in the Parent Company's assets 30.44% % the investment represents in the Parent Company's assets 1.39% % the investment represents in the Parent Company's assets 0.07%. % the investment represents in the Parent Company's assets 0.36% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.90% Indirectly: 0.10%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.9998%; Indirectly: 0.0001%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 99.85%. Indirectly: 0.15%. % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0.00007% Indirectly: 34.9965%. Corporate purpose: Perform exclusively foreign permanent or income investments in all kinds of movable goods. Corporate purpose: Invest in all kinds of companies and commercialize foods in general. Corporate purpose: Freight transportation in general in the beverage industry and other processed goods. Commercial relationship: Investment vehicle Commercial relationship: Investment vehicle Board of Directors / Management Council: Miguel Ángel Peirano (2) Andrés Wainer (2) Jaime Cohen (2) Martín Idígoras (2), (A) Fernando Jaña (2), (A) Gonzalo Muñoz (2) (A) 114 Board of Directors / Management Council: Miguel Ángel Peirano (2) Andrés Wainer (2) Jaime Cohen (2) Martín Idígoras (2) (A) Fernando Jaña (2) (A) Gonzalo Muñoz (2) (A) General Manager: Miguel Ángel Peirano (2) General Manager: Miguel Ángel Peirano (2) Commercial relationship: Provides ground transportation services and commercialization of products. Board of Directors / Management Council: N/A Corporate purpose: Company dedicated to the processing and commercialization of fruits, ice creams, vegetables and food in general, under the Guallarauco brand. Commercial relationship: Sales of juices, flavored waters, among others, to the Coca- Cola bottlers in Chile Board of Directors / Management Council: José Luis Solórzano (2) Rodrigo Ormaechea (2) Roberta Cabral Valenca Paulo Dias Francisco Jeldres José Jaramillo (A) Fernando Jaña (2) (A) Alejandro Zalaquett (2) (A) Maria Sol Jares (A) Mercedes Rodríguez (A) Gerardo Beramendi (A) General Manager: Juan Luis Piwonka Notes Chile: (°) Closed stock corporation * No ownership variations during the last year (°°°) They are limited liability companies in which the management of the company corresponds to Embotelladora Andina S.A. through specially appointed agents or representatives. (Ω) : This company was incorporated in 2018 (1): Director and member of the Controlling Group of Embotelladora Andina S.A. (2): Embotelladora Andina S.A. officer (A) Alternate HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTParaguay Refrescos S.A. ° Abisa Corp. Aconcagua Investing Ltd. Address: Acceso Sur, Ruta Ñemby Km 3,5 -Barcequillo -San Lorenzo, Asunción Address: Vanterpool Plaza, 2°Piso, Wickhams Cay 1, Road Town Tortola, British Virgin Island | N° de Registro 512410 Address: Vanterpool Plaza, Wickhams Cay 1, P.O. Box 873 Road Town, Tortola, British Virgin Island | N° de Registro 569101 RUT: 80.003.400-7 Telephone: (595) 21 959 1000 Paid-in and subscribed capital (at 12/31/19) G. 94,284,000,000 % the investment represents in the Parent Company's assets 10.88% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0.076%. Indirectly: 97.6555%. Corporate purpose: Manufacture, distribute and commercialize carbonated and non-carbonated non-alcoholic beverages Commercial relationship: Coca-Cola bottler in Paraguay. Board of Directors / Management Council: Andrés Wainer (1) Francisco Sanfurgo (2) Jaime Cohen (1) Gonzalo Muñoz (1) RUT: 59.144.140-K Telephone: (1-284) 494 5959 Telephone: (1-284) 494 5959 Paid-in and subscribed capital (at 12/31/19) Th$ 12,594,313 % the investment represents in the Parent Company's assets 14.00% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: -. Indirectly: 99.99%. Corporate purpose: Invest in financial instruments, for its own account or on behalf of third parties. Commercial relationship: Investment company Board of Directors / Management Council: Miguel Ángel Peirano (1) Andrés Wainer (1) Jaime Cohen (1) Paid-in and subscribed capital (at 12/31/19) Th$ 523,599 % the investment represents in the Parent Company's assets 0.96% % that the Parent Company holds in the capital of the subsidiary or equity investee(*) Directly: 0.70% Indirectly: 99.2998%. Corporate purpose: Invest in financial instruments, for its own account or on behalf of third parties. Commercial relationship: Investment company Board of Directors / Management Council: Jaime Cohen (1) Andrés Wainer (1) Miguel Ángel Peirano (1) 115 General Manager: Francisco Sanfurgo (2) Notes Paraguay: °Corporation * No ownership variations during the last year 1 Embotelladora Andina S.A. officer 2 Paraguay Refrescos S.A. officer Notes British Virgin Islands * No ownership variations during the last year 1 Embotelladora Andina S.A. officer HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTFACILITIES INVE􀀈STMENTS Additions to property, plant and equipment (nominal million US$) Argentina Embotelladora Atlántico S.A. (1) Andina Empaques Argentina S.A. (1) Brazil Chile Rio de Janeiro Refrescos S.A. Embotelladora Andina S.A. VJ S.A. Vital Aguas S.A. Envases Central S.A. 2015 35.0 1.9 41.1 69.3 3.2 1.3 1.8 2016 2017 2018 2019 57.8 3.7 51.5 44.4 7.3 2.6 1.0 47.1 1.9 112.1 45.0 1.1 0.3 4.4 40.8 1.8 74.0 56.8 0 0 1.6 22.3 25.9 1.1 28.1 54.2 0.6 0.8 1.2 20.8 Paraguay Paraguay Refrescos S.A. 16.0 16.1 16.0 e own production plants in each of the principal population centers that comprise the franchise territories. In addition, we own distribution centers and administrative offices in each of the franchise territories. 116 A detail of our properties and facilities can be reviewed in the exhibits section. Total 169.6 184.4 227.9 197.3 132.6 1) For Argentina, 2019 figures are expressed in Dec-2019 currency pursuant to criteria set by IAS 29. For previous periods there is no change in criteria. INVESTMENT AND FINANCING POLICY The Bylaws of Coca-Cola Andina do not define a particular financing structure or the investments that the Company can make. Within the powers granted by the Shareholders' Meeting, the Board defines financing and investment policies. On the other hand, as agreed at Board session held December 20, 2011, supplemented by the agreements made at Board session held August 28, 2012, certain types of investments and financing require the agreement of the Board of Directors. We have budgeted US$160-170 million for our capital investments in 2020, which are expected to be mainly spent on: • Improving our information technologies in Argentina, Brazil and Paraguay, • Improving our productive capacity (mainly returnable labelling projects and new lines in Brazil, Chile and Paraguay), • Improving infrastructure (mainly in Paraguay and Chile) • Returnable bottles and containers, and • Cold equipment. INSURANCE EQUIPMENT Our main equipment consists of bottling lines and auxiliary equipment, market assets, packaging and distribution assets. All of these are in good condition and are sufficient to sustain the normal functioning of operations. Coca-Cola Andina and its subsidiaries maintain insurance policies with first-class companies. The main policies cover fire risks, earthquakes and business interruption, including resulting lost profits. In addition, there are policies with specific coverages, among others: transportation, motor vehicles, terrorism, civil liability and product liability. Coca-Cola Andina periodically uses exchange rate hedging insurance to back payment commitments in currencies other than the functional currency of our business, either for obligations arising from the acquisition of fixed assets or by purchases of raw materials. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT chapter.eight | EXHIBITS HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT8EXHIBITS INDEX RISK FACTORS PROPERTIES AND FACILITIES EXPERIENCE BOARD OF DIRECTORS AND EXECUTIVE TEAM FINANCIAL STATEMENTS ANALYSIS OF THE FINANCIAL STATEMENTS MATERIAL EVENTS CONSOLIDATED FINANCIAL STATEMENTS AT 31.12.2019 y 2018 GRI VERIFICATION LETTER ACKNOWLEDGMENTS HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTRISK FACTORS The Comany is subject to various economic, political, social and competitive conditions. Any of the following risks, if they materialize, could materially and adversely affect our business, results of operations, prospects and financial condition. RISKS RELATING TO OUR COMPANY We rely heavily on our relationship with The Coca-Cola Company, which has substantial influence over our business and operations; and changes in this relationship may adversely affect our business. The Coca-Cola Company has substantial influence on the conduct of our business. The interests of The Coca-Cola Company may be different from the interests of our other shareholders, which may result in us taking actions contrary to the interests of our other shareholders. 68% and 70% of our net sales for 2018 and 2019, respectively, were derived from the distribution of soft drinks under The Coca-Cola Company trademarks and an additional 22% and 23% of our net sales for 2018 and 2019, respectively, were derived from the distribution of other beverages also bearing trademarks owned by The Coca-Cola Company. In addition, The Coca-Cola Company currently owns, directly or through its subsidiaries, 14.65% of our Series A shares (representing 7.3% of our total shares) and benefits from certain rights under a shareholders’ agreement. We produce, market and distribute Coca-Cola products through standard bottler agreements between our bottler subsidiaries and The Coca-Cola Company. The Coca-Cola Company has the ability to exert a substantial influence on the business of the Company through its rights under the bottler agreements. According to the bottler agreements, The Coca-Cola Company unilaterally sets the prices for Coca-Cola concentrate that they sell to us. The Coca-Cola Company may in the future increase the price we pay for the concentrate, increasing our costs. The Coca-Cola Company also monitors our prices and has the right to review and approve our marketing, operating and advertising plans. These factors may impact our profit margins, which could adversely affect our net income and results of operations. Our marketing campaigns for Coca-Cola products are designed and controlled by The Coca-Cola Company. The Coca-Cola Company also makes significant contributions to our marketing expenses, although it is not required to contribute a particular amount. Accordingly, The Coca- Cola Company may discontinue or reduce such contribution at any time. Pursuant to the bottler agreements, we are required to submit a business plan to The Coca-Cola Company for prior approval on a yearly basis. In accordance with our bottler agreements, The Coca-Cola Company may, among other things, require that we demonstrate the financial ability to meet our business plan, and if we are not able to demonstrate our financial capacity, The Coca-Cola Company may terminate our rights to produce, market and distribute Coca-Cola soft drinks or other Coca-Cola beverages in territories where we have such approval. Under these bottler agreements, we are prohibited from producing, bottling, distributing or selling any products that could be substituted for, be confused with or be considered an imitation of soft drinks or other beverages and products under the trademarks of The Coca-Cola Company. We depend on The Coca-Cola Company to renew our bottler agreements, which are subject to termination by The Coca-Cola Company in the event we default or upon expiration of their respective terms. We currently are party to four bottler agreements: one agreement for Chile, which expires in 2023, one agreement for Brazil, which expires in 2022, one agreement for Argentina, which expires in 2022, and one agreement for Paraguay, which expires in September 2020. We cannot provide any assurance that our bottler agreements will be maintained or renewed upon their termination. Even if they are renewed, we cannot provide any assurance that renewal will be granted on the same terms as those currently in effect. Termination, non-extension or non-renewal of any of our bottler agreements would prevent us from selling Coca-Cola trademark beverages in the affected territory, which would have a material adverse effect on our business, financial condition and results of operation. In addition, any acquisition we make of bottlers of Coca-Cola products in other territories may require, among other things, the consent of The Coca-Cola Company under bottler agreements to which such other bottlers are subject. We cannot assure you that The Coca-Cola Company will consent to any future geographic expansion of our Coca-Cola beverage business. We cannot assure you that our relationship with The Coca-Cola Company will not deteriorate or otherwise undergo significant changes in the future. If such changes do occur, our operations and financial results and condition could be materially affected. The beverage business environment is changing rapidly, including as a result of increased health and environmental concerns, and if we do not address evolving consumer product and shopping preferences, our business could suffer. The beverage business environment in our territories is dynamic and constantly evolving rapidly as a result of, among other things, changes in consumer preferences, including changes based on health and nutrition considerations and obesity concerns, shifting consumer preferences and needs; changes in consumer lifestyles; concerns regarding location of origin or source of ingredients and raw materials, and the environmental and sustainability impact of the product manufacturing process; consumer shopping patterns that are changing with the digital revolution; consumer emphasis on transparency related to our products and packaging; and competitive product and pricing pressures. While we have reduced the amounts of sugar in multiple beverages across our portfolio and increased availability of low or no-calorie soft drinks, if we are unable to successfully adapt in this environment, our participation in the sales of beverages and financial results in general would be negatively affected. Increased concern about the health effects of sugar and other sweeteners in beverages could result in changes to the beverage business. Consumers, public health officials and government agencies in the majority of our markets, are increasingly concerned with public health consequences associated with obesity, particularly among young people. Additionally, some researchers, health advocates and dietary guidelines are encouraging consumers to reduce consumption of sugar-sweetened beverages and beverages sweetened with nutritive or alternative sweeteners. Increasing public concern about these issues, the possibility of taxes on sugar-sweetened beverages or other sweeteners, additional governmental regulations concerning the marketing, labeling, packaging or sale of our beverages and any negative publicity resulting from actual or threatened legal actions against beverage companies relating to the marketing, labeling or sale of beverages may reduce demand for our products or increase the cost, which could adversely affect our profitability. Our business is highly competitive, including with respect to price competition, which may adversely affect our net profits and margins. The beverage business is highly competitive in each of the territories in which we operate. We compete with bottlers of local and regional brands, including low cost beverages and Pepsi products. This competition in each of the regions where we operate is likely to continue, and we cannot assure you that it will not intensify in the future, which could materially and adversely affect our financial condition and results of operations. If we do not continuously strengthen our capabilities in marketing and innovation to maintain our brand loyalty and market share, our business and results of operations could be negatively affected. If our raw material costs increase, including as a result of U.S. dollar/local currency exchange risk and price volatility, our profitability may be affected. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTIn addition to water, our most significant raw materials are (1) concentrate, which we acquire from affiliates of The Coca-Cola Company, (2) sweeteners and (3) packaging materials. Our most significant packaging raw material costs arise from the purchase of resin and plastic preforms to make plastic bottles and from the purchase of finished plastic bottles, the prices of which are related to crude oil prices and global resin supply. Prices for concentrate are determined by The Coca-Cola Company and The Coca-Cola Company has unilaterally increased concentrate prices in the past and may do so again in the future. We cannot assure you that The Coca-Cola Company will not increase the price of the concentrate for Coca-Cola trademark beverages or change the manner in which these prices will be calculated in the future. The prices for our remaining raw materials are driven by market prices and local availability, the imposition of import duties and restrictions and fluctuations in exchange rates. We may not be successful in negotiating or implementing measures to mitigate the negative effect that increased raw material costs may have in the pricing of our products or our results. We purchase our raw materials from both domestic and international suppliers, some of which must be approved by The Coca-Cola Company, which may limit the number of suppliers available to us. Because the prices of our main raw materials –except for concentrate– are denominated in U.S. dollars, we are subject to local currency risk with respect to each of our operations. If any of the Chilean peso, Brazilian real, Argentine peso, or Paraguayan Guaraní were to depreciate significantly against the U.S. dollar, the cost of certain raw materials in our respective territories could rise significantly, which could have an adverse effect on our financial condition and results of operations. We cannot assure you that these currencies will not lose value against the U.S. dollar in the future. Additionally, some raw material prices are subject to high volatility, which could also have a material adverse effect on our profitability. The supply or cost of specific raw materials could be adversely affected by domestic or global price changes, strikes, weather conditions, taxes, governmental controls or other factors. Any sustained interruption in the supply of these raw materials or any significant increase in their price could have a material adverse effect on our financial performance. Instability in the supply of utility services and oil prices may adversely impact our results of operations. Our operations depend on a stable supply of utilities and fuel in the countries where we operate. Electrical power outages could lead to increased energy prices and possible service interruptions. We cannot assure you that in the future we will not experience energy interruptions that could materially and adversely affect our business. In addition, a significant increase in energy prices would raise our costs, which could materially impact our results of operations. Fluctuations in oil prices have adversely affected our cost of energy and transportation in the regions where we operate, and we expect that they will continue to do so in the future. We cannot assure you that fuel prices will not increase in the future, and that such an increase would not have a significant effect on our financial performance. Water scarcity and poor water quality could adversely impact our production costs and capacity. Water is the main ingredient in substantially all of our products. It is also a limited resource in many parts of the world, facing unprecedented challenges from overexploitation, increasing pollution and poor management. As demand for water continues to increase around the world, and as the quality of available water deteriorates, we may incur increasing production costs or face capacity constraints that could adversely affect our profitability. We obtain water from various sources in our territories, including springs, wells, rivers and municipal and state water companies pursuant to concessions granted by governments in our various territories. We also anticipate future discussions on new regulations in Chile and other countries where we operate relating to future ownership of water resources, including possible nationalization, and stricter controls on water usage. Water scarcity or changes in governmental regulations aimed at rationing water in the regions where we operate could affect our water supply and therefore our business. We cannot assure you that water will be available in sufficient quantities to meet our future production needs or will prove sufficient to meet our current water supply needs. Significant additional labeling or warning requirements may inhibit sales of our products. The countries in which we operate may adopt significant advertising restrictions as well as additional product labeling or warning requirements relating to the chemical content or perceived adverse health consequences of certain of our Coca-Cola products or other products. The Chilean Congress passed Law No. 20,606 with respect to labeling of certain consumer products, including soft drinks and bottled juices and waters such as ours. The law became effective in June 2016 and its implementation has been carried out in stages, with labeling requirements becoming progressively stricter in June 2018 and June 2019. Given the uncertainty surrounding the interpretation of the law, we may occasionally be subject to costs and penalties associated with non-compliance, which are difficult to predict. These requirements may adversely affect sales of our products and our results of operations. Our business may be adversely affected if we are unable to maintain brand image and product quality. Our beverage business is highly dependent on maintaining the reputation of our products in the countries where we operate. If we fail to maintain high standards for product quality, our reputation and ability to remain a distributor of The Coca-Cola Company beverages in the countries where we operate could be jeopardized. Negative publicity or incidents related to our products may reduce their demand and could have a material adverse effect on our financial performance. If any of our products is defective or found to contain contaminants, or causes injury or illness, we may be subject to legal claims filed by consumers, product recalls, business interruptions and/or other liabilities. We take significant precautions in order to minimize any risk of defects or contamination in our products. These precautions include quality- control programs for raw materials, the production process and our final products. We also have established procedures to correct as soon as practicable any problems that are detected. However, the precautions and procedures we implement may not be sufficient to protect us from potential incidents. Trademark infringement could adversely impact our beverage business. A significant portion of our sales derives from sales of beverages branded with trademarks of The Coca-Cola Company, as well as other trademarks. If other parties attempt to misappropriate trademarks we use, we may be unable to protect these trademarks. Maintaining the reputation of these brands is essential for the future success of our beverage business. Misappropriation of trademarks we use, or challenges thereto, could have a material adverse effect on our financial performance. We may not be able to successfully implement our expansion strategies or achieve the expected operational efficiencies or synergies from potential acquisitions. We have, and we may continue to, acquire businesses and pursue other strategic transactions as part of our expansion strategies. We cannot assure you that we will be successful in identifying opportunities and consummating acquisitions and other strategic transactions on favorable terms or at all. These types of transactions may involve additional risks to our Company, including operating in geographic regions or with beverage categories in which we have less or no operating history. Depending on the size and timing of an acquisition or transaction, we may be required to raise future financing to consummate the acquisition or transaction. Moreover, even if we are able to consummate a transaction, acquisitions and other strategic opportunities may involve significant risks and uncertainties. Key elements to achieving the benefits and expected synergies of our acquisitions are the integration of acquired businesses’ operations into our own in a timely and effective manner and the retention of qualified and experienced key personnel. We may incur in unforeseen liabilities in connection with acquiring, taking control of, or managing beverage operations and other businesses and may encounter difficulties and HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTunforeseen or additional costs in restructuring and integrating them into our operating structure. These difficulties include distraction of management from current operations, difficulties in integration with our existing business and technology, greater than expected liabilities and expenses, inadequate return on capital, and unidentified issues not discovered in our pre-acquisition investigations and evaluations of those strategies and acquisitions. We cannot assure you that these efforts will be successful or completed as expected by us, and our business, financial condition, results of operations could be adversely affected if we are unable to do so. Weather conditions or natural disasters may adversely affect our business. Lower temperatures and higher rainfall may negatively impact consumer patterns, which may result in lower per capita consumption of our beverages. Additionally, adverse weather conditions or natural disasters may affect road infrastructure in the countries in which we operate and limit our ability to sell and distribute our products. For example, in February of 2010 our business experienced a temporary interruption in our production as a result of the 8.8 magnitude earthquake in central Chile; and in March 2015, flash floods in the north of Chile interrupted our production and distribution in such territory. Our business is subject to risks arising from epidemic diseases, such as the recent outbreak of the COVID-19 illness The recent outbreak of the Coronavirus Disease 2019, or COVID-19, which has been declared by the World Health Organization to be a “public health emergency of international concern”, has spread across the globe and is impacting worldwide economic activity. A public health epidemic, including COVID-19, poses the risk that we or our employees, contractors, suppliers, and other partners may be prevented from conducting business activities for an indefinite period of time, including due to shutdowns that may be requested or mandated by governmental authorities. While it is not possible at this time to estimate the impact that COVID-19 could have on our business, the continued spread of COVID-19 and the measures taken by the governments of countries affected could disrupt the supply chain and the manufacture or shipment of our products and adversely impact our business, financial condition or results of operations. The COVID-19 outbreak and mitigation measures may also have an adverse impact on global economic conditions which could have an adverse effect on our business and financial condition. The extent to which the COVID-19 outbreak impacts our results will depend on future developments that are highly uncertain and cannot be predicted, including new information that may emerge concerning the severity of the virus and the actions to contain its impact. Our insurance coverage may not adequately cover losses resulting from the risks for which we are insured. We maintain insurance for our principal facilities and other assets. Our insurance coverage protects us in the event we suffer certain losses resulting from fire, terrorism and natural disasters, such as earthquake and floods, or from business interruptions caused by such events. In addition, we maintain other insurance policies for general liability and product contamination. We cannot assure you that our insurance coverage will be sufficient or will provide adequate compensation for losses that we may incur. If we are unable to protect our information systems against data corruption, cyber-based attacks or network security breaches, our operations could be disrupted. We are increasingly dependent on information technology networks and systems, including over the Internet, to process, transmit and store electronic information. In particular, we depend on our information technology infrastructure for digital marketing activities and electronic communications among us and our clients, suppliers and also among our subsidiaries and facilities. Security breaches or infrastructure flaws can create system disruptions, shutdowns or unauthorized disclosure of confidential information. If we are unable to prevent such breaches or flaws, our operations could be disrupted, or we may suffer financial damage or loss because of lost or misappropriated information. Cyber threats are rapidly evolving and the means for obtaining access to information in digital and other storage media are becoming increasingly sophisticated. Cyber threats and cyber-attackers can be sponsored by countries or sophisticated criminal organizations or be the work of single “hackers” or small groups of “hackers”. We are in the process of analyzing the adequacy of our information technology systems and installing new and upgrading existing information technology systems in order to achieve industry standard levels of protection for the Company’s data and business processes against risk of data security breach and cyber-attack. We are working to strengthen the integrity of our data network and expect this process to continue over the coming years. Insider or employee cyber and security threats are increasingly a concern for all companies, including ours. Nevertheless, as cyber threats evolve, change and become more difficult to detect and successfully defend against, one or more cyber- attacks might defeat our or a third-party service provider’s security measures in the future and obtain the personal information of customers or employees. Employee error or other irregularities may also defeat of security measures and result in a breach of information systems. Moreover, hardware, software or applications we use may have inherent defects of design, manufacture or operations or could be inadvertently or intentionally implemented or used in a manner that could compromise information security. A security breach and loss of information may not be discovered for a significant period of time after it occurs. While we have no knowledge of a material security breach to date, any compromise of data security could result in a violation of applicable privacy and other laws or standards, the loss of valuable business data, or a disruption of our business. A security breach involving the misappropriation, loss or other unauthorized disclosure of sensitive or confidential information could give rise to unwanted media attention, materially damage our customer relationships and reputation, and result in fines or liabilities, which may not be covered by our insurance policies. Perception of risk in emerging economies may impede our access to international capital markets, hinder our ability to finance our operations and adversely affect our financial performance. International investors, as a general rule, consider the countries in which we operate to be emerging market economies. Consequently, economic conditions and the market for securities of emerging market countries influence investors’ perceptions of Chile, Brazil, Argentina and Paraguay and their evaluation of securities of companies located in these countries. During periods of heightened investor concern regarding emerging market economies, in particular in recent years Argentina, the countries where we operate may experience significant outflows of U.S. dollars. In addition, during these periods companies based in the countries where we operate have faced higher costs for raising funds, both domestically and abroad, as well as limited access to international capital markets, which have negatively affected the prices of the aforementioned countries’ securities. Although economic conditions are different in each of the emerging-market countries, investors’ reactions to developments in one of these countries may affect the securities of issuers in the others. For example, adverse developments in emerging market countries may lead to decreased investor interest in the securities of Chilean companies. Our business may be adversely affected if we fail to renew collective bargaining labor agreements on satisfactory terms or experience strikes or other labor unrest. A substantial portion of our employees is covered by collective bargaining labor agreements. These agreements generally expire every year. Our inability to renegotiate these agreements on satisfactory terms could cause work stoppages and interruptions, which may adversely impact our operations. Changes to the terms and conditions of existing agreements could also increase our costs or otherwise have an adverse effect on our operational efficiency. We experience periodic strikes and other forms of labor unrest through the ordinary course of business. We cannot assure you labor interruptions or other labor unrest will not occur in the future. If we experience strikes, work stoppages or other forms of labor unrest at any of our production facilities, our ability to supply beverages to customers could be impaired, which would reduce our net operating revenues and could expose us to customer claims. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTOur business is subject to extensive regulation, which is complex and subject to change. We are subject to local regulations in each of the territories in which we operate. The main areas of regulation are water, environment, labor, taxation, health, consumer protection, advertising and antitrust. Regulation could affect our ability to set prices for our products. The adoption of new laws or regulations or a stricter interpretation or enforcement thereof in the countries in which we operate may increase our operating costs or impose restrictions on our operations which, in turn, may adversely affect our financial condition, business and results. Further changes in current regulations may result in increased compliance costs, which may have an adverse effect on our results or financial condition. In the past, voluntary price restraints or statutory price controls have been imposed in several of the countries in which we operate. Currently there are no restraints or price controls applicable to our products in any of the territories in which we operate, except with respect to a limited number of products in Argentina. However, we cannot assure you that government authorities in any country in which we operate will not impose statutory price controls, or that we will not be requested to impose voluntary price restraints in the future. The potential imposition of restraints or price controls in the future may have an adverse effect on our results and financial condition. Our business is subject to increasing environmental regulation, which may result in increases in our operating costs or adverse changes in consumer demand. We are subject to various environmental laws and regulations in the countries where we operate, which apply to our products, containers and activities. If these environmental laws and regulations are strengthened or newly established in jurisdictions in which we conduct our businesses, we may be required to incur considerable expenses in order to comply with such laws and regulations. We are also subject to uncertainty regarding the interpretation of the environmental laws and regulations of the countries in which we operate, and any ambiguity or uncertainty regarding the interpretation or application of regulations can result in increased production costs or penalties for non- compliance, which are difficult to predict. Such increased expenses may have a material adverse effect on our results of operations and financial position. To the extent we determine that it is not financially sound for us to continue to comply with such laws and regulations, we may have to curtail or discontinue our activities in the affected business areas. In addition, concerns over the environmental impact of plastic may reduce the consumption of our products sold in plastic bottles or result in additional taxes that could adversely affect consumer demand. In 2019 alone, three bills seeking to restrict the production and sale of single- use plastics in Chile were introduced for consideration by the Chilean Congress. Currently, we cannot predict whether these laws will pass. While the legislative process is still in its early stages, if enacted, these bills may have an adverse effect on our results of operations. If we were to become subject to adverse judgments or determinations in legal proceedings to which we are, or may become, a party, our future profitability could suffer through significant liabilities, a reduction of sales, increased costs or damage to our reputation. In the ordinary course of our business, we become involved in various claims, lawsuits, investigations and governmental and administrative proceedings, some of which are or may be significant. We are currently a party to certain legal proceedings. Adverse judgments or determinations in one or more of these proceedings could require us to change the way we do business or use substantial resources in adhering to the settlements. These could have a material adverse effect on our business, including, among other consequences, by significantly increasing the costs required to operate our business. Ineffective communications during or after these proceedings could amplify the negative effects, if any, of these proceedings on our reputation and may result in a negative market impact on the price of our securities. We evaluate these litigation claims and legal proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses. Based on these assessments and estimates, we establish reserves and/or disclose the relevant litigation claims or legal proceedings, as appropriate. These assessments and estimates are based on the information available to management at the time and involve a significant amount of management judgment. Actual outcomes or losses may differ materially from our current assessments and estimates. In addition, during recent years, the Company has been subject to judicial proceedings and administrative investigations associated with alleged monopolistic practices. In December 2019, the Chilean Supreme Court overturned a dismissal by the Chilean Antitrust Court of an antitrust complaint filed against us and remanded the case to the Antitrust Court for a full decision on the merits. We believe the likelihood of loss remains low. Although these proceedings and investigations have not resulted in any convictions or penalties for the Company, we cannot assure that this will not occur in the future. Antitrust complaints may be submitted in Chile without any prior admissibility test and, as a result, we cannot predict whether unsubstantiated claims against us will be filed. Possible sanctions in matters of competition could have an adverse effect on our business. The countries in which we operate may adopt new tax laws or modify existing laws to increase taxes applicable to our business or reduce existing tax incentives. We cannot assure you that any governmental authority in any country where we operate will not impose new taxes or increase the taxes on our products in the future. The imposition of new taxes, the increases in taxes or the reduction of tax incentives may have a material adverse effect on our business, financial condition and results. For example, in Chile on September 29, 2014 Law No. 20,780 was enacted which was subsequently amended by Law No. 20,899, on February 8, 2016 (the “Tax Reform”). The Tax Reform introduced a new tax regime for corporations, the Semi-Integrated Regime established in article 14(B) of the Chilean Income Law, increasing the tax burden, among other changes. In Argentina in December 2017, a tax reform was passed, which came into force in 2018. The most important consequence for the Company is the reduction in the previous income tax rate from 35% to 30% for the fiscal years 2018 and 2019 and from 2020 onwards the rate decreases to 25%. However, this reduction is only available when profits are reinvested. In addition, a tax of 7% must be paid at the time of distribution of dividends for the first two years and 13% from 2020 onwards. However, as of the date of this annual report, the Argentine government had suspended the corporate income tax rate decrease previously contemplated for fiscal year 2020. As a result, the corporate income tax rate will remain at 30% and the income tax rate on dividends will remain at 7%. In relation to gross income tax, in 2019 there was a 0.5% average reduction in the gross income tax rate for industry activity in provinces of Argentina where Andina has no productive plants, while the 0.5% reduction planned for 2020 has been suspended. Municipal rates in 2019 and as far as of the date of this annual report, remain unchanged, with few insignificant exceptions. Andina enjoys the benefit of a zero-tax rate on gross income in the province of Córdoba, Argentina, until the year 2021 under an industrial promotion. For further information, see also “Risks Relating to Brazil – Changes in tax laws may increase our tax burden and reduce tax incentives, and as a result negatively affect our profitability.” Brazilian tax proceedings may result in a significant tax liability. Our subsidiary Rio de Janeiro Refrescos Ltda. is party in several tax proceedings in which the Brazilian federal tax authorities argue the alleged existence of liabilities associated with value added tax on industrialized products for an approximate total amount of R$ 2 billion (equivalent to approximately US$488 million). These proceedings are at different administrative as well as judicial procedural stages. We disagree with the Brazilian tax authorities’ position and believe that Rio de Janeiro Refrescos Ltda. is entitled to claim Imposto sobre Productos Industrializados (IPI) tax credits in connection with its purchases of certain exempt raw materials from suppliers located in the Manaus Free Trade Zone. We believe that the Brazilian tax authorities’ claims are without merit. Our external Brazilian counsel has advised us that it HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTother individuals of similar experience and skill. It is not certain that we will be able to attract or retain key employees and successfully manage them, which could disrupt our business and have an unfavorable material effect on our financial position, income from operations and competitive position. A devaluation of the currencies of the countries where we have our operations, with regard to the Chilean peso, can negatively affect the results reported by the Company in Chilean pesos. The Company reports its results in Chilean pesos, while a large part of its revenues and Adjusted EBITDA comes from countries that use other currencies. During the year ended December 31, 2018 and the year ended December 31, 2019, 32% and 35% of the Company’s net sales were generated in Brazil, 25% and 22% in Argentina, and 9% and 9% in Paraguay, while 33% and 34% of Adjusted EBITDA was generated in Brazil, 19% and 16% in Argentina, and 12% and 12% in Paraguay, respectively. If the currencies of these countries depreciate against the Chilean peso, this would have a negative effect on the results and financial condition of the Company, which are reported in Chilean pesos. The imposition of exchange controls could restrict the entry and exit of funds to and from the countries in which we operate, which could significantly limit our financial capacity. The imposition of exchange controls in the countries in which we operate could affect our ability to repatriate profits, which could significantly limit our ability to pay dividends to our shareholders. Additionally, it may limit the ability of our foreign subsidiaries to finance payments of U.S. dollar denominated liabilities required by foreign creditors. Negative information on social media and similar platforms could adversely affect our reputation. Negative or inaccurate information concerning us or The Coca-Cola trademarks may be posted on social media and similar platforms of Internet-based communications at any time. This information may affect our reputation, and adversely impact our business and results of operations. believes that Rio de Janeiro Refrescos Ltda.’s likelihood of loss in most of these proceedings is classified as possible to remote (i.e., approximately 30%). Despite the foregoing, the outcome of these claims is subject to uncertainty, and it is difficult to predict their final resolution or any other negative repercussions from this dispute with the Brazilian tax authorities to The Coca-Cola Company or its bottling companies in Brazil, including our Brazilian subsidiaries. The termination of the Heineken product distribution agreement in Brazil and our potential inability to secure a substitute supplier could adversely affect our profitability. In July 2017 Heineken Brazil unilaterally notified us of the termination of the agreement by virtue of which Rio de Janeiro Refrescos Ltda. commercializes and distributes Heineken-branded beers in Brazil. Rio de Janeiro Refrescos Ltda. understood that the expiration of the agreement was scheduled for 2022 and we submitted the dispute to arbitration. In October 2019, a non-appealable decision was rendered in our favor. We continue distributing Heineken-branded products in Brazil and expect to do so until the termination of the agreement in March 2022. However, if following the termination of the agreement we are unable to secure a substitute supplier of beer in Brazil, our business and results of operations may be adversely affected. Heineken-branded products represent 21.7% of our consolidated net sales in Brazil during 2019. If we do not successfully comply with laws and regulations designed to combat corruption in countries in which we sell our products, we could become subject to fines, penalties or other regulatory sanctions, and our sales and profitability could suffer. Although we are committed to conducting business in a legal and ethical manner in compliance with local and international statutory requirements and standards applicable to our business, there is a risk that our employees or representatives may take actions that violate applicable laws and regulations that generally prohibit the making of improper payments to foreign government officials for the purpose of obtaining or keeping business, including laws relating to the 1997 OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions or the U.S. Foreign Corrupt Practices Act. We may not be able to recruit or retain key personnel. The implementation of our strategic business plans could be undermined by a failure to recruit or retain key personnel or the unexpected loss of senior employees, including in acquired companies. We face various challenges inherent in the management of a large number of employees over diverse geographical regions. Key employees may choose to leave their employment for a variety of reasons, including reasons beyond our control. The impact of the departure of key employees cannot be determined and may depend on, among other things, our ability to recruit HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTRISKS RELATING TO CHILE Our growth and profitability depend to a significant degree on economic conditions in Chile. Our operations in Chile represented 39.4% and 37.7% of our assets as of December 31, 2018 and December 31, 2019, respectively, and 34.1% and 34.2% of our net sales for 2018 and 2019, respectively. Accordingly, our business, financial condition, and results of operations depend, to a considerable extent, upon economic conditions in Chile. International and local economic conditions may adversely affect the Chilean economy, and unfavorable general economic conditions could negatively affect the affordability of and demand for some of our products in the country. In difficult economic conditions, consumers may seek to reduce discretionary spending by forgoing purchases of our products or buying low cost brands offered by competitors. Any of these events could have an adverse effect on our business, financial condition and results of operations. According to data published by the Central Bank, the Chilean economy grew at a rate of 1.8% in 2014, 2.3% in 2015, 1.3% in 2016, 1.5% in 2017, 4.0% in 2018 and 1.1% in 2019. Our financial condition and results of operations could also be adversely affected by changes over which we have no control, including, without limitation: • political or economic developments in or affecting Chile; • the economic or other policies of the Chilean government, which has a substantial influence over many aspects of the private sector; • tax rates and policies; • regulatory changes or administrative practices of Chilean authorities; • inflation and governmental policies to combat inflation; • currency exchange movements; and • global and regional economic conditions. We cannot assure you that the future development of the Chilean economy will not impair our ability to successfully carry out our business plan or materially adversely affect our business, financial condition or results of operations. Civil unrest in Chile could have a material adverse effect on general economic conditions in Chile and our business, results of operations and financial condition. Beginning on October 18, 2019, widespread protests have taken place in Chile. The protests began over the government’s announcement of an increase in subway fares in Santiago and quickly grew into broader unrest over economic inequality, including claims about transportation costs, funding for education, health care costs and pension amounts, among others. Demonstrations spread across the country and resulted in violent, and sometimes deadly acts, causing significant damage to subway stations in Santiago, shops, houses and other public and private property. In March 2020, protests and civil unrest stopped as a consequence of the COVID-19 outbreak, but civil unrest could continue after COVID-19 outbreak is left behind. In response, the Chilean government imposed a state of emergency and nighttime curfews in Santiago and other cities, for a limited period. Also, the Chilean government announced a reshuffling of the cabinet and a series of social and economic reforms to tackle issues at the heart of the unrest, including cancellation of the increased subway fares, increases in government-subsidized pension, a guaranteed minimum monthly income, affordable medical insurance, lowering the price of medicine and a cancellation of energy price hikes. Chile’s Congress also reached an agreement to reform the country’s constitution. Following an agreement between Chilean political parties, a nationwide plebiscite will take place to ask Chileans if they want a new constitution and, if so, how the new constitution should be drafted. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTWe cannot predict the extent to which the Chilean economy will be affected by the civil unrest, nor can we predict if government policies enacted as a response to the civil unrest will have a negative impact on the Chilean economy. Changes in government policies may include higher tax rates and other changes in laws and policies that could result in a less favorable environment for private businesses. Despite looting and vandalism at our distribution center in Puente Alto, our operations have not been affected in any material respect to date. We cannot assure you that looting and vandalism will not continue after COVID-19 outbreak is left behind, affecting our production and logistics infrastructure. Also, if the protests continue or worsen, future government policies to preempt, or in response to unrest, may materially affect the Chilean economy, and thereby our business, financial condition and results of operation. The Chilean peso is subject to depreciation and volatility, which could adversely affect our business. The Chilean peso has been subject to large nominal devaluations in the past and may be subject to significant fluctuations in the future. The main drivers of exchange rate volatility in past years were the significant fluctuations of commodity prices, as well as general uncertainty and trade imbalances in the global markets. As of December 31, of each year, the Chilean peso depreciated 17% during 2015, appreciated 6% and 8% during 2016 and 2017, respectively, and depreciated 13% and 8% during 2018 and 2019, respectively, compared with the closing exchange rate for the U.S. dollar in nominal terms. A significant part of the raw materials used by the Company are in U.S. dollars, therefore a devaluation of the Chilean peso against the U.S. dollar can affect our costs and margins in a significant way. In addition, as we report our results of operations in Chilean pesos, fluctuations in the value of the Chilean peso versus the Brazilian real, the Argentine peso and the Paraguayan Guaraní could also impact our reported performance in Chilean pesos. Inflation in Chile and government measures to curb inflation may disrupt our business and have an adverse effect on our financial condition and results of operations. Although Chilean inflation has decreased in recent years, Chile has experienced significant levels of inflation in the past. The rates of inflation in Chile, which in, 2015, 2016, 2017, 2018 and 2019 were, 4.4%, 2.7%, 2.3%, 2.6% and 3.0%, respectively, as measured by changes in the consumer price index and as reported by the National Statistics Institute (Instituto Nacional de Estadísticas), could adversely affect the Chilean economy and have a material adverse effect on our financial condition and results of operations if we are unable to increase our prices in line with inflation. We cannot assure you that Chilean inflation will not increase in the future. The measures taken by the Central Bank in the past to control inflation have often included maintaining a conservative monetary policy with high interest rates, thereby restricting the availability of credit and economic growth. Inflation, measures to combat inflation, and public speculation about possible additional actions by the government have also contributed in the past to economic uncertainty in Chile and to heightened volatility in its securities markets. Periods of higher inflation may also slow the growth rate of the Chilean economy, which could lead to reduced demand for our products and decreased sales. Inflation is also likely to increase some of our costs and expenses, given that the majority of our supply contracts in Chile are UF- denominated or are indexed to the Chilean consumer price index. We cannot assure you that, under competitive pressure, we will be able to carry out price increases, which could adversely impact our operating margins and operating income. Additionally, an important part of our financial debt in Chile is UF-denominated, and therefore the value of the debt reflects any increase of the inflation in Chile. A severe earthquake or tsunami in Chile could adversely affect the Chilean economy and our network infrastructure. Chile lies on the Nazca tectonic plate, one of the world’s most seismically active regions. Chile has been adversely affected by powerful earthquakes in the past, including an 8.0 magnitude earthquake that struck Santiago in 1985 and a 9.5 magnitude earthquake in 1960 which is the largest earthquake ever recorded. In February 2010, an 8.8 magnitude earthquake struck the central and south-central regions of Chile. The quake epicenter was located 200 miles southwest of Santiago and 70 miles north of Concepción, Chile’s second largest city. The regions of Bío Bío and Maule were the most severely affected regions, especially the coastal area, which, shortly after the earthquake, was hit by a tsunami that significantly damaged cities and port facilities. The Valparaíso and Metropolitan regions were also severely affected. At least 1.5 million homes were damaged, and more than 500 people were killed. As a result of these developments, economic activity in Chile was adversely affected in March 2010. Legislation was passed to raise the corporate income tax rate in order to pay for reconstruction following the earthquake and tsunami, which had an adverse effect on our results. RISKS RELATING TO BRAZIL Our business operations in Brazil are dependent on economic conditions in Brazil. Our operations in Brazil represented 36.8% and 40.1% of our assets as of December 31, 2018 and December 31, 2019, respectively, and 32.3% and 34.8% of our net sales for 2018 and 2019, respectively. Because demand for soft drinks and beverage products is usually correlated to economic conditions prevailing in the relevant local market, developments in economic conditions in Brazil, and measures taken by the Brazilian government, have had and are expected to continue to have an impact on our business, results of operations and financial condition. The Brazilian economy has historically been characterized by unstable economic cycles and interventions by the Brazilian government. Brazilian GDP grew by 0.5% in 2014, contracted by 3.5% and 3.3% in 2015 and 2016, respectively, grew by 1.1%, 1.3% and 1.2% in 2017, 2018 and 2019, respectively, according to the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatistica). The Brazilian government has often changed monetary, taxation and other policies to influence the course of Brazil’s economy. Our business, results of operations and financial condition may be adversely affected by, among others, the following factors: • expansion or contraction of the Brazilian economy; • exchange rate fluctuations; • high inflation rates; • changes in fiscal or tax policies; • changes in monetary policy, including an increase in interest rates; • exchange control policies and restrictions on remittances abroad; A severe earthquake and/or tsunami in Chile in the future could have an adverse impact on the Chilean economy and on our business, financial condition and results of operation, including our production and logistics network. • investment levels; • liquidity of domestic capital and credit markets; HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT• employment levels and labor and social security regulations; • energy or water shortages or rationalization; • changes in environmental regulation; • social and political instability; and • other developments in or affecting Brazil. The Brazilian economy is also affected by international economic and market conditions in general, especially economic and market conditions in the United States, the European Union and China. Historically volatile political, social and economic conditions in Brazil could adversely affect our business and results of operations. Brazil’s political environment has historically influenced, and continues to influence, the performance of the country’s economy. Political crisis have affected and continue to affect the confidence of investors and the general public, which have historically resulted in economic deceleration. Economic instability in Brazil has contributed to a decline in market confidence in the Brazilian economy as well as to a deteriorating political environment. In addition, various ongoing investigations into allegations of money laundering and corruption being conducted by the Office of the Brazilian Federal Prosecutor, including the largest such investigation, known as “Operação Lava Jato,” have negatively impacted the Brazilian economy and political environment. The potential outcome of these investigations is uncertain, but they have already had an adverse impact on the image and reputation of the implicated companies, and on the general market perception of the Brazilian economy. We cannot predict whether the ongoing investigations will result in further political and economic instability, or if new allegations against government officials and/or executives of private companies will arise in the future. Jair Bolsonaro was elected as the President of Brazil in October 2018. His election led to a market recovery and the recovery of the value of the local stock market. However, we cannot assure that this confidence in the market will remain, nor that the policies promoted by the new government will be beneficial to the economy or our business. A failure by the Brazilian government to implement necessary reforms may result in diminished confidence in the Brazilian government’s fiscal condition and budget, which could result in downgrades of Brazil’s sovereign foreign credit rating by credit rating agencies, negatively impact Brazil’s economy, lead to further depreciation of the real and an increase in inflation and interest rates, adversely affecting our business, financial condition and results of operations. Inflation and the Brazilian government’s measures to curb inflation, including by increasing interest rates, may contribute to economic uncertainty in Brazil. Brazil has historically experienced high rates of inflation, including periods of hyperinflation before 1995. Several measures have been implemented by the Brazilian government in an effort to curb rising inflation, but we cannot predict whether these policies will be effective. According to the National Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo, or “IPCA”), published by the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística, “IBGE”), Brazilian annual rates of inflation for consumer prices were 6.4% in 2014, 10.7% in 2015, 6.3% in 2016, 2.9% in 2017, 3.7% in 2018 and 4.1% in 2019. Inflationary pressures may result in governmental interventions in the economy, including policies that could adversely affect the general performance of the Brazilian economy, which, in turn, could adversely affect our business operations in Brazil. Inflation may also increase our costs and expenses, and we may be unable to transfer such costs to our customers, reducing our profit margins and net income. In addition, inflation could also affect us indirectly, as our customers may also be affected and have their financial capacity reduced. Any decrease in our net sales or net income, as well as any reduction in our financial performance, may also result in a reduction in our net operating margin. Our customers and suppliers may be affected by high inflation rates and such effects on our customers and suppliers may adversely affect us. The Brazilian real is subject to depreciation and volatility, which could adversely affect our business, financial condition and results of operations. The Brazilian currency has been subject to significant fluctuations over the past three decades. Throughout this period, the Brazilian government has implemented various economic plans and exchange rate policies, including sudden devaluations, periodic mini devaluations (during which the frequency of adjustments has ranged from daily to monthly), exchange controls, dual exchange market and floating exchange rate systems. Although long-term devaluation of the real is generally related to the rate of inflation in Brazil, the devaluation of the real over shorter periods has resulted in significant fluctuations in the exchange rate between the Brazilian currency, the U.S. dollar and other currencies. As of December 31 of each year, the Brazilian real depreciated 47% during 2015, appreciated 17% during 2016 and depreciated 2%, 17%, and 4% during 2017, 2018 and 2019, respectively, compared with the closing exchange rate for the U.S. dollar in nominal terms. A significant part of the raw materials we use in Brazil are priced in U.S. dollars, so a depreciation of the Brazilian real against the U.S. dollar has a significant adverse effect in our costs and margins. Any depreciation of the real against the U.S. dollar could create additional inflationary pressure, which might result in the Brazilian government adopting restrictive policies to combat inflation. This could lead to increases in interest rates, which might negatively affect the Brazilian economy as a whole, as well as our results of operations, in addition to restricting our access to international financial markets. It also reduces the U.S. dollar value of our revenues. On the other hand, future appreciation of the real against the U.S. dollar might result in the deterioration of Brazil’s current and capital accounts, as well as a weakening of Brazilian GDP growth derived from exports. We cannot assure you that the real will not again fluctuate significantly against the U.S. dollar in the future and, as a result, have an adverse effect on our business, results of operations and financial condition. Changes in tax laws may increase our tax burden and reduce tax incentives and, as a result, negatively affect our profitability. The Brazilian government regularly implements changes to tax regimes that may increase our and our customers’ tax burdens. These changes include modifications in the tax rates and, on occasion, enactment of temporary taxes, the proceeds of which are earmarked for designated governmental purposes. In the past, the Brazilian government has presented certain tax reform proposals, which have been mainly designed to simplify the Brazilian tax system, to avoid internal disputes within and between the Brazilian states and municipalities, and to redistribute tax revenues. The tax reform proposals provide for changes in the rules governing the federal Social Integration Program (Programa de Integração Social, or “PIS”) and Social Security Contribution (Contribuição para o Financiamento da Seguridade Social, or “COFINS”) taxes, the state Tax on the Circulation of Goods and Services (Imposto Sobre a Circulação de Mercadorias e Serviços, or “ICMS”) and some other taxes, such as increases in payroll taxes. These proposals may not be approved and passed into law. The effects of these proposed tax reform measures and any other changes that result from enactment of additional tax reforms have not been, and cannot be, quantified. However, some of these measures, if enacted, may result in increases in our overall tax burden, which could negatively affect our overall financial performance. In addition, the Brazilian beverage industry experiences unfair competition arising from tax evasion, which is primarily due to the high level of taxes on beverage products in Brazil. An increase in taxes may lead to an increase in tax evasion, which could result in unfair pricing practices in the industry. Since 2018, the Brazilian government has gradually altered the value-added tax on industrialized products (Imposto sobre Produtos Industrializados or “IPI”) applicable to soft drinks concentrate. This measure has negatively affected our operations, since it significantly reduced the tax credit derived from the purchases of concentrate from the Manaus Free Trade Zone that currently benefits Rio de Janeiro Refrescos, and the soft drinks industry as a whole. Such HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTalterations have been implemented gradually, as follows: (1) 20% IPI rate until September 2018; (2) 4% IPI rate from October to December 2018; (3) 12% IPI rate in the first half of 2019; (4) 8% IPI rate from July 1, 2019 to September 30, 2019; (5) 10% IPI rate from October 1, 2019 to December 31, 2019; (6) 4% IPI rate from January 1, 2020 to May 31, 2020; (7) 8% IPI rate from June 1, 2020 to November 30, 2020; and (8) 4% IPI rate from December 1, 2020 onwards. Any further reductions of the IPI may adversely affect our financial condition and results of operations. Given the high tax burden in Brazil, federal and state authorities of that country offer a series of significant tax incentives to certain territories and/or localities in order to attract investment, particularly for manufacturers and other companies operating and investing in Brazil. Coca-Cola Andina Brazil has received some of these tax incentives and its results have been positively affected by these incentives. Although these incentives have generally been renewed in the past, we cannot assure that they will continue to be renewed in the future. Current tax incentives from the State of Rio de Janeiro in connection with the development and construction of the Duque de Caxias production plant are due to expire in October 2020 and may not be renewed. Termination, non-extension or non-renewal of tax incentives could have a material adverse effect on our business, financial condition and results of operation. RISKS RELATING TO ARGENTINA Our business operations in Argentina are dependent on economic conditions in Argentina Our operations in Argentina represented 10.9% and 10.1% of our assets as of December 31, 2018 and December 31, 2019, respectively, and 24.7% and 22.2% of our net sales for 2018 and 2019, respectively. Developments in economic, political, regulatory and social conditions in Argentina, and measures taken by the Argentine government, have had and are expected to continue to have an impact on our business, results of operations and financial condition. Historically, the Argentine economy has experienced periods of high levels of instability and volatility, low or negative economic growth and high and variable inflation and devaluation levels. According to the National Statistics and Census Institute (Instituto Nacional de Estadísticas y Censos, or “INDEC”), Argentine GDP contracted in real terms by 2.5% in 2014, grew 2.6% in 2015, contracted by 2.1% in 2016, grew by 2.7% in 2017 and contracted by 2.5% and 2.2% in 2018 and 2019, respectively. Argentine economic conditions are dependent on a variety of factors, including the following: • domestic production, international demand and prices for Argentina’s principal commodity exports; • the competitiveness and efficiency of domestic industries and services; • the stability and competitiveness of the Argentine peso against foreign currencies; • the rate of inflation; • the government’s fiscal deficits; • the government’s public debt levels; • foreign and domestic investment and financing; and • governmental policies and the legal and regulatory environment. Government policies and regulation—which at times have been implemented through informal measures and have been subject to radical shifts—that have had a significant impact on the Argentine economy in the past have included, among others: monetary policy, including exchange controls, capital controls, high interest rates and a variety of measures to curb inflation, restrictions on exports and imports, price controls, mandatory wage increases, taxation and government intervention in the private sector. We cannot assure you that the future development of the Argentine economy will not impair our ability to successfully carry out our business plan or materially adversely affect our business, financial condition or results of operations. Political and economic instability in Argentina may recur, which could have a material adverse effect on our Argentine operations and on our financial condition and results of operations. Argentina has a history of political and economic instability that often results in abrupt changes in government policies. Argentine governments have pursued different, and often contradictory, policies to those of preceding administrations. In recent decades, succeeding administrations have implemented interventionist policies, which included nationalization, debt renegotiation, price controls, and exchange restrictions, as well as market-friendly policies, such as export tax reductions, elimination of currency controls, deregulation of utility prices, negotiation of free trade agreements and implementation of pro-investor initiatives. In October 2019, Argentine presidential, legislative and certain provincial and municipal governments elections were held and Alberto Fernández was elected president. The new administration took office on December 10, 2019. Certain members of the current government HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTcoalition, including president Alberto Fernández and vice president Cristina Fernández de Kirchner, were part of administrations which in the past were characterized by high levels of government intervention and policies at times disadvantageous to investors and the private sector. As a result, there is uncertainty regarding the policies and changes in regulation that the new Argentine government will implement. On December 23, 2019, the new Argentine government passed a law granting emergency powers to the executive branch, among other measures. We cannot predict what policies the new Argentine government will implement under these emergency powers We cannot provide assurance that the Argentine government will not adopt policies, over which we have no control, that adversely affect the Argentine economy and impair our Argentine operations and our business, financial condition or results of operations [170]. Inflation in Argentina may adversely affect our operations, which could adversely impact our financial condition and results of operations. Argentina has experienced high levels of inflation in recent decades. Argentina’s historically high rates of inflation resulted mainly from its lack of control over fisal policy and the money supply. Argentina continues to face high inflationary pressures. The INDEC in 2017 reported that the consumer price index (índice de precios al consumidor or “CPI”) increased 24.8%, while the wholesale price index (índice de precios internos al por mayor or “WPI”) increased 18.8%. In 2018, the INDEC registered a variation in the CPI of 47.6% and an increase in WPI of 73.5%. In 2019, the INDEC registered an increase in CPI of 53.7%, while the WPI increased 58.5%. During 2018 and 2019, Argentina met the criteria to be considered a hyperinflationary economy as provided by IAS 29 guidelines, which include, among other characteristics, a cumulative inflation rate over three years that approaches or exceeds 100%. Accordingly, IAS 29 must be applied for financial statements for fiscal years ending on or after July 1, 2018. IAS 29 requires non-monetary assets and liabilities, shareholders’ equity and comprehensive income to be restated in terms of a measuring unit current at the period end. IAS 29 also requires the use of a general price index to reflect changes in purchasing power. As a result, since July 2018, we began to apply IAS 29 in the preparation of our financial statements and report the results of our operations in Argentina as if this economy was hyperinflationary from January 1, 2018. In addition, by application of IAS 29, we had to translate figures in Argentine pesos to Chilean pesos using the period closing exchange rate (and not the average exchange rate), thus reducing our results of operations and net earnings. We cannot predict for how long Argentina will be considered a hyperinflationary economy and we will have to apply IAS 29 to the preparation of our financial statements. In the past, inflation has materially undermined the Argentine economy and the government’s ability to generate conditions that foster economic growth. High inflation or a high level of price instability may materially and adversely affect the business volume of the financial system. This result, in turn, could adversely affect the level of economic activity and employment in the country. In 2015, 2016, 2017, 2018 and 2019, the Argentine peso depreciated 52%, 22%, 17%, 102% and 59%, respectively, compared with the closing exchange rate for the U.S. dollar. A significant part of the raw materials used by the company in Argentina are in U.S. dollars, so a devaluation of the Argentine peso against the U.S. dollar can affect our costs and margins in a significant way. High inflation would also undermine Argentina’s foreign competitiveness and adversely affect economic activity, employment, real salaries, consumption and interest rates, thereby materially and adversely affecting economic activity and consumers’ income and their purchasing power, all of which could have a material adverse effect on our financial condition and operating results. Between 2007 and 2015, the INDEC, which is the only institution in Argentina with the statutory authority to produce official national statistics, experienced significant institutional and methodological changes that gave rise to controversy regarding the reliability of the information that it produces, including inflation, GDP and unemployment data, resulting in allegations that the inflation rate in Argentina and the other rates calculated by INDEC could be substantially different than as indicated in official reports. While the previous administration undertook reforms and the credibility of the national statistics systems has since been restored, we cannot assure you that the new or future administrations will not implement policies that may affect the national statistics system undermining consumer and investor confidence, which ultimately could affect our business, results of operations and financial condition. The Argentine peso is subject to depreciation and volatility, which could adversely affect our financial condition and results of operations. Fluctuations in the value of the peso continue to affect the Argentine economy. Since January 2002, the peso has fluctuated significantly in value, often following periods of high inflation and currency controls that artificially appreciated the value of the currency. Frequent devaluations have had an adverse effect on the ability of the Argentine government and Argentine companies to make timely payments on their foreign currency denominated obligations, have significantly reduced wages in real terms, and have adversely impacted the stability of businesses whose success depends on the domestic market demand. In an effort to reduce downward pressure on the value of the Argentine peso, the Argentine government has at times implemented policies aimed at maintaining the level of reserves of the Banco Central de la República Argentina (“BCRA”) that limit the purchase of foreign currency by private companies and individuals. Currently, access to the foreign exchange market is subject to several restrictions and governmental authorizations. The depreciation of the Argentine peso may have a negative impact on the ability of certain Argentine businesses to service their foreign currency denominated debt, significantly reduce real wages and jeopardize the stability of businesses whose success depends on domestic market demand, and also adversely affect the Argentine government’s ability to honor its foreign debt obligations. A significant appreciation of the Argentine peso against the U.S. dollar also presents risks for the Argentine economy, including the possibility of a reduction in exports as a consequence of the loss of external competitiveness. Any such appreciation could also have a negative effect on economic growth and employment, and reduce tax revenues. Given the economic and political conditions in Argentina, we cannot predict whether, and to what extent, the value of the Argentine peso may depreciate or appreciate against the U.S. dollar, the euro or other foreign currencies. We cannot predict how these conditions will affect the consumption of our products. Moreover, we cannot predict whether the new Argentine government will continue its monetary, fiscal, and exchange rate policy and, if so, what impact any of these changes could have on the value of the Argentine peso and, accordingly, on our financial condition, results of operations and cash flows, and on our ability to transfer funds abroad in order to comply with commercial or financial obligations. The Argentine government could impose certain restrictions on currency conversions and remittances abroad, which could affect the timing and amount of any dividends or other payment we receive from our Argentine subsidiary. Beginning in December 2015, the Argentine government gradually eased restrictions which significantly curtailed access to the foreign exchange market by individuals and private sector entities and affected our ability to declare and distribute dividends with respect to our Argentine subsidiary. These measures included informal restrictions, which consisted of de facto measures restricting local residents and companies from purchasing foreign currency through the foreign exchange market to make payments abroad, such as dividends and payment for the importation of goods and services. On September 1, 2019, in a response to the weakening of the Argentine peso following the results of the primary elections, the Argentine government temporarily reinstated certain exchange restrictions. The new controls apply with respect to access to the foreign exchange market by residents (both companies and natural persons) for savings HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT Future government policies to preempt, or in response to, social unrest may include expropriation, nationalization, forced renegotiation or modification of existing contracts, suspension of the enforcement of creditors’ rights, new taxation policies and changes in laws and policies affecting foreign trade and investment. Such policies could destabilize the country and adversely and materially affect the Argentine economy, and thereby our business, results of operations and financial condition. and investment purposes abroad, the payment of external financial debts abroad, the payment of dividends in foreign currency abroad, the payment of imports of goods and services, and the obligation to repatriate and settle for Argentine pesos the proceeds from exports of goods and services, among others. Under current Argentine law, we are restricted from accessing the official foreign exchange market to make dividend payments to us from our Argentine subsidiaries without prior approval from the Argentine Central Bank. It is not possible to anticipate whether these measures will be in force after December 31, 2019 or if the new administration which took office on December 10, 2019 will impose additional restrictions. The Argentine government could maintain or impose new exchange control regulations, restrictions and take other measures in response to capital flight or a significant depreciation of the peso, which could limit access to the international capital markets, adversely affect Argentina’s economy, and further impair our ability to declare and distribute dividends from our Argentine subsidiaries. The Argentine government’s ability to obtain financing from international capital markets may be limited or costly, which may impair its ability to implement reforms and foster economic growth. At the end of 2001, the Argentine government defaulted in part of its sovereign debt. In 2005 and 2010, Argentina conducted exchange offers to restructure part of its sovereign debt that had been in default since the end of 2001. Through these exchange offers, Argentina restructured over 92% of its eligible defaulted debt. In April 2016, after a series of judicial actions by Argentina’s bondholders, the Argentine government settled substantially all of the remaining defaulted debt. Additionally, as a result partially of emergency measures undertaken by the government in response to the crisis of 2001 and 2002, foreign shareholders of several Argentine companies filed claims with the International Centre for Settlement of Investment Disputes (“ICSID”), alleging that those measures diverged from the just and equal treatment standards set forth in bilateral investment treaties to which Argentina is a party. The ICSID ruled against the Argentine government in a number of these proceedings, and the Argentine government has settled some but not all of these claims. In December 2019, the Argentine government delayed payment on roughly US$9 billion in U.S. dollar-denominated short-term debt, postponing payment until August 2020 while announcing to its creditors that it will seek to restructure the country’s debt obligations, including loans from the International Monetary Fund (FMI), which extended a US$57 billion bailout program. As a result, rating agency Fitch downgraded Argentina to “restricted default” and Standard & Poor’s changed its country rating to “selective default”. While Argentina had regained access to the international capital markets, actions by the Argentine government, or investor perceptions of the country’s creditworthiness, could curtail access in the future or could significantly increase borrowing costs, limiting the government’s ability to foster economic growth. Limited or costly access to international financing for the private sector could also affect our business, financial condition and results of operations. The government may order salary increases to be paid to employees in the private sector, which could increase our operating costs and affect our results of operations. In the past, the Argentine government has passed laws, regulations and decrees requiring companies in the private sector to increase wages and provide specified benefits to employees. On December 23, 2019, the Argentine government passed a law granting emergency powers to the executive branch which, among others, include the ability to mandate increases to private sector wages. Due to persistent high levels of inflation, labor organizations regularly demand significant wage increases. In 2015, 2016, 2017, 2018 and 2019 the increase in the federally-mandated minimum wage was 27%, 35%, 17%, 28% and 48%, respectively, and for these same years the market average salary increase for workers was 32%, 33%, 26%, 32% and 48%, respectively. In addition, the Argentine government has arranged various measures to mitigate the impact of inflation and exchange rate fluctuation in wages. Due to high levels of inflation, both public and private sector employers continue to experience significant pressure to further increase salaries. Labor relations in Argentina are governed by specific legislation, such as Labor Law No. 20,744 and Law No. 14,250 on Collective Bargaining Agreements, which, among other things, dictate how salary and other labor negotiations are to be conducted. In the future, the government could take new measures requiring salary increases or additional benefits for workers, and the labor force and labor unions may apply pressure in support of such measures. Any such increase in wages or worker benefit could result in added costs and reduced results of operations for Argentine companies, including us. Government measures to preempt or respond to social unrest may adversely affect the Argentine economy and our business. In recent decades, Argentina has experienced significant social and political turmoil, including civil unrest, riots, looting, nationwide protests, strikes and street demonstrations. Social and political tension and high levels of poverty and unemployment continue. Unions frequently stage nationwide strikes and protests, and riots and lootings of shops and supermarkets in cities around the country have taken place at times of social turmoil. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTCentral Bank, actively participates in the exchange market in order to reduce volatility. Since a portion of our total costs (30%) in Paraguay for raw material and supplies are denominated in U.S. dollars, a significant depreciation of the local currency could adversely affect our financial situation and results. The Paraguayan Guaraní depreciated by 26% in 2015, appreciated by 1% and 3% in 2016 and 2017, respectively, and depreciated by 7% and 8% in 2018 and 2019, respectively, in each case compared with the closing exchange rate of the U.S. dollar. The local currency follows regional and global trends. When the U.S. dollar’s value increases, and raw materials lose value in Paraguay, this directly impacts Paraguay’s generation of foreign exchange which occurs mainly through the export of raw materials. A deterioration in the economic growth of Paraguay as result of a significant depreciation of the Guaraní could have an effect on our business, financial condition and results of operations. RISKS RELATING TO PARAGUAY Our business operations in Paraguay are dependent on economic conditions in Paraguay. Our operations in Paraguay represented 12.9% and 12.1% of our assets as of December 31, 2018 and December 31, 2019, respectively, and 8.9% and 8.9% of our net sales for 2018 and 2019, respectively. Because demand for soft drinks and beverage products is generally related to the economic conditions prevailing in the local market which, in turn, depend on the macroeconomic and political conditions of the country, our financial situation and our results of operations could be adversely affected by changes in these factors over which we have no control. Paraguay has a history of economic and political instability, exchange controls, frequent changes in regulatory policies, corruption and weak judicial security. Paraguayan GDP grew by 3%, 4%, 5% and 3% in 2015, 2016, 2017 and 2018, respectively; it did not grow in 2019, according to the Paraguayan Central Bank. Paraguayan GDP is closely tied to the performance of Paraguay’s agricultural sector, which can be volatile. The situation of the Paraguayan economy is also strongly influenced by the economic situation in Argentina and Brazil. A deterioration in the economic situation of these countries could adversely affect the Paraguayan economy and, in turn, our financial condition and operating results. Inflation in Paraguay may adversely affect our financial condition and results of operations. Although inflation in Paraguay has remained stable at around 4% over the last five years, we cannot assure that inflation in Paraguay will not increase significantly. An increase in inflation in Paraguay could decrease the purchasing power of our consumers in the country, which could adversely affect our volumes and impact our sales income. The Paraguayan Guaraní is subject to depreciation and volatility, which could adversely affect our financial condition and results of operations. The exchange rate of Paraguay is free and floating and the Paraguay HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTRISK FACTORS RELATING TO THE ADRS AND COMMON STOCK Preemptive rights may be unavailable to ADR holders. According to the Ley de Sociedades Anónimas No. 18,046 and the Reglamento de Sociedades Anónimas (collectively, the “Chilean Companies Law”), whenever we issue new shares for cash, we are required to grant preemptive rights to holders of our shares (including shares represented by ADRs), giving them the right to purchase a sufficient number of shares to maintain their existing ownership percentage. However, we may not be able to offer shares to United States holders of ADRs pursuant to preemptive rights granted to our shareholders in connection with any future issuance of shares unless a registration statement under the U.S. Securities Act of 1933, as amended, is effective with respect to such rights and shares, or an exemption from the registration requirements of the U.S. Securities Act of 1933, as amended, is available. Under the procedure established by the Central Bank of Chile, the foreign investment agreement of a Chilean company with an existing ADR program will become subject to an amendment (which will also be deemed to incorporate all laws and regulations applicable to international offerings in effect as of the date of the amendment) that will extend the benefits of such contract to new shares issued pursuant to a preemptive rights offering to existing ADR owners and to other persons residing and domiciled outside of Chile that exercise preemptive rights, upon request to the Central Bank of Chile. We intend to evaluate at the time of any rights offering the costs and potential liabilities associated with any such registration statement as well as the indirect benefits to us of enabling United States ADR holders to exercise preemptive rights and any other factors that we consider appropriate at the time, and then make a decision as to whether to file such registration statement. We cannot assure you that any registration statement would be filed. To the extent ADR holders are unable to exercise such rights because a registration statement has not been filed, the depositary will attempt to sell such holders’ preemptive rights and distribute the net proceeds thereof if a secondary market for such rights exists and a premium can be recognized over the cost of any such sale. If such rights cannot be sold, they will expire, and ADR holders will not realize any value from the grant of such preemptive rights. In any such case, such holder’s equity interest in the Company would be diluted proportionately. Shareholders’ rights are less well-defined in Chile than in other jurisdictions, including the United States. Under the United States federal securities laws, as a foreign private issuer, we are exempt from certain rules that apply to domestic United States issuers with equity securities registered under the United States Securities Exchange Act of 1934, as amended, including the proxy solicitation rules, the rules requiring disclosure of share ownership by directors, officers and certain shareholders. We are also exempt from certain of the corporate governance requirements of the Sarbanes- Oxley Act of 2002 and the New York Stock Exchange, Inc., including the requirements concerning independent directors. Our corporate affairs are governed by the laws of Chile and our estatutos or bylaws. Under such laws, our shareholders may have fewer or less well-defined rights than they might have as shareholders of a corporation incorporated in a U.S. jurisdiction. Pursuant to Law No. 19,705, enacted in December 2000, the controlling shareholders of an open stock corporation can only sell their controlling shares through a tender offer to all shareholders in which the bidder would have to buy all of the offered shares up to the percentage determined by it, where the price paid is substantially higher than the market price (i.e., when the price paid was higher than the average market price for a period starting 90 days before the proposed transaction and ending 30 days before such proposed transaction, plus 10%). The market for our shares may be volatile and illiquid. The Chilean securities markets are substantially smaller, less liquid and more volatile than major securities markets in the United States. The Bolsa de Comercio de Santiago (the “Santiago Stock Exchange”), which is Chile’s principal securities exchange, had a market capitalization of approximately US$205,798 million as of December 31, 2019 and an average monthly trading volume of approximately US$3,369 million for the year. The lack of liquidity is owed, in part, to the relatively small size of the Chilean securities markets and may have a material adverse effect on the trading prices of our shares. Because the market for our ADRs depends, in part, on investors’ perception of the value of our underlying shares, this lack of liquidity for our shares in Chile may have a significant effect on the trading prices of our ADRs. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTMAIN USE Distribution Centers / Warehouses Offices / Production of Soft Drinks / Distribution Center / Warehouses Square meters Property 600 Third Parties 102,708 Own PROPERTIES AND FACILITIES Argentina Embotelladora del Atlántico S.A. Azul Bahía Blanca Bahía Blanca Bahía Blanca Bahía Blanca Bahía Blanca Bariloche Bialet Masse Bolívar Bragado Carlos Casares Carlos Paz Warehouses (Don Pedro) Commercial Offices Real Estate (parking lot) Warehouses (M&F Palletizer -EDF deposit) Offices / Distribution Centers / Warehouses Real Estate** Commercial Logistic Operations Commercial Offices Commercial Logistic Operations Commercial Offices Carmen de Patagones Commercial Offices / Warehouses / Crossdocking Chacabuco Chivilcoy Chivilcoy Offices / Distribution Centers / Warehouses Distribution Centers / Warehouses Commercial Offices Comodoro Rivadavia Offices / Distribution Centers / Warehouses Concepción del Uruguay Crossdocking Concepción del Uruguay Commercial Offices 6,000 903 73,150 1,400 1,870 880 700 38 345 270 1,600 25,798 Leased Leased Own Leased Leased Own Third Parties Leased Third Parties Leased Leased Own 1,350 Third Parties 72 7,500 n/a 118 Leased Leased Third Parties Leased Concordia Córdoba Commercial Offices / Third party Distribution Centers / Warehouses 1,289 Leased Offices /Production of soft drinks and other still beverages / Distribution Centers / Warehouses / Real estate 959,585 Own Córdoba (H. Primo) Commercial Offices / parking lot / Deposit Córdoba (San Isidro) Deposit and Offices Córdoba Córdoba Córdoba Córdoba Deposit (Cencosud) Deposit (Rigar) Deposit (Ricardo Balbín) Deposit (Agnolon) 1,173 8,808 n/a 8,800 2,500 6,000 Leased Own Leased Leased Leased Leased HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTArgentina Embotelladora del Atlántico S.A. Coronel Pringles Coronel Suárez Embalse General Pico General Roca Gualeguaychu MAIN USE Commercial Logistic Operations Offices / Third party Distribution Centers / Warehouses / Deposit Commercial Logistic Operations Offices / Distribution Centers / Warehouses Distribution Centers / Warehouses Commercial Offices / Warehouses Junín (Buenos Aires) Cross Docking Junín (Buenos Aires) Commercial Offices Junín (Mendoza) Commercial Offices Mendoza Offices / Distribution Centers / Warehouses Monte Hermoso Real Estate** Neuquén Olavarría Paraná Pehuajo Pergamino Puerto Madryn Rafaela Rio Gallegos Rio Grande Río IV Río IV Río IV Río IV Offices / Distribution Centers / Warehouses Offices / Distribution Centers / Warehouses Commercial Offices Offices / Distribution Centers / Warehouses Offices / Cross Docking Commercial Offices Commercial Logistic Operations Distribution Centers / Warehouses Offices / Distribution Centers / Warehouses Housing Private Passageway Cross Docking Commercial Offices Río Tercero Commercial Logistic Operations Rivadavia (Mendoza) Deposit** Rosario San Francisco San Francisco Offices / Distribution Centers / Warehouses / Parking Lot / Real Estate Commercial Offices Crossdocking Square meters Property 675 Third Parties 1,000 Leased 600 Third Parties 15,525 2,548 2,392 995 108 234 36,452 300 10,157 3,065 318 1,060 Own Third Parties Leased Third Parties Leased Leased Own Own Own Leased Leased Leased 15,700 Own 115 Leased 1,000 Third Parties 2,491 2,460 1,914 5,170 7,482 93 600 800 27,814 63 800 Leased Leased Own Own Own Leased Third Parties Own Own Leased Third Parties HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTArgentina Embotelladora del Atlántico S.A. MAIN USE Square meters Property San Juan San Luis Offices / Distribution Centers / Warehouses Commercial Offices / Distribution Centers / Warehouses San Martín de los Andes Offices / Distribution Center / Warehouses San Nicolás San Nicolás San Rafael Santa Fe Santa Rosa Santo Tomé Trelew Trelew Crossdocking Commercial Offices Commercial Offices Commercial Offices Distribution Centers / Warehouses Administrative Offices / Distribution Centers / Warehouses Offices / Production of Soft Drinks / Distribution Centers / Warehouses Warehouses Trenque Lauquen Distribution Center / Warehouses / Commercial Offices Tres Arroyos Offices / Crossdocking / Warehouses Ushuaia Ushuaia Offices / Distribution Centers / Warehouses Commercial Offices Venado Tuerto Commercial Offices / Distribution Centers / Warehouses Villa María Villa María Villa Mercedes Villa Mercedes Andina Empaques Argentina S.A. Buenos Aires Buenos Aires Buenos Aires Commercial Offices Crossdocking Commercial Offices Crossdocking Production of bottles, PET Preforms, Plastic Caps and Cases Deposit adjoining the production plant Deposit adjoining the production plant 48,036 5,205 1,500 1,320 50 58 238 Own Own Third Parties Third Parties Leased Leased Leased 1,200 Third Parties 88,309 51,000 Own Own 1,500 Leased 1,185 Third Parties 1,548 1,360 94 2,449 125 Leased Leased Leased Leased Leased 1,200 Third Parties 70 600 Leased Third Parties 27,043 Own 1,041 940 Leased Leased HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTBrazil Rio de Janeiro Refrescos Ltda. MAIN USE Square meters Property Jacarepaguá Offices / Production of Soft Drinks / Distribution Center / Warehouses Duque de Caxias Offices / Production of Soft Drinks / Distribution Center / Warehouses Nova Iguaçu Distribution Centers / Warehouses Bangu Campos Cabo Frio Distribution Centers Distribution Centers Distribution Centers** Sao Pedro da Aldeia 1 Distribution Centers Itaperuna Caju 1 Caju 2 Caju 3 Crossdocking Distribution Centers Distribution Centers Parking Lot Vitória (Cariacica) Distribution Centers Cachoeiro do Itapemirim Crossdocking Linhares Ribeirão Preto Ribeirão Preto Franca Mococa Araraquara São Paulo Crossdocking Offices / Production of Soft Drinks / Distribution Center / Warehouses Real Estate Distribution Centers Distribution Centers Distribution Centers Apartment Sao Joao da Boa Vista Crossdocking Sao Pedro da Aldeia 2 Parking Lot Itaipu Nova Friburgo Commercial Offices Commercial Offices / Crossdocking 249,470 2,243,953 82,618 44,389 36,083 1,985 Own Own Own Own Own Own 10,139 Concession 2,500 4,866 8,058 7,400 Leased Own Own Leased 93,320 Own 8,000 1,500 238,096 279,557 32,500 33,669 11,658 69 20,773 Leased Leased Own Own Own Leased Own Own Own 6,400 Concession 750 350 Leased Leased HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTMAIN USE Square meters Property Chile Embotelladora Andina S.A. Renca Renca Renca Renca Offices / Production of Soft Drinks / Distribution Center / Warehouses Warehouses Warehouses Warehouses Carlos Valdovinos Distribution Centers / Warehouses Puente Alto Maipú Distribution Centers / Warehouses Distribution Centers / Warehouses Demetrop (Región Metropolitana) Warehouses Trailerlogistic (Región Metropolitana) Warehouses Monster (Región Metropolitana) Warehouses Rancagua San Antonio Antofagasta Antofagasta Calama Tocopilla Coquimbo Copiapó Ovalle Vallenar Illapel Distribution Centers / Warehouses Distribution Centers / Warehouses Offices / Production of Soft Drinks / Distribution Center / Warehouses Offices / Production of Soft Drinks / Distribution Center / Warehouses Distribution Centers / Warehouses Distribution Centers / Warehouses Offices / Production of Soft Drinks / Distribution Center / Warehouses Distribution Centers / Warehouses Distribution Centers / Warehouses Distribution Centers / Warehouses Distribution Centers / Warehouses Punta Arenas Offices / Production of Soft Drinks / Distribution Center / Warehouses Coyhaique Puerto Natales Distribution Centers / Warehouses Distribution Centers / Warehouses 380,833 55,562 11,211 46,965 106,820 68,682 45,833 n/a n/a n/a 25,920 19,809 34.729 8.028 10.700 562 31.383 26.800 6.223 5.000 Own Own Own Own Own Own Own Leased Leased Leased Own Own Own Own Own Own Own Own Own Own s/d Leased 109.517 5.093 850 Own Own Leased HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTMAIN USE Square meters Property Chile Embotelladora Andina S.A. Vital Jugos S.A. Renca Vital Aguas S.A. Rengo Envases Central S.A. Offices / Production of Juices Offices / Production of Waters Renca Offices / Production of Soft Drinks Paraguay Paraguay Refrescos S.A. San Lorenzo Coronel Oviedo Encarnación Ciudad del Este MAIN USE Offices / Production of Soft Drinks / Warehouses Offices / Warehouses Offices / Warehouses Offices / Warehouses 40,000 Own 573,620 Own 51,907 Own Square meters Property 275,292 32,911 12,744 14,620 Own Own Own Own HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEXPERIENCE BOARD OF DIRECTORS AND EXECUTIVE TEAM BOARD OF DIRECTORS JUAN CLARO / Chairman RUT: 5.663.828-8 Nationality: Chilean Date of birth: November 7, 1950 EDUARDO CHADWICK / Director RUT: 7.011.444-5 Nationality: Chilean Date of birth: March 20, 1959 JOSÉ ANTONIO GARCÉS / Director RUT: 8.745.864-4 Nationality: Chilean Date of birth: March 1, 1966 ARTURO MAJLIS / Director RUT: 6.998.727-3 Nationality: Chilean Date of birth: April 7, 1962 GONZALO SAID / Vice Chairman RUT: 6,555.478-K Nationality: Chilean Date of birth: October 16, 1964 Eduardo Chadwick has been Director of Coca- Cola Andina since 2012. He is also member of the board of directors of Penta, Maltexco and Ebema. He is an Industrial Civil Engineer of the Pontificia Universidad Católica de Chile.Universidad Católica de Chile. Juan Claro is an entrepreneur and since 2004 has been a member of the board of directors of the Company, chairing it since the same year. Currently, he is also Director at Antofagasta PLC, Cementos Melón, Agrosuper and Energía Llaima. He has developed an outstanding activity of business representativeness, having chaired the Sociedad de Fomento Fabril (Sofofa) between 2001 and 2005 and also the Confederación de Producción y Comercio (2002 to 2005). In addition, he is an honorary partner of the Centro de Estudios Públicos and between 2005 and 2007 he was Chairman of the Chile-China Bilateral Business Council. He has studies in civil engineering at the Pontificia Universidad Católica de Chile. José Antonio Garcés has been member of the Company's Board of Directors since April 1992 and currently serves as Director of Banco Consortium, CN LIFE Compañía de Seguros, Consorcio Nacional de Seguros, Banvida and Viña Montes. He has previously been Chairman of the Board of Directors of Banvida S.A., Past President of USEC and Director of Fundación Paternitas, as well as General Manager of Inversiones San Andrés (family holding company) and former Director of Sofofa. He is a Business Administrator of the Universidad Gabriela Mistral specializing in finance and has postgraduate studies with an Executive MBA and PADE from ESE of the Universidad de Los Andes. Arturo Majlis has been director of Coca-Cola Andina since April 1997. An attorney at law of the Universidad de Chile, he has specialized in the areas of corporate governance, financial law, litigation and arbitration. He is currently a senior partner of the law firm Grasty, Quintana, Majlis y Compañía. In addition, he is member of the board of directors of Orión Seguros, Grupo Mathiesen, Banchile, Inersa and Laboratorios Maver. In addition, he is Director at Fundación Puerto de Ideas and Fundación Convivir. Gonzalo Said has been a member of the Company's Board of Directors since 1992, as well as being a Director at Scotiabank, Energía Llaima and Holding Empresas Said Handal. In parallel, he has an active participation in the trade union field, through his position as Vice President of Sofofa and as Director of Fundación Generación Empresarial, from where he has promoted his vision on corporate governance and good business practices. He is a Business Administrator of the Universidad Gabriela Mistral. de la Universidad Gabriela Mistral. SALVADOR SAID / Director RUT: 6.379.626-3 Nationality: Chilean Date of birth: September 16, 1964 GEORGES DE BOURGUIGNON / Director RUT: 7.269.147-4 Nationality: Chilean Date of birth: July 14, 1962 FELIPE JOANNON / Director RUT: 6.558.360-7 Nationality: Chilean Date of birth: December 17, 1959 PILAR LAMANA / Director RUT: 8,538.550-K Nationality: Chilean-Spanish Date of birth: May 31, 1965 ROBERTO MERCADE / Director DNI: 700.192.456-7 (Colombia) Nationality: U.S. Date of birth: September 18, 1968 Salvador Said joined the company's Board of Directors on April 8, 1998. He is also Director of Parque Arauco S.A., Scotiabank Chile S.A., Envases CMF S.A. and Energía Llaima SpA. He is also Executive Director of the said Group companies and Director of the Centro de Estudios Públicos . In addition, he participates in non-profit foundations oriented to entrepreneurship, such as Endeavor Chile, an entity that he chaired for six years. He is a Business Administrator from Universidad Gabriela Mistral. Georges de Bourguignon joined the Board of Coca-Cola Andina in April 2016. He also currently serves as Director at Asset Chile S.A., Asset AGF, Soquimich S.A., and Tanica S.A. He was previously Director of Latam Airlines Group and Empresas La Polar. In academia, he has been Professor of Economics at Universidad Católica and Director of Harvard Business School Alumni Board Boston. He has also been member of the Board of Directors of Corporación de Amigos del Lago Ranco. He is an Economist from the Pontificia Universidad Católica de Chile. Felipe Joannon has been Director of the Company since April 2018, also serving in the Board of Directors of Forestal O'Higgins (parent company Grupo Matte), Quimetal Industrial S.A., Inmobiliaria Icom, Hotels Plaza El Bosque and Maquinarias y Construcciones Río Loa S.A. Previously he was director of the Luksic Group companies and at the management level he held the positions of Development Manager of Quiñenco S.A., General Manager of Viña Santa Rita and Deputy General Manager of Cristalerías de Chile. In academia, he is a Professor of the Faculty of Management and Economics at the Universidad Católica de Chile and at ESE of the Universidad de Los Andes. He is a Commercial Engineer specializing in Economics from the Pontificia Universidad Católica de Chile and MBA of The Wharton School. Pilar Lamana, Commercial Engineer from the Universidad de Chile, joined the Board of Coca- Cola Andina in April 2017. She also serves as a Director at Polpaico, Petrobras and Laboratorios Petrizzio. She is a partner of the company Go to Market. Roberto Mercadé has been Director of the Company since April 2019 and currently holds the position of President of the Latin Center Business Unit of The Coca-Cola Company. Industrial Engineer of the Georgia Institute of Technology, Atlanta, USA; he has formerly integrated the ARCA-Lindley Boards in Peru, Campo Alegre School in Venezuela and American International School of Johannesburg in South Africa. GONZALO PAROT / Director RUT: 6.703,799-5 Nationality: Chilean Date of birth: September 14, 1952 ENRIQUE RAPETTI / Director Nationality: Argentine Date of birth: October 22, 1976 MARIANO ROSSI / Director Passport: 1,7761,559 Nationality: Argentine-Italian Date of birth: January 22, 1966 RODRIGO VERGARA / Director RUT: 7,980.977-2 Nationality: Chilean Date of birth: June 5, 1962 Gonzalo Parot has been part of the Company's Board of Directors since 2010, a position he currently holds in parallel with that of Director at AES Gener. Previously, he developed his professional activity as Head of Research at CCU, Manager of Research and Corporate Development at Empresas CMPC, General Manager of Celulosa del Pacifico, Corporate General Manager at CMPC Tissue and Corporate General Manager at Copesa. In his career he has excelled as Director, Executive Vice President and Counselor of the Teatro Municipal de Santiago, as Director of the National Press Association and the Chilean-Argentine Chamber of Business and as Professor and Director of the School of Economics of Universidad de Chile. He is an Industrial Civil Engineer from the Universidad de Chile and an Economist from Chicago University, his areas of specialization are Business, Economy and Finance. Enrique Rapetti is Chief Financial Officer for Coca-Cola Latin America and has served as Director of Coca-Cola Andina since October 2016. He is Certified Public Accountant; throughout his professional career he has specialized in the area of Corporate Finance. His higher education took place at the Universidad Argentina de la Empresa (UADE) and the Universidad Torcuato Di Tella (UTDT). Mariano Rossi has been a Director at the Company since July 2012 and is currently also part of the Board of Directors of Novusfill. As part of The Coca-Cola Company he has been General Manager in Argentina and Chief Financial Officer Latam. Between 1999 and 2008 he served as Director in public bottlers of the Coca-Cola System in Latin America (Chile, Peru and Uruguay). He holds a degree in Management from the Universidad de Buenos Aires, specializing in Finance. Rodrigo Vergara has been a director of Coca- Cola Andina since April 2018. He currently holds the position of Senior Economist of the Centro de Estudios Públicos and Associate Researcher of the Mossavar-Rahmani Center of Harvard University. He is also Director of Banco Santander Chile and Besalco S.A. Previously president of the Banco Central de Chile (2011-2016), Director of the same monetary entity (2009-2011) and Director at Moneda S.A., Moneda AGF, Entel S.A. and Banco Internacional. He is a Business Administrator with specializing in Economics of the Pontificia Universidad Católica de Chile. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEXECUTIVE TEAM MIGUEL ANGEL PEIRANO Chief Executive Officer ANDRÉS WAINER Chief Financial Officer JAIME COHEN Chief Legal Officer GONZALO MUÑOZ Chief Human Resources Officer MARTIN IDIGORAS Chief IT Officer RUT: 23.836.584-8 Nationality: Argentine Date of birth: March 22, 1959 Date of entry to the Company: August 2011 Appointment date of office: August 2011 RUT: 10.031.788-5 Nationality: Chilean Date of birth: October 15, 1970 Date of entry to the Company: April 1996 Appointment date of office: December 2010 RUT: 10.550.141-2 Nationality: Chilean Date of birth: October 14, 1967 Date of entry to the Company: September 2008 Appointment date of office: September 2008 RUT: 7.691.376-5 Nationality: Chilean Date of birth: September 23, 1961 Date of entry to the Company: January 2015 Appointment date of office: January 2015 RUT: 22.526.397-3 Nationality: Argentine Date of birth: February 6, 1975 Date of entry to the Company: November 2018 Appointment date of office: January 2019 Electronic Engineer of the Instituto Tecnológico de Buenos Aires and with postgraduate studies at Harvard Business School, Stanford University. Prior to taking over as CEO, he served as a Senior Engagement Manager at McKinsey & Company and President of Coca-Cola Femsa Mercosur. Business Administrator specializing in Economics of the Pontificia Universidad Católica de Chile and holds a Master's degree in Finance from The London Business School. He joined the Company in 1996 and before taking over as CFO he served as Finance Manager of the operation in Chile and as Corporate Manager of Research and Development. Lawyer of the Universidad de Chile and Virginia, United States, who throughout his career has specialized in Corporate and Financial Law. Prior to his appointment as Chief Legal Officer of the Company he was Legal Affairs Manager at Socovesa S.A. (2004-2008); Corporate Banking Attorney at Citibank N.A. (2000-2004); International Associate at Milbank, Tweed, Hadley & McCloy, New York (2001-2002); Associate Lawyer at Cruzat, Ortuzar & Mackenna, Baker & McKenzie (1996-1999) and Financial and Real Estate Attorney at Banco de A. Edwards (1993-1996). CPA of the Universidad de Chile who throughout his professional career has specialized in the areas of Finance, General Management, Trade Marketing and Human Resources. Prior to his appointment as Chief Human Resources Officer of Coca-Cola Andina, he worked at British American Tobacco serving as Director of Human Resources in Mexico and Director of the Southern Human Resources Cone. In the same company he also served as Chief Financial Officer and General Manager in several Latin American countries. Bachelor of Systems of the John F. Kennedy University specializing in Technologies. Prior to joining Coca-Cola Andina, he worked for more than 17 years at Cencosud. During that time he served as CIO for the Home Improvement Division (2015-2018), Regional Manager Center of Expertise SAP (2014-2015) and Regional CTO (2010-June 2014). He also worked in different Technology positions at Correo Argentino and Arcor. FERNANDO JAÑA Chief Strategic Planning Officer JOSÉ LUIS SOLÓRZANO General Manager Embotelladora Andina S.A. FABIÁN CASTELLI General Manager Embotelladora del Atlántico S.A. FRANCISCO SANFURGO General Manager Paraguay Refrescos S.A. RENATO BARBOSA General Manager Rio de Janeiro Refrescos Ltda. RUT: 12.167.257-K Nationality: Chilean Date of birth: June 13, 1977 Date of entry to the Company: June 2014 Appointment date of office: May 2019 RUT: 10.023.094-1 Nationality: Chilean Date of birth: October 9, 1970 Date of entry to the Company: April 2003 Appointment date of office: April 2014 DAYS: 17744981 Nationality: Argentine Date of birth: October 27, 1965 Date of entry to the Company: May 1994 Appointment date of office: April 2014 RUT: 7.053.083-K Nationality: Chilean Date of birth: July 24, 1954 Date of entry to the Company: 1988 Appointment date of office: January 2005 DNI: 505.757 SSP/DF Nationality: Brazilian Date of birth: January 14, 1960 Date of entry to the Company: January 2012 Appointment date of office: January 2012 Industrial Civil Engineer of the Universidad Adolfo Ibáñez has specialized in the areas of Mass Consumption and Retail. He holds a Master's degree in Logistics and Supply Chain Management from The University of Sydney. Prior to the position of Chief Strategic Planning Officer of the Company he was General Manager of Coca-Cola del Valle, Manager of Innovation and Projects at Coca- Cola Andina Chile, e-Commerce Manager at Supermercados Cencosud and Logistics and Distribution Manager at CCU. Business Administrator of the Universidad Adolfo Ibáñez specializing in the areas of Marketing and Finance. Prior to being appointed general manager of Coca-Cola Andina Chile, he held the positions of General Manager of Andina Argentina and Commercial Manager of Andina. Prior to this he was Commercial Manager of Coca-Cola Polar. Industrial Engineer of the Universidad Nacional de Cuyo, specializing in the Management Development Program at IAE, Argentina, and Donald A. Keough System Leadership Academy. Before being appointed General Manager of Embotelladora del Atlántico S.A.. and after joining the Company in 1994 he has held the positions of Head of the Sales Department of Mendoza, Manager of Commercial Development and Planning, Marketing Manager, Commercial Manager. He has also been AdeS Director and Vice President of AFAC. Mechanical Engineer of the Universidad de Concepción, specializing in Project Management at Universidad Adolfo Ibáñez. Prior to his appointment as General Manager of Paresa, he served as Commercial Manager at Dimetral in Punta Arenas, Manager of the Punta Arenas branch of Citicorp and General Manager of Cervecería Austral in Punta Arenas. Economist of the Universidad do Distrito Federal, specializing in Business. Before taking over as general manager of Rio de Janeiro Refrescos he held the position of General Manager at Brasal Refrigerantes, (Coca-Cola bottler of the eastern central part of Brazil.) HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTSUMMARIZED CONSOLIDATED FINANCIAL STATEMENTS Embotelladora Andina S.A. and Subsidiaries Consolidated Statements of Financial Position at December 31, 2019 and 2018 Consolidated Income Statement by Function for the periods between January 1 and December 31, 2019 and 2018 Consolidated Statement of Comprehensive Income for the periods between January 1 and December 31, 2019 and 2018 Consolidated Statement of Changes in Equity for the periods between January 1 and December 31, 2019 and 2018 Consolidated Statements of Direct Cash Flows for the periods between January 1 and December 31, 2019 and 2018 Notes to the Consolidated Financial Statements External Auditor Report HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTCONSOLIDATED FINANCIAL STATEMENTS AT DECEMBER 31, 2019 AND 2018 Embotelladora Andina S.A. and Subsidiaries EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statement of Financial Position ASSETS Current assets: Cash and cash equivalents Other financial assets Other non-financial assets Trade and other accounts receivable, net NOTE 12.31.2019 12.31.2018 4 5 6 7 CLP (000’s) CLP (000’s) 157,567,986 137,538,613 347,278 683,567 16,188,965 5,948,923 191,077,588 174,113,323 Accounts receivable from related companies 12.1 10,835,768 9,450,263 Inventory Current tax assets Total Current Assets Non-Current Assets: Other financial assets Other non-financial assets Trade and other receivables Accounts receivable from related parties Investments accounted for under the equity method Intangible assets other than goodwill Goodwill Property, plant and equipment Deferred tax assets Total Non-Current Assets Total Assets The accompanying notes form an integral part of these Consolidated Financial Statements 8 9 5 6 7 12.1 14 15 16 11 10.2 147,641,224 151,319,709 9,815,294 2,532,056 533,474,103 481,586,454 110,784,311 97,362,295 125,636,150 34,977,264 523,769 283,118 1,270,697 74,340 99,866,733 102,410,945 675,075,375 668,822,553 121,221,661 117,229,173 722,718,863 710,770,968 1,364,340 - 1,857,474,320 1,732,918,235 2,390,948,423 2,214,504,689 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statement of Financial Position LIABILITIES AND EQUITY ASSETS Current Liabilities: Other financial liabilities Trade and other accounts payable Accounts payable to related parties Provisions Income taxes payable Employee benefits current provisions Other non-financial liabilities Total Current Liabilities Non-Current Liabilities: Other financial liabilities, non-current Accounts payable, non-current Accounts payable to related companies, non-current Other provisions, non-current Deferred tax liabilities Employee benefits non-current provisions Total Non-Current Liabilities: Equity: Issued capital Retained earnings Other reserves Equity attributable to equity holders of the parent Non-controlling interests Total Equity Total Liabilities and Equity The accompanying notes form an integral part of these Consolidated Financial Statements NOTE 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 17 18 12.2 19 9 13 20 17 18 12.2 19 10.2 13 21 40,593,878 56,114,977 243,700,553 238,109,847 53,637,601 45,827,859 2,068,984 6,762,267 3,485,613 9,338,612 38,392,854 33,210,979 26,502,215 33,774,214 411,658,352 419,862,101 743,327,057 716,563,778 619,587 735,665 19,777,812 - 67,038,566 58,966,913 169,449,747 145,245,948 10,173,354 9,415,541 1,010,386,123 930,927,845 270,737,574 270,737,574 600,918,265 462,221,463 76,993,851 110,854,089 948.649.690 843,813,126 20,254,258 19,901,617 968,903,948 863,714,743 2,390,948,423 2,214,504,689 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Income Statement by Function for the periods between January 1 and December 31, 2019 and 2018 Net sales Cost of sales Gross Profit Other income Distribution expenses Administrative expenses Other expenses Other (loss) gains Financial income Financial expenses 01.01.2019 01.01.2018 12.31.2019 12.31.2018 NOTE CLP (000’s) CLP (000’s) 8 26 25 25 27 29 28 28 1,779,025,115 1,672,915,799 (1,048,343,767) (968,027,774) 730,681,348 704,888,025 40,947,158 2,609,168 (166,996,289) (165,775,484) (325,903,809) (313,742,853) (26,182,847) (16,057,763) 2,876 (2,707,859) 45,155,791 3,940,244 (46,209,020) (55,014,660) Share of profit (loss) of investments in associates and joint ventures accounted for using the equity method 14.3 (3,415,083) 1,411,179 Foreign exchange differences Income by indexation units Net income before income taxes Income tax expense Net income Net income attributable to Owners of the controller Non-controlling interests Net income Earnings per Share, basic and diluted Earnings per Series A Share Earnings per Series B Share The accompanying notes form an integral part of these Consolidated Financial Statements (4,130,543) (1,449,256) (7,536,466) (5,085,140) 236,413,116 153,015,601 10.1 (61,166,891) (55,564,855) 175,246,225 97,450,746 173,721,928 96,603,371 1,524,297 847,375 175,246,225 97,450,746 CLP CLP 21.5 21.5 174.79 192.27 97.20 106.92 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statement of Comprehensive Income for the periods between January 1 and December 31, 2019 and 2018 Net income Other Comprehensive Income: 01.01.2019 01.01.2018 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 175,246,225 97,450,746 Components of other comprehensive income that will not be reclassified to net income for the period, before taxes Actuarial losses from defined benefit plans (379,007) (63,463) Components of other comprehensive income that will be reclassified to net income for the period, before taxes Gain (losses) from exchange rate translation differences Gain (losses) from cash flow hedges (41,844,584) (72,455,525) (1,865,233) (13,151,841) Income tax related to components of other comprehensive income that will not be reclassified to net income for the period Income tax benefit related to defined benefit plans 102,332 16,184 Income tax related to components of other comprehensive income that will be reclassified to net income for the period Income tax related to exchange rate translation differences Income tax related to cash flow hedges Other comprehensive income, total Total comprehensive income Total comprehensive income attributable to: Equity holders of the controller Non-controlling interests Total comprehensive income The accompanying notes form an integral part of these Consolidated Financial Statements 9,295,545 2,476,204 683,483 2,554,551 (34,007,464) (80,623,890) 141,238,761 16,826,856 139,861,690 16,370,635 1,377,071 456,221 141,238,761 16,826,856 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statement of Changes in Equity for the periods between January 1 and December 31, 2019 and 2018 Issued capital Reserves for exchange rate differences Cash flow hedge reserve Other reserves Actuarial gains or losses in employee benefits Other reserves Total other reserves Retained earnings Controlling Equity Non-Controlling interests Total Equity Opening balance as of 01.01.2019 270,737,574 (306,674,528) (13,668,932) (1,954,077) 433,151,626 110,854,089 462,221,463 843,813,126 19,901,617 863,714,743 CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) Changes in Equity Comprehensive Income Earnings Other comprehensive income Comprehensive income Dividends Increase (decrease) from other changes Total changes in equity - - - - - - - - (32,401,812) (1,181,751) (276,675) (32,401,812) (1,181,751) (276,675) - - - - - - (32,401,812) (1,181,751) (276,675) - - - - - - - 173,721,928 173,721,928 1,524,297 175,246,225 (33,860,238) - (33,860,238) (147,226) (34,007,464) (33,860,238) 173,721,928 139,861,690 1,377,071 141,238,761 - - (86,568,579) (86,568,579) (1,024,430) (87,593,009) 51,543,453 51,543,453 - 51,543,453 (33,860,238) 138,696,802 104,836,564 352,641 105,189,205 Ending balance as of 12.31.2019 270,737,574 (339,076,340) (14,850,683) (2,230,752) 433,151,626 76,993,851 600,918,265 948,649,690 20,254,258 968,903,948 Issued capital Reserves for exchange rate differences Cash flow hedge reserve Other reserves Actuarial gains or losses in employee benefits Other reserves Total other reserves Retained earnings Controlling Equity Non-Controlling interests Total Equity CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) Opening balance as of 01.01.2018 270,737,574 (237,077,572) (3,094,671) (1,915,587) 427,137,058 185,049,228 335,523,254 791,310,056 21,923,293 813,233,349 Changes in accounting policies - - - - - - 79,499,736 79,499,736 - 79,499,736 Restated opening balance 270,737,574 (237,077,572) (3,094,671) (1,915,587) 427,137,058 185,049,228 415,022,990 870,809,792 21,923,293 892,733,085 Changes in Equity Comprehensive Income Earnings Other comprehensive income Comprehensive income, total Dividends Increase (decrease) from other changes Total changes in equity - - - - - - - - (69,596,956) (10,597,290) (69,596,956) (10,597,290) - - - 23,029 (38,490) (38,490) - - - - - - - - 96,603,371 96,603,371 847,375 97,450,746 (80,232,736) - (80,232,736) (391,154) (80,623,890) (80,232,736) 96,603,371 16,370,635 456,221 16,826,856 - (85,475,291) (85,475,291) (2,477,897) (87,953,188) 6,014,568 6,037,597 36,070,393 42,107,990 - 42,107,990 (69,596,956) (10,574,261) (38,490) 6,014,568 (74,195,139) 47,198,473 (26,996,666) (2,021,676) (29,018,342) Ending balance as of 12.31.2018 270,737,574 (306,674,528) (13,668,932) (1,954,077) 433,151,626 110,854,089 462,221,463 843,813,126 19,901,617 863,714,743 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Direct Cash Flows for the periods between January 1 and December 31, 2019 and 2018 Cash flows provided by (used in) Operating Activities Cash flows provided by Operating Activities Receipts from the sale of goods and the rendering of services (including taxes) Payments for Operating Activities Payments to suppliers for goods and services (including taxes) Payments to and on behalf of employees Other payments for operating activities (value-added taxes on purchases, sales and others) Dividends received Interest payments Interest received Income tax payments Other cash movements (tax on bank debits Argentina and others) Cash flows provided by (used in) Operating Activities Cash flows provided by (used in) Investing Activities Contributions made in associates Proceeds from sale of Property, plant and equipment Purchase of Property, plant and equipment Purchase of intangible assets Proceeds from other long-term assets (redemption of term deposits over 90 days) Payments on forward, term, option and financial exchange agreements Collection on forward, term, option and financial exchange agreements Other payments on the purchase of financial instruments Net cash flows used in Investing Activities Cash Flows generated from (used in) Financing Activities Loan payments Lease liability payments Dividend payments by the reporting entity Other inflows (outflows) of cash (Placement and payment of public obligations) Net cash flows (used in) generated by Financing Activities Net increase in cash and cash equivalents before exchange differences Effects of exchange differences on cash and cash equivalents Effects of exchange differences on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents – beginning of period Cash and cash equivalents - end of period The accompanying notes form an integral part of these Con- solidated Financial Statements 01.01.2019 01.01.2018 NOTE 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 2,626,374,510 2,296,830,656 (1,802,751,639) (1,526,444,730) (203,681,853) (199,460,816) (292,958,045) (267,827,342) 411,041 601,022 (36,141,477) (41,353,013) 1,539,120 3,545,313 (34,198,767) (29,904,176) (3,444,416) (707,552) 255,148,474 235,279,362 - (15,615,466) 18,904 260,116 (110,683,258) (121,063,273) (448,307) - - 13,883,132 1,135,034 6,403,152 - (70,373) (1,953,309) (110,048,000) (118,085,648) (24,035,552) (14,384,131) (2,989,457) (2,395,966) (86,265,896) (87,535,698) (13,821,732) (10,319,483) (127,112,637) (114,635,278) 17,987,837 2,558,436 4,048,168 3,574,340 (2,006,632) (4,836,279) 20,029,373 1,296,497 137,538,613 136,242,116 157,567,986 137,538,613 4 4 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTSUMMARIZED FINANCIAL STATEMENTS - SUBSIDIARIES EMBOTELLADORA ANDINA CHILE S.A. RUT: 76.070.406-7 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 ThCh$ 2018 ThCh$ 19,362 8,270 52,454,914 59,041,413 52,474,276 59,049,683 14,197,314 22,810,544 - -570,806 36,239,123 34,287,329 2,037,839 1,951,810 52,474,276 59,049,683 2,898,833 -496,633 2,402,200 -364,361 2,037,839 3,026,715 -738,154 2,288,561 -336,751 1,951,810 -3,960,370 5,506,384 - - 3,971,987 -5,504,110 - 2,631 14,248 - 357 2,631 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTVITAL JUGOS S.A. RUT: 93.899.000-K Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 18,534,272 16,005,424 15,475,979 16,969,708 34,010,251 32,975,132 11,150,695 11,018,878 274,583 28,298 21,832,281 21,153,490 752,692 774,466 34,010,251 32,975,132 1,067,195 1,001,894 -133,240 933,955 -181,263 752,692 -45,393 956,501 -182,035 774,466 2,629,740 -1,801,136 -347,380 - 15,886 2,083,739 4,381,985 -4,466 - -3,209 3,892,549 2,083,739 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTVITAL AGUAS S.A. RUT: 76.389.720-6 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 5,266,575 8,527,624 13,794,199 5,794,282 2,615,188 4,616,490 5,287,639 9,904,129 3,803,117 171,184 5,068,698 5,820,289 316,031 109,539 13,794,199 9,904,129 589,243 -144,576 444,667 -128,636 316,031 185,324 -388,825 -2,757 243 931,592 725,577 176,171 -61,366 114,805 -5,266 109,539 208,638 88,674 -1,739 -1,036 637,055 931,592 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTENVASES CENTRAL S.A. RUT: 96.705.990-0 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period 2019 2018 CLP (000’s) CLP (000’s) 16,265,862 13,737,336 20,903,184 12,239,333 37,169,046 25,976,669 18,732,369 13,063,735 5,796,119 1,041,400 11,343,718 11,983,836 1,296,840 -112,302 37,169,046 25,976,669 1,933,871 -284,777 1,649,094 -352,254 1,296,840 36,769 -283,128 -246,359 134,057 -112,302 2,208,142 2,666,065 -821,153 -751,783 -54,908 697,380 -1,239,219 -734,583 432 4,685 Balance cash and cash equivalents 1,277,678 697,380 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTTRANSPORTES ANDINA REFRESCOS LTDA. RUT: 78.861.790-9 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 6,321,807 5,030,924 22,071,216 20,806,062 28,393,023 25,836,986 13,009,373 11,926,316 3,188,181 9,164,157 3,031,312 2,812,062 6,867,109 4,231,499 28,393,023 25,836,986 5,300,037 5,571,344 -375,510 4,924,527 147,986 5,719,330 -1,893,215 -1,487,831 3,031,312 4,231,499 10,222,386 9,946,817 -8,352,546 -7,231,059 -1,807,096 -2,684.,739 - 64,914 127,657 - 64,914 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTSERVICIOS MULTIVENDING LTDA. RUT: 78.536.950-5 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 1,507,507 502,480 2,009,987 931,376 59,234 902,012 117,365 1,531,192 660,967 2,192,159 1,254,621 35,364 839,417 62,757 2,009,987 2,192,159 148,173 5,609 153,782 -36,417 117,365 79,683 2,747 82,430 -19,673 62,757 -9,346,861 -4,989,861 -117,730 9,479,195 - 182,555 197,158 1,490,770 3,556,583 - 125,063 182,555 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTANDINA BOTTLING INVESTMENTS S.A. (1) RUT: 96.842.970-1 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents (1) Inversiones Los Andes Ltda. (ILA) se fusionó en Andina Bottling Investments S.A. (ABISA) 2019 2018 CLP (000’s) CLP (000’s) 11,224,575 2,361 740,560,722 433,239,566 751,785,297 433,241,927 12,865,896 - 2,483 - 716,236,570 415,085,837 22,682,831 18,153,607 751,785,297 433,241,927 -495,792 -387,493 23,178,623 18,541,100 22,682,831 18,153,607 - - 22,682,831 18,153,607 -13,733 -101,069 - - 55,147 2,361 43,775 - - 102,557 873 2,361 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTANDINA BOTTLING INVESTMENTS DOS S.A. RUT: 96.972.760-9 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 363,579,906 255,925,557 328,827,154 267,098,850 692,407,060 523,024,407 894,817 -379,357 377,044,214 - 579,687,762 132,774,782 112,203,838 13,205,411 692,407,060 523,024,407 -408,056 -274,446 117,146,038 17,170,351 116,737,982 16,895,904 -4,534,145 -3,690,494 112,203,838 13,205,410 261,870 -303,535 - - -53,014 18,328 227,183 - - 312,122 9,741 18,328 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTANDINA INVERSIONES SOCIETARIAS S.A. RUT: 96.836.750-1 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 347,305 313,828 31,290,917 30,576,986 31,638,221 30,890,814 10,003 - 10,568 - 30,244,033 30,013,931 1,384,185 866,315 31,638,221 30,890,814 -9,228 1,372,029 1,362,801 21,384 -93,584 959,906 866,322 -7 1,384,185 866,315 -19,481 -184,577 - - 1,634 34,735 16,888 - - 1,093 218,219 34,735 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTRIO DE JANEIRO REFRESCOS LTDA. CNPJ: 00.074.569/0001-00 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 171,349,293 135,259,768 786,979,234 679,183,347 958,328,527 814,443,115 124,248,587 128,146,943 506,297,573 420,218,066 244,637,973 229,207,313 83,144,394 36,870,792 958,328,527 814,443,115 93,737,398 75,412,555 26,228,373 -28,452,775 119,965,771 46,959,780 -36,821,377 -10,088,988 83,144,394 36,870,792 63,392,475 44,949,860 -21,343,312 -32,536,213 -25,654,792 -5,099,823 1,754,638 -1,073,404 28,040,970 21,800,551 46,189,979 28,040,970 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTEMBOTELLADORA DEL ATLÁNTICO S.A. CUIT: 30-52913594-3 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 73,309,861 78,222,876 160,885,628 156,224,157 234,195,489 234,447,033 66,987,371 82,148,269 12,732,620 15,897,476 129,943,683 115,096,882 24,531,815 21,304,406 234,195,489 234,447,033 31,345,849 35,341,079 -176,488 3,460,256 31,169,361 38,801,335 -6,637,546 -17,496,929 24,531,815 21,304,406 29,642,160 28,560,174 -23,616,114 -27,428,696 -616,475 -467,414 -10,644,812 -3,494,326 6,691,037 19,698,698 11,633,194 6,691,037 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTANDINA EMPAQUES ARGENTINA S.A. CUIT: 30-71213488-3 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 4,350,074 9,433,294 4,329,932 9,251,800 13,783,368 13,581,732 2,212,255 618,031 8,999,058 1,954,024 2,309,810 1,169,270 9,643,672 458,980 13,783,368 13,581,732 2,932,310 -713,567 2,218,743 -264,719 1,954,024 3,017,688 -1,181,183 1,836,505 -1,377,525 458,980 798,601 339,283 -1,174,638 -1,272,037 - 560,700 98,963 283,626 - 38,141 993,576 98,963 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTABISA CORP S.A. N° DE REGISTRO: 512410 / RUT: 59.144.140-K Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 318,439,511 317,440,017 - - 318,439,511 317,440,017 288,330 288,359 - - 317,151,687 315,912,102 999,495 1,239,556 318,439,511 317,440,017 - 999,495 999,495 - 208,000 1,031,556 1,239,556 - 999,495 1,239,556 -961 - - 95 2,272 1,406 -612 - - 162 2,722 2,272 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTTRANSPORTES POLAR S.A. RUT: 96.928.520-7 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 808,327 7,074,398 7,882,725 3,114,075 1,298,051 2,365,549 1,105,050 7.882,725 406,520 7,249,659 7,656,179 2,992,765 1,299,350 2,397,534 966,530 7,656,179 1,518,307 1,329,724 -314 1,517,993 -412,943 1,105,050 1,512,634 -484,683 -998,514 - 7,037 36,474 10,463 1,340,187 -373,657 966,530 1,027,231 -327,465 -797,797 - 105,068 7,037 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTACONCAGUA INVESTING LTDA. N° DE REGISTRO: 569101 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) - - 21,856,527 21,856,527 21,856,527 21,856,527 8,906 - 8,908 - 21,847,621 21,847,619 - - 21,856,527 21,856,527 - - - - - - - - - - - - - - - - - - - - - - HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTPARAGUAY REFRESCOS S.A RUT: 80.003.400-7 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 41,266,559 37,309,706 248,309,451 248,751,791 289,576,010 286,061,496 25,990,081 21,870,719 16,161,177 16,323,385 218,749,025 222,237,028 28,675,727 25,630,364 289,576,010 286,061,496 33,393,186 29,860,172 -112,728 371,066 33,280,459 30,231,238 -4,604,732 -4,600,874 28,675,727 25,630,364 16,010,813 11,394,620 -13,454,124 -9,684,466 -489,302 -53,673 -330,067 941,206 11,101,685 8,780,393 13,115,400 11,101,685 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTRED DE TRANSPORTES COMERCIALES LTDA. RUT: 76.276.604-3 Ended at December 31, 2019 and 2018 BALANCE SHEET Assets Current assets Non-current assets Total assets Liabilities Current liabilities Non-current liabilities Capital and reserves Profit (loss) for the fiscal year Total liabilities and equity STATEMENT OF INCOME Operating income Non-operating income Income (loss) before taxes Income tax expenses Profit (Loss)) STATEMENT OF CASH FLOWS Operating cash flow Investment cash flow Financing cash flow Effects of exchange rate variation on cash and cash equivalents Cash and cash equivalents at the beginning of the period Balance cash and cash equivalents 2019 2018 CLP (000’s) CLP (000’s) 2,503,234 487,976 2,991,210 1,411,365 31,091 1,319,594 229,160 2,991,210 233,020 -114,038 118,982 110,178 229,160 80,769 29,723 -30,448 - 450,227 530,271 2,526,991 377,646 2,904,637 1,811,657 118,691 1,390,115 -415,826 2,904,637 -199,875 -61,123 -260,998 -154,828 -415,826 77,611 15,745 -32,767 - 389,637 450,227 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTHOME ANALYSIS OF THE FINANCIAL STATEMENTS 9 1 0 2 A D A R G E T N I L A U N A A I R O M E M 1 2 ANDINA AT A GLANCE OUR HISTORY 3 SUSTAINABLE VALUE CREATION STRATEGY 4 VALUE CREATION 5 WE OPERATE WITH INTEGRITY 6 OUR PRINCIPAL METRICS 7 CORPORATE INFORMATION 8 EXHIBITS ACCUMMULATED RESULTS: as of the 4th Quarter 2019 vs. accumulated results as of the 4th Quarter 2018 Figures of the following analysis are set according to IFRS, in nominal Chilean pesos, both for consolidated results and for the results of each of our operations. All variations with respect to 2018 are nominal. It is worth mentioning that the devaluation of local currencies with respect to the U.S. dollar has a negative impact on our dollarized costs and that the devaluation of local currencies with respect to the Chilean peso has a negative impact on the consolidation of figures. In addition, according to IAS 29, for the Argentine case, the translation of figures from the local currency to the reporting currency was carried out using closing exchange rates for the translation to Chilean pesos of 12.5 CLP/ARS, which is compared to 18.4 CLP/ARS for the same period of the previous year, thus generating a negative impact on the consolidation of figures. Argentina's figures in local currency referred to in this section, for both 2018 and 2019, are all expressed in December 2019 currency. The following table shows the exchange rates used: Exchange rates used Local currency /USD (Average Exchange rate) CLP/local currency (Average Exchange rate*) Argentina Brazil Chile Paraguay *Except Argentina, where the closing exchange rate is used, pursuant to IAS 29 FY19 48.2 3.95 703 6,240 FY18 28.1 3.65 638 5,732 FY18 18.4 174.6 N.A. 0.11 FY19 12.5 178.1 N.A. 0.11 Consolidated Results Consolidated Sales Volume reached 746.4 million unit cases, representing a 0.6% decrease with respect to the same period of 2018, mainly explained by the volume decrease in the Argentine franchise, partly offset by volume increases in Brazil, Chile and Paraguay. On the other hand, transactions reached 3,931.2 million, representing a 0.4% increase. Consolidated Net Sales reached CLP 1,779,025 million, an increase of 6.3%. Consolidated Cost of Sales increased by 8.3%, which is mainly explained by (i) the effect of greater volume sold in Brazil and Chile, (ii) the devaluation of the Argentine Peso and Paraguayan Guarani on our dollarized costs, (iii) a greater cost of concentrate in Brazil, and (iv) a shift in the mix towards products carrying a higher unit cost in Brazil and Chile. The foregoing was partially offset by the lower cost of sugar in the four countries where we operate, and by lower Sales Volume in Argentina. Consolidated Distribution Costs and Administrative Expenses increased by 2.8%, which is mainly explained by (i) greater freight costs in Brazil, Chile and Paraguay, (ii) greater labor costs in Brazil, Chile and Paraguay, and (iii) greater advertising expenses in Brazil, Chile and Paraguay. This was partially offset by (i) the effect of lower volumes on distribution expenses in Argentina, and (ii) lower labor expenses and services provided by third parties, which grew below local inflation in Argentina. The foregoing mentioned impacts, led to a Consolidated Operating Income of CLP 237,781 million, an increase of 5.5%. Operating Margin was 13.4%. Consolidated Adjusted EBITDA reached CLP 348,869 million, an increase of 7.4%. Adjusted EBITDA Margin was 19.6%, an expansion of 19 basis points. Net Income attributable to the owners of the controller was CLP 173,722 million, a 79.8% growth and Net Margin reached 9.8%. Argentina: Sales Volume decreased by 11.7% reaching 178.2 million unit cases. On the other hand, transactions reached 842.3 million, which represents an 8.5% decrease. Net Sales reached CLP 394,636 million, a 4.6% decrease while in local currency, Net Sales decreased by 9.2%, which was mainly explained by the already mentioned decrease in sales volume, partially offset by price increases performed during the period. Cost of Sales decreased 0.1%. In local currency it decreased by 4.9%, which is mainly explained by (i) lower sales volume, (ii) lower sugar costs, and (iii) lower labor costs. This was partly offset by the effect of the devaluation of the Argentine peso on our dollarized costs. Distribution Costs and Administrative Expenses decreased by 6.9% in the reporting currency. In local currency they decreased by 11.4% which is mainly explained by (i) the effect of lower volumes over distribution expenses, (ii) lower labor expenses and services provided by third parties, which grew below local inflation, and (iii) the reversal of a local tax-related provision. The foregoing mentioned impacts, led to an Operating Income of CLP 32,039 million, a 19.4% decrease. Operating Margin was 8.1%. In local currency Operating Income decreased by 23.3%. Adjusted EBITDA reached CLP 57,408 million, a 4.7% decrease. Adjusted EBITDA Margin was 14.5%, a contraction of 2 basis points. On the other hand, Adjusted EBITDA in local currency decreased by 9.3%. Brazil Sales Volume grew by 4.1%, reaching 259.3 million unit cases. The volume growth is explained by the volume growth in the soft drinks, water and beer categories and partially offset by the volume decrease in the juice category. On the other hand, transactions reached 1,360.7 million, which represents a 6.2% increase. Net Sales reached CLP 619,321 million, a 14.6% increase, mainly explained by the increase in average prices and greater sales volume. In local currency, Net Sales increased by 13.2% regarding the same period of the previous year, mainly explained by an increase in average prices and greater sales volume. Cost of Sales increased by 16.8%, while in local currency it increased by 15.4%, which is mainly explained by (i) greater concentrate costs due to the decrease of Manaus IPI (lower tax credit) and the price increases we have performed, (ii) greater volume sold, and (iii) the shift in the mix towards products carrying a greater unit price, such as beer. Distribution Costs and Administrative Expenses increased by 9.7% in the reporting currency, and in local currency they increased by 8.2%. This is mainly explained by (i) greater advertising expenses, (ii) greater distribution freight expenses, and (iii) greater labor expenses. The foregoing mentioned impacts, led to an Operating Income of CLP 90,185 million, a 13.5% increase. Operating Margin was 14.5%. In local currency, Operating Income increased by 12.3%. Adjusted EBITDA reached CLP 120,131 million, a 13.0% increase regarding the previous year. Adjusted EBITDA Margin was 19.4%, a contraction of 27 basis points. In local currency Adjusted EBITDA increased by 11.7%. Chile Sales Volume reached 239.6 million unit cases, representing a 3.5% increase, explained by the growth of all categories. On the other hand, transactions reached 1,314.2 million, representing a 0.6% increase. Net Sales reached CLP 608,952 million, a 6.7% growth, explained by greater sales volume and the increase in average prices. Cost of Sales increased by 6.8%, which is mainly explained by greater volume sold and the shift in the mix towards products that carry a higher unit cost. This was partially offset by a lower cost of sugar. Distribution Costs and Administrative Expenses increased by 6.2% which is mainly explained by (i) greater labor expenses, (ii) greater distribution expenses and (iii) greater advertising expenses. The foregoing mentioned impacts, led to an Operating Income of CLP 87,978 million, 7.1% higher when compared to the previous year. Operating Margin was 14.4%. Adjusted EBITDA reached CLP 134,083 million, increasing by 7.7%. Adjusted EBITDA Margin was 22.0%, an expansion of 22 basis points. Paraguay Sales Volume reached 69.3 million unit cases, representing an increase of 1.7%, explained by the volume increase of all categories. On the other hand, transactions reached 414.0 million, which represents a 1.4% increase. Net Sales reached CLP 158,892 million, an increase of 6.2%. In local currency Net Sales increased by 5.1%, which is explained by price increases performed during the period and the already mentioned increase in Sales Volume. Cost of Sales increased by 4.0% and in local currency it increased by 2.9%. This is mainly explained by the negative impact of the devaluation of local currency on our dollarized costs, which was partially offset by the reduction in sweetener costs. Distribution Costs and Administrative Expenses increased by 7.5% in the reporting currency. In local currency they increased by 6.5%, which is mainly explained by (i) greater labor expenses, (ii) higher freight expenses, and (iii) greater advertising expenses. The foregoing effects led to an Operating Income of CLP 32,451 million, 11.6% higher when compared to the previous year. Operating Margin was 20.4%. In local currency Operating Income increased by 10.0%. Adjusted EBITDA reached CLP 42,119 million, 7.9% higher when compared to the previous year and Adjusted EBITDA Margin was 26.5%, an expansion of 42 basis points. In local currency Adjusted EBITDA increased by 6.6%. NYSE: AKO/A; AKO/B BOLSA DE COMERCIO DE SANTIAGO: ANDINA-A; ANDINA-B www.koandina.com -2- CONSOLIDATED BALANCE SHEET The balance of assets and liabilities as of the closing dates of these financial statements are: Assets Current assets Non-current assets Total Assets Liabilities Current liabilities Non-current liabilities Total Liabilities Equity Non-controlling interests Equity attributable to the owners of the controller Total Equity 12.31.2018 CLP million 481,587 1,732,919 2,214,505 12.31.2018 CLP million 419,862 930,928 1,350,790 12.31.2018 CLP million 19,902 843,813 863,715 12.31.2019 CLP million 533,474 1,857,474 2,390,948 12.31.2019 CLP million 411,658 1,010,386 1,422,044 12.31.2019 CLP million 20,254 948,650 968,904 Variation CLP million 51,887 124,555 176,443 Variation CLP million -8,204 79,458 71,255 Variation CLP million 353 104,836 105,189 At the closing of December 2019, regarding the closing of December 2018, the Argentine peso, and the Paraguayan guarani depreciated against the Chilean peso, by 47.4% and 0.5%, respectively. This generated a decrease in assets, liabilities and equity accounts, due to the effect of translation of figures. On the other hand, the Brazilian real appreciated by 3.5% against the Chilean peso, compared to the closing of 2018, generating an increase in assets, liabilities and equity accounts. Assets Total assets increased by CLP 176,443 million, 8.0% compared to December 2018. Current assets increased by CLP 51,887 million, 10.8% compared to December 2018, which is mainly explained by an increase in Cash and Cash Equivalents (CLP 20,029 million) and an increase Accounts in Trade Accounts and Other Receivable, current (CLP 16,965 million) mainly due to the recognition of tax credits in Brazil (short-term). The mentioned increases are added to the increase in Other Current Non-Financial Assets (CLP 10,240 million) due to the reclassification of advances to suppliers of Trade Accounts and Other Accounts Receivable, current to this account. On the other hand, non-current assets increased by CLP 124,555 million, 7.2% compared to December 2018, which is mainly explained by the increase in Other Non-Current Non-Financial Assets (CLP 90,659 million), mainly due to the recognition of tax credits in Brazil (long-term). Added to the previous increase is the increase in Other Non-Current Financial Assets (CLP 13,422 million), mainly explained by the effect of the depreciation of the Brazilian Real against the U.S. dollar during the period, which increased the mark to market of cross currency swaps, and the increase in Property, Plant and Equipment (CLP 11,948 million). The increase in Property, plant and equipment is due to investments made in the period (CLP 94,449 million), mainly investments in packaging and cases, market assets (coolers) and other production investments, and the effect of adopting IAS 16 beginning January 1, 2019 on this item, which has meant recognizing rights-of-use. Property, plant and equipment increases are partially offset by depreciation. Liabilities and Equity In total, liabilities increased by CLP 71,255 million, 5.3% compared to December 2018. Current liabilities decreased by CLP 8,204 million, 2.0% regarding December 2018, which is explained by the decrease in Other Current Financial Liabilities (-CLP 15,521 million) mainly due to the decline in net debt between banks and the public, and the decrease in Other Current Non-Financial Liabilities (-CLP 7,272 million). The mentioned decreases are partially offset by the increase in Current Accounts Payable to Related Entities (CLP 7,810 million) due to higher accounts payable of our Brazilian subsidiary, and by the increase in Trade Accounts and Other Accounts Payable, current (CLP 5,591 million). On the other hand, non-current liabilities increased by CLP 79,458 million, 8.5% compared to December 2018, mainly due to the increase in Other Non-Current Financial Liabilities (CLP 26,763 million), mainly explained by the debt restatement in UFs and U.S. dollars, and by the increase in liabilities for the recognition of rights-of-use given the adoption of IAS 16. Added to the previous increase is the increase in Deferred Tax Liabilities (CLP 24,204 million), which is mainly explained by the recognition of tax credits in Brazil, and the increase in Non- NYSE: AKO/A; AKO/B BOLSA DE COMERCIO DE SANTIAGO: ANDINA-A; ANDINA-B www.koandina.com -3- Current Accounts payable to Related Companies (CLP 19,778 million) due to higher accounts payable between our subsidiary in Brazil with the TCCC subsidiary in the same country, related to the recognition of tax credits in Brazil. As for total equity, it increased by CLP 105,189 million, 12.2% compared to December 2018, explained by Retained Income (CLP 138,697 million), which are the result of the earnings obtained in the period (CLP 173,722 million), the increase given the application of IAS 29 in Argentina associated with equity balances (CLP 51,543 million), which are partially offset by dividend payments (-CLP 86,568 million). The increase in Retained Income was partially offset by the decrease in Other Reserves (-CLP 33,861 million), due to the effect of translating figures from foreign subsidiaries upon consolidation, due to exchange rate differences. FINANCIAL ASSETS AND LIABILITIES Total financial assets amounted to USD 342 million. Excluding the market valuation effect of Cross Currency Swaps ("CCS"), financial assets amounted to USD 210 million, which are invested in time deposits and short-term fixed income mutual funds. In terms of exposure to currency, without considering derivatives, financial assets are 37.0% denominated in Chilean pesos, 29.3% in Brazilian real, 22.8% in U.S. dollars, 8.3% in Paraguayan guarani and 2.6% in Argentine pesos. Financial debt level reached USD 1,047 million, of which USD 364 million correspond to a bond in the international market, USD 625 million to bonds in the local Chilean market, and USD 58 million to bank debt. Financial debt, including the CCS effect, is denominated 59.8% in UF, 36.7% in Brazilian real, 2.5% in Chilean pesos, 0.6% in U.S. dollars, 0.1% in Argentine pesos and 0.2% in Paraguayan guarani. The Company's Net Debt, including the aforementioned CCS effect, reached USD 704 million. CASH FLOW Cash Flow Operating Investment Financing Net Cash Flow for the period 12.31.2018 CLP million 235,279 -118,086 -114,635 2,558 12.31.2019 CLP million 255,148 -110,048 -127,112 17,988 Variation CLP million 19,869 8,038 -12,477 15,430 % 8.4% -6.8% 10.9% 603.2% During the present period, the Company generated a positive net cash flow of CLP 17,988 million, which is explained as follows: Activo Corriente Pasivo Corriente Operating activities generated a positive net cash flow of CLP 255,148 million, higher than the CLP 235,279 million recorded in the same period of 2018, which is mainly due to higher collections from clients partially offset by higher payments to suppliers. Investment activities generated a negative cash flow of CLP 110,048 million, with a positive variation of CLP 8,038 million compared to the previous year, which is mainly explained by lower purchases of property, plant and equipment. Financing activities generated a negative cash flow of CLP 127,112 million, decreasing CLP 12,477 million regarding the previous year, which is mainly explained by greater financial expenses in Chile for interest payments. MAIN INDICATORS INDICATOR Definition Unit Dec 19 Dec 18 Dec 19 vs Dec 18 LIQUIDITY Current Liquidity Acid Ratio ACTIVITY Investments Current Asset Current Liability Times Current Asset - Inventory Times Current Liability 1.3 0.9 1.1 0.8 13.0% 19.2% CLP million 116,171 128,908 -9.9% Inventory Turnover Cost of Sales Times 7.0 6.8 2.4% Average Inventory NYSE: AKO/A; AKO/B BOLSA DE COMERCIO DE SANTIAGO: ANDINA-A; ANDINA-B www.koandina.com -4- INDEBTEDNESS Indebtedness Ratio Financial Expenses Coverage Total Liabilities Times 1.5 1.6 -6.2% Minority Interest + Equity EBIT* Times 225.5 4.0 5,542.4% Net Debt/Adjusted EBITDA Net Debt Times 1.5 1.7 -10.6% Fin. Expenses – Fin. Income PROFITABILITY On Equity On Total Assets Adjusted EBITDA* Net Income for the fiscal year* Average Equity Net Income for the Fiscal year* Average Assets % % 19.4% 11.8% 7.6 pp 7.5% 4.5% 3.1 pp *Value corresponds to the sum of the last 12 moving months. Equity corresponds to equity attributable to the owners of the controller. EBIT is the result before taxes and interest. Liquidity Current Liquidity recorded a positive variation of 13.0% regarding December 2018, explained by the 10.8% increase in current assets, which is mainly explained by the increase in Cash and Cash Equivalents, Current Trade Accounts and Other Accounts Receivable and Other Current Non-Financial Assets previously mentioned. Added to this is the 2.0% decrease in current liabilities. Acid Ratio recorded a 19.2% increase regarding December 2018, due to the above-mentioned reasons in addition to a 2.4% decrease in inventories. Thereby, current assets excluding inventories recorded a 16.8% increase when compared to December 2018. Activity At the closing of December 2019, investments reached CLP 116,171 million, representing a 9.9% decrease compared to the closing of 2018. Of the total of 2019, CLP 21,722 million correspond to the effects of adopting IAS 16, since the standard implied the recognition of right-of- use for that amount. Excluding the effects of IAS 16, investments decreased by 26.7%, which is mainly explained by lower investments in the Duque de Caxias plant. Inventory Turnover reached 7.0x, recording a 2.4% increase versus the closing of 2018, because cost of sales recorded a higher increase (8.3%) than that of average inventory (5.8%). Indebtedness Indebtedness ratio reached 1.5x as of the closing of December 2019, representing a 6.2% decrease regarding the closing of December 2018. This is due to the 12.2% increase in total equity compared to December 2018, which was partially offset by the 5.3% increase in total liabilities, mainly because of the effects of recognizing tax credits in Brazil on our non-current liabilities, as previously mentioned. The Financial Expenses Coverage indicator records an increase of 5,542.4 % when compared to December 2018, mainly due to higher financial income which is mainly explained by the recognition of tax credit in Brazil, given that the restatement of said credit is accounted for as financial income. Net Debt/Adjusted EBITDA was 1.5x, which represents a 10.6% decrease versus December 2018. The foregoing is mainly due to the 7.4% increase of Adjusted EBITDA added to the 4.1% decrease of Net Debt compared to December 2018, mainly explained by the increase in Cash and Cash Equivalents and the decrease of Other Current Financial Liabilities. Profitability Profitability on Equity reached 19.4%, increasing 7.6 percentage points compared to December 2018. This result is due to the increase in Net Income for the Fiscal Year was higher than that of Average Equity, showing variations of 79.8% and 9.6%, respectively. Meanwhile, Profitability on Total Assets was 7.5%, 3.1 percentage points higher than the indicator measured in December 2018, mainly explained by the increase in Net Income for the Fiscal Year. NYSE: AKO/A; AKO/B BOLSA DE COMERCIO DE SANTIAGO: ANDINA-A; ANDINA-B www.koandina.com -5- HOME MATERIAL EVENTS 9 1 0 2 A D A R G E T N I L A U N A A I R O M E M 1 2 ANDINA AT A GLANCE OUR HISTORY 3 SUSTAINABLE VALUE CREATION STRATEGY 4 VALUE CREATION 5 WE OPERATE WITH INTEGRITY 6 OUR PRINCIPAL METRICS 7 CORPORATE INFORMATION 8 EXHIBITS 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 March 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : EMBOTELLADORA ANDINA S.A. : 00124 : 91.144.000-8 MATERIAL EVENT By virtue of the stipulations in Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30, Section II of the Chilean Superintendence of Securities and Insurance, and being duly empowered to this effect by the Board of Directors, I hereby report the following regarding Embotelladora Andina S.A. (the “Company”), its business, its securities or tender offer, as a material event: The following was resolved, among other matters, at a Company’s Regular Board of Directors’ Meeting held February 28, 2019: I. II. To convene a Regular Shareholders Meeting (the “Meeting”) for April 17, 2019, at 10:00 a.m., at Company’s offices located at Av. Miraflores Nº9153, Borough of Renca, Santiago. The following matters will be discussed at the Regular Shareholders Meeting: 1) 2) 3) 4) 5) 6) 7) 8) 9) The Annual Report, Balance and Financial Statements for the year 2018; as well as the Report of Independent Auditors with respect to the Financial Statements; Earnings distribution and dividend payments; Present Company dividend distribution policy and inform about the distribution and payment procedures utilized; Determine the compensation for directors, Directors’ Committee members pursuant to article 50 bis of Chilean Corporation’s Law and of the members of the Audit Committee required by Sarbanes & Oxley Act of the United States; their annual reports and expenses incurred by both Committees; Appoint the Company’s independent auditors for the year 2019; Appoint the Company’s rating agencies for the year 2019; Report on Board agreements which took place after the last Shareholders Meeting, relating to operations referred to by article 146 and following of Chilean Corporation’s Law; Determine the newspaper where regular and special shareholder meetings notices and invitations shall be published; and In general, to resolve every other matter under its competency and any other matter of Company interest. III. Propose to Shareholders the distribution of a Final Dividend charged against 2018 fiscal year, for the following amounts: a) Ch$21.50 (twenty one point fifty Chilean pesos) per each Series A Shares; and b) Ch$23.65 (twenty-three point sixty five Chilean pesos) per each Series B Shares. If the Shareholders’ Meeting approves payment of these dividends, they will be paid beginning on May 30, 2019. The Shareholders’ Registry would close on the fifth business day prior to the payment date, for payment of these dividends. Propose to Shareholders the distribution of an Additional Dividend on account of accumulated earnings, for the following amounts: 2 a) Ch$21.50 (twenty one point fifty Chilean pesos) per each Series A Shares; and b) Ch$23.65 (twenty-three point sixty five Chilean pesos) per each Series B Shares. If the Shareholders’ Meeting approves payment of these additional dividends, they will be paid beginning on August 29, 2019. The Shareholders’ Registry would close on the fifth business day prior to the payment date, for payment of these dividends. Santiago, March 1°, 2019. Jaime Cohen Arancibia Corporate Legal Officer Embotelladora Andina S.A. 3 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. SIGNATURES /s/ Jaime Cohen EMBOTELLADORA ANDINA S.A. By: Name: Jaime Cohen Title: Chief Legal Officer Santiago, March 1°, 2019 4 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 April 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : : : EMBOTELLADORA ANDINA S.A. 00124 91.144.000-8 MATERIAL EVENT By virtue of the stipulations in Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of the Chilean Superintendence of Securities and Insurance, (Comisión para el Mercado Financiero), and being duly empowered to this effect by the Board of Directors, I hereby report the following regarding Embotelladora Andina S.A. (the “Company”), its business, its securities or tender offer, as a material event: The following resolutions were adopted at the General Shareholders’ Meeting held on April 17, 2019, among others: 1. The approval of the Annual Report, Statements of Financial Position and Financial Statements for the year 2019; as well as the Report of Independent Auditors with respect to the previously mentioned Financial Statements; 2. The approval of earnings distribution and dividend payments; 3. The approval of Company dividend distribution policy and the distribution and payment procedures utilized; 4. The approval of compensation for Directors and members of the Directors’ Committee pursuant to Chilean Corporate Law and members of the Audit Committee established pursuant to the Sarbanes-Oxley Act; their annual report and expenses incurred by both Committees; 5. The appointment of Ernst & Young as the Company’s independent auditors for the year 2019; 6. The appointment of Fitch Chile Clasificadora de Riesgo Limitada and International Credit Rating Clasificadora de Riesgo Limitada as the Company’s local rating agencies and Fitch Ratings, Inc. and Standard Poor’s Global Ratings as the Company’s international rating agencies, for the year 2019; 7. The approval of the report on Board agreements in accordance with articles 146 and forward of Chilean Corporate Law, regarding operations that took place after the last General Shareholders’ Meeting; and, 8. The appointment of Diario Financiero, as the newspaper where Company notices and shareholders’ meetings announcements should be published. Regarding number 2 above, the Shareholders’ Meeting approved payment of a Final Dividend on account of 2018 Fiscal Year and an Additional dividend on account of retained earnings in the following amounts: Final Dividend Ch$21.50 (twenty one point fifty Chilean pesos) per each Series A Shares; and Ch$23.65 (twenty-three point sixty five Chilean pesos) per each Series B Shares. 1 Payment of this final dividend will be available beginning May 30, 2019. The Shareholders’ Registry will close on the fifth business day prior to payment date. Additional Dividend Ch$21.50 (twenty one point fifty Chilean pesos) per each Series A Shares; and Ch$23.65 (twenty-three point sixty five Chilean pesos) per each Series B Shares. Payment of this additional dividend will be available beginning August 29, 2019. The Shareholders’ Registry will close on the fifth business day prior to payment date. Santiago, April 18, 2019. Jaime Cohen Arancibia Corporate Legal Officer Embotelladora Andina S.A. 2 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. SIGNATURES Santiago, April 18, 2019 /s/ Jaime Cohen EMBOTELLADORA ANDINA S.A. By: Name: Jaime Cohen Title: Chief Legal Officer 3 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 April 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. MATERIAL EVENT : EMBOTELLADORA ANDINA S.A. : 00124 : 91.144.000-8 By virtue of the stipulations in Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of Chile’s Superintendence of Securities and Insurance, and being duly empowered to this effect, I hereby report the following regarding Embotelladora Andina S.A. (the “Company”), its business, its securities or tender offer, as a material event: On April 24, 2019, the Company´s Board of Directors was informed that Mr. Manuel Arroyo tendered his resignation as member of the Board. Such resignation is due to personal reasons, and it will be effective immediately. At the Board´s meeting held on the same date, and pursuant to article 71 of Corporations Law Regulations (Reglamento de Sociedades Anónimas), the Board of Directors appointed Mr. Roberto Mercadé as his successor, who shall exercise his duties until the next Ordinary Shareholders Meeting. Santiago, April 25, 2019 Jaime Cohen Arancibia Chief Legal Officer Embotelladora Andina S.A. 2 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. SIGNATURES Santiago, April 25, 2019 /s/ Jaime Cohen EMBOTELLADORA ANDINA S.A. By: Name: Jaime Cohen Title: Chief Legal Officer 3 MATERIAL EVENT CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : : : EMBOTELLADORA ANDINA S.A. 00124 91.144.000-8 By virtue of Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of the Chilean Superintendence of Security and Insurance (Comisión para el Mercado Financiero), and duly empowered, I hereby report the following information with respect to Embotelladora Andina S.A. (“Andina” or the “Company”), its business, its securities and their offer, as material event: I hereby inform that Andina, jointly with Coca-Cola Embonor S.A. (“Embonor”), are currently in negotiations with Empresa Cooperativa Agrícola y Pisquera Elqui Ltda. and Viña Francisco de Aguirre S.A. (together, the “Producers”), for purposes of settling the terms and conditions of a distribution agreement for the distribution of the products of the Producers in the national territory (the “Agreement”). Among the brands of products to be distributed are Alto del Carmen®, Capel®, Artesanos del Cochiguaz®, Monte Fraile®, Sensus®, Inca de Oro® and Francisco de Aguirre®, among others. The eventual execution of the Agreement is part of the Company´s growth and product portfolio diversification strategy, initiated in 2018, by joining the commercialization and distribution of alcoholic beverages market. The eventual execution of the Agreement will be subject to the parties involved reaching an agreement, and that all corporate and contractual authorizations required are obtained, which will be then duly informed. Likewise, the financial effects that might be derived from the Agreement will be informed once the Agreement is subscribed. Santiago, July 20, 2019. Jaime Cohen Arancibia Corporate Legal Officer Embotelladora Andina S.A. 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 August 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : : : EMBOTELLADORA ANDINA S.A. 00124 91.144.000-8 MATERIAL EVENT By virtue of Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of the Comisión para el Mercado Financiero, and duly empowered, I hereby report the following information with respect to Embotelladora Andina S.A. (“Andina” or the “Company”), as a material event: I hereby inform that today, Andina, on one side, and Empresa Cooperativa Agrícola y Pisquera Elqui Ltda. and Viña Francisco de Aguirre S.A. (both together, the “Producers”), on the other, entered into a Distribution Agreement for the distribution of the products of the Producers in the Chilean territories of the Metropolitan Region, the Province of San Antonio and the Province of Cachapoal, as well as the Regions of Antofagasta, Atacama, Coquimbo, Aysén and Magallanes (the “Agreement”). Among the brands of products to be distributed are Alto del Carmen , Capel , Artesanos del Cochiguaz , Monte Fraile , Sensus , Inca de Oro and Francisco de Aguirre , among others. ® ® ® ® ® ® ® The Agreement is part of the Company´s growth and product portfolio diversification strategy, initiated in 2018, by joining the commercialization and distribution of alcoholic beverages market. Considering that the incremental sales volume of this transaction and the selling price of the products to be distributed are still unknown, it is not possible for us to determine the potential effect of the Agreement on the Company's financial statements. Santiago, August 21, 2019. Jaime Cohen Arancibia Corporate Legal Officer Embotelladora Andina S.A. 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. SIGNATURES Santiago, August 21, 2019 EMBOTELLADORA ANDINA S.A. /s/ Jaime Cohen By: Name: Jaime Cohen Title: Chief Legal Officer 3 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 October 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : EMBOTELLADORA ANDINA S.A. : : 00124 91.144.000-8 MATERIAL EVENT By virtue of the stipulations in Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of Chile’s Superintendence of Securities and Insurance, and being duly empowered to this effect, I hereby report the following regarding Embotelladora Andina S.A. (the “Company”), its business, its securities or tender offer, as a material event: INTERIM DIVIDEND As authorized by the Regular Shareholders’ Meeting held April 17, 2019, the Board of Directors during session held September 24, 2019, agreed to distribute the following amounts as interim dividend: a) Ch$21.50 (twenty one point fifty Chilean pesos) per each Series A Shares; and b) Ch$23.65 (twenty-three point sixty five Chilean pesos) per each Series B Shares. This dividend will be paid on account of income from the 2019 fiscal year and will be available to shareholders beginning October 24, 2019. The Shareholders’ Registry will close on the fifth business day prior to the payment date. Santiago, October 1, 2019 Jaime Cohen Arancibia Chief Legal Officer Embotelladora Andina S.A. 2 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. SIGNATURES Santiago, October 1, 2019 EMBOTELLADORA ANDINA S.A. /s/ Jaime Cohen By: Name:Jaime Cohen Title: Chief Legal Officer 3 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 December 2019 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. Miraflores 9153 Renca 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 (cid:95) Form 40-F (cid:134) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) 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 (cid:134) No (cid:95) CORPORATE NAME SECURITIES REGISTRY TAXPAYER I.D. : : : EMBOTELLADORA ANDINA S.A. 00124 91.144.000-8 MATERIAL EVENT By virtue of the stipulations in Article 9 and subparagraph 2 of Article 10 of Law 18,045, and the provisions in General Rule No. 30 of Chile’s Superintendence of Securities and Insurance, and being duly empowered to this effect, I hereby report the following regarding Embotelladora Andina S.A. (the “Company”), its business, its securities or tender offer, as a material event: INTERIM DIVIDEND As authorized by the Regular Shareholders’ Meeting held April 17, 2019, the Board of Directors during session held December 20, 2019, agreed to distribute the following amounts as interim dividend: a) Ch$22.60 (twenty two point sixty Chilean pesos) per each Series A Shares; and b) Ch$24.86 (twenty-four point eighty six Chilean pesos) per each Series B Shares. This dividend will be paid on account of income from the 2019 fiscal year and will be available to shareholders beginning January 23, 2019. The Shareholders’ Registry will close on the fifth business day prior to the payment date. Santiago, December 20, 2019 Jaime Cohen Arancibia Chief Legal Officer Embotelladora Andina S.A. 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. SIGNATURES EMBOTELLADORA ANDINA S.A. /s/ Jaime Cohen By: Name: Jaime Cohen Title: Chief Legal Officer Santiago, December 20, 2019 HOME CONSOLIDATED FINANCIAL STATEMENTS AT 12.31.2019 AND 2018 Consolidated Statements of Financial Position at December 31, 2019 and 2018 Consolidated Statement of Changes in Equity for the periods between January 1 and December 31, 2019 and 2018 Consolidated Income Statement by Function for the periods between January 1 and December 31, 2019 and 2018 Consolidated Statements of Direct Cash Flows for the periods between January 1 and December 31, 2019 and 2018 Consolidated Statement of Comprehensive Income for the periods between January 1 and December 31, 2019 and 2018 Notes to the Consolidated Financial Statements 9 1 0 2 A D A R G E T N I L A U N A A I R O M E M External Auditor Report 1 2 ANDINA AT A GLANCE OUR HISTORY 3 SUSTAINABLE VALUE CREATION STRATEGY 4 VALUE CREATION 5 WE OPERATE WITH INTEGRITY 6 OUR PRINCIPAL METRICS 7 CORPORATE INFORMATION 8 EXHIBITS EY Chile Avda. Presidente Riesco 5435, piso 4, Santiago Tel: +56 (2) 2676 1000 www.eychile.cl Assurance Limited Statement of Embotelladora Andina 2019 Integrated Report (free translation from the original in Independent Spanish) To the President and Directors of Embotelladora Andina Scope Our Responsibility We have performed an engagement on Embotelladora Andina 2019 Integrated Report. independent the information and data presented limited assurance in Preparation of the Integrated Report is the responsibility of the Management of Embotelladora Andina. The Management of Embotelladora Andina is also responsible for the data and affirmations included in the Integrated Report, definition of the scope and management and control of the information systems that have provided the reported information. Standards and Assurance Procedures Our review has been performed in accordance with the International Standard on Assurance Engagements ISAE 3000, established by the International Auditing and Assurance Board of the International Federation of Accountants and the version GRI Standards of the guidelines for the preparation of sustainability reports under the Global Reporting Initiative (GRI). We conducted our assurance procedures in order to: ► Determine whether the information and data presented in Integrated Report are duly supported by the 2019 evidence. ► Verify the traceability of the information disclosed by Embotelladora Andina in its 2019 Integrated Report. ► Determine whether Embotelladora Andina has prepared its 2019 Integrated Report in accordance with the Content and Quality Principles of the GRI Standards. ► Confirm Embotelladora Andina self-declared “Core” option of the GRI Standards to its report. Work Performed the Our assurance procedures Management of Embotelladora Andina the development of the Integrated Report process, in addition to other analytical procedures and sampling methods as described below: included enquiries involved to in Our responsibility is limited to the procedures mentioned above, corresponding to a limited assurance which is the basis for our conclusions. Conclusions Subject to our limitations of scope noted previously and based on our procedures for this limited assurance of Embotelladora Andina Integrated Report, we conclude that nothing has come to our attention that would cause us to believe that: ► The information and data disclosed in Embotelladora Andina 2019 Integrated Report are not presented fairly. ► Embotelladora Andina 2019 Integrated Report has not been prepared in accordance with the GRI Standards for the preparation of sustainability reports under the Global Reporting Initiative. ► The Embotelladora Andina self-declared option does not meet the GRI Standards requirements for this option. Improvement Recommendations Without affecting our conclusions as set out above, we have detected some improvement opportunities for Embotelladora Andina 2019 Integrated Report, which are detailed in a recommendations report presented to Embotelladora Andina Administration. . Truly Yours, EY Consulting SpA ► Interviews with key Embotelladora Andina personnel to assess the 2019 Integrated Report preparation process, the definition of its content and its underlying information systems. Elanne Almeida March 23th, 2020 I-00616/16 ► Review of Embotelladora Andina. supporting documents provided by ► Review of formulas and calculations by recalculation. ► Review of the 2019 Integrated Report to ensure its phrasing and format does not mislead the reader regarding the information presented. 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 December 2019 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. Miraflores 9153 Renca 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 (cid:95)(cid:3)Form 40-F (cid:133) 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 (cid:133)(cid:3)No (cid:95) 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 (cid:133)(cid:3)No (cid:95) 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 (cid:133)(cid:3)No (cid:95) Consolidated Financial Statements EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Santiago, Chile as of December 31, 2019, and December 31, 2018 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Financial Statements Independent auditor´s report I. II. Consolidated Statements of Financial Position as of December 31, 2019 and 2018 III. Consolidated Statements of Income by Function For the periods ended December 31, 2019 and 2018 IV. Consolidated Statements of Comprehensive Income For the periods ended December 31, 2019 and 2018 V. Consolidated Statements of Changes in Equity For the periods ended December 31, 2019 and 2018 VI. Consolidated Statements of Direct Cash Flows For the periods ended December 31, 2019 and 2018 VII.Notes to the Consolidated Financial Statements Corporate information Presentation bases of consolidated financial statements and applicable accounting criteria Financial information by segment Cash and cash equivalents Other financial assets, current and non-current Other non-financial assets, current and non-current Trade debtors Inventory Tax assets and liabilities Income tax and deferred taxes Property, plant and equipment Related parties Employee benefits, current and non-current Investments accounted for using the equity method Intangible assets other than goodwill 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. Goodwill 17. Other financial liabilities, current and non-current 18. 19. Other provisions, current and non-current 20. Other non-financial liabilities 21. 22. Assets and liabilities for derivative instruments 23. 24. 25. 26. Other income 27. Other expenses by function 28. Income and financial costs 29. Other (loss) gains 30. 31. 32. Litigations and contingencies Financial risk management Expenses by nature Local and foreign currency Environment Subsequent events Trade accounts payable and other accounts payable Equity 1 3 4 5 6 7 7 8 28 31 31 32 33 34 35 35 38 41 43 45 47 49 49 61 61 62 62 66 68 72 76 76 76 77 77 78 82 82 Independent Auditor’s Report (Translation of the report originally issued in Spanish) To Shareholders and Directors Embotelladora Andina S.A. We have audited the accompanying consolidated financial statements of Embotelladora Andina S.A. and subsidiaries (“the Company”), which comprise the consolidated statement of financial position as of December 31, 2019 and 2018, and the related consolidated statements of comprehensive income, changes in shareholders’ equity, and cash flows for the years then ended, and the related notes to the consolidated financial statements. Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in Chile. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion on the Regulatory Basis of Accounting In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Embotelladora Andina S.A. and subsidiaries as of December 31, 2019 and 2018, and the results of their operations and their cash flows for the years then ended in accordance with International Financial Reporting Standards. Tatiana Ramos S. EY Audit SpA Santiago February 25, 2020 Consolidated Financial Statements EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES As of December 31, 2019, and 2018 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Financial Position ASSETS Current assets: Cash and cash equivalents Other financial assets Other non-financial assets Trade and other accounts receivable, net Accounts receivable from related companies Inventory Current tax assets Total Current Assets Non-Current Assets: Other financial assets Other non-financial assets Trade and other receivables Accounts receivable from related parties Investments accounted for under the equity method Intangible assets other than goodwill Goodwill Property, plant and equipment Deferred tax assets Total Non-Current Assets Total Assets NOTE 12.31.2019 CLP (000’s) 12.31.2018 CLP (000’s) 4 5 6 7 12.1 8 9 5 6 7 12.1 14 15 16 11 10.2 157,567,986 347,278 16,188,965 191,077,588 10,835,768 147,641,224 9,815,294 533,474,103 137,538,613 683,567 5,948,923 174,113,323 9,450,263 151,319,709 2,532,056 481,586,454 110,784,311 125,636,150 523,769 283,118 99,866,733 675,075,375 121,221,661 722,718,863 1,364,340 1,857,474,320 2,390,948,423 97,362,295 34,977,264 1,270,697 74,340 102,410,945 668,822,553 117,229,173 710,770,968 - 1,732,918,235 2,214,504,689 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 1 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Financial Position LIABILITIES AND EQUITY LIABILITIES Current Liabilities: Other financial liabilities Trade and other accounts payable Accounts payable to related parties Provisions Income taxes payable Employee benefits current provisions Other non-financial liabilities Total Current Liabilities Other financial liabilities, non-current Accounts payable, non-current Accounts payable to related companies, non-current Other provisions, non-current Deferred tax liabilities Employee benefits non-current provisions Non-Current Liabilities: Equity: Issued capital Retained earnings Other reserves Equity attributable to equity holders of the parent Non-controlling interests Total Equity Total Liabilities and Equity NOTE 12.31.2019 CLP (000’s) 12.31.2018 CLP (000’s) 17 18 12.2 19 9 13 20 17 18 12.2 19 10.2 13 21 40,593,878 243,700,553 53,637,601 2,068,984 6,762,267 38,392,854 26,502,215 411,658,352 743,327,057 619,587 19,777,812 67,038,566 169,449,747 10,173,354 1,010,386,123 56,114,977 238,109,847 45,827,859 3,485,613 9,338,612 33,210,979 33,774,214 419,862,101 716,563,778 735,665 - 58,966,913 145,245,948 9,415,541 930,927,845 270,737,574 600,918,265 76,993,851 948.649.690 20,254,258 968,903,948 2,390,948,423 270,737,574 462,221,463 110,854,089 843,813,126 19,901,617 863,714,743 2,214,504,689 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 2 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Income by Function For the periods ended Net sales Cost of sales Gross Profit Other income Distribution expenses Administrative expenses Other expenses Other (loss) gains Financial income Financial expenses Share of profit (loss) of investments in associates and joint ventures accounted for using the equity method Foreign exchange differences Income by indexation units Net income before income taxes Income tax expense Net income Net income attributable to Owners of the controller Non-controlling interests Net income Earnings per Share, basic and diluted Earnings per Series A Share Earnings per Series B Share NOTE 8 26 25 25 27 29 28 28 14.3 10.1 01.01.2019 12.31.2019 CLP (000’s) 1,779,025,115 (1,048,343,767) 730,681,348 40,947,158 (166,996,289) (325,903,809) (26,182,847) 2,876 45,155,791 (46,209,020) 01.01.2018 12.31.2018 CLP (000’s) 1,672,915,799 (968,027,774) 704,888,025 2,609,168 (165,775,484) (313,742,853) (16,057,763) (2,707,859) 3,940,244 (55,014,660) (3,415,083) (4,130,543) (7,536,466) 236,413,116 (61,166,891) 175,246,225 1,411,179 (1,449,256) (5,085,140) 153,015,601 (55,564,855) 97,450,746 173,721,928 1,524,297 175,246,225 96,603,371 847,375 97,450,746 21.5 21.5 CLP CLP 174.79 192.27 97.20 106.92 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 3 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Comprehensive Income For the periods ended Net income Other Comprehensive Income: Components of other comprehensive income that will not be reclassified to net income for the period, before taxes Actuarial losses from defined benefit plans Components of other comprehensive income that will be reclassified to net income for the period, before taxes Gain (losses) from exchange rate translation differences Gain (losses) from cash flow hedges Income tax related to components of other comprehensive income that will not be reclassified to net income for the period Income tax benefit related to defined benefit plans Income tax related to components of other comprehensive income that will be reclassified to net income for the period Income tax related to exchange rate translation differences Income tax related to cash flow hedges Other comprehensive income, total Total comprehensive income Total comprehensive income attributable to: Equity holders of the controller Non-controlling interests Total comprehensive income 01.01.2019 12.31.2019 CLP (000’s) 175,246,225 01.01.2018 12.31.2018 CLP (000’s) 97,450,746 (379,007) (63,463) (41,844,584) (1,865,233) (72,455,525) (13,151,841) 102,332 16,184 9,295,545 683,483 (34,007,464) 141,238,761 2,476,204 2,554,551 (80,623,890) 16,826,856 139,861,690 1,377,071 141,238,761 16,370,635 456,221 16,826,856 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 4 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Changes in Equity As of December 31, 2019, and 2018 as of December 31, 2019, and 2018 Other reserves Actuarial gains or losses in employee benefits Issued capital Reserves for exchange rate differences Cash flow hedge reserve Total Equity CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 863,714,743 270,737,574 (1,954,077) 433,151,626 (306,674,528) (13,668,932) 110,854,089 462,221,463 843,813,126 19,901,617 Other reserves Total other reserves Retained earnings Controlling Equity Non- Controlling interests - - - - - (32,401,812) (32,401,812) - (1,181,751) (1,181,751) - - (276,675) (276,675) - - - - - 173,721,928 - (33,860,238) - (33,860,238) 173,721,928 (86,568,579) - 173,721,928 (33,860,238) 139,861,690 (86,568,579) 1,524,297 (147,226) 1,377,071 (1,024,430) 175,246,225 (34,007,464) 141,238,761 (87,593,009) - - 270,737,574 - (32,401,812) (339,076,340) - (1,181,751) (14,850,683) - (276,675) - - (2,230,752) 433,151,626 - 51,543,453 (33,860,238) 138,696,802 600,918,265 76,993,851 51,543,453 104,836,564 948,649,690 - 352,641 20,254,258 51,543,453 105,189,205 968,903,948 Other reserves Actuarial gains or losses in employee benefits Cash flow hedge reserve Reserves for Total other exchange rate differences Total Equity reserves CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 813,233,349 (1,915,587) 427,137,058 185,049,228 335,523,254 791,310,056 (237,077,572) 79,499,736 79,499,736 - (1,915,587) 427,137,058 185,049,228 415,022,990 870,809,792 (237,077,572) 892,733,085 (3,094,671) - (3,094,671) Non- Controlling interests 21,923,293 - 21,923,293 Controlling Equity Retained earnings Other reserves 79,499,736 - - - Issued capital CLP (000’s) 270,737,574 - 270,737,574 - - - - - (69,596,956) (69,596,956) - - (10,597,290) (10,597,290) - - (38,490) (38,490) - - - - - - (80,232,736) (80,232,736) - 96,603,371 - 96,603,371 (85,475,291) 96,603,371 (80,232,736) 16,370,635 (85,475,291) 847,375 (391,154) 456,221 (2,477,897) 97,450,746 (80,623,890) 16,826,856 (87,953,188) - - 270,737,574 - (69,596,956) (306,674,528) 23,029 (10,574,261) (13,668,932) - (38,490) 42,107,990 6,037,597 (26,996,666) (74,195,139) (1,954,077) 433,151,626 110,854,089 462,221,463 843,813,126 36,070,393 47,198,473 6,014,568 6,014,568 - (2,021,676) 19,901,617 42,107,990 (29,018,342) 863,714,743 Opening balance as of 01.01.2019 Changes in Equity Comprehensive Income Earnings Other comprehensive income Comprehensive income Dividends Increase (decrease) from other changes Total changes in equity Ending balance as of 12.31.2019 Opening balance as of 01.01.2018 Changes in accounting policies Restated opening balance Changes in Equity Comprehensive Income Earnings Other comprehensive income Comprehensive income, total Dividends Increase (decrease) from other changes Total changes in equity Ending balance as of 12.31.2018 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 5 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Consolidated Statements of Direct Cash Flows As of December 31, 2019, and 2018 Cash flows provided by (used in) Operating Activities NOTE Cash flows provided by Operating Activities Receipts from the sale of goods and the rendering of services (including taxes) Payments for Operating Activities Payments to suppliers for goods and services (including taxes) Payments to and on behalf of employees Other payments for operating activities (value-added taxes on purchases, sales and others) Dividends received Interest payments Interest received Income tax payments Other cash movements (tax on bank debits Argentina and others) Cash flows provided by (used in) Operating Activities Cash flows provided by (used in) Investing Activities Contributions made in associates Proceeds from sale of Property, plant and equipment Purchase of Property, plant and equipment Purchase of intangible assets Proceeds from other long-term assets (redemption of term deposits over 90 days) Payments on forward, term, option and financial exchange agreements Collection on forward, term, option and financial exchange agreements Other payments on the purchase of financial instruments Net cash flows used in Investing Activities Cash Flows generated from (used in) Financing Activities Loan payments Lease liability payments Dividend payments by the reporting entity Other inflows (outflows) of cash (Placement and payment of public obligations) Net cash flows (used in) generated by Financing Activities Net increase in cash and cash equivalents before exchange differences Effects of exchange differences on cash and cash equivalents Effects of exchange differences on cash and cash equivalents Net decrease in cash and cash equivalents Cash and cash equivalents – beginning of period Cash and cash equivalents - end of period 4 4 01.01.2019 12.31.2019 CLP (000’s) 01.01.2018 12.31.2018 CLP (000’s) 2,626,374,510 2,296,830,656 (1,802,751,639) (1,526,444,730) (199,460,816) (203,681,853) (292,958,045) 411,041 (36,141,477) 1,539,120 (34,198,767) (3,444,416) 255,148,474 (267,827,342) 601,022 (41,353,013) 3,545,313 (29,904,176) (707,552) 235,279,362 - 18,904 (110,683,258) (448,307) (15,615,466) 260,116 (121,063,273) - - 1,135,034 (70,373) (110,048,000) 13,883,132 6,403,152 - (1,953,309) (118,085,648) (24,035,552) (2,989,457) (86,265,896) (14,384,131) (2,395,966) (87,535,698) (13,821,732) (127,112,637) 17,987,837 4,048,168 (2,006,632) 20,029,373 137,538,613 157,567,986 (10,319,483) (114,635,278) 2,558,436 3,574,340 (4,836,279) 1,296,497 136,242,116 137,538,613 The accompanying notes 1 to 32 form an integral part of these Consolidated Financial Statements 6 EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES Notes to the Consolidated Financial Statements 1 - CORPORATE INFORMATION Embotelladora Andina S.A. RUT (Chilean Tax Id. N°) 91.144.000-8 (hereinafter “Andina,” and together with its subsidiaries, the “Company”) is an open stock corporation, whose corporate address and principal offices are located at Miraflores 9153, borough of Renca, Santiago, Chile. The Company is registered under No. 00124 of the Securities Registry and is regulated by Chile’s Financial Market Commission (hereinafter “CMF”) and pursuant to Chile’s Law 18,046 is subject to the supervision of this entity. It is also registered with the U.S. Securities and Exchange Commission (hereinafter “SEC”) and its stock is traded on the New York Stock Exchange since 1994. The principal activities of Embotelladora Andina S.A. are to manufacture, bottle, commercialize and/or distribute Coca-Cola products and brands registered by The Coca-Cola Company (“TCCC”). The Company has operations and is licensed by The Coca- Cola Company in its territories Chile, Brazil, Argentina and Paraguay. In Chile, the geographic areas in which the Company has distribution franchises are the Metropolitan Region II Region of Antofagasta, III Region of Atacama, IV Region of Coquimbo, the Province of San Antonio, V Region of Valparaiso, the province of Cachapoal, VI Region del Libertador General Bernardo O’Higgins, XI Region de Aysén del General Carlos Ibáñez del Campo; and XII Region of Magallanes and Chilean Antartic.. In Brazil, its territories include the city of Rio de Janeiro and the central and northern parts of the state of Rio de Janeiro, the city of Vitória and the whole state of Espirito Santo and the city of Ribeirão Preto and part of the state of Sao Paulo and Minas Gerais. In Argentina, the territories include Mendoza, Córdoba, San Luis, Entre Ríos, Santa Fe, Rosario, Santa Cruz, Neuquén, El Chubut, Tierra del Fuego, Río Negro, La Pampa and the western zone of the Province of Buenos Aires. In Paraguay, the franchised territory covers the whole country. License agreements for the territories in Chile expire in October 2023. In Argentina they expire in 2022; in Brazil they expire in 2022 and in Paraguay they expire in 2020. Said licenses are renewable upon the request of the licensee and at the sole discretion of The Coca-Cola Company. As of the date of these consolidated financial statements, regarding Andina’s principal shareholders, the Controlling Group holds 55.72% of the outstanding shares with voting rights, corresponding to the Series A shares. The Controlling Group is composed of the Chadwick Claro, Garcés Silva, Hurtado Berger, Said Handal and Said Somavía families, who control the Company in equal parts. These Consolidated Financial Statements reflect the consolidated financial position of Embotelladora Andina S.A. and its subsidiaries, which were approved by the Board of Directors on February 25, 2020. 7 2 - BASIS OF PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS AND APPLICATION OF ACCOUNTING CRITERIA 2.1 Accounting principles and basis of preparation The Company’s Consolidated Financial Statements for the periods ended December 31, 2019 and 2018, have been prepared in accordance with the International Financial Reporting Standards (hereinafter "IFRS") issued by the International Accounting Standards Board (hereinafter "IASB"). These Consolidated Financial Statements have been prepared following the going concern principle by applying the historical cost method, with the exception, according to IFRS, of those assets and liabilities that are recorded at fair value. These Consolidated Statements reflect the consolidated financial position of Embotelladora Andina S.A. and its Subsidiaries as of December 31, 2019 and 2018 and the results of operations for the periods between January 1 and December 31, 2019 and 2018, together with the statements of changes in equity and cash flows for the periods between January 1 and December 31, 2019 and 2018. These Consolidated Financial Statements have been prepared based on the accounting records maintained by the Parent Company and by the other entities that are part of the Company and are presented in thousands of Chilean pesos (unless expressly stated) as this is the functional and presentation currency of the Company. Foreign operations are included in accordance with the accounting policies established in Notes 2.5. 2.2 Subsidiaries and consolidation Subsidiary entities are those companies directly or indirectly controlled by Embotelladora Andina. Control is obtained when the Company has power over the investee, when it has exposure or is entitled to variable returns from its involvement in the investee and when it has the ability to use its power to influence the amount of investor returns. They include assets and liabilities, results of operations, and cash flows for the periods reported. Income or losses from subsidiaries acquired or sold are included in the Consolidated Financial Statements from the effective date of acquisition through the effective date of disposal, as applicable. The acquisition method is used to account for the acquisition of subsidiaries. The consideration transferred for the acquisition of the subsidiary is the fair value of assets transferred, equity securities issued, liabilities incurred or assumed on the date that control is obtained. Identifiable assets acquired, and identifiable liabilities and contingencies assumed in a business combination are accounted for initially at their fair values at the acquisition date. Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If the consideration is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the income statement. Intercompany transactions, balances and unrealized gains on transactions between Group entities are eliminated. Unrealized losses are also eliminated. When necessary, the accounting policies of the subsidiaries are modified to ensure uniformity with the policies adopted by the Group. The interest of non-controlling shareholders is presented in the consolidated statement of changes in equity and the consolidated statement of income by function under "Non-Controlling Interest" and “Earnings attributable to non-controlling interests", respectively. 8 The consolidated financial statements include all assets, liabilities, income, expenses, and cash flows of the Company and its subsidiaries after eliminating balances and transaction among the Group’s entities, the subsidiary companies included in the consolidation are the following: Company Name Direct 12.31.2019 Indirect Ownership interest Total Direct 12.31.2018 Indirect Total Taxpayer ID 59.144.140-K Foreign 96.842.970-1 96.972.760-9 Foreign 96.836.750-1 76.070.406-7 Foreign 96.705.990-0 96.971.280-6 Foreign 76.276.604-3 Foreign 78.536.950-5 78.861.790-9 96.928.520-7 76.389.720-6 93.899.000-k Abisa Corp S.A. Aconcagua Investing Ltda. Andina Bottling Investments S.A. Andina Bottling Investments Dos S.A. Andina Empaques Argentina S.A. Andina Inversiones Societarias S.A. Embotelladora Andina Chile S.A. Embotelladora del Atlántico S.A. Envases Central S.A. Inversiones Los Andes Ltda. (1) Paraguay Refrescos S.A. Red de Transportes Comerciales Ltda. Rio de Janeiro Refrescos Ltda. Servicios Multivending Ltda. Transportes Andina Refrescos Ltda. Transportes Polar S.A. Vital Aguas S.A. Vital Jugos S.A. (1) Company merged into Andina Bottling Investments SA. 99.99 99.28 0.09 0.09 99.98 0.01 - 99.07 - - 97.75 0.09 99.99 0.09 0.09 - - 50.00 99.99 99.99 99.99 99.99 99.98 99.99 99.99 99.99 59.27 - 97.83 99.99 99.99 99.99 99.99 99.99 66.50 65.00 - 0.71 99.90 99.90 - 99.98 99.99 0.92 59.27 99.9 0.08 99.90 - 99.90 99.90 99.99 66.50 15.00 99.99 99.28 0.09 0.09 99.98 0.01 - 99.07 - - 97.75 0.09 99.99 0.09 0.09 - - 50.00 99.99 99.99 99.99 99.99 99.98 99.99 99.99 99.99 59.27 99.9 97.83 99.99 99.99 99.99 99.99 99.99 66.50 65.00 - 0.70 99.90 99.90 - 99.98 99.99 0.92 59.27 - 0.08 99.90 - 99.90 99.90 99.99 66.50 15.00 9 2.3 Investments in associates and joint ventures Ownership interest held by the Group in joint ventures and associates are recorded following the equity method. According to the equity method, the investment in an associate or joint venture is initially recorded at cost. As of the date of acquisition, the investment in the statement of financial position is recorded by the proportion of its total assets, which represents the Group's participation in its capital, once adjusted, where appropriate, the effect of the transactions made with the Group, plus capital gains that have been generated in the acquisition of the company. Dividends received from these companies are recorded by reducing the value of the investment and the results obtained by them, which correspond to the Group according to its ownership, are recorded under the item “Participation in profit (loss) of associates accounted for by the equity method.” 2.3.1 Investments in Associates Associates are all entities over which the Group exercises significant influence but does not have control, significant influence is the power to intervene in the financial and operating policy decisions of the associate, without having control or joint control over it. The results of these associates are accounted for using the equity method. Accounting policies of the associates are changed, where necessary, to ensure conformity with the policies adopted by the Company and unrealized gains are eliminated. 2.3.2 Joint arrangements Joint arrangements are those entities in which the Group exercises control through an agreement with other shareholders and jointly with them, that is, when decisions on their relevant activities require the unanimous consent of the parties that share control. Depending on the rights and obligations of the parties, joint arrangements are classified as: - - Joint venture: agreement whereby the parties exercising joint control are entitled to the net assets of the entity. Joint ventures are integrated into the consolidated financial statements by the equity method, as described above. Joint operation: agreement whereby the parties exercising joint control are entitled to the assets and obligations with respect to the liabilities related to the agreement. Joint operations are consolidated by proportionally integrating the assets and liabilities affected by said operation. To determine the type of joint agreement that derives from a contractual agreement, Group Management evaluates the structure and legal form of the agreement, the terms agreed by the parties, as well as other relevant factors and circumstances. Embotelladora Andina does not have joint arrangements that qualify as a joint operation business. 2.4 Financial reporting by operating segment “IFRS 8 Operating Segments” requires that entities disclose information on the results of operating segments. In general, this is information that Management and the Board of Directors use internally to assess performance of segments and allocate resources to them. Therefore, the following operating segments have been determined based on geographic location: (cid:120) Operation in Chile (cid:120) Operation in Brazil (cid:120) Operation in Argentina (cid:120) Operation in Paraguay 10 2.5 Functional currency and presentation currency 2.5.1 Functional currency Items included in the financial statements of each of the entities in the Company are measured using the currency of the primary economic environment in which the entity operates (“functional currency”). The functional currency of each of the Operations is the following: Company Functional currency Embotelladora del Atlántico Embotelladora Andina Paraguay Refrescos Rio de Janeiro Refrescos Argentine Peso (ARS) Chilean Peso (CLP) Paraguayan Guaraní (PYG) Brazil Real (BRL) Foreign currency-denominated monetary assets and liabilities are converted to the functional currency at the spot exchange rate in effect on the closing date. All differences arising from the liquidation or conversion of monetary items are recorded in the income statement, with the exception of the monetary items designated as part of the hedging of the Group's net investment in a business abroad. These differences are recorded in another overall result until the disposal of the net investment, at which point they are reclassified to the income statement. Tax adjustments attributable to exchange differences in these monetary items are also recognized in another overall outcome. Non-monetary items that are valued at historical cost in a foreign currency are converted using the exchange rate in effect at the date of the initial transaction. Non-monetary items measured at fair value in a foreign currency are converted using the exchange rate in effect at the date on which fair value is determined. Losses or gains arising from the conversion of non-monetary items measured at fair value are recorded in accordance with the recognition of losses or gains arising from the change in the fair value of the respective item (e.g., exchange differences arising from items whose fair value gains or losses are recognized in another overall result or in results are also recognized in another overall result or in results, respectively). Functional currency in hyperinflationary economies Beginning July 2018, Argentina's economy is considered as hyperinflationary, according to the criteria established in the International Accounting Standard No. 29 “Financial information in hyperinflationary economies” (IAS 29). This determination was carried out based on a series of qualitative and quantitative criteria, including an accumulated inflation rate of more than 100% for three years. In accordance with IAS 29, the financial statements of companies in which Embotelladora Andina S.A. participates in Argentina have been retrospectively restated by applying a general price index to the historical cost, in order to reflect the changes in the purchasing power of the Argentine peso, as of the closing date of these financial statements. Non-monetary assets and liabilities were restated since February 2003, the last date an inflation adjustment was applied for accounting purposes in Argentina. In this context, it should be mentioned that the Group made its transition to IFRS on January 1, 2004, applying the attributed cost exemption for Property, plant and equipment. For consolidation purposes in Embotelladora Andina S.A. and as a result of the adoption of IAS 29, the results and financial situation of our Argentine subsidiaries were converted to the closing exchange rate (ARS/CLP) as December 31, 2019, in accordance with IAS 21 "Effects of foreign currency exchange rate variations", when dealing with a hyperinflationary economy. Whereas the functional and presentation currency of Embotelladora Andina S.A. does not correspond to that of a hyperinflationary economy, according to the guidelines set out in IAS 29, the re-expression of periods is not required in the consolidated financial statements of the Group. 11 Inflation for the periods January to December 2019 and 2018 amounted to 54.85% and 47.6%, respectively. The first-time adoption of IAS 29 in 2018 resulted in a positive adjustment in the accumulated consolidated results of Embotelladora Andina S.A., for CLP 79,499,736 thousand (net of deferred taxes) as of January 1, 2018. 2.5.2 Presentation currency The presentation currency is the Chilean peso, which is the functional currency of the parent company, for such purposes, the financial statements of subsidiaries are translated from the functional currency to the presentation currency as indicated below: a. Translation of financial statements whose functional currency does not correspond to hyperinflationary economies (Brazil and Paraguay) Financial statements measured as indicated are translated to the presentation currency as follows: (cid:120) The statement of financial position is translated to the closing exchange rate at the financial statement date and the income statement is translated at the average monthly exchange rates, the differences that result are recognized in equity under other comprehensive income. (cid:120) Cash flow income statement are also translated at average exchange rates for each transaction. (cid:120) In the case of the disposal of an investment abroad, the component of other comprehensive income (OCI) relating to that investment is reclassified to the income statement. b. Translation of financial statements whose functional currency corresponds to hyperinflationary economies (Argentina) Financial statements of economies with a hyperinflationary economic environment, are recognized according to IAS 29 Financial Information in Hyperinflationary Economies, and subsequently converted to Chilean pesos as follows: (cid:120) The statement of financial position sheet is translated at the closing exchange rate at the financial statements date; (cid:120) The income statement is translated at the closing exchange rate at the financial statements date (cid:120) The statement of cash flows is converted to the closing exchange rate at the date of the financial statements. (cid:120) In the case of the disposal of an investment abroad, the component of other comprehensive income (OCI) relating to that investment is reclassified to the income statement. 2.5.3 Exchange rates Exchange rates regarding the Chilean peso in effect at the end of each period are as follows: Date 12.31.2019 12.31.2018 USD 748.74 694.77 BRL 185.76 179.30 ARS PGY 12.50 18.43 0.116 0.117 12 2.6 Property, plant, and equipment The elements of Property, plant and equipment, are valued for their acquisition cost, net of their corresponding accumulated depreciation, and of the impairment losses they have experienced. The cost of the items of Property, plant and equipment include in addition to the price paid for the acquisition: i) the financial expenses accrued during the construction period that are directly attributable to the acquisition, construction or production of qualified assets, which are those that require a substantial period of time before being ready for use, such as production facilities. The Group defines a substantial period as one that exceeds twelve months. The interest rate used is that corresponding to specific financing or, if it does not exist, the weighted average financing rate of the Company making the investment; and ii) personnel expenses directly related to the construction in progress. Construction in progress is transferred to operating assets after the end of the trial period when they are available for use, from which moment depreciation begins. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset only when it is probable that future economic benefits associated with the items of Property, plant and equipment will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. Repairs and maintenance are charged to the income statement in the reporting period in which they are incurred. Land is not depreciated since it has an indefinite useful life. Depreciation on other assets is calculated using the straight-line method to allocate their cost or revalued amounts to their residual values over their estimated useful lives. The estimated useful lives by asset category are: Assets Buildings Plant and equipment Warehouse installations and accessories Furniture and supplies Motor vehicles Other Property, plant and equipment Bottles and containers Range in years 30-50 10-20 10-30 4-5 5-7 3-8 2-8 The residual value and useful lives of Property, plant and equipment are reviewed and adjusted at the end of each fiscal year, if appropriate. When the value of an asset is greater than its estimated recoverable amount, the value is written down immediately to its recoverable amount. Gains and losses on disposals of property, plant, and equipment are calculated by comparing the proceeds to the carrying amount and are charged to other expenses by function or other gains, as appropriate in the statement of comprehensive income. If there are items available for sale and comply with the conditions of IFRS 5 "Non-current assets held for sale and discontinued operations" are separated from Property, plant and equipment and are presented within current assets at the lower value between the book value and its fair value less selling costs. 13 2.7 Intangible assets and Goodwill 2.7.1 Goodwill Goodwill represents the excess of the consideration transferred over the Company’s interest in the net fair value of the net identifiable assets of the subsidiary and the fair value of the non-controlling interest in the subsidiary on the acquisition date. Since goodwill is an intangible asset with indefinite useful life, it is recognized separately and tested annually for impairment. Goodwill is carried at cost less accumulated impairment losses. Gains and losses on the sale of an entity include the carrying amount of goodwill related to that entity. Goodwill is assigned to each cash generating unit (CGU) or group of cash-generating units, from where it is expected to benefit from the synergies arising from the business combination. Such CGUs or groups of CGUs represent the lowest level in the organization at which goodwill is monitored for internal management purposes. 2.7.2 Distribution rights Distribution rights are contractual rights to produce and/or distribute products under the Coca-Cola brand and other brands in certain territories in Argentina, Brazil, Chile and Paraguay that were acquired during Business Combination. Distribution rights are born from the process of valuation at fair value of the assets and liabilities of companies acquired in business combinations. Distribution rights have an indefinite useful life and are not amortized, (as they are permanently renewed by The Coca-Cola Company) and therefore are subject to impairment tests on an annual basis. 2.7.3 Software Carrying amounts correspond to internal and external software development costs, which are capitalized once the recognition criteria in IAS 38, Intangible Assets, have been met. Their accounting recognition is initially realized for their acquisition or production cost and, subsequently, they are valued at their net cost of their corresponding accumulated amortization and of the impairment losses that, if applicable, they have experienced. The aforementioned software is amortized within four years. 2.8 Impairment of non-financial assets Assets that have an indefinite useful life, such as intangibles related to distribution rights and goodwill, are not amortized and are tested annually for impairment or more frequently if events or changes in circumstances indicate a potential impairment. Assets that are subject to amortization are tested for impairment whenever there is an event or change in circumstances indicating that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the carrying value of the asset exceeds its recoverable amount. The recoverable amount is the greater of an asset’s fair value less costs to sell or its value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units - CGU). Regardless of what was stated in the previous paragraph, in the case of CGUs to which capital gains or intangible assets have been assigned with an indefinite useful life, the analysis of their recoverability is carried out systematically at the end of each fiscal year. These indications may include new legal provisions, change in the economic environment that affects business performance indicators, competition movements, or the disposal of an important part of a CGU. 14 Management reviews business performance based on geographic segments. Goodwill is monitored at the operating segment level that includes the different cash generating units in operations in Chile, Brazil, Argentina and Paraguay. The impairment of distribution rights is monitored geographically in the CGU or group of cash generating units, which correspond to specific territories for which Coca-Cola distribution rights have been acquired. These cash generating units or groups of cash generating units are composed of the following segments: - - - - Operation in Chile (excluding the Metropolitan Region, Rancagua Province and San Antonio Province); Operation in Argentina (North and South region); Operation in Brazil (State of Rio de Janeiro and Espirito Santo, Ipiranga territories, investment in the Sorocaba associate and investment in the Leão Alimentos S.A. associate); Operation in Paraguay To check if goodwill has suffered a loss due to impairment of value, the Company compares the book value thereof with its recoverable value, and recognizes an impairment loss, for the excess of the asset's carrying amount over its recoverable amount. To determine the recoverable values of the CGU, management considers the discounted cash flow method as the most appropriate. The main assumptions used in the annual test are: a) Discount rate The discount rate applied in the annual test carried out in December 2019 was estimated using the CAPM (Capital Asset Pricing Model) methodology, which allows estimating a discount rate according to the level of risk of the CGU in the country where it operates. A nominal discount rate before tax is used according to the following table: Argentina Chile Brazil Paraguay Discount rates 2019 Discount rates 2018 35.3% 8.5% 11.4% 11.5% 21.2% 8.1% 10.9% 10.1% Management carries out the process of annual goodwill impairment assessments as of December 31 of each year for each CGU. b) Other assumptions The financial projections to determine the net present value of the future cash flows of the CGUs are modeled based on the main historical variables and the respective budgets approved by the CGU. In this regard, a conservative growth rate is used, which reaches 3% for the carbonated beverage category and up to 7% for less developed categories such as juices and waters. Beyond the fifth year of projection, growth perpetuity rates are established per operation ranging from 1% to 2.5% depending on the degree of maturity of the consumption of the products in each operation. In this sense, the variables with greatest sensitivity in these projections are the discount rates applied in the determination of the net present value of projected cash flows, growth perpetuities and EBITDA margins considered in each CGU. In order to sensitize the impairment test, variations were made to the main variables used in the model. Ranges used for each of the modified variables are: - - - Discount Rate: Increase / Decrease of up to 100 bps as a value in the rate at which future cash flows are discounted to bring them to present value Perpetuity: Increase / Decrease of up to 75 bps in the rate to calculate the perpetual growth of future cash flows EBITDA margin: Increase / Decrease of 100bps of EBITDA margin of operations, which is applied per year for the projected periods, that is, for the years 2020-2024 15 The Company conducts impairment analyses on an annual basis, as a result of tests conducted as of December 31, 2019 and 2018, no signs of impairments in any of the CGUs were identified, assuming conservative EBITDA margin projections in line with market history. Despite the deterioration in macroeconomic conditions experienced by the economies of the countries where cash-generating units operate, the impairment test resulted in recovery values higher than the book values including sensitivity calculations to which it was submitted. 2.9 Financial instruments A financial instrument is any contract that results in the recognition of a financial asset in one entity and a financial liability or equity instrument in another entity. 2.9.1 Financial assets Pursuant to IFRS 9 “Financial Instruments”, except for certain trade accounts receivable, the Group initially measures a financial asset at its fair value plus transaction costs, in the case of a financial asset that is not at fair value, reflecting changes in P&L. According to IFRS 9, financial assets are subsequently measured at (i) fair value with changes in P&L (FVPL), (ii) amortized cost or (iii) fair value through other comprehensive income (FVOCI). The classification is based on two criteria: (a) the Group's business model for the purpose of managing financial assets to obtain contractual cash flows; and (b) if the contractual cash flows of financial instruments represent "solely payments of principal and interest” on the outstanding principal amount (the “SPPI criterion”). The subsequent classification and measurement of the Group's financial assets are as follows: - - Financial asset at amortized cost for financial instruments that are maintained within a business model with the objective of maintaining the financial assets to collect contractual cash flows that meet the SPPI criterion. This category includes the Group’s trade and other accounts receivable. Financial assets measured at fair value with changes in other comprehensive income (FVOCI), with gains or losses recognized in P&L at the time of liquidation. Financial assets in this category correspond to the Group's instruments that meet the SPPI criterion and are kept within a business model both to collect cash flows and to sell. Other financial assets are classified and subsequently measures as follows: - - Equity instruments at fair value with changes in other comprehensive income (FVOCI) without recognizing earnings or losses in P&L at the time of liquidation. This category only includes equity instruments that the Group intends to keep in the foreseeable future and that the Group has irrevocably chosen to classify in this category in the initial recognition or transition. Financial assets at fair value with changes in P&L (FVPL) include derivative instruments and equity instruments quoted that the Group had not irrevocably chosen to classify at FVOCI in the initial recognition or transition. This category also includes debt instruments whose cash flow characteristics do not comply with the SPPI criterion or are not kept within a business model whose objective is to recognize contractual cash flows or sale. 16 A financial asset (or, where applicable, a portion of a financial asset or a portion of a group of similar financial assets) is initially disposed (for example, canceled in the Group's consolidated financial statements) when: - - The rights to receive cash flows from the asset have expired, The Group has transferred the rights to receive the cash flows of the asset or has assumed the obligation to pay all cash flows received without delay to a third party under a transfer agreement; and the Group (a) has substantially transferred all risks and benefits of the asset, or (b) has not substantially transferred or retained all risks and benefits of the asset, but has transferred control of the asset. 2.9.2 Financial Liabilities Financial liabilities are classified as a fair value financial liability at the date of their initial recognition, as appropriate, with changes in results, loans and credits, accounts payable or derivatives designated as hedging instruments in an effective coverage. All financial liabilities are initially recognized at fair value and transaction costs directly attributable are netted from loans and credits and accounts payable. The Group's financial liabilities include trade and other accounts payable, loans and credits, including those discovered in current accounts, and derivative financial instruments. The classification and subsequent measurement of the Group's financial liabilities are as follows: - - Fair value financial liabilities with changes in results include financial liabilities held for trading and financial liabilities designated in their initial recognition at fair value with changes in results. The losses or gains of liabilities held for trading are recognized in the income statement. Loans and credits are valued at cost or amortized using the effective interest rate method. Gains and losses are recognized in the income statement when liabilities are disposed, as well as interest accrued in accordance with the effective interest rate method. A financial liability is disposed of when the obligation is extinguished, cancelled or expires. Where an existing financial liability is replaced by another of the same lender under substantially different conditions, or where the conditions of an existing liability are substantially modified, such exchange or modification is treated as a disposal of the original liability and the recognition of the new obligation. The difference in the values in the respective books is recognized in the statement of income. 2.9.3 Offsetting financial instruments Financial assets and financial liabilities are offset with the corresponding net amount presenting the corresponding net amount in the statement of financial position, if: - - There is currently a legally enforceable right to offset the amounts recognized, and It is intended to liquidate them for the net amount or to realize the assets and liquidate the liabilities simultaneously. 2.10 Derivatives financial instruments and hedging activities The Company and its subsidiaries use derivative financial instruments to mitigate risks relating to changes in foreign currency and exchange rates associated with raw materials, and loan obligations. Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value at each closing date. Derivatives are accounted as financial assets when the fair value is positive and as financial liabilities when the fair value is negative. The method of recognizing the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged. 17 2.10.1 Derivative financial instruments designated as cash flow hedges At the inception of the transaction, the group documents the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items. The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in the consolidated income statement within "other gains (losses)” Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss (for example, when foreign currency denominated financial liabilities are translated into their functional currencies). The gain or loss relating to the effective portion of cross currency swaps hedging the effects of changes in foreign exchange rates are recognized in the consolidated income statement within "foreign exchange differences.” When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in the consolidated income statement. 2.10.2 Derivative financial instruments not designated for hedging The fair value of derivative financial instruments that do not qualify for hedge accounting pursuant to IFRS are immediately recognized in the consolidated income statement under "Other income and losses". The fair value of these derivatives is recorded under "other current financial assets" or "other current financial liabilities" in the statement of financial position.” The Company does not use hedge accounting for its foreign investments. The Company also evaluates the existence of derivatives implicitly in contracts and financial instruments as stipulated by IFRS 9 and classifies them pursuant to their contractual terms and the business model of the group. As of December 31, 2019, the Company had no implicit derivatives. 2.10.3 Fair value hierarchy Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the date of the transaction. Fair value is based on the presumption that the transaction to sell the asset or to transfer the liability takes place; - - In the asset or liability main market, or In the absence of a main market, in the most advantageous market for the transaction of those assets or liabilities. The Company maintains assets related to foreign currency derivative contracts which were classified as Other current and non- current financial assets and Other current and non-current financial liabilities, respectively, and are accounted at fair value within the statement of financial position. The Company uses the following hierarchy to determine and disclose the fair value of financial instruments with assessment techniques: Level 1: Quote values (unadjusted) in active markets for identical assets or liabilities Level 2: Valuation techniques for which the lowest level variable used, which is significant for the calculation, is directly or indirectly observable Level 3: Valuation techniques for which the lowest level variable used, which is significant for the calculation, is not observable. 18 During the reporting periods there were no transfers of items between fair value measurement categories. All of which were valued during the period using Level 2. 2.11 Inventories Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted average cost method. The cost of finished goods and work in progress includes raw materials, direct labor, other direct costs and manufacturing overhead (based on operating capacity) to bring the goods to marketable condition, but it excludes interest expense. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses. Spare parts and production materials are stated at the lower of cost or net realizable value. The initial cost of inventories includes the transfer of losses and gains from cash flow hedges, recognized under other comprehensive income, related to the purchase of raw materials. Estimates are also made for obsolescence of raw materials and finished products based on turnover and age of the related goods. 2.12 Trade receivables Trade accounts receivables and other accounts receivable are measured and recognized at the transaction price at the time they are generated pursuant to IFRS 15, since they do not have a significant financial component, less provision for expected credit losses. This provision is made applying a value impairment model based on expected credit losses for the following 12 months. The Group applies a simplified focus for trade receivables, thereby impairment is always recorded referring to expected losses during the whole life of the asset. The carrying amount of the asset is reduced by the provision of expected credit losses, and the loss is recognized in administrative expenses in the consolidated income statement by function. 2.13 Cash and cash equivalents Cash and cash equivalents include cash on hand, bank balances, time deposits and other short-term highly liquid and low risk of change in value investments and mutual funds with original short-term maturities equal to or less than three months from the date of acquisition. 2.14 Other financial liabilities Resources obtained from financial institutions as well as the issuance of debt securities are initially recognized at fair value, net of costs incurred during the transaction. Then, liabilities are valued by accruing interests in order to equal the current value with the future value of liabilities payable, using the effective interest rate method. General and specific borrowing costs directly attributable to the acquisition, construction or production of qualified assets, considered as those that require a substantial period of time in order to get ready for their forecasted use or sale, are added to the cost of those assets until the period in which the assets are substantially ready to be used or sold. 19 2.15 Income tax The Company and its subsidiaries in Chile account for income tax according to the net taxable income calculated based on the rules in the Income Tax Law. Subsidiaries in other countries account for income taxes according to the tax regulations of the country in which they operate. Deferred income taxes are calculated using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the Consolidated Financial Statements, using the tax rates that have been enacted or substantively enacted on the balance sheet date and are expected to apply when the deferred income tax asset is realized, or the deferred income tax liability is settled. Deferred income tax assets are recognized only to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilized. The Company does not recognize deferred income taxes for temporary differences from investments in subsidiaries in which the Company can control the timing of the reversal of the temporary differences and it is probable that they will not be reversed in the near future. 2.16 Employee benefits The Company records a liability regarding indemnities for years of service that will be paid to employees in accordance with individual and collective agreements subscribed with employees, which is recorded at actuarial value in accordance with IAS 19 “Employee Benefits”. Results from updated of actuarial variables are recorded within other comprehensive income in accordance with IAS 19. Additionally, the Company has retention plans for some officers, which have a provision pursuant to the guidelines of each plan. These plans grant the right to certain officers to receive a cash payment on a certain date once they have fulfilled with the required years of service. The Company and its subsidiaries have recorded a provision to account for the cost of vacations and other employee benefits on an accrual basis. These liabilities are recorded under current non-financial liabilities. 2.17 Provisions Provisions for litigation and other contingencies are recognized when the Company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation. 20 2.18 Leases In accordance with IFRS 16 “Leases” Embotelladora Andina analyzes, at the beginning of the contract, the economic background of the agreement, to determine if the contract is, or contains, a lease, evaluating whether the agreement transfers the right to control the use of an identified asset for a period of time in exchange for a consideration. Control is considered to exist if the client has i) the right to obtain substantially all the economic benefits from the use of an identified asset; and ii) the right to direct the use of the asset. The Company when operating as a lessee, at the beginning of the lease (on the date the underlying asset is available for use) records an asset for the right-of-use in the statement of financial position (under Property, plant and equipment) and a lease liability (under Other financial liabilities). This asset is initially recognized at cost, which includes: i) value of the initial measurement of the lease liability; ii) lease payments made up to the start date less lease incentives received; iii) the initial direct costs incurred; and iv) the estimation of costs for dismantling or restoration. Subsequently, the right-of-use asset is measured at cost, adjusted by any new measurement of the lease liability, less accumulated depreciation and accumulated losses due to impairment of value. The right-of- use asset is depreciated in the same terms as the rest of similar depreciable assets, if there is reasonable certainty that the lessee will acquire ownership of the asset at the end of the lease. If such certainty does not exist, the asset depreciates at the shortest period between the useful life of the asset or the lease term. On the other hand, the lease liability is initially measured at the present value of the lease payments, discounted at the incremental loan rate of the Company, if the interest rate implicit in the lease could not be easily determined. Lease payments included in the measurement of the liability include: i) fixed payments, less any lease incentive receivable; ii) variable lease payments; iii) residual value guarantees; iv) exercise price of a purchase option; and v) penalties for lease termination. The lease liability is increased to reflect the accumulation of interest and is reduced by the lease payments made. In addition, the carrying amount of the liability is measured again if there is a modification in the terms of the lease (changes in the term, in the amount of payments or in the evaluation of an option to buy or change in the amounts to be paid). Interest expense is recognized as an expense and is distributed among the periods that constitute the lease period, so that a constant interest rate is obtained in each year on the outstanding balance of the lease liability. Short-term leases, equal to or less than one year, or lease of low-value assets are excepted from the application of the recognition criteria described above, recording the payments associated with the lease as an expense in a linear manner throughout the lease term. The Company does not act as lessor. 2.19 Deposits for returnable containers This liability comprises cash collateral, or deposit, received from customers for bottles and other returnable containers made available to them. This liability pertains to the deposit amount that is reimbursed when the customer or distributor returns the bottles and containers in good condition, together with the original invoice. The liability is estimated based on the number of bottles given to clients and distributors, the estimated number of bottles in circulation, and a historical average weighted value per bottle or containers. Deposits for returnable containers are presented as a current liability in other financial liabilities because the Company does not have legal rights to defer settlement for a period in excess of one year. However, the Company does not anticipate any material cash settlements for such amounts during the upcoming year. 21 2.20 Revenue recognition The Company recognizes revenue when control over a good or service is transferred to the client. Control refers to the ability of the client to direct the use and obtain substantially all the benefits of the goods and services exchanged. Revenue is measured based on the consideration to which it is expected to be entitled for such transfer of control, excluding amounts collected on behalf of third parties. Management has defined the following indicators for revenue recognition, applying the five-step model established by IFRS 15 “Revenue from contracts with customers”: 1) Identification of the contract with the customer; 2) Identification of performance obligations; 3) Determination of the transaction price; 4) Assignment of the transaction price; and 5) Recognition of revenue. All the above conditions are met at the time the products are delivered to the customer. Net sales reflect the units delivered at list price, net of promotions, discounts and taxes. The revenue recognition criteria of the good provided by Embotelladora Andina corresponds to a single performance obligation that transfers the product to be received to the customer. 2.21 Contributions of The Coca-Cola Company The Company receives certain discretionary contributions from The Coca-Cola Company (TCCC) mainly related to the financing of advertising and promotional programs for its products in the territories where the Company has distribution licenses. The contribution received from TCCC are recognized in net income after the conditions agreed with TCCC in order to become a creditor to such incentive have been fulfilled, they are recorded as a reduction in the marketing expenses included in the Administration Expenses account. Given its discretionary nature, the portion of contributions received in one period does not imply it will be repeated in the following period. 2.22 Dividend payments Dividend distribution to Company shareholders is recorded as a liability in the Company’s Consolidated Financial Statements, considering the 30% minimum dividend of the period’s earnings established by Chilean Corporate Law, unless otherwise agreed in the respective meeting, by the unanimity of the issued shares. Interim and final dividends are recorded at the time of their approval by the competent body, which in the first case is normally the Board of Directors of the Company, while in the second case it is the responsibility of General Shareholders’ Meeting. 2.23 Critical accounting estimates and judgments The Company makes estimates and judgments concerning the future. Actual results may differ from previously estimated amounts. In preparing the consolidated financial statements, the Company has used certain judgments and estimates made to quantify some of the assets, liabilities, income, expenses and commitments. Following is an explanation of the estimates and judgments that might have a material impact on future financial statements. 22 2.23.1 Impairment of goodwill and intangible assets with indefinite useful lives The Company tests annually whether goodwill and intangible assets with indefinite useful life (such as distribution rights) have suffered any impairment. The recoverable amounts of cash generating units are generating units are determined based on value in use calculations. The key variables used in the calculations include sales volumes and prices, discount rates, marketing expenses and other economic factors including inflation. The estimation of these variables requires a use of estimates and judgments as they are subject to inherent uncertainties; however, the assumptions are consistent with the Company’s internal planning end past results. Therefore, management evaluates, and updates estimates according to the conditions affecting the variables. If these assets are considered to have been impaired, they will be written off at their estimated fair value or future recovery value according to the discounted cash flows analysis. As of December 31, 2019, discounted cash flows in the Company's cash generating units in Chile, Brazil, Argentina and Paraguay generated a higher value than the carrying values of the respective net assets, including goodwill of the Brazilian, Argentinian and Paraguayan subsidiaries. 2.23.2 Fair Value of Assets and Liabilities IFRS requires in certain cases that assets and liabilities be recorded at their fair value. Fair value is the price that would be received for selling an asset or paid to transfer a liability in a transaction ordered between market participants at the date of measurement. The basis for measuring assets and liabilities at fair value are their current prices in an active market. For those that are not traded in an active market, the Company determines fair value based on the best information available by using valuation techniques. In the case of the valuation of intangibles recognized as a result of acquisitions from business combinations, the Company estimates the fair value based on the "multi-period excess earning method", which involves the estimation of future cash flows generated by the intangible assets, adjusted by cash flows that do not come from these, but from other assets. The Company also applies estimations over the period during which the intangible assets will generate cash flows, cash flows from other assets, and a discount rate. Other assets acquired, and liabilities assumed in a business combination are carried at fair value using valuation methods that are considered appropriate under the circumstances. Assumptions include the depreciated cost of recovery and recent transaction values for comparable assets, among others. These valuation techniques require certain inputs to be estimated, including the estimation of future cash flows. 2.23.3 Allowances for doubtful accounts The Group uses a provision matrix to calculate expected credit losses for trade receivables. Provisions are based on due days for various groups of customer segments that have similar loss patterns (i.e. by geography region, product type, customer type and rating, and credit letter coverage and other forms of credit insurance). The provision matrix is initially based on the historically observed non-compliance rates for the Group. The Group will calibrate the matrix to adjust the historical credit loss experience with forward-looking information. For example, if expected economic conditions (i.e. gross domestic product) are expected to deteriorate over the next year, which can lead to more non-compliances in the industry, historical default rates are adjusted. At each closing date, the observed historical default rates are updated and changes in prospective estimates are analyzed. The assessment of the correlation between observed historical default rates, expected economic conditions and expected credit losses are significant estimates. 23 2.23.4 Useful life, residual value and impairment of property, plant, and equipment Property, plant, and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful life of those assets. Changes in circumstances, such as technological advances, changes to the Company’s business model, or changes in its capital strategy might modify the effective useful lives as compared to our estimates. Whenever the Company determines that the useful life of Property, plant and equipment might be shortened, it depreciates the excess between the net book value and the estimated recoverable amount according to the revised remaining useful life. Factors such as changes in the planned usage of manufacturing equipment, dispensers, transportation equipment and computer software could make the useful lives of assets shorter. The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of any of those assets may not be recovered. The estimate of future cash flows is based, among other factors, on certain assumptions about the expected operating profits in the future. The Company’s estimation of discounted cash flows may differ from actual cash flows because of, among other reasons, technological changes, economic conditions, changes in the business model, or changes in operating profit. If the sum of the projected discounted cash flows (excluding interest) is less than the carrying amount of the asset, the asset shall be written-off to its estimated recoverable value. 2.23.5 Liabilities for deposits of returnable container The Company records a liability for deposits received in exchange for bottles and containers provided to its customers and distributors. This liability represents the amount of deposits that must be reimbursed if the customer or distributor returns the bottles and containers in good condition, together with the original invoice. This liability is estimated based on the number of bottles given on loan to customers and distributors, estimates of bottles in circulation and the weighted average historical cost per bottle or container. Management uses professional judgment in order to estimate this liability, including the number of bottles in circulation, the amount of deposit that must be reimbursed and the timing of disbursements. 2.24.1 New Standards, Interpretations and Amendments for annual periods beginning on or after January 1, 2019. Standards and interpretations, as well as the improvements and amendments to IFRS, which have been issued, effective at the date of these financial statements, are detailed below. The Company has applied these rules concluding that they will not significantly affect the financial statements. IFRS 16 IFRIC 23 Standards, Interpretations, Amendments Leases Uncertainty over Income Tax Treatments Mandatory application date January 1, 2019 January 1, 2019 IFRS 16 “Leases” IFRS 16 replaces IAS17 “Leases”, IFRIC 4 “Determining Whether an Arrangement Contains a Lease”, SIC-15 “Operating Leases Incentives” and SIC-27 “Evaluating the Substance of Transactions in the Legal Form of a Lease.” The standard establishes the principles for the recognition, measurement, presentation and disclosure of leases and requires that lessees consider most leases in a single balance sheet model. The lessor's accounting under IFRS 16 remains substantially unchanged from IAS 17. Lessors will continue to classify leases as operating or financial leases using principles similar to those in IAS 17. The Group adopted IFRS 16 using the amended retrospective adoption method, with an initial application date of January 1, 2019. The Group chose to use the transition practice to not re-evaluate whether a contract is, or contains, a lease as of January 1, 2019. Instead, the Group applied the rule only to contracts that were previously identified as leases applying IAS 17 and IFRIC 4 on the date of initial application. The Group also chose to use the recognition exemptions for leases that, on the start date, have a lease term of 12 months or less and do not contain a purchase option (short-term leases), and leases for which the underlying asset is of low value (low-value assets). 24 The effects of adopting IFRS 16 are as follows: Consolidated Statement of Financial Position Assets Property, Plant & Equipment (several) Right of use Liabilities Lease liabilities short-term Lease liabilities long-term 12.31.2018 IFRS 16 Adjustments 01.01.2019 17,805,700 - (17,805,700) 37,380,774 37,380,774 1,534,467 13,797,468 4,410,510 12,309,239 5,944,977 26,106,707 (i) (i) (ii) i. Right-of-use assets consisting of CLP 17,805,700 from transfers of other Property, Plant and Equipment assets and CLP 19,575,074 for assets arising from operating leases. ii. Lease Liabilities increase Following the adoption of IFRS 16, the Group applied a single recognition and measurement approach for all leases for which it is the tenant, except for short-term leases and low-value asset leases. The Group recognized lease liabilities for lease payments and right-of-use assets that represent the right to use the underlying assets. In accordance with the amended retrospective adoption method, the Group recognized assets and liabilities for the total future payments committed in the contracts. IFRIC 23 “Uncertainty over Income Tax Treatments” The Interpretation addresses the accounting of income taxes when tax treatments imply uncertainty that affects the application of IAS 12 “Income taxes”. It does not apply to taxes or encumbrances that are outside the scope of IAS 12, nor does it specifically include requirements related to interests and penalties associated with uncertain tax treatments. The Interpretation specifically addresses the following: • • • • If an entity considers the treatment of uncertain tax positions separately The assumptions that an entity makes about the assessment of tax treatments by tax authorities How an entity determines fiscal gain (tax loss), tax bases, unused tax losses, unused tax credits and tax rates. How an entity considers changes in facts and circumstances. This interpretation began its effective application as of January 1, 2019. The application of IFRIC 23 has not generated impacts on the consolidated financial statements of Embotelladora Andina and its subsidiaries. Amendments to IFRS that have been issued effective as of the date of these financial statements, are detailed below. Amendments Application date IFRS 3 Business combinations - interests previously held in a joint operation January 1, 2019 January 1, 2019 IFRS 9 Financial instruments - payments with negative compensation IFRS 11Joint agreements - interests previously held in a joint operation January 1, 2019 IAS 12 Income taxes - tax consequences of payments related to financial instruments classified as equity January 1, 2019 January 1, 2019 IAS 23 Loan costs - eligible loan costs to be capitalized January 1, 2019 IAS 28 Investments in associates - long-term investments in associates or joint ventures January 1, 2019 IAS 19 Employee benefits - amendment, reduction or liquidation of the plan Company Management evaluates the impact of the amendments listed above, once such transactions are carried out. 25 2.24.2 New Accounting Standards, Interpretations and Amendments with effective application for annual periods beginning on or after January 1, 2020. Standards and interpretations, as well as IFRS amendments, which have been issued, but have still not become effective as of the date of these financial statements are set forth below. The Company has not made an early adoption of these standards. Conceptual Framework IFRS 17 Standards and Interpretations Revised Conceptual Framework Insurance Contracts Mandator y application date January 1, 2020 January 1, 2021 Revised Conceptual Framework The IASB issued a Revised Conceptual Framework in March 2018, incorporating some new concepts, providing updated definitions and recognition criterion for assets and liabilities and clarifying some important concepts. Changes in the Conceptual Framework may affect the application of IFRS when no standard applies to a given transaction or event. The Revised Conceptual Framework becomes effective for periods ending on or after January 1, 2020. IFRS 17 Insurance Contracts In May 2017, the IASB issued IFRS 17 Insurance Contracts, a new comprehensive accounting standard for insurance contracts that covers recognition, measurement, presentation and disclosure. The new rule applies to all types of insurance contracts, regardless of the type of entity that issues them, being effective for periods beginning on or after January 1, 2021, with required comparative figures, early application is allowed, provided that the entity also applies IFRS 9 and IFRS 15. Amendments to IFRS which have been issued and will become in effect on January 1, 2020 are detailed below: IFRS 3 IAS 1 and IAS 8 IFRS 9, IAS 39 and IFRS 7 IFRS 10 and IAS 28 Definition of a business Definition of material Reference Interest Rate Reform Consolidated Financial Statements - sale or contribution of assets between an investor and its associate or joint venture Amendments Implementation date January 1,2020 January 1,2020 January 1,2020 To be determined IFRS 3 Business Combinations - Definition of Business The IASB issued amendments to the definition of business in IFRS 3 Business Combinations, to help entities determine whether an acquired set of activities and assets is a business or not. The IASB clarifies the minimum requirements for defining a business, eliminates the assessment of whether market participants are able to replace any missing elements, includes guidance to help entities assess whether a process acquired is substantial, reduces the definitions of a business and products and introduces an optional fair value concentration test. Amendments have to be applied to business combinations or asset acquisitions that occur on or after the start of the first annual reporting period beginning on or after January 1, 2020. As a result, entities do not have to review transactions that occurred in previous periods. Early application is permitted and must be disclosed. Because the amendments apply prospectively to transactions or other events that occur on or after the date of the first application, most entities will probably not be affected by these amendments in the transition. However, those entities that consider the acquisition of a set of activities and assets after implementing the amendments must first update their accounting policies in a timely manner. 26 Amendments may also be relevant in other areas of IFRS (e.g. they may be relevant when a controller loses control of a subsidiary and has anticipated the sale or contribution of assets between an investor and its associate or joint venture) (Amendments to IFRS 10 and IAS 28). The Company will perform an impact assessment of the amendment once it takes effect. IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors – Definition of Material In October 2018, the IASB issued amendments to IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, changes in accounting estimates and errors, to align the definition of "material" in all standards and to clarify certain aspects of the definition. The new definition states that information is material if when omitted, misstated, or reasonably hidden could be expected to influence decisions that primary users of general-purpose of the financial statements make based on those financial statements, which provide financial information about a specific reporting entity. Amendments should be applied prospectively. Early application is permitted and must be disclosed. While amendments to the definition of material are not expected to have a significant impact on an entity's financial statements, the introduction of the term "hide" in the definition could impact the way materiality judgments are made, increasing the importance of how information is communicated and organized in the financial statements. The Company will perform an impact assessment of the amendment once it takes effect. IFRS 9, IAS 39 and IFRS 7 Reference Interest Rate Reform In September 2019, the IASB issued amendments to IFRS 9, IAS 39 and IFRS 7, which concludes the first stage of its work to respond to the effects of the reform of interbank offer rate (IBOR) in financial information. The amendments provide temporary exceptions that allow hedge accounting to continue during the uncertain period, prior to replacing existing benchmark interest rates with near-risk free alternative interest rates. Amendments should be applied retrospectively. However, any hedge relationship that has previously been discontinued cannot be reinstated with the application of these amendments, nor can a hedge relationship be designated using the retrospect reasoning benefit. Early application is permitted and must be disclosed. The Company will perform an impact assessment of the amendment once it takes effect. IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures – sale or contribution of assets between an investor and its associate or joint venture Amendments to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures (2011) address a recognized inconsistency between IFRS 10 requirements and IAS 28 (2011) requirements in the treatment of the sale or contribution of assets between an investor and its associate or joint venture. The amendments, issued in September 2014, state that when the transaction involves a business (whether it is in a subsidiary or not) all gains, or losses generated are recognized. A partial gain or loss is recognized when the transaction involves assets that do not constitute a business, even when the assets are in a subsidiary. The mandatory implementation date of these amendments is yet to be determined because the IASB is awaiting the results of its research project on accounting according to the equity method of accounting. These amendments must be applied retrospectively, and early adoption is allowed, which must be disclosed. The Company will perform an impact assessment of the amendment once it takes effect. 27 3 – FINANCIAL REPORTING BY SEGMENT The Company provides financial information by segments according to IFRS 8 “Operating Segments,” which establishes standards for reporting by operating segment and related disclosures for products and services, and geographic areas. The Company’s Board of Directors and Management measures and assesses performance of operating segments based on the operating income of each of the countries where there are Coca-Cola franchises. The operating segments are determined based on the presentation of internal reports to the Company´s chief strategic decision- maker. The chief operating decision-maker has been identified as the Company´s Board of Directors who makes the Company’s strategic decisions. The following operating segments have been determined for strategic decision making based on geographic location: (cid:120) Operation in Chile (cid:120) Operation in Brazil (cid:120) Operation in Argentina (cid:120) Operation in Paraguay The four operating segments conduct their businesses through the production and sale of soft drinks and other beverages, as well as packaging materials. Expenses and revenue associated with the Corporate Officer were assigned to the operation in Chile in the soft drinks segment because Chile is the country that manages and pays the corporate expenses, which would also be substantially incurred, regardless of the existence of subsidiaries abroad. Total revenues by segment include sales to unrelated customers and inter-segments, as indicated in the consolidated statement of income of the Company. 28 A summary of the Company’s operating segments in accordance to IFRS is as follows: Chile Brazil For the period ended December 31, 2019 Net sales Cost of sales Distribution expenses Administrative expenses Finance income Finance expense Interest expense, net* Share of the entity in income of associates Income tax expense Other income (loss) Net income of the segment reported CLP (000’s) CLP (000’s) Operation Argentina Operation CLP (000’s) 608,952,121 (359,465,664) (59,076,433) (114,250,801) 1,286,021 (13,151,176) (11,865,155) 381,255 (12,838,517) (15,109,823) 36,726,982 Operation Paraguay Operation CLP (000’s) 619,321,284 394,635,840 (214,447,259) (384,838,875) (42,673,570) (56,421,024) (98,071,441) (89,276,114) 1,346,501 42,327,682 (34,057,214) 999,370 8,270,468 2,345,871 (3,796,338) - (36,821,377) (6,902,265) (3,235,926) 21,754,242 83,144,394 26,699,123 158,892,010 (92,368,109) (8,825,262) (24,305,453) 195,587 0 195,587 - (4,604,732) (308,315) 28,675,726 (2,776,140) 2,776,140 Intercompany Eliminations Consolida CLP ( CLP (000’s) 1,779 (1,048 (166 (325 45 (46 ( (3 - - - - - - - Depreciation and amortization 46,105,063 25,369,034 29,945,887 9,667,300 Current assets Non-current assets Segment assets, total 244,504,165 657,069,423 901,573,588 76,354,086 165,116,212 241,470,298 171,349,293 786,979,234 958,328,527 41,266,559 248,309,451 289,576,010 Carrying amount in associates and joint ventures accounted for using the equity method, total Segment disbursements of non-monetary assets 49,703,673 - 50,163,060 - 51,542,820 24,343,002 21,343,312 13,454,124 Current liabilities Non-current liabilities Segment liabilities, total 193,298,799 474,576,722 667,875,521 68,120,885 13,350,651 81,471,536 124,248,587 506,297,573 630,546,160 25,990,081 16,161,177 42,151,258 Cash flows provided by in Operating Activities Cash flows (used in) provided by Investing Activities Cash flows (used in) provided by Financing Activities 145,551,360 30,440,761 63,145,540 16,010,813 (50,706,748) (24,790,752) (21,096,376) (13,454,124) (100,352,068) (616,475) (25,654,792) (489,302) - - - - - - - - - - - - (*) Financial expenses associated with external financing for the acquisition of companies, are presented in this item 29 (6 3 175 11 533 1,857 2,390 99 110 41 1,010 1,422 255 (110 (127 Chile Brazil For the period ended December 31, 2018 Net sales Cost of sales Distribution expenses Administrative expenses Finance income Finance expense Interest expense, net Share of the entity in income of associates Income tax expense Other income (loss) Net income of the segment reported CLP (000’s) CLP (000’s) Operation Argentina Operation CLP (000’s) 570,939,102 (336,719,937) (55,798,363) (109,373,432) 1,744,821 (23,772,554) (22,027,733) 298,359 (22,000,539) (11,540,167) 13,777,290 Operation Paraguay Operation CLP (000’s) 413,560,523 540,509,549 (214,647,052) (329,529,112) (38,835,833) (88,809,386) 2,019,489 (31,108,284) (29,088,795) 1,112,820 (10,088,988) (8,399,463) 36,870,792 149,588,252 (88,813,300) (8,241,714) (22,410,131) 219,964 - 219,964 - (4,600,874) (111,834) 25,630,363 (62,899,574) (93,149,904) (44,030) (133,822) (177,852) - (18,874,454) (2,639,386) 21,172,301 (1,681,627) 1,681,627 Intercompany Eliminations Consolida CLP ( CLP (000’s) 1,672 (968 (165 (313 3 (55 (51 - - - - - - - Depreciation and amortization 42,353,664 20,474,446 26,830,835 9,935,501 Current assets Non-current assets Segment assets, total 228,108,768 644,395,166 872,503,934 80,908,212 160,587,931 241,496,143 135,259,768 679,183,347 814,443,115 37,309,706 248,751,791 286,061,497 Carrying amount in associates and joint ventures accounted for using the equity method, total Segment disbursements of non-monetary assets 50,136,065 - 52,274,880 - 67,709,231 28,702,138 32,536,213 9,684,466 Current liabilities Non-current liabilities Segment liabilities, total 186,831,021 477,319,648 664,150,669 83,013,418 17,066,746 100,080,164 128,146,943 420,218,066 548,365,009 21,870,719 16,323,385 38,194,104 Cash flows provided by in Operating Activities Cash flows (used in) provided by Investing Activities Cash flows (used in) provided by Financing Activities 150,035,425 28,899,457 44,949,860 11,394,620 (47,164,236) (28,700,733) (32,536,213) (9,684,466) (98,560,576) (10,644,812) (5,099,823) (330,067) - - - - - - - - - - - - (*) Financial expenses associated with external financing for the acquisition of companies, including capital contributions among others, are presented in this item. 30 (55 (22 97 99 481 1,732 2,214 102 138 419 930 1,350 235 (118 (114 4 – CASH AND CASH EQUIVALENTS The composition of Cash and cash equivalents is as follows: By item Cash Bank balances Time deposits Other fixed rate instruments Total cash and cash equivalents 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 2,331,714 2,907,276 51,176,617 46,425,927 - 1,500,315 86,705,095 104,059,655 157,567,986 137,538,613 Time deposits expire in less than three months from their acquisition date and accrue market interest for this type of short-term investment. Other fixed-income instruments mainly correspond to purchase transactions with the resale of debt instruments with a maturity of less than 90 days, from the date of investment. There are no restrictions for significant amounts available to cash. By currency USD EUR ARS CLP PGY BRL Cash and cash equivalents 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 5,917,041 16,733,249 51,401 9,722 6,726,906 3,830,199 86,121,695 78,420,966 10,680,600 12,383,873 28,040,970 46,189,977 157,567,986 137,538,613 5 – OTHER CURRENT AND NON-CURRENT FINANCIAL ASSETS The composition of other financial assets is as follows: Other financial assets Financial assets measured at amortized cost (1) Financial assets at fair value (2) Other financial assets measured at amortized cost (3) Total Balance Current 12.31.2019 12.31.2018 CLP (000’s) 30,073 317,205 CLP (000’s) 14,040 669,527 Non-current 12.31.2019 CLP (000’s) 1,216,865 98,918,457 12.31.2018 CLP (000’s) - 87,446,662 - 347,278 - 683,567 10,648,989 110,784,311 9,915,663 97,362,295 (1) Financial instruments held by the Company other than cash and cash equivalents. They mainly consist of time deposits with short-term maturities (more than 90 days). (2) See detail in Note 22 (3) Correspond to the rights in the Argentinean company Alimentos de Soya S.A., which are framed in the purchase of the "AdeS" brand managed by The Coca-Cola Company at the end of 2016. 31 6 – OTHER CURRENT AND NON-CURRENT NON-FINANCIAL ASSETS The composition of other non-financial assets is as follows: Other non-financial assets Prepaid expenses Tax credit remainder (1) Guaranty deposit Deposit in courts Others (2) Total Balance Current Non-current 12.31.2019 CLP (000’s) 11,242,456 180,695 422 - 4,765,392 16,188,965 12.31.2018 CLP (000’s) 4,967,255 18,022 3,013 - 960,633 5,948,923 12.31.2019 CLP (000’s) 595,045 103,540,639 19,226,030 2,274,436 125,636,150 12.31.2018 CLP (000’s) 810,662 13,322,720 - 18,590,597 2,253,285 34,977,264 (1) In November 2006, Rio de Janeiro Refrescos Ltda. ("RJR") filed a court order No. 0021799-23.2006.4.02.5101 seeking recognition of the right to exclude ICMS (Tax on Commerce and Services) from the PIS (Program of Social Integration) and COFINS (Contribution for the Financing of Social Security) calculation base, as well as recognition of the right to obtain reimbursement of amounts unduly collected since November 14, 2001, duly restated using the Selic interest rate. On May 20, 2019, the ruling favoring RJR became final, allowing the recovery of amounts overpaid from November 14, 2001 to August 2017. It is worth noting that in September 2017, RJR had already obtained a Security Mandate, which granted it the right to exclude, from that date, the ICMS from the PIS and COFINS calculation base. The company took steps to assess the total amount of the credit at issue for the period of unduly collection of taxes from November 2001 to August 2017, totaling CLP 103,540 million (BRL 567 million, of which BRL 357 million corresponds to capital and BRL 210 million to interest and monetary restatement. These amounts were recorded as of December 31, 2019. In addition, the company acknowledged the indirect costs (attorneys' fees, consulting, auditing, indirect taxes and other obligations) resulting from the recognition of the right acquired in court, totaling BRL 161 million. The payment of income tax occurs when liquidating the credit, thus the respective deferred tax liability recorded was CLP 25,200 million (BRL 138 million). Compañía de Bebidas Ipiranga ("CBI") acquired in September 2013, also filed a court order No. 0014022-71.2000.4.03.6102 in order to recognize the same issue as the one previously described for RJR. In September 2019, the ruling favoring CBI became final, allowing the recovery of the amounts overpaid from September 12, 1990 to December 1, 2013 (date when CBI was incorporated by RJR). CBI's credit will be generated in the name of RJR, however, pursuant to the contractual clause ("Subscription Agreement for Shares and Exhibits"), as soon as collected by RJR, this payment should be immediately paid to former CBI shareholders (supervention favoring former CBI shareholders). In addition, RJR has an associate called Sorocaba Refrescos SA ("Sorocaba"), where it has a 40% shareholding in the capital, which also filed a court order seeking recognition of the right to the same issue as RJR's action. On June 13, 2019, the ruling favoring Sorocaba became final, allowing the recovery of the amounts overpaid from July 5, 1992 until the date on which the decision became final. The amount of this credit will be calculated and the respective impacts on RJR’s results derived from its participation in Sorocaba will be recognized in the fiscal year ended December 31, 2020. Based on the information available for the CBI and Sorocaba lawsuits, the Company concluded that there was not enough documentary support to say that the credit is almost certain for the tax authorities and therefore, did not record the respective asset in the booking accounts. (2) Other non-financial assets are mainly composed of advances to suppliers 32 7 – TRADE AND OTHER RECEIVABLES The composition of trade and other receivables is as follows: Trade debtors and other accounts receivable, Net Trade debtors Other debtors Other accounts receivable Total Trade debtors and other accounts receivable, Gross Trade debtors Other debtors Other accounts receivable Total The stratification of the portfolio is as follows: Current trade debtors without impairment impact Less than one month Between one and three months Between three and six months Between six and eight months Older than eight months Balance Current Non-current 12.31.2019 CLP (000’s) 150,509,528 39,620,246 947,814 191,077,588 12.31.2018 CLP (000’s) 147,728,216 16,722,240 9,662,867 174,113,323 12.31.2019 CLP (000’s) - 466,007 57,762 523,769 12.31.2018 CLP (000’s) 66,510 1,204,187 - 1,270,697 Balance Current Non-current 12.31.2019 CLP (000’s) 153,654,549 42,719,679 1,196,347 197,570,575 12.31.2018 CLP (000’s) 150,933,965 19,552,539 9,925,027 180,411,531 12.31.2019 CLP (000’s) - 466,007 57,762 523,769 12.31.2018 CLP (000’s) 66,510 1,204,187 - 1,270,697 Balance 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 148,150,717 144,172,500 2,066,514 601,042 851,009 3,309,410 Total 153,654,549 151,000,475 1,872,144 838,277 482,596 2,310,815 33 The Company has approximately 276,000 clients, which may have balances in the different sections of the stratification. The number of clients is distributed geographically with 65,400 in Chile, 89,200 in Brazil, 64,400 in Argentina and 57,000 in Paraguay. Debtors for current credit operations Non-current credit operations Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 153,654,549 150,933,965 66,510 153,654,549 151,000,475 - The movement in the allowance for expected credit losses is presented below: Opening balance Increase (decrease) Provision reversal Increases (decrease) for changes of foreign currency Sub – total movements Ending balance 8 – INVENTORIES The composition of inventories is detailed as follows: Details Raw materials (1) Finished goods Spare parts and supplies Work in progress Other inventories Obsolescence provision (2) Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 6,494,113 1,629,761 (1,257,591) (568,075) (195,905) 6,298,208 6,298,208 1,762,246 (1,184,953) (382,514) 194,779 6,492,987 12.31.2019 CLP (000’s) 93,524,911 32,337,670 20,769,626 567,973 3,625,488 (3,184,444) 147,641,224 12.31.2018 CLP (000’s) 86,102,495 37,213,848 28,777,180 780,324 1,049,165 (2,603,303) 151,319,709 The cost of inventory recognized as cost of sales as of December 31, 2019 and 2018, is CLP 1,048,343,767 thousand and CLP 968,027,774 thousand, respectively. (1) Approximately 80% is composed of concentrate and sweeteners used in the preparation of beverages, as well as caps and PET supplies used in the packaging of the product. (2) The obsolescence provision is related mainly with the obsolescence of spare parts classified as inventories and to a lesser extent to finished products and raw materials. The general standard is to provision all those multi-functional spare parts without utility in rotation in the last four years prior to the technical analysis technical to adjust the provision. In the case of raw materials and finished products, the obsolescence provision is determined according to maturity. 34 9 – TAX ASSETS AND LIABILITIES The composition of current tax accounts receivable is the following: Tax assets Tax credits (1) Total 12.31.2019 12.31.2018 CLP (000’s) 9,815,294 9,815,294 CLP (000’s) 2,532,056 2,532,056 (1) Tax credits correspond to income tax credits on training expenses, purchase of Property, plant and equipment, and donations. The composition of current tax accounts payable is the following: Tax liabilities Income tax expense Total 12.31.2019 12.31.2018 CLP (000’s) 6,762,267 6,762,267 CLP (000’s) 9,338,612 9,338,612 10 – INCOME TAX EXPENSE AND DEFERRED TAXES 10.1 Income tax expense The current and deferred income tax expenses are detailed as follows: Details Current income tax expense Current tax adjustment previous period Withholding tax expense foreign subsidiaries Other current tax expense (income) Current income tax expense Expense (income) for the creation and reversal of temporary differences of deferred tax and others Expense (income) for deferred taxes Total income tax expense 35 12.31.2019 CLP (000’s) 35,439,707 713,992 4,534,145 (425,958) 40,261,886 12.31.2018 CLP (000’s) 38,313,980 312,403 7,364,213 474,105 46,464,701 20,905,005 20,905,005 61,166,891 9,100,154 9,100,154 55,564,855 The distribution of national and foreign tax expenditure is as follows: Income taxes Current taxes Foreign National Current tax expense Deferred taxes Foreign National Deferred tax expense Income tax expense 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) (24,315,576) (24,442,984) (15,946,310) (22,021,717) (40,261,886) (46,464,701) (9,121,332) (24,012,798) 21,178 3,107,793 (20,905,005) (9,100,154) (61,166,891) (55,564,855) The reconciliation of the tax expense using the statutory rate with the tax expense using the effective rate is as follows: Reconciliation of effective rate Net income before taxes Tax expense at legal rate (27.0%) Effect of a different tax rate in other jurisdictions Permanent differences: Non-taxable revenues Non-deductible expenses Tax effect of excess tax provisioned in previous periods Effect of monetary tax restatement Chilean companies Foreign subsidiaries tax withholding expense and other legal tax debits and credits Adjustments to tax expense Tax expense at effective rate Effective rate 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 153,015,601 236,413,116 (41,314,212) (63,831,541) (3,741,569) 967,671 9,507,807 (4,664,045) (3,316,278) 5,199,589 (590,718) 6,136,355 (61,166,891) 12,522,541 (11,141,237) (295,632) 2,566,163 (18,870,149) (15,218,314) (55,564,855) 25.9% 36.3% The applicable income tax rates in each of the jurisdictions where the Company operates are the following: Country Chile Brazil Argentina Paraguay Rate 2019 2018 27.0% 34.0% 30.0% 10.0% 27.0% 34.0% 30.0% 10.0% 36 10.2 Deferred income taxes The net cumulative balances of temporary differences that give rise to deferred tax assets and liabilities are detailed as follows: 12.31.2019 12.31.2018 Temporary differences Property, plant and equipment Obsolescence provision ICMS exclusion credit Employee benefits Post-employment benefits Tax loss carry forwards (1) Tax goodwill Brazil Contingency provision Foreign Exchange differences (2) Allowance for doubtful accounts Coca-Cola incentives (Argentina) Assets and liabilities for placement of bonds Lease liabilities Inventories Distribution rights Others Subtotal Total assets and liabilities net Assets Assets Liabilities 5,445,810 1,588,563 - 5,418,561 148,853 7,607,813 10,341,033 34,109,458 9,284,450 756,895 - 390,163 2,242,439 447,192 - Liabilities CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 46,181,359 112,359 - 131,829 1,014,354 - - - - - - 1,327,727 - - 173,273,994 5,940,224 227,981,846 145,245,948 51,414,971 - 25,651,794 12,157 787,576 - - - - - - 1,187,649 - - 163,107,412 3,705,078 245,866,637 169,449,747 5,420,447 910,076 - 5,169,161 90,941 9,137,392 18,836,838 26,796,262 13,083,953 1,262,977 352,061 - 1,328,320 347,470 - - 82,735,898 - 77,781,230 1,364,340 (1) Tax losses mainly associated with the subsidiary Embotelladora Andina Chile S.A. In Chile tax losses have no expiration date (2) Corresponds to differed taxes for exchange rate differences generated on the translation of debt expressed in foreign currency in the subsidiary Rio de Janeiro Refrescos Ltda. and which for tax purposes are recognized in Brazil when incurred. The movement in deferred income tax accounts is as follows: Movement Opening Balance Increase (decrease) in deferred tax Increase (decrease) due to foreign currency translation (*) Total movements Ending balance (*) Includes IAS 29 effect, due to inflation in Argentina 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 145,245,948 121,991,585 11,303,016 11,951,347 23,254,363 168,085,407 145,245,948 20,905,005 1,934,454 22,839,459 37 11 – PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment are detailed below at the end of each period: Property, plant and equipment, gross Construction in progress Land Buildings Plant and equipment Information technology equipment Fixed installations and accessories Vehicles Leasehold improvements Rights of use (1) Other properties, plant and equipment (2) Total Property, plant and equipment, gross Accumulated depreciation of Property, plant and equipment Buildings Plant and equipment Information technology equipment Fixed installations and accessories Vehicles Leasehold improvements Rights of use (1) Other properties, plant and equipment (2) Total accumulated depreciation Total Property, plant and equipment, net (1) For adoption of IFRS 16. See details of underlying assets in Note 11.1 (2) The net balance of each of these categories is presented below: Other Property, plant and equipment, net Bottles Marketing and promotional assets Other Property, plant and equipment Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 51,522,834 44,071,742 45,739,948 57,442,154 13,270,507 17,343,316 114,784,403 114,606,098 38 12.31.2019 CLP (000’s) 27,290,581 104,196,754 299,282,674 571,154,695 23,912,963 46,062,659 55,128,493 214,886 40,498,400 452,600,945 1,620,343,050 12.31.2018 CLP (000’s) 26,048,670 100,479,196 371,279,937 623,568,795 22,752,205 43,717,907 53,682,179 144,914 - 438,350,022 1,680,023,825 12.31.2019 CLP (000’s) (87,308,899) (385,801,471) (18,911,118) (26,219,378) (33,167,346) (144,865) (8,254,568) (337,816,542) (897,624,187) 12.31.2018 CLP (000’s) (157,119,586) (416,164,810) (17,567,484) (22,660,738) (31,883,578) (112,737) - (323,743,924) (969,252,857) 722,718,863 710,770,968 11.1 Movements Movements in Property, plant and equipment are detailed as follows: Construction in progress Rights-of-use CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) Buildings, net Vehicles, net Others Land Plant and equipment, net IT equipment net Fixed facilities and accessories, net Leasehold improvements, net Property, plant & equipment, net CLP (000’s) 26,048,670 100,479,196 - 49,134,461 214,160,351 207,403,985 11,582,259 749,800 5,184,721 675,974 21,057,169 7,271 21,798,601 (342,001) 32,177 114,606,098 32,640,210 1,309 - - 710,770,968 94,449,283 - (8,761) - - - (5,902) - (352,204) - (977) - (8,911) - (52,095) - (155) - (1,135,304) 21,721,728 - 21,721,728 (1,564,309) (48,358,902) 2,268,316 430,971 20,735,065 1,019,048 1,379,012 7,650,847 65,250 14,810,393 - (25,991) - - - - - (266,007) (13,788,120) (23,712) - (1,181,465) - (2,520,405) 17,805,700 (7,681,481) - (37,572,910) - (1,949,851) - (2,977,512) - (6,267,039) - (30,737) (42,410,016) - - (8,254,568) (98,889,546) (8,254,568) - - 688,063 1,529,526 4,685,319 3,228,519 83,757 386,253 464,563 2,177 2,216,555 1,024,539 14,309,271 (186,959) (80,284) (99,276) (5,883,370) 12,885 (1) (110,264) - (3,423,128) (53,567) (9,823,964) 1,241,911 3,717,558 (2,186,576) (22,050,761) (182,876) (1,213,888) 162,546 37,844 178,305 32,243,832 11,947,895 27,290,581 104,196,754 211,973,775 185,353,224 5,001,845 19,843,281 21,961,147 70,021 114,784,403 32,243,832 722,718,863 Opening balance at January 1, 2019 Additions Right-of use additions (3) Disposals Transfers between items of Property, plant and equipment Right-of-use transfers Depreciation expense Amortization (2) Increase (decrease) due to foreign currency translation differences Other increase (decrease) (1) Total movements Ending balance at December 31, 2019 (1) Mainly correspond to effects of adopting IAS 29 in Argentina. (2) Of the total of CLP 8,254,468 thousand recorded as amortization for the current period, CLP 5,994,037 thousand correspond to right-of-use amortization arising from the adoption of the IFRS, effective beginning on January 1, 2019. The remaining CLP 2,260,531 thousand correspond to depreciation (today amortization) of goods acquired under the financial lease method, which until December 31, 2018 were classified and valued pursuant to the accounting criteria of property, plant and equipment. (3) For IFRS 16 adoption 39 Construction in progress Land Buildings, net Plant and equipment, net CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) IT Equipment, net CLP (000’s) Fixed facilities and accessories, net Vehicles, net Leasehold improvements, net Other, net Property, plant and equipment, net CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 84,118,716 65,284,334 - 96,990,155 - (5,465) 162,385,848 155,833,080 17,924,606 (1,002,133) 504,675 (209,713) 4,627,325 783,299 - 19,589,877 165,226 - 29,263,265 1,451,462 (203,036) 7,415 106,934,818 42,793,277 1,430 (1,588,050) - 659,750,499 128,908,309 (3,008,397) (109,893,610) - - - 45,032,440 (7,001,828) 54,460,571 (39,182,401) 622,222 (1,830,295) 1,481,081 (2,668,535) (2,218,354) (5,201,263) 22,000 (11,112) 10,493,650 (41,727,195) - (97,622,629) (6,880,059) (6,580,711) (58,070,046) (4,615,830) 8,110,336 3,489,041 (14,485,709) 27,934,638 51,774,503 (17,048,903) 36,419,165 51,570,905 (414,850) 1,397,020 557,396 (4,048,135) 6,537,655 1,467,292 (1,722,767) 429,294 (7,464,664) 169 (16,954,922) 14,654,520 7,671,280 12,275 24,762 (66,171,006) 88,914,192 51,020,469 26,048,670 100,479,196 214,160,351 207,403,985 5,184,721 21,057,169 21,798,601 32,177 114,606,098 710,770,968 Opening balance at January 1, 2018 Additions Disposals Transfers between items of Property, plant and equipment Depreciation expense Increase (decrease) due to foreign currency translation differences Other increase (decrease) (1) Total movements Ending balance at December 31, 2018 (1) Mainly correspond to the effects of adopting IAS 29 in Argentina. Right-of-use asset as of December 31, 2019 is composed as follows: Rights of use Buildings Plant and equipment IT Equipment Motor vehicles Others Total Gross asset CLP (000’s) 1,454,555 28,109,470 283,473 5,198,413 5,452,489 40,498,400 Depreciation CLP (000’s) (294,791) (4,856,397) (69,209) (1,776,055) (1,258,116) (8,254,568) Interest expense for lease liabilities for the period ended December 31, 2019 amounts to CLP 2,282,221 thousand. 40 12 – RELATED PARTIES Balances and main transactions with related parties are detailed as follows: 12.1 Accounts receivable: Taxpayer ID Company Relationship Country Currency 96.891.720-K 96.714.870-9 Foreign Foreign Foreign 96.517.210-2 86.881.400-4 96.919.980-7 77.755.610-K 78.826.410-9 76.140.057-6 Total Embonor S.A. Coca-Cola de Chile S.A. Coca Cola de Argentina UBI 3 (AdeS) Alimentos de Soja S.A.U. Embotelladora Iquique S.A. Envases CMF S.A. Cervecería Austral S.A. Comercial Patagona Ltda. Guallarauco Monster Shareholder related Chile Shareholder Chile CLP CLP Director related Argentina ARS Shareholder related Argentina ARS Shareholder related Argentina ARS Shareholder related Chile Chile Associate Director related Chile Director related Associate Associate Chile Chile Chile CLP CLP USD CLP CLP CLP 12.2 Accounts payable: 12.31.2019 12.31.2018 Current CLP (000’s) 6,589,539 Non-current CLP (000’s) - Current CLP (000’s) 4,344,082 Non-current CLP (000’s) - 14,839 283,118 2,175,934 74,340 1,203,389 - 428,802 278,176 217,510 45,644 3,872 2,003,203 50,794 10,835,768 - - - - - - - - - 283,118 1,684,357 455,823 371,712 228,387 161,460 26,557 1,951 - - 9,450,263 - - - - - - - - - 74,340 Taxpayer ID Company Relationship Country Currency 12.31.2019 12.31.2018 Current M$ Non-current M$ Current M$ Non-current M$ 96.714.870-9 Foreign 86.881.400-4 Foreign Foreign Foreign 76.572.588-7 89.996.200-1 96.891.720-K Foreign Foreign Foreign Foreign Total Argentina ARS Chile Associate Shareholder Shareholder Shareholder related Brazil Chile Associate Coca-Cola de Chile S.A. Recofarma do Indústrias Amazonas Ltda. Envases CMF S.A. Ser. y Prod. para Bebidas Refrescantes S.R.L. Leão Alimentos e Bebidas Ltda. Monster Energy Brasil Com de Bebidas Ltda. Shareholder related Brazil Coca-Cola del Valle New Ventures S.A. Envases del Pacífico S.A. Embonor S.A. Alimentos de Soja S.A.U. Verde Campo Coca-Cola Panama Sorocaba Refrescos S.A. Director related Chile Shareholder related Chile Associate Associate Brazil Brazil Chile Shareholder related Argentina ARS BRL Shareholder related Brazil USD Shareholder related Panama BRL BRL CLP CLP CLP BRL 41 CLP 20,555,135 - 21,286,933 - BRL CLP 14,888,934 6,359,797 19,777,812 - 8,681,099 5,702,194 5,887,070 1,841,377 827,300 1,247,961 25,202 275,565 929,986 765,521 7,739 - - - - - - - - - 5,479,714 3,132,515 664,565 649,046 139,468 92,325 - - - 26,014 53,637,601 - 19,777,812 - 45,827,859 - - - - - - - - - - - - - 12.3 Transactions: Taxpayer ID Company Relationship Country Transaction Description A Currency 96.714.870-9 Coca-Cola de Chile S.A. 96.714.870-9 Coca-Cola de Chile S.A. 96.714.870-9 Coca-Cola de Chile S.A. 96.714.870-9 Coca-Cola de Chile S.A. 86.881.400-4 Envases CMF S.A. 86.881.400-4 Envases CMF S.A. 86.881.400-4 Envases CMF S.A. 86.881.400-4 Envases CMF S.A. 86.881.400-4 Envases CMF S.A. 86.881.400-4 Envases CMF S.A. 96.891.720-K Embonor S.A. 96.891.720-K Embonor S.A. 96.891.720-K Embonor S.A. 96.517.310-2 Embotelladora Iquique S.A. 89.996.200-1 Envases del Pacífico S.A. 94.627.000-8 Parque Arauco S.A Foreign Foreign Foreign Foreign Foreign Foreign Foreign 76.572.588-7 Coca Cola Del Valle New Ventures SA Alimentos de Soja S.A.U. Foreign Alimentos de Soja S.A.U. Foreign Trop Frutas do Brasil Ltda. Foreign Chile Shareholders Chile Shareholders Chile Shareholders Chile Shareholders Chile Associate Chile Associate Chile Associate Chile Associate Chile Associate Chile Associate Shareholder related Chile Shareholder related Chile Shareholder related Chile Shareholder related Chile Chile Director related Director related Chile Shareholder related Brazil Shareholder related Brazil 42 CLP Concentrate purchase CLP Purchase of advertising services CLP Water source lease CLP Sale of raw materials and others CLP Purchase of bottles CLP Purchase of raw materials CLP Purchase of caps CLP Purchase of services and others CLP Purchase of containers CLP Sale of containers /raw materials CLP Sale of finished products CLP Sale of services and others CLP Minimum dividend Sale of finished products CLP Purchase of raw materials and materials CLP CLP Space lease BRL Concentrate purchase BRL Reimbursement and other purchases ARS ARS BRL BRL BRL CLP ARS ARS BRL Recofarma do Indústrias Amazonas Ltda. Recofarma do Indústrias Amazonas Ltda. Serv. y Prod. para Bebidas Refrescantes S.R.L. Shareholder related Argentina Concentrate purchase Serv. y Prod. para Bebidas Refrescantes S.R.L. Shareholder related Argentina Advertising participation Associate KAIK Participações Associate Sorocaba Refrescos S.A. Associate Leão Alimentos e Bebidas Ltda. Associate Shareholder related Argentina Payment of commissions and services Shareholder related Argentina Purchase of products Purchase of products Associate Reimbursement and other purchases Purchase of products Purchase of products Sale of services and others Brazil Brazil Brazil Chile Brazil 12.4 Salaries and benefits received by key management Salaries and benefits paid to the Company’s key management personnel including directors and managers are detailed as follows: Description Executive wages, salaries and benefits Director allowances Benefit accrued in the last five years and paid during the fiscal year Benefit for contract termination Total 13 – CURRENT AND NON-CURRENT EMPLOYEE BENEFITS Employee benefits are detailed as follows: Description Accrued vacation Participation in profits and bonuses Indemnities for years of service Total Current Non-current Total 13.1 Indemnities for years of service The movements of employee benefits, valued pursuant to Note 2 are detailed as follows: 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 6,056,337 1,495,123 242,907 51,534 7,845,901 6,267,936 1,512,000 305,674 54,819 8,140,429 12.31.2019 CLP (000’s) 17,584,587 20,896,357 10,085,264 48,566,208 12.31.2018 CLP (000’s) 19,536,809 13,674,170 9,415,541 42,626,520 CLP (000’s) 38,392,854 10,173,354 48,566,208 CLP (000’s) 33,210,979 9,415,541 42,626,520 Movements Opening balance Service costs Interest costs Actuarial losses Benefits paid Total 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 8,286,355 957,593 565,167 271,045 (664,619) 9,415,541 9,415,541 784,984 354,471 (210,956) (258,776) 10,085,264 43 13.1.1 Assumptions The actuarial assumptions used are detailed as follows: Assumptions Discount rate Expected salary increase rate Turnover rate Mortality rate Retirement age of women Retirement age of men 13.2 Personnel expenses Personnel expenses included in the consolidated statement of income are as follows: Wages and salaries Employee benefits Severance benefits Other personnel expenses Total 13.3 Number of employees Number of employees Average number of employees Description Description 44 12.31.2019 2.7% 2.0% 5.4% RV-2014 60 years 65 years 12.31.2018 2.7% 2.0% 5.4% RV-2009 60 years 65 years 12.31.2019 CLP (000’s) 194,740,646 58,005,213 6,987,184 13,389,967 273,123,010 12.31.2018 CLP (000’s) 195,162,903 50,254,164 5,535,410 16,014,364 266,966,841 12.31.2019 12.31.2018 16,167 15,444 16,098 15,364 14 – INVESTMENTS IN ASSOCIATES ACCOUNTED FOR USING THE EQUITY METHOD Investments in associates using equity method of accounting are detailed as follows: Taxpayer ID Company Functional Country Currency 86.881.400-4 Envases CMF S.A. (1) Chile CLP Leão Alimentos e Bebidas Ltda. (2) Kaik Participações Ltda. (2) SRSA Participações Ltda. Sorocaba Refrescos S.A. Trop Frutas do Brasil Ltda. (2) Coca-Cola del Valle New Ventures S.A. Brazil Brazil Brazil Brazil Brazil BRL BRL BRL BRL BRL Chile CLP Foreign Foreign Foreign Foreign Foreign 76.572.588.7 Total 12.31.2019 CLP (000’s) 18,561,835 17,896,839 1,313,498 65,301 24,636,945 6,250,481 CLP (000’s) 18,743,604 21,727,894 1,228,256 94,706 22,979,029 6,244,839 31,141,834 99,866,733 31,392,617 102,410,945 50.00% 50.00% 10.26% 11.32% 40.00% 40.00% 7.52% 10.26% 11.32% 40.00% 40.00% 7.52% 35.00% 35.00% Investment value Ownership interest 12.31.2018 12.31.2019 12.31.2018 (1) In Envases CMF S.A., regardless of the percentage of ownership interest, it was determined that no controlling interest was held, only a significant influence, given that there was not a majority vote of the Board of Directors to make strategic business decisions. (2) In these companies, regardless of the percentage of ownership interest held, the Company has significant influence, given that it has a representative on each entity’s Board of Directors. 45 14.1 Movement The movement of investments in other entities accounted for using the equity method is shown below: Description Opening balance Other investment increases in associates (Capital contributions to Leão Alimentos e Bebidas Ltda. and Coca-Cola del Valle New Ventures S.A.) Dividends received Share in operating income Amortization unrealized income in associates Increase (decrease) in foreign currency translation, investments in associates Ending balance The main movements are explained below: 12.31.2019 CLP (000’s) 102,410,945 12.31.2018 CLP (000’s) 86,809,069 - (1,076,491) (2,495,621) (919,462) 1,947,362 99,866,733 15,615,466 (403,414) 2,194,144 85,268 (1,889,588) 102,410,945 (cid:120) (cid:120) (cid:120) In December 2019, Leão Alimentos e Bebidas Ltda. performed an impairment provision at its Linhares Plant for BRL 256 million. Andina recognized as results for the 2019 fiscal year, a loss of CLP 4,671 million. In 2019 Sorocaba Refrescos S.A., Coca-Cola del Valle and CMF distributed dividends. During 2018, Embotelladora Andina S.A. made a capital contribution in Coca-Cola del Valle New Ventures S.A. for CLP 15,615,466 thousand. 14.2 Reconciliation of share of profit in investments in associates: Description Equity value on income of associates 12.31.2019 CLP (000’s) (2,495,621) 12.31.2018 CLP (000’s) 2,194,144 Unrealized earnings from product inventory acquired from associates and not sold at the end of the period, which is presented as a discount in the respective asset account (containers and / or inventory) Amortization goodwill in the sale of fixed assets of Envases CMF S.A. Amortization goodwill preferred rights CCDV S.A. Income statement balance (394,490) 85,266 (610,238) (3,415,083) (868,233) 85,268 - 1,411,179 46 14.3 Summary financial information of associates: The following table presents summarized information regarding the Company’s equity investees: Sorocaba Refrescos Envases CMF S.A. S.A. CLP (000’s) CLP (000’s) CLP (000’s) 11,661,828 Kaik Participações Ltda. 77,994,582 116,551,131 Leão Alimentos e Bebidas Ltda. Trop Frutas do Brasil Ltda. CLP (000’s) CLP (000’s) CLP (000’s) 393,856 248,493,994 104,778,397 107,388,847 Coca-Cola del Valle New Ventures S.A. SRSA Participações Ltda. CLP (000’s) 39,826,283 54,650,105 35 229,780 38,137,061 27,158,470 18,693,717 58,640,058 69,343,990 337,450 160,342 139,769,189 47,252,571 31,914,825 1,449,997 3,948,798 337,450 160,342 2,320,841 (1,177,262) 4,297,003 12.31.2019 11.30.2019 11.30.2019 11.30.2019 11.30.2019 11.30.2019 11.30.2019 Total assets Total liabilities Total revenue Net income (loss) of associate Reporting date 15 - INTANGIBLE ASSETS OTHER THAN GOODWILL Intangible assets other than goodwill are detailed as follows: Description Distribution rights (1) Software Others Total Gross Value CLP (000’s) 667,148,383 34,347,843 750,309 702,246,535 December 31, 2019 Accumulated Amortization CLP (000’s) (393,187) (26,484,427) (293,546) (27,171,160) Net Value CLP (000’s) 666,755,196 7,863,416 456,763 675,075,375 Gross Value CLP (000’s) 661,285,834 31,526,159 728,198 639,540,191 December 31, 2018 Accumulated Amortization CLP (000’s) (259,434) (24,160,202) (298,002) (24,717,638) Net Value CLP (000’s) 661,026,400 7,365,957 430,196 668,822,553 (1) Correspond to the contractual rights to produce and distribute Coca-Cola products in certain parts of Argentina, Brazil, Chile and Paraguay. Distribution rights result from the valuation process at fair value of the assets and liabilities of the companies acquired in business combinations. Production and distribution contracts are renewable for periods of 5 years with Coca-Cola. The nature of the business and renewals that Coca-Cola has permanently done on these rights, allow qualifying them as indefinite contracts. 47 The distribution rights together with the assets that are part of the cash-generating units, are annually subjected to the impairment test. Such distribution rights have an indefinite useful life and are not subject to amortization: except for the Monster rights that are amortized in the term of the agreement which is 4 years. Distribution rights Chile (excluding Metropolitan Region, Rancagua and San Antonio) Brazil (Rio de Janeiro, Espirito Santo, Ribeirão Preto and investments in Sorocaba y Leão Alimentos e Bebidas Ltda.) Paraguay Argentina (North and South) Total The movement and balances of identifiable intangible assets are detailed as follows: 12.31.2019 CLP (000’s) 305,235,247 12.31.2018 CLP (000’s) 304,888,183 187,616,890 171,841,663 2,061,396 666,755,196 181,583,404 172,594,328 1,960,485 661,026,400 Description Opening balance Additions Amortization Other increases (decreases) (1) Ending balance January 1 to December 31, 2019 January 1 to December 31, 2018 Distribution Rights CLP (000’S) 661,026,400 - (133,753) Others CLP (000’S) 430,196 - - Software CLP (000’S) 7,365,957 3,296,558 (2,324,225) Total CLP (000’S) 668,822,553 3,296,558 (2,457,978) Distribution Rights CLP (000’S) 656,294,617 - (112,601) Others CLP (000’S) 470,918 - (40,722) Software CLP (000’S) 6,507,343 3,718,038 (1,971,417) Total CLP (000’S) 663,272,878 3,718,038 (2,124,740) 5.862.549 666,755,196 26,567 456,763 (474,874) 7,863,416 5,414,242 675,075,375 4,844,384 661,026,400 - 430,196 (888,007) 7,365,957 3,956,377 668,822,553 (1) Mainly corresponds to restatement due to the effects of translation of distribution rights of foreign subsidiaries. 48 16 - GOODWILL Movement in Goodwill is detailed as follows: Operating segment Chilean operation Brazilian operation Argentine operation Paraguayan operation Total Operating segment Chilean operation Brazilian operation Argentine operation Paraguayan operation Total 01.01.2019 CLP (000’s) 8,503,023 73,080,100 28,319,129 7,327,921 117,229,173 01.01.2018 CLP (000’s) 8,503,023 73,509,080 4,672,971 6,913,143 93,598,217 Foreign currency translation differences where functional currency is different from presentation currency and hyperinflation CLP (000’s) 12.31.2019 CLP (000’s) 8,503,023 75,674,072 29,750,238 7,294,328 3,992,488 121,221,661 - 2,593,972 1,432,109 (33,593) Foreign currency translation differences where functional currency is different from presentation currency and hyperinflation CLP (000’s) 12.31.2018 CLP (000’s) 8,503,023 73,080,100 28,319,129 7,327,921 23,630,956 117,229,173 - (428,980) 23,645,158 414,778 17 – OTHER CURRENT AND NON-CURRENT FINANCIAL LIABILITIES Liabilities are detailed as follows: Bank loans (17.1.1 – 2) Bonds payable, net1 (17.2) Deposits in guarantee Derivative contract liabilities (see note 22) Leasing agreements (17.4.1 – 2) Total Balance Current Non-current 12.31.2019 CLP (000’s) 1,438,161 21,604,601 11,163,005 374,576 6,013,535 40,593,878 12.31.2018 CLP (000’s) 21,542,736 20,664,481 12,242,464 130,829 1,534,467 56,114,977 12.31.2019 CLP (000’s) 909,486 718,962,871 - - 23,454,700 743,327,057 12.31.2018 CLP (000’s) 2,439,253 700,327,057 - - 13,797,468 716,563,778 1 Amounts net of placement expenses and discounts related to placement 49 The fair value of financial assets and liabilities is presented below: Current Cash and cash equivalent (2) Other financial assets (1) Trade debtors and other accounts receivable (2) Accounts receivable related companies (2) Bank loans (2) Bonds payable (2) Bottle guaranty deposits (2) Derivative contracts liabilities (see note 20) (1) Leasing agreements (2) Accounts payable (2) Accounts payable related companies (2) Non-current Other financial assets (1) Accounts receivable, non-current (2) Accounts receivable related companies (2) Bank loans (2) Bonds payable (2) Leasing agreements (2) Accounts payable, non-current (2) Book Value 12.31.2019 CLP (000’s) 157,567,986 317,205 191,077,588 10,619,740 1,438,161 21,604,601 11,163,005 374,576 6,013,535 243,700,553 53,637,601 12.31.2019 CLP (000’s) 98,918,457 523,769 283,118 909,486 718,962,871 23,454,700 619,587 Fair Value 12.31.2019 CLP (000’s) 157,567,986 317,205 191,077,588 10,619,740 1,434,255 24,188,060 11,163,005 374,576 6,013,535 243,700,553 53,637,601 12.31.2019 CLP (000’s) 98,918,457 523,769 283,118 867,025 803,017,145 23,454,700 619,587 Book Value 12.31.2018 CLP (000’s) 137,538,613 669,527 174,113,323 9,450,263 21,542,736 20,664,481 12,242,464 130,829 1,534,467 238,109,847 45,827,859 12.31.2018 CLP (000’s) 97,362,295 1,270,697 74,340 2,439,253 700,327,057 13,797,468 735,665 Fair Value 12.31.2018 CLP (000’s) 137,538,613 669,527 174,113,323 9,450,263 21,542,736 20,664,481 12,242,464 130,829 1,534,467 238,109,847 45,827,859 12.31.2018 CLP (000’s) 97,362,295 1,270,697 74,340 2,439,253 700,327,057 13,797,468 735,665 (1) (2) Fair values are based on discounted cash flows using market discount rates at the close of the six-month and one-year period and are classified as Level 2 of the fair value measurement hierarchies. Financial instruments such as: Cash and Cash Equivalents, Trade and Other Accounts Receivable, Accounts Receivable, Bottle Guarantee Deposits and Trade Accounts Payable, and Other Accounts Payable present a fair value that approximates their carrying value, considering the nature and term of the obligation. The business model is to maintain the financial instrument in order to collect/pay contractual cash flows, in accordance with the terms of the contract, where cash flows are received/cancelled on specific dates that exclusively constitute payments of principal plus interest on that principal. These instruments are revalued at amortized cost. 50 17.1.1 Bank obligations, current Tax ID Indebted entity Name Country Tax ID Creditor entity Name Type of Effective Nominal Up to 90 days to Maturity Country Currency Amortization Rate Rate 96.705.990-0 Envases Central S.A. Foreign Embotelladora del Atlántico S.A. Argentina Foreign Banco de la Nación Argentina Chile 97.006.000-6 Banco BCI Chile Argentina ARS UF Foreign Foreign Foreign Foreign Foreign Total Embotelladora del Atlántico S.A. Argentina Foreign Foreign Rio de Janeiro Refrescos Ltda. Brazil Foreign Rio de Janeiro Refrescos Ltda. Brazil Foreign Rio de Janeiro Refrescos Ltda. Brazil Foreign Rio de Janeiro Refrescos Ltda. Brazil Banco Galicia y Buenos Aires S.A. Argentina ARS BRL Banco Itaú BRL Banco Santander BRL Banco Itaú BRL Banco Santander Brazil Brazil Brazil Brazil 17.1.2 Bank obligations, non-current Semiannually Monthly Upon maturity Monthly Monthly Quarterly Quarterly 90 days CLP (000’S) 2.13% 374,419 - 12 ( 1 year CLP (000’S) 374,419 - 2.13% 20.00% 20.00% 82.00% 82.00% 8,453 6.63% 635,727 6.63% 7.15% 7.15% - 4.50% 11,678 4.50% - 6.24% 6.24% - - - 33,465 - 1 Indebted Entity Creditor Entity Type Effective Nominal Tax ID Name Country Tax ID Name Country Currency Amortization Rate 96.705.990-0 Envases Central S.A. Foreign TOTAL Chile Rio de Janeiro Refrescos Ltda. Brazil 97.006.000-6 Banco BCI Chile Banco Itaú Brazil Foreign UF BRL Semiannually Monthly 2.13% 6.63% 51 More than 4 years Up to 5 Maturity More than 3 years Up to 4 years CLP (000’s) - More than 2 years Up to 3 years CLP (000’s) - Rate More 1 year than 5 a up to years Years 12.31. 2 years CL CLP CLP CLP (000 (000’s) (000’s) (000’s) 2.13% 736,033 736 - - 6.63% 44,621 44,621 44,621 39,590 173 - 909 17.1.2 Bank obligations, non-current previous Maturity Indebted Entity Creditor Entity Type of Effective Nominal Tax ID Name Country Tax ID Name Country Currency Amortization Rate Rate 1 year to 2 years CLP (000’S) More than More than 2 More than 5 Up to 3 years Up to 4 years Up to 5 years years CLP (000’S CLP (000’S) CLP (000’S) CLP (000’S) More than 4 Envases Central S.A. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. 96.705.990-0 Foreign Foreign Foreign Foreign Total Chile 97.006.000-6 Brazil Foreign Banco BCI Banco Itaú Chile UF Semiannually 2.1% 2.1% 1,434,786 - - - Brazil BRL Monthly 6.6% 6.6% 72,439 43,033 43,033 81,225 Brazil Foreign Banco Santander Brazil BRL Monthly 7.2% 7.2% 151,873 Brazil Foreign Banco Santander Brazil BRL Quarterly 6.2% 6.2% - Brazil Foreign Banco Itaú Brazil BRL Quarterly 4.5% 4.5% 612,864 - - - - - - - - - 17.1.3 Current and non-current bank obligations “Restrictions” Bank obligations are not subject to restrictions for the reported periods. 52 17.2 Bonds payable During 2018, Andina carried out a debt restructuring process that consisted of a partial repurchase in the amount of USD 210 million of the 144A/RegS Senior Notes and refinancing it with the placement of Series F bonds in the local market in the amount of UF 5.7 million due 2039 and accruing an annual interest rate of 2.83%. The costs corresponding to the repurchase of bonds, associated with premium payments, overpricing and proportional amortization of placement costs and discounts in bonds in original U.S. Dollars amounting to CLP 9,583,000 thousand, were recorded in results under the item financial costs. Current Non-current Total Composition of bonds payable Bonds (face value) 2 12.31.2019 CLP (000’s) 12.31.2018 CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 22,189,595, 21,038,064 721,950,553 704,048,747 744,140,148 725,086,811 12.31.2019 12.31.2018 12.31.2019 12.31.2018 17.2.1 Current and non-current balances Bonds payable correspond to bonds in UF issued by the parent company on the Chilean market and bonds in U.S. dollars issued by the Parent Company on the international market. A detail of these instruments is presented below: Bonds Series CMF Registration N°254 06.13.2001 CMF Registration N°641 08.23.2010 CMF Registration N°759 08.20.2013 CMF Registration N°760 08.20.2013 CMF Registration N°760 04.02.2014 CMF Registration N°912 10.10.2018 Bonds USA Total B C C D E F - Current Nominal amount 1,891,186 1,500,000 250,000 4,000,000 3,000,000 5,700,000 UF UF UF UF UF UF 365,000,000 USD Adjustment Unit Interest Rate Final Maturity Interest payment Current Non-current 12.31.2019 12.31.2018 12.31.2019 12.31.2018 6.5% 4.0% 3.5% 3.8% 3.75% 2.83% 5.0% 06-01- 2026 08-15- 2031 08-16- 2020 08-16- 2034 03-01- 2035 09-25- 2039 10-01- 2023 Semi- annually Semi- annually Semi- annually Semi- annually Semi- annually Semi- annually Semi- annually CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 7,160,809 6,598,389 46,659,296 52,132,023 630,731 614,152 42,464,910 41,348,685 7,168,907 7,069,487 - 6,891,448 1,587,051 1,545,334 113,239,760 110,263,160 1,048,938 1,027,009 84,929,828 82,697,378 1,195,700 1,013,805 161,366,658 157,125,003 3,397,459 22,189,595 3,169,888 21,038,064 273,290,101 721,950,553 253,591,050 704,048,747 Accrued interest included in the current portion of bonds payable as of December 31, 2019 and 2018 amounts to CLP 7,983,770 thousand and CLP 7,856,274 thousand, respectively. 2 Amounts gross, not consider placement expenses and discounts related to placement 53 17.2.3 Non-current maturities CMF Registration N°254 06.13.2001 CMF Registration N°641 08.23.2010 CMF Registration N°760 08.20.2013 CMF Registration N°760 04.02.2014 CMF Registration N°912 10.10.2018 Bonds USA Total 17.2.4 Market rating Year of maturity Total non- current CLP (000’s) CLP (000’s) CLP (000’s) Series more than 1 to 2 more than 2 to 3 more than 3 to 4 More than 5 12.31.2019 CLP (000’s) CLP (000’s) 46,659,296 42,464,910 - 113,239,760 113,239,760 84,929,828 - - 161,366,658 161,366,658 273,290,101 - 273,290,101 285,461,315 413,637,541 721,950,553 7,803,536 3,860,446 - - - - 11,663,982 7,327,269 3,860,446 - - - - 11,187,715 23,217,724 30,883,571 8,310,767 3,860,447 B C D E F - 84,929,828 The bonds issued on the Chilean market had the following rating : AA : ICR Compañía Clasificadora de Riesgo Ltda. rating AA : Fitch Chile Clasificadora de Riesgo Limitada rating The rating of bonds issued on the international market had the following rating: BBB : Standard&Poors Global Ratings BBB+ : Fitch Ratings Inc. 17.2.5 Restrictions 17.2.5.1 Restrictions regarding bonds placed abroad. Obligations with bonds placed abroad are not affected by financial restrictions for the periods reported 17.2.5.2 Restrictions regarding bonds placed in the local market. For purposes of the calculation of the covenants, the amount of EBITDA that was agreed on each bond issue is included. Restrictions on the issuance of bonds for a fixed amount registered under number 254. (cid:120) Maintain an indebtedness level where Consolidated Financial Liabilities to Consolidated Equity does not exceed 1.20 times. For these purposes Consolidated Financial Liabilities shall be regarded as Liabilities Receivables accruing interest, namely: (i) other current financial liabilities, plus (ii) other non-current financial liabilities, less (iii) asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Financial Statements. Consolidated Equity will be regarded as total equity including non-controlling interest. As of December 31, 2019, indebtedness level is 0.71 times of Consolidated Equity. (cid:120) Maintain, and in no manner lose, sell, assign or transfer to a third party, the geographical area currently denominated as the “Metropolitan Region” (Región Metropolitana) as a territory in Chile in which we have been authorized by The Coca-Cola Company for the development, production, sale and distribution of products and brands of the licensor, in accordance to the respective bottler or license agreement, renewable from time to time. 54 (cid:120) Not lose, sell, assign, or transfer to a third party any other territory of Argentina or Brazil, which as of this date is franchised by TCCC to the Company for the development, production, sale and distribution of products and brands of such licensor, as long as any of these territories account for more than 40% of the Issuer's Adjusted Consolidated Operating Cash Flow. (cid:120) Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.3 times of the issuer’s unsecured consolidated liabilities. Unsecured consolidated liabilities payable shall be regarded as the total liabilities, obligations and debts of the issuer that are not secured by real guarantees on goods and assets of the latter, voluntarily and conventionally constituted by the issuer less the asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. Consolidated Assets free of any pledge, mortgage or other lien will only be regarded as those assets free of any pledge, mortgage or other real lien voluntarily and conventionally constituted by the issuer less asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities and under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. As of December 31, 2019, this index is 1.71 times. Restrictions to bond lines registered in the Securities Registered under number 641. (cid:120) Maintain a level of "Net Financial Debt" within its quarterly financial statements that may not exceed 1.5 times, measured over figures included in its consolidated statement of financial position. To this end, net financial debt shall be defined as the ratio between net financial debt and total equity of the issuer (equity attributable to controlling owners plus non-controlling interest). On its part, net financial debt will be the difference between the Issuer's financial debt and cash. As of December 31, 2019, Net Financial Debt level was 0.66 times. (cid:120) Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.3 times of the issuer’s unsecured consolidated liabilities. Unencumbered assets refer to the assets that are the property of the issuer; classified under Total Assets of the Issuer’s Financial Statements; and that are free of any pledge, mortgage or other liens constituted in favor of third parties, less "Other Current Financial Assets" and "Other Non-Current Financial Assets" of the Issuer’s Financial Statements (to the extent they correspond to asset balances of derivative financial instruments, taken to hedge exchange rate and interest rate risk of the financial liabilities). Unsecured total liabilities correspond to: liabilities from Total Current Liabilities and Total Non-Current Liabilities of Issuer’s Financial Statement which do not benefit from preferences or privileges, less "Other Current Financial Assets" and "Other Non-Current Financial Assets" of the Issuer’s Financial Statements (to the extent they correspond to asset balances of derivative financial instruments, taken to hedge exchange rate and interest rate risk of the financial liabilities). As of December 31, 2019, this index is 1.71 times. (cid:120) Maintain a level of "Financial net coverage" in its quarterly financial statements of more than 3 times. Net financial coverage means the ratio between the Issuer's Ebitda for the past 12 months and net financial expenses (financial income less financial expenses) of the issuer for the past 12 months. However, this restriction will be considered breached when the mentioned net financial coverage level is lower than the level previously indicated during two consecutive quarters. 55 As of December 31, 2019, Net Financial Coverage level is 306.38 times. Restrictions to bond lines registered in the Securities Registrar under numbers 759 and 760 D-E. (cid:120) Maintain an indebtedness level where Consolidated Financial Liabilities to Consolidated Equity does not exceed 1.20 times. For these purposes Consolidated Financial Liabilities shall be regarded as Liabilities Receivables accruing interest, namely: (i) other current financial liabilities, plus (ii) other non-current financial liabilities, less (iii) cash and cash equivalent and (iv) other current financial assets, and (v) other non-current financial assets (to the extent they are asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities). Consolidated Equity will be regarded as total equity including non-controlling interest. As of December 31, 2019, Indebtedness Level is 0.54 times of Consolidated Equity. (cid:120) Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.3 times of the issuer’s unsecured consolidated liabilities payable. Unsecured Consolidated Liabilities Payable shall be regarded as the total liabilities, obligations and debts of the issuer that are not secured by real guarantees on goods and assets of the latter, voluntarily and conventionally constituted by the issuer less the asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. The following will be considered in determining Consolidated Assets: assets free of any pledge, mortgage or other lien, as well as those assets having a pledge, mortgage or real encumbrances that operate solely by law, less asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Financial Statements. Therefore, Consolidated Assets free of any pledge, mortgage or other lien will only be regarded as those assets free of any pledge, mortgage or other real lien voluntarily and conventionally constituted by the issuer less asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities and under "Other Current Financial Assets" and "Other non- current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. As of December 31, 2019, this index is 1.71 times. (cid:120) Maintain, and in no manner, lose, sell, assign or transfer to a third party, the geographical area currently denominated as the “Metropolitan Region” as a territory franchised to the Issuer in Chile by The Coca-Cola Company, hereinafter also referred to as "TCCC" or the "Licensor" for the development, production, sale and distribution of products and brands of said licensor, in accordance to the respective bottler or license agreement, renewable from time to time. Losing said territory, means the non- renewal, early termination or cancellation of this license agreement by TCCC, for the geographical area today called "Metropolitan Region". This reason shall not apply if, as a result of the loss, sale, transfer or disposition, of that licensed territory is purchased or acquired by a subsidiary or an entity that consolidates in terms of accounting with the Issuer. (cid:120) Not lose, sell, assign, or transfer to a third party any other territory of Argentina or Brazil, which as of the issuance date of these instruments is franchised by TCCC to the Issuer for the development, production, sale and distribution of products and brands of such licensor, as long as any of these territories account for more than 40% of the Issuer's Adjusted Consolidated Operating Cash Flow of the audited period immediately before the moment of loss, sale, assignment or transfer. For these purposes, the term "Adjusted Consolidated Operating Cash Flow" shall mean the addition of the following accounting accounts of the Issuer's Consolidated Statement of Financial Position: (i) "Gross Profit" which includes regular activities and cost of sales; less (ii) "Distribution Costs"; less (iii) "Administrative Expenses"; plus (iv) "Participation in profits (losses) of associates and joint ventures that are accounted for using the equity method"; plus (v) "Depreciation"; plus (vi) "Intangibles Amortization". 56 Restrictions to bond lines registered in the Securities Registrar under number 912. (cid:120) Maintain an indebtedness level where Consolidated Financial Liabilities to Consolidated Equity does not exceed 1.20 times. For these purposes Consolidated Financial Liabilities shall be regarded as Liabilities Receivables accruing interest, namely: (i) other current financial liabilities, plus (ii) other non-current financial liabilities, less (iii) cash and cash equivalent and (iv) other current financial assets, and (v) other non-current financial assets (to the extent they are asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities). Consolidated Equity will be regarded as total equity including non-controlling interest. As of December 31, 2019, this index equals 0.65 times. (cid:120) Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.3 times of the issuer’s unsecured consolidated liabilities payable. Unsecured Consolidated Liabilities Payable shall be regarded as the total liabilities, obligations and debts of the issuer that are not secured by real guarantees on goods and assets of the latter, voluntarily and conventionally constituted by the issuer less the asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. The following will be considered in determining Consolidated Assets: assets free of any pledge, mortgage or other lien, as well as those assets having a pledge, mortgage or real encumbrances that operate solely by law, less asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities under "Other Current Financial Assets" and "Other non-current Financial Assets" of the Issuer’s Consolidated Financial Statements. Therefore, Consolidated Assets free of any pledge, mortgage or other lien will only be regarded as those assets free of any pledge, mortgage or other real lien voluntarily and conventionally constituted by the issuer less asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities and under "Other Current Financial Assets" and "Other non- current Financial Assets" of the Issuer’s Consolidated Statement of Financial Position. As of December 31, 2019, this index equals 1.71 times. (cid:120) Not lose, sell, assign, or transfer to a third party any other territory of Argentina or Brazil, which as of the issuance date of local bonds Series C, D and E is franchised by TCCC to the Issuer for the development, production, sale and distribution of products and brands of such licensor, as long as any of these territories account for more than 40% of the Issuer's Adjusted Consolidated Operating Cash Flow of the audited period immediately before the moment of loss, sale, assignment or transfer. For these purposes, the term "Adjusted Consolidated Operating Cash Flow" shall mean the addition of the following accounting accounts of the Issuer's Consolidated Statement of Financial Position: (i) "Gross Profit" which includes regular activities and cost of sales; less (ii) "Distribution Costs"; less (iii) "Administrative Expenses"; plus (iv) "Participation in profits (losses) of associates and joint ventures that are accounted for using the equity method"; plus (v) "Depreciation"; plus (vi) "Intangibles Amortization". As of December 31, 2018, the Company complies with all financial collaterals. 57 17.2.6 Repurchased bonds In addition to UF bonds, the Company holds bonds that it has repurchased in full through companies that are included in the consolidation: The subsidiary Rio de Janeiro Refrescos Ltda. maintains a liability corresponding to a bond issuance for US $75 million due in December 2020 and semi-annual interest payments. As of December 31, 2019, these issues are held by Andina. On January 1, 2013, Abisa Corp S.A. transferred the totality of this asset to Embotelladora are Andina S.A., the latter becoming the creditor of the above-mentioned Brazilian subsidiary. Consequently, the assets and liabilities related to the transaction have been eliminated from these Consolidated Financial Statements. In addition, the transaction has been treated as a net investment of the group in the Brazilian subsidiary; consequently, the effects of exchange rate differences between the dollar and the functional currency of each one has been recorded in other comprehensive income. 17.3 Derivative contract obligations Please see details in Note 22 58 Maturity To Up to 90 days CLP (000’S) 90 days up to 1 year CLP (000’S) At 12.31.2019 CLP (000’S) - - - - - - 17.4.1 Current liabilities for leasing agreements Indebted Entity Name Country Creditor Entity Name Tax ID Country Currency Amortization Rate Rate Type of Effective Nominal Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Brazil Foreign Banco Santander Brazil BRL Monthly 9.65% 9.47% Brazil Foreign Brazil Foreign Citibank Brazil Cogeração - Light ESCO Brazil BRL Monthly 8.54% 8.52% BRL Monthly 13.00% 12.28% 200,472 639,030 839,502 Brazil Foreign Tetra Pack Brazil BRL Monthly 7.65% 7.39% 87,735 273,119 360,854 Brazil Foreign Imóveis Brazil BRL Monthly 8.20% 8.20% 90,234 210,104 300,338 Brazil Foreign Leão Brazil BRL Monthly 6.56% 6.56% 127,226 370,160 497,386 Argentina Foreign Argentina Foreign Argentina Foreign Vital Aguas S.A Chile 76.389.720-6 Envases Central S.A Chile 96.705.990-0 Paraguay Refrescos SA Paraguay 80.003.400-7 Tetra Pak SRL Banco Comafi Real Estate Coca Cola del Valle New Ventures S.A Coca Cola del Valle New Ventures S.A Tetra Pack Ltda. Suc. Py Argentina USD Monthly 12.00% 12.00% 33,204 99,611 132,815 Argentina USD Monthly 12.00% 12.00% 22,184 66,555 88,739 Argentina ARS Monthly 50.00% 50.00% 66,607 122,713 189,320 Chile CLP Lineal 6.20% 6.20% 292,471 877,413 1,169,884 Chile CLP Lineal 6.20% 6.20% 549,750 1,649,248 2,198,998 Paraguay PGY Monthly 0.00% 0.00% 58,925 176,774 Total 235,699 6,016,535 The Company maintains lease agreements on forklifts, vehicles, real estate and machinery. These leases have an average life of between one and eight years without including a renewal option in the contracts. 59 17.4.2 Non-current liabilities for leasing agreements, non-current Indebted Entity Name Country Creditor Entity Type of Effective Nominal Rut Name Country Currency Amortization Rate Rate Maturity 1 year up to 2 years M$ 2 years up to 3 years M$ 3 years up to 4 years M$ 4 years up to 5 years M$ More than 5 years M$ At 12.31.2019 M$ Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Brazil Foreign Brazil Foreign Brazil Foreign Brazil Foreign Argentina O-E Argentina O-E Argentina O-E Vital Aguas S.A Chile 76.572.588-7 Envases Central S.A Chile 76.572.588-7 Paraguay Refrescos SA Paraguay 80.003.400-7 Total Cogeração - Light ESCO Tetra Pack Real estate Leão Alimentos e Bebidas Ltda. Tetra Pak SRL Banco Comafi Real estate Coca Cola del Valle New Ventures S.A Coca Cola del Valle New Ventures S.A Tetra Pack Ltda. Suc. Py Brazil BRL Monthly 13.00% 12.28% 948,466 1,071,766 1,211,096 1,368,538 8,101,730 12,701,596 Brazil BRL Monthly 7.65% 7.39% 271,264 111,005 Brazil BRL Monthly 8.20% 8.20% 97,784 9,144 - - - - - - 382,269 106,928 Brazil BRL Monthly 6.56% 6.56% 365,671 355,172 339,020 331,185 375,688 1,766,736 Argentina USD Monthly 12.00% 12.00% Argentina USD Monthly 12.00% 12.00% Argentina ARS Monthly 50.00% 50.00% - - - 398,442 110,924 55,222 Chile CLP Monthly 6.2% 0.27% 2,242,278 Chile CLP Monthly 6.7% 0.27% 4,947,745 Paraguay PGY Monthly 0.00% 0.00% 399,456 - - - - - - - 343,104 - - - - - - - 741,546 110,924 55,222 - 2,242,278 - 4,947,745 399,456 23,454,700 17.4.3 Non-current liabilities for leasing agreements (previous year) Indebted Entity Name Country Tax, ID Creditor Entity Name Country Currency Amortization Effective Nominal Type rate Rate Maturity 1 year to 2 years CLP (000’s) 2 years to 3 years CLP (000’s) 3 years to 4 years CLP (000’s) 4 years to More 5 years CLP (000’s) 5 years CLP (000’s) at 12.31.2018 CLP (000’s) Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. TOTAL Brazil Foreign Cogeração Light Esco Brazil Foreign Tetra Pack Brazil BRL Monthly 13.00% 12.28% 810,185 915,509 1,034,525 1,169,014 9,466,995 13,396,228 Brazil BRL Monthly 7.65% 7.39% 401,240 - - - - 401,240 13,797,468 Leasing agreement obligations are not subject to financial restrictions for the reported periods. 60 18 – TRADE AND OTHER ACCOUNTS PAYABLE Trade and other current accounts payable are detailed as follows: Classification Current Non-current Total Item Trade accounts payable Withholding tax Others Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 243.700.553 238,109,847 735,665 244.320.140 238,845,512 619.587 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 172,142,472 174,486,806 47,693,379 53,326,254 18,851,414 16,665,327 244,320,140 238,845,512 19 – OTHER PROVISIONS, CURRENT AND NON-CURRENT 19.1 Balances The composition of provisions is as follows: Detail Litigation (1) Total Current Non-current Total 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 62,452,526 62,452,526 69,107,550 2,068,984 67,038,566 69,107,550 3,485,613 58,966,913 62,452,526 (1) Correspond to the provision made for the probable losses of fiscal, labor and commercial contingencies, based on the opinion of our legal advisors, according to the following detail: Detail (see note 23.1) Tax contingencies Labor contingencies Civil contingencies Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 47,991,514 10,376,830 4,084,182 62,452,526 38,853,059 10,569,754 19,684,737 69,107,550 61 19.2 Movements The movement of principal provisions over litigation is detailed as follows: Detail Opening balance as of January 1 Additional provisions Increases (decrease) in existing provisions (*) Payments Reversal of unused provision Increase (decrease) due to foreign exchange differences Total 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 65,624,166 46,657 (4,998,530) 6,139,963 (2,157,152) (2,202,578) 62,452,526 62,452,526 121,003 (13,085,051) 21,506,141 (2,511,589) 624,520 69,107,550 (*) During 2019 and 2018, provisions consisting of fines demanded by the Brazilian tax authority on the use of tax credits resulting from favorable sentencing to Rio de Janeiro Refrescos Ltda. 20 – OTHER NON-FINANCIAL LIABILITIES Other current and non-current liabilities at each reporting period end are detailed as follows: Description Dividends payable Other Total 21 – EQUITY 21.1 Number of shares: 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 21,584,314 12,189,900 33,774,214 22,639,150 3,863,065 26,502,215 Number of shares subscribed at nominal value Number of shares paid in Number of voting shares Series A B 2019 473,289,301 473,281,303 2018 473,289,301 473,281,303 2019 473,289,301 473,281,303 2018 473,289,301 473,281,303 2019 473,289,301 473,281,303 2018 473,289,301 473,281,303 62 21.1.1 Equity: Series A B Total 21.1.2 Rights of each series: Subscribed Capital 2018 2019 Paid-in capital 2019 2018 CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 135,379,504 135,379,504 135,379,504 135,379,504 135,358,070 135,358,070 135,358,070 135,358,070 270,737,574 270,737,574 270,737,574 270,737,574 (cid:120) (cid:120) Series A: Elects 12 of the 14 Directors Series B: Receives an additional 10% of dividends distributed to Series A and elects 2 of the 14 Directors. 21.2 Dividend policy According to Chilean law, cash dividends must be paid equal to at least 30% of annual net profit, barring a unanimous vote by shareholders to the contrary. If there is no net profit in a given year, the Company will not be legally obligated to pay dividends from retained earnings. At the ordinary Shareholders’ Meeting held in April 2019, the shareholders agreed to pay out of the 2018 earnings a final dividend additional to the 30% required by Chile’s Law 18,046 which will be paid in May 2019, and an additional dividend that will be paid in August 2019. Pursuant to Circular Letter N° 1,945 of the Chilean Financial Market Commission (CMF) dated September 29, 2009, the Company’s Board of Directors decided to maintain the initial adjustments from adopting IFRS as accumulated earnings for future distribution. The dividends declared and paid per share are presented below: Periods January May August October January May August October January Dividend type Interim Final Additional Interim Interim Final Additional Interim Interim 2018 2018 2018 2018 2019 2019 2019 2019 2020 Profits imputable to dividends 2017 Earnings 2017 Earnings Accumulated Earnings 2018 Earnings 2018 Earnings 2018 Earnings Accumulated Earnings 2019 Earnings 2019 Earnings 63 Ch$ per Series A Share Ch$ per Series B Share 23.65 23.65 23.65 23.65 23.65 23.65 23.65 23.65 24.86 21.50 21.50 21.50 21.50 21.50 21.50 21.50 21.50 22.60 21.3 Other Reserves The balance of other reserves includes the following: Description Goodwill in share exchange reserve Translation differences reserves Cash flow hedge reserves Reserve for employee benefits actuarial gains or losses Legal and statutory reserves Other Total 21.3.1 Goodwill in share exchange reserve 12.31.2019 CLP (000’s) 421,701,520 (339,076,340) (14,850,683) (2,230,752) 5,435,538 6,014,568 76,993,851 12.31.2018 CLP (000’s) 421,701,520 (306,674,529) (13,668,932) (1,954,077) 5,435,538 6,014,569 110,854,089 This amount corresponds to the difference between the valuation at fair value of the issuance of shares of Embotelladora Andina S.A. and the book value of the paid capital of Embotelladoras Coca-Cola Polar S.A., which was finally the value of the capital increase notarized in legal terms. 21.3.2 Cash flow hedge reserve They arise from the fair value of the existing derivative contracts that have been qualified for hedge accounting at the end of each financial period. When contracts are expired, these reserves are adjusted and recognized in the income statement in the corresponding period (see Note 22). 21.3.3 Reserve for employee benefit actuarial gains or losses Corresponds to the restatement effect of employee benefits actuarial losses that according to IAS 19 amendments must be carried to other comprehensive income. 64 21.3.4 Legal and statutory reserves In accordance with Official Circular N° 456 issued by the Chilean Financial Market Commission (CMF), the legally required price- level restatement of paid-in capital for 2009 is presented as part of other equity reserves and is accounted for as a capitalization from Other Reserves with no impact on net income or retained earnings under IFRS. This amount totaled CLP 5,435,538 thousand as of December 31, 2009. 21.3.5 Foreign currency translation reserves This corresponds to the conversion of the financial statements of foreign subsidiaries whose functional currency is different from the presentation currency of the Consolidated Financial Statements. Additionally, exchange differences between accounts receivable kept by the companies in Chile with foreign subsidiaries are presented in this account, which have been treated as investment equivalents accounted for using the equity method. Translation reserves are detailed as follows: Details Brazil Argentina Paraguay Total 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) (98,794,118) (114,180,197) (246,415,922) (201,118,180) 8,623,849 (339,076,340) (306,674,528) 6,133,700 The movement of this reserve for the fiscal years ended December 31, 2019 and 2018, is detailed as follows: Details Brazil Argentina Paraguay Total 21.4 Non-controlling interests 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) (10,313,069) (72,770,068) 13,486,181 (69,596,956) 15,386,079 (45,297,742) (2,490,149) (32,401,812) This is the recognition of the portion of equity and income from subsidiaries owned by third parties. This account is detailed as follows: Details Embotelladora del Atlántico S,A, Andina Empaques Argentina S,A, Paraguay Refrescos S,A, Vital S,A, Vital Aguas S,A, Envases Central S,A, Total Non-controlling interests Shareholders’ Equity Income December 2019 CLP (000’s) 26,342 2,290 5,368,470 7,904,741 1,803,884 5,148,531 20,254,258 December 2018 CLP (000’s) 23,260 2,113 5,378,074 7,674,785 1,986,493 4,836,892 19,901,617 December 2019 CLP (000’s) 4,183 409 622,188 263,442 105,870 528,205 1,524,297 December 2018 CLP (000’s) 3,633 96 556,112 271,063 36,696 (20,225) 847,375 Ownership interest % 2019 2018 0,0171 0,0209 2,1697 35,0000 33,5000 40,7300 0,0171 0,0209 2,1697 35,0000 33,5000 40,7300 65 21.5 Earnings per share The basic earnings per share presented in the statement of comprehensive income is calculated as the quotient between income for the period and the average number of shares outstanding during the same period. Earnings per share used to calculate basic and diluted earnings per share is detailed as follows: Earnings per share Earnings attributable to shareholders (CLP 000’s) Average weighted number of shares Earnings per share (in CLP) Earnings per share Earnings attributable to shareholders (CLP (000’s)) Average weighted number of shares Earnings per share (in CLP) 22 – DERIVATIVE ASSETS AND LIABILITIES 12.31.2019 SERIES A SERIES B 82,725,427 90,996,501 473,289,301 473,281,303 192.27 174.79 12.31.2018 SERIES A SERIES B 46,001,994 50,601,377 473,289,301 473,281,303 106.92 97.20 Embotelladora Andina currently maintains “Cross Currency Swaps” and “Currency Forward” agreements as derivative financial instruments. Cross Currency Swaps (“CCS”), also known as interest rate and currency swaps, are valued by the method of discounted future cash flows at a market rate corresponding to the risk of the operation. CCS are currently maintained to re-denominate debt incurred in currency and rate in USD to currency and rate in BRL. To discount future flows in BRL and USD, the Zero coupon curves of the BRL and the Zero coupon USD are used, respectively. On the other hand, the fair value of forward currency contracts is calculated in reference to current forward exchange rates for contracts with similar maturity profiles. As of December 31, 2019 and 2018, the Company held the following derivative instruments: 22.1 Derivatives accounted for as cash flow hedges: Cross Currency Swaps associated with US Bonds At December 31, 2019, the Company held cross currency swap derivative contracts to convert US Dollar public bond obligations of USD 360 million into Real liabilities to hedge the Company’s exposure to variations in foreign exchange rates. Said contracts are valued at their value and the net value to be received as of December 31, 2019 amounted to CLP 98,918,457 thousand. These swap contracts have the same terms of the underlying bond obligation and expire in 2023. The amount of exchange differences recognized in the statement of income related to financial liabilities in U.S. dollars and the identified effective portion that was absorbed by the amounts recognized under comprehensive income. 22.2. Forward currency transactions expected to be very likely: During 2019 and 2018, the Company entered into foreign currency forward contracts to hedge its exposure to expected future raw materials purchases in US Dollars during these years. The total amount of outstanding forward contracts was USD 46.9 million as of December 31, 2019 (USD 56.8 million as of December 31, 2018). 66 Futures contracts that ensure prices of future raw materials have not been designated as hedge agreements, since they do not fulfill IFRS documentation requirements, whereby its effects on variations in fair value are accounted for directly under statements of income in the "other gains and losses" account. Fair value hierarchy As of December 31, 2019, the Company held assets for derivative contracts for CLP 99,235,662 thousand (CLP 88,116,189 thousand as of December 31, 2018) and held liabilities for derivative contracts as of December 31, 2019 for CLP 374,576 thousand (CLP 130,829 thousand as of December 31, 2018). Those contracts covering existing items have been classified in the same category of hedged, the net amount of derivative contracts by concepts covering forecasted items have been classified in financial assets and financial liabilities. All the derivative contracts are carried at fair value in the consolidated statement of financial position. The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities Level 2: Inputs other than quoted prices included in level 1 that are observable for the assets and liabilities, either directly (that is, as prices) or indirectly (that is, derived from prices) Level 3: Inputs for assets and liabilities that are not based on observable market data. During the reporting period, there were no transfers of items between fair value measurement categories; all of which were valued during the period using level 2. Assets Current assets Other current financial assets Other non-current financial assets Total assets Liabilities Current liabilities Other current financial liabilities Total liabilities Fair Value Measurements at December 31, 2019 Quoted prices in active markets for identical assets or liabilities (Level 1) CLP (000’S) Observable market data (Level 2) CLP (000’S) Unobservable market data (Level 3) CLP (000’S) Total CLP (000’S) - - - - - 317,205 98,918,457 99,235,662 374,576 374,576 - - - - - 317,205 98,918,457 99,235,662 374,576 374,576 Fair Value Measurements at December 31, 2018 Quoted prices in active markets for identical assets or liabilities (Level 1) Observable market data (Level 2) Unobservable market data (Level 3) Total Assets Current assets Other current financial assets Other non-current financial assets Total assets Liabilities Current liabilities Other current financial liabilities Total liabilities CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) - - - - - 669,527 87,446,662 88,116,189 130,829 130,829 669,527 87,446,662 88,116,189 130,829 130,829 - - - - 67 23 – LITIGATION AND CONTINGENCIES 23.1 Lawsuits and other legal actions: In the opinion of the Company's legal counsel, the Parent Company and its subsidiaries do not face legal or extrajudicial contingencies that might result in material or significant losses or gains, except for the following: 1) Embotelladora del Atlántico S.A. faces labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling CLP 942,173 thousand. Management considers it unlikely that non-provisioned contingencies will affect the Company's income and equity, based on the opinion of its legal counsel. Additionally, Embotelladora del Atlántico S.A. maintains time deposits for an amount of CLP 457,576 thousand to guaranty judicial liabilities 2) Rio de Janeiro Refrescos Ltda. faces labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling CLP 66,070,162 thousand. Management considers it unlikely that non-provisioned contingencies will affect the Company's income and equity, based on the opinion of its legal counsel. As it is customary in Brazil, Rio de Janeiro Refrescos Ltda. maintains Deposit in courts and assets given in pledge to secure the compliance of certain processes, irrespective of whether these have been classified as a possible, probable or remote. The amounts deposited or pledged as legal guarantees As of December 31, 2019 and 2018, amounted to CLP 32,166,823 thousand and CLP 31,143,415 thousand, respectively. Part of the assets held under warranty by Rio de Janeiro Refrescos Ltda. as of December 31, 2014, are in the process of being released and others have already been released in exchange for guarantee insurance and bond letters for BRL 1,152,911,259, with different Financial Institutions and Insurance Companies in Brazil, these entities receive an annual commission fee of 0.59%. and become responsible of fulfilling obligations with the Brazilian tax authorities should any trial result against Rio de Janeiro Refrescos Ltda. Additionally, if the warranty and bail letters are executed, Rio de Janeiro Refrescos Ltda. promises to reimburse to the financial institutions and Insurance Companies any amounts disbursed by them to the Brazilian government. Main contingencies faced by Rio de Janeiro Refrescos are as follows: a) Tax contingencies resulting from credits on tax on industrialized products (IPI). Rio de Janeiro Refrescos is a party to a series of proceedings under way, in which the Brazilian federal tax authorities demand payment of value-added tax on industrialized products (Imposto sobre Produtos Industrializados, or IPI) allegedly owed by ex- Companhia de Bebidas Ipiranga. The initial amount demanded reached BRL 1,330,473,161 (historical amount without adjustments), corresponding to different trials related to the same cause. In September 2014, one of these trials for BRL 598,745,218, was settled in favor of the Company, and additionally during 2017 several trials were settled in favor of the Company in the amount for BRL 135,282,155 however, there are new lawsuits arising after the purchase of ex-Companhia de Bebidas Ipiranga (October 2013) that amount to BRL 375,286,356. The Company does not share the position of the Brazilian tax authority in these procedures and considers that Companhia de Bebidas Ipiranga was entitled to claim IPI tax credits in connection with purchases of certain exempt raw materials from suppliers located in the Manaus free trade zone. Based on the opinion of its advisers, and legal outcomes to date, Management estimates that these procedures do not represent probable losses and has not recorded a provision on these matters. Notwithstanding the above, the IFRS related to business combination in terms of distribution of the purchase price establish that contingencies must be measured one by one according to their probability of occurrence and discounted at fair value from the date on which it is deemed the loss can be generated. According to this criterion, from a total of identified contingencies amounting BRL 694,085,017 (including readjustments of current lawsuits), the Company recorded a provision for the beginning of business combination accounting in the amount BRL 213,122,274 equivalent to CLP 39,608,019 thousand. 68 b) Tax contingencies on ICMS and IPI causes. They refer mainly to tax settlements issued by advance appropriation of ICMS credits on fixed assets, payment of the replacement of ICMS tax to the operations, untimely IPI credits calculated on bonuses, among other claims. The Company does not consider that these judgments will result in significant losses, given that their loss, according to its legal counsel, is considered unlikely. However, the accounting standards of financial information related to business combination in terms of distribution of the purchase price, establish contingencies must be valued one by one according to their probability of occurrence and discounted to fair value from the date on which it is deemed that the loss can be generated. Based on this criterion, a starting provision has been made in the accounting of the business combination for BRL 77,587,076 equivalent to CLP 14,412,520 3) Embotelladora Andina S.A. and its Chilean subsidiaries face labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling CLP 2,065,496 thousand. Management considers it is unlikely that non-provisioned contingencies will affect income and equity of the Company, in the opinion of its legal advisors. 4) Paraguay Refrescos S.A. faces tax, trade, labor and other lawsuits. Accounting provisions have been made for the contingency of any loss because of these lawsuits amounting to CLP 3,488 thousand. Management considers it is unlikely that non- provisioned contingencies will affect income and equity of the Company, in the opinion of its legal advisors. 69 23.2 Direct guarantees and restricted assets: Guarantees and restricted assets are detailed as follows: Guarantees that commit assets included in the financial statements: Committed assets Accounting value Guaranty creditor Debtor name Relationship Guaranty Type Gas Licuado Lipigas S.A. Transportes San Martin Cooperativa Agrícola Pisquera Elqui Limitada Inmob. e invers. supetar Ltda. Embotelladora Andina S.A. Embotelladora Andina S.A. Embotelladora Andina S.A. Parent company Cash Parent company Cash Parent company Cash Transportes Polar Subsidiary Maria Lobos Jamet Transportes Polar Subsidiary Bodega San Francisco Employee claims Civil and tax claims Government entities Distribuidora Baraldo S.H. Acuña Gomez Nicanor López Labarda Municipalidad Bariloche Municipalidad San Antonio Oeste Municipalidad Carlos Casares Municipalidad Chivilcoy Others Granada Maximiliano Cicsa Other lessors Aduana de EZEIZA Municipalidad de Junin Almada Jorge Transportes Polar Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Cash Cash Cash Subsidiary Subsidiary Deposit in court Subsidiary Subsidiary Deposit in court Plant & equipment Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Cash deposit Subsidiary Cash deposit Subsidiary Cash deposit Subsidiary Deposit in court Subsidiary Deposit in court Trade debtors and other accounts receivable Trade debtors and other accounts receivable Other non-current financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Property, Plant & Equipment Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other current non- financial assets Other current non- financial assets Other current non- financial assets Other non-current non-financial assets Other non-current non-financial assets 12-31-2019 12-31-2018 CLP (000’s) CLP (000’s) - 1,140 2,805 1,216,865 4,579 2,565 6,483 - - 4,579 2,565 - 6,600,863 5,336,644 12,186,432 12,597,136 13,379,610 13,209,635 250 375 268 5 36,313 27,598 1,116 369 553 395 7 21,420 40,682 1,645 172,602 254,430 53 2,250 3,128 78 3,317 4,612 15,289 46,169 422 360 3,054 3,013 1,592 4,949 Municipalidad de Picun Leufu Mirgoni Marano Farias Matias Luis Temas Industriales SA - Embargo General de Fondos Gomez Alejandra Raquel Lopez Gustavo Gerardo C/Inti Saic Y Otros Tribunal Superior De Justicia De La Provincia De Córdoba DBC SA C CERVECERIA ARGENTINA SA ISEMBECK Coto Cicsa Cencosud Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Embotelladora del Atlántico S.A. Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Subsidiary Deposit in court Deposit in court Deposit in court Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other current financial assets Deposit in court Deposit in court Cash deposit Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Subsidiary Deposit in court Marcus A.Peña Paraguay Refrescos Subsidiary Real estate Mauricio J Cordero C Paraguay Refrescos Subsidiary Real estate José Ruoti Maltese Paraguay Refrescos Subsidiary Real estate Alejandro Galeano Paraguay Refrescos Subsidiary Real estate Ana Maria Mazó Paraguay Refrescos Subsidiary Real estate 70 Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Other non-current non-financial assets Property, Plant & Equipment Property, Plant & Equipment Property, Plant & Equipment Property, Plant & Equipment Property, Plant & Equipment - 76 1,401 72 112 309 156,759 231,077 - - - 35 226 290 28,129 41,465 5,001 3,125 3,955 917 738 1,275 1,213 - - 4,164 904 758 1,251 1,191 Guarantees provided without obligation of assets included in the financial statements: Guaranty creditor Debtor name Relationship Guaranty Type 12.31.2019 CLP (000’s) 12.31.2018 CLP (000’s) Committed assets Amounts involved Employee procedures Administrative procedures Federal Government State Government Sorocaba Refrescos Others Aduana de EZEIZA Aduana de EZEIZA Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Rio de Janeiro Refrescos Ltda. Embotelladora del Atlántico S.A. Andina Empaques Argentina S.A. Subsidiary Guaranty receipt Legal proceeding 106.819.809 2,601,353 Subsidiary Guaranty receipt Legal proceeding 10.566.188 8,233,853 Subsidiary Guaranty receipt Legal proceeding 31.804.574 116,192,877 Subsidiary Guaranty receipt Legal proceeding 59.025.436 43,015,207 Associate Loan Guarantor 3.715.186 3,586,095 Subsidiary Guaranty receipt Subsidiary Surety insurance Subsidiary Surety insurance Legal proceeding Faithful compliance of contract Faithful compliance of contract 2.232.793 3,236,092 673.854 699,502 506.623 182,459 71 24 – FINANCIAL RISK MANAGEMENT The Company’s businesses are exposed to a variety of financial and market risks (including foreign exchange risk, interest rate risk and price risk). The Company’s global risk management program focuses on the uncertainty of financial markets and seeks to minimize potential adverse effects on the performance of the Company. The Company uses derivatives to hedge certain risks. A description of the primary policies established by the Company to manage financial risks are provided below: Interest Rate Risk As of December 31, 2019, the Company maintains all its debt liabilities at a fixed rate as to avoid fluctuations in financial expenses resulting from tax rate increases. The Company’s greatest indebtedness corresponds to own issued Chilean local bonds at a fixed rate for UF 16,457 million denominated in UF (“UF”), a currency indexed to inflation in Chile (Company sales are correlated with the UF variation). There is also the Company’s indebtedness on the international market through a 144A/RegS Bond at a fixed rate for USD 365 million (original amount issued USD 575 million and partial prepayment in October 2019 for USD 210 million), denominated in dollars, and practically 100% of which has been re-denominated to BRL through Cross Currency Swaps. Credit risk The credit risk to which the Company is exposed comes mainly from trade accounts receivable maintained with retailers, wholesalers and supermarket chains in domestic markets; and the financial investments held with banks and financial institutions, such as time deposits, mutual funds and derivative financial instruments. a. Trade accounts receivable and other current accounts receivable Credit risk related to trade accounts receivable is managed and monitored by the area of Finance and Administration of each business unit. The Company has a wide base of more than 100 thousand clients implying a high level of atomization of accounts receivable, which are subject to policies, procedures and controls established by the Company. In accordance with such policies, credits must be based objectively, non-discretionary and uniformly granted to all clients of a same segment and channel, provided these will allow generating economic benefits to the Company. The credit limit is checked periodically considering payment behavior. Trade accounts receivable pending of payment are monitored on a monthly basis. i. Sale Interruption: In accordance with Corporate Credit Policy, the interruption of sale must be within the following framework: when a customer has outstanding debts for an amount greater than USD 250,000, and over 60 days expired, sale is suspended. The General Manager in conjunction with the Finance and Administration Manager authorize exceptions to this rule, and if the outstanding debt should exceed USD 1,000,000, and in order to continue operating with that client, the authorization of the Chief Financial Officer is required. Notwithstanding the foregoing, each operation can define an amount lower than USD 250,000 according to the country’s reality. ii. Impairment The impairment recognition policy establishes the following criteria for provisions: 30% is provisioned for 31 to 60 days overdue, 60% between 60 and 91 days, 90% between 91 and 120 days overdue and 100% for more than 120 days. Exemption of the calculation of global impairment is given to credits whose delays in the payment correspond to accounts disputed with the customer whose nature is known and where all necessary documentation for collection is available, therefore, there is no uncertainty on recovering them. However, these accounts also have an impairment provision as follows: 40% for 91 to 120 days overdue, 80% between 120 and 170, and 100% for more than 170 days. 72 iii. Prepayment to suppliers The Policy establishes that USD 25,000 prepayments can only be granted to suppliers if its value is properly and fully provisioned. The Treasurer of each subsidiary must approve supplier warranties that the Company receives for prepayments before signing the respective service contract. In the case of domestic suppliers, a warranty ballot (or the instrument existing in the country) shall be required, in favor of Andina executable in the respective country, non-endorsable, payable on demand or upon presentation and its validity will depend on the term of the contract. In the case of foreign suppliers, a stand-by credit letter will be required which shall be issued by a first line bank; in the event that this document is not issued in the country where the transaction is done, a direct bank warranty will be required. Subsidiaries can define the best way of safeguarding the Company’s assets for prepayments under USD 25,000. iv. Guarantees In the case of Chile, we have insurance with Compañía de Seguros de Crédito Continental S.A. (AA rating –according to Fitch Chile and Humphreys rating agencies) covering the credit risk regarding trade debtors in Chile. The rest of the operations do not have credit insurance, instead mortgage guarantees are required for volume operations of wholesalers and distributors in the case of trade accounts receivables. In the case of other debtors, different types of guarantees are required according to the nature of the credit granted. Historically, uncollectible trade accounts have been lower than 0.5% of the Company’s total sales. b. Financial investments The Company has a Policy that is applicable to all the companies of the group in order to cover credit risks for financial investments, restricting both the types of instruments as well as the institutions and degree of concentration. The companies of the group can invest in: i. Time deposits: only in banks or financial institutions that have a risk rating equal or higher than Level 1 (Fitch) or equivalent for deposits of less than 1 year and rated A or higher (S&P) or equivalent for deposits of more than 1 year. ii. Mutual funds: investments with immediate liquidity and no risk of capital (funds composed of investments at a fixed-term, current account, fixed rate Tit BCRA, negotiable obligations, Over Night, etc.) in all those counter-parties that have a rating greater than or equal to AA-(S&P) or equivalent, Type 1 Pacts and Mutual Funds, with a rating greater than or equal to AA+ (S&P) or equivalent. iii. Other investment alternatives must be evaluated and authorized by the office of the Chief Financial Officer. Exchange Rate Risk The company is exposed to three types of risk caused by exchange rate volatility: a) Exposure of foreign investment This risk originates from the translation of net investment from the functional currency of each country (Brazilian Real, Paraguayan Guaraní, and Argentine Peso) to the Parent Company’s reporting currency (Chilean Peso). Appreciation or devaluation of the Chilean Peso with respect to the functional currencies of each country, originates decreases and increases in equity, respectively. The Company does not hedge this risk. 73 a.1 Investment in Argentina As of December 31, 2019, the Company maintains a net investment of CLP 159,998,762 thousand. in Argentina, composed by the recognition of assets amounting to CLP 241,470,298 thousand and liabilities amounting to CLP 81,471,536. These investments accounted for 22.0% of the Company’s consolidated sales revenues As of December 31, 2019, the Argentine peso devalued by 32.2% with respect to the Chilean peso. If the exchange rate of the Argentine Peso devalued an additional 5% with respect to the Chilean Peso, the Company would have lower income from the operation in Argentina of CLP 309,180 thousand and a decrease in equity of CLP 4,568,317 thousand, originated by lower asset recognition of CLP 7,801,317 thousand and by lower liabilities recognition of CLP 3,233,000 thousand. a.2 Investment in Brazil As of December 31, 2019, the Company maintains a net investment of CLP 327,783,626 thousand in Brazil, composed by the recognition of assets amounting to CLP 958,328,527 thousand and liabilities amounting to CLP 630,544,901thousand. These investments accounted for 34.8% of the Company's consolidated sales revenues. As of December 31, 2019, the Brazilian Real devalued by 3.6% with respect to the Chilean peso. If the exchange rate of the Brazilian Real devalued an additional 5% with respect to the Chilean Peso, the Company would have lower income from the operation in Brazil of CLP 3,959,257 thousand and a decrease in equity of CLP 13,126,491thousand, originated by lower asset recognition of CLP 40,179,105 thousand and by lower liabilities recognition of CLP 27,052,614 thousand. a.3 Investment in Paraguay As of December 31, 2019, the Company maintains a net investment of CLP 247,424,752 thousand in Paraguay, composed by the recognition of assets amounting to CLP 289,576,010 thousand and liabilities amounting to CLP 42,151,258 thousand. These investments accounted for 8.9% of the Company's consolidated sales revenues. As of December 31, 2019, the Paraguayan Guarani devalued by 0.5% with respect to the Chilean peso. If the exchange rate of the Paraguayan Guaraní devalued by 5% with respect to the Chilean Peso, the Company would have lower income from the operations in Paraguay of CLP 1,365,519 thousand and a decrease in equity of CLP 11,749,100thousand originated by lower asset recognition of CLP 13,559,529 thousand and lower liabilities recognition of CLP 1,810,429thousand. b) Net exposure of assets and liabilities in foreign currency This risk stems mostly from carrying liabilities in US dollar, so the volatility of the US dollar with respect to the functional currency of each country generates a variation in the valuation of these obligations, with consequent effect on results. As of December 31, 2019, the Company maintains a net debt position with a net liability position in USD totaling CLP 255,482,827 thousand, basically composed of bonds payable and leasing contracts for CLP 272,216,076 thousand partially offset by financial assets denominated in dollars for CLP 16,733,249 thousand. 74 All U.S. Dollar liabilities amounting to CLP 272,216,076 thousand correspond to dollar liabilities of the Chilean, Argentinean and Brazilian operations and are, therefore, exposed to the volatility of the Chilean peso against the U.S. Dollar. In order to protect the Company from the effects on income resulting from the volatility of the Brazilian Real and the Chilean Peso against the U.S. dollar, the Company maintains derivative contracts (cross currency swaps) to cover almost 100% of US dollar- denominated financial liabilities. By designating such contracts as hedging derivatives, the effects on income for variations in the Chilean Peso and the Brazilian Real against the US dollar, are mitigated annulling its exposure to exchange rates. c) Exposure of assets purchased or indexed to foreign currency This risk originates from purchases of raw materials and investments in Property, plant and equipment, whose values are expressed in a currency other than the functional currency of the subsidiary. Changes in the value of costs or investments can be generated through time, depending on the volatility of the exchange rate. In order to minimize this risk, the Company maintains a currency hedging policy stipulating that it is necessary to enter into foreign currency derivatives contracts to lessen the effect of the exchange rate over cash expenditures expressed in US dollars, corresponding mainly to payment to suppliers of raw materials in each of the operations. This policy stipulates a 12-month forward horizon. Commodities risk The Company is subject to a risk of price fluctuations in the international markets mainly for sugar, PET resin and aluminum, which are inputs used to produce beverages and containers, which together, account for 35% to 40% of operating costs. Procurement and anticipated purchase contracts are made frequently to minimize and/or stabilize this risk. To minimize this risk or stabilize often supply contracts and anticipated purchases are made when market conditions warrant. Liquidity risk The products we sell are mainly paid for in cash and short-term credit; therefore, the Company´s main source of financing comes from the cash flow of our operations. This cash flow has historically been sufficient to cover the investments necessary for the normal course of our business, as well as the distribution of dividends approved by the General Shareholders’ Meeting. Should additional funding be required for future geographic expansion or other needs, the main sources of financing to consider are: (i) debt offerings in the Chilean and foreign capital markets (ii) borrowings from commercial banks, both internationally and in the local markets where the Company operates; and (iii) public equity offerings The following table presents an analysis of the Company’s committed maturities for liability payments throughout the coming years: Item Bank debt Bonds payable Lease obligations Contractual obligations Total Maturity More than 2 years up to 3 CLP (000’s) 786,812 41,194,718 10,933,557 5,654,968 58,570,055 More than 3 up to 4 CLP (000’s) 44,621 41,041,811 10,817,417 4,823,313 56,727,162 More than 4 years CLP (000’s) 44,621 341,250,507 18,479,429 2,499,886 362,274,443 1 year CLP (000’s) 724,370 44,833,400 8,663,557 19,108,905 73,330,232 More than 1 year up to 2 CLP (000’s) 1,439,072 42,979,308 11,228,497 63,130,570 118,777,447 75 25 – EXPENSES BY NATURE Other expenses by nature are: Details Direct production costs Employee expenses Transportation and distribution Advertising Depreciation and amortization Repairs and maintenance Other expenses Total (1) 01.01.2018 01.01.2019 12.31.2019 12.31.2018 CLP (000’s) CLP (000’s) 759,229,954 266,966,841 137,428,173 17,345,951 99,594,446 28,120,098 138,860,648 1,541,243,865 1,447,546,111 877,716,948 273,123,010 138,486,337 27,113,322 111,087,284 30,528,180 83,188,784 (1) Corresponds to the addition of cost of sales, administration expenses and distribution cost. 26 – OTHER INCOME Other income by function is detailed as follows: Details Gain on disposal of Property, plant and equipment Recovery AFIP claim Recovery PIS and COFINS credits (1) Others Total (1) See Note 6 for more information regarding recovery 27 – OTHER EXPENSES BY FUNCTION Other expenses by function are detailed as follows: Details Contingencies and non-operating fees Tax on bank debits Write-offs, disposal and loss of Property, plant and equipment Others Total 76 01.01.2018 01.01.2019 12.31.2018 12.31.2019 CLP (000’s) CLP (000’s) 1,984,547 232,617 - 392,004 2,609,168 265,514 - 40,281,550 400,094 40,947,158 01.01.2019 12.31.2019 CLP (000’s) 17,690,171 4,356,973 2,978,194 1,157,509 26,182,847 01.01.2018 12.31.2018 CLP (000’s) 10,192,495 4,653,929 262,366 948,973 16,057,763 28 – FINANCIAL INCOME AND EXPENSES Financial income and expenses are detailed as follows: a) Financial income Detail Interest income Guaranty restatement Ipiranga acquisition Recovery PIS and COFINS credits (1) Other financial income Total (1) See Note 6 for more information regarding recovery b) Financial costs Details Bond interest Bank loan interest Other financial costs Total 29 – OTHER (LOSSES) GAINS Other (losses) gains are detailed as follows: Details (Losses) gains on ineffective portion of hedge derivatives Other income and expenses Total 77 01.01.2019 12.31.2019 CLP (000’s) 3,249,550 27,219 39,780,620 2,098,402 45,155,791 01.01.2018 12.31.2018 CLP (000’s) 1,046,580 - - 2,893,664 3,940,244 01.01.2019 12.31.2019 CLP (000’s) 38,153,036 1,337,670 6,718,314 46,209,020 01.01.2018 12.31.2018 CLP (000’s) 38,547,682 1,828,588 14,638,390 55,014,660 01.01.2019 12.31.2019 CLP (000’s) - 2,876 2,876 01.01.2018 12.31.2018 CLP (000’s) (2,707,802) (57) (2,707,859) 30. LOCAL AND FOREIGN CURRENCY Local and foreign currency balances are the following: CURRENT ASSETS Cash and cash equivalent USD EUR CLP BRL ARS PGY Other financial assets, current CLP BRL ARS PGY Other non-financial assets, current USD EUR UF CLP BRL ARS PGY Trade accounts and other accounts receivable USD EUR UF CLP BRL ARS PGY Accounts receivable related entities USD CLP ARS Inventory USD EUR CLP BRL ARS PGY 12.31.2019 CLP (000’S) 157,567,986 16,732,278 9,723 78,421,936 46,189,977 3,830,199 12,383,873 347,278 275,407 13,498 16,575 41,798 16,188,965 893,571 615,636 410,203 5,642,901 1,738,793 3,918,728 2,969,133 191,077,588 1,431,079 - 453,469 83,328,449 79,586,461 19,088,164 7,189,966 10,835,768 45,644 9,157,922 1,632,202 147,641,224 6,027,076 - 48,320,784 43,820,564 34,262,914 15,209,886 12.31.2018 CLP (000’S) 137,538,613 5,917,041 51,401 86,121,695 28,040,970 6,726,906 10,680,600 683,537 355,126 14,040 300,359 14,042 5,948,923 45,053 78,623 3,589,253 1,275,073 460,125 500,796 174,113,323 863,794 52,332 1,414,800 73,028,244 66,585,089 25,000,141 7,168,923 9,450,263 26,557 6,911,814 2,511,892 151,319,709 2,197,382 12,522 50,130,341 36,797,523 46,394,230 15,787,711 Current tax assets 9,815,294 2,532,056 CLP BRL Total current assets USD EUR UF CLP BRL ARS PGY 9,815,294 - - 2,532,056 553,474,103 25,129,648 625,359 863,672 234,962,693 171,349,293 62,748,782 37,794,656 481,586,454 9,049,827 116,255 1,493,423 220,136,473 135,244,751 81,393,653 34,152,072 78 NON-CURRENT ASSETS Other non-current financial assets UF BRL ARS Other non-current, non-financial assets USD UF CLP BRL ARS PGY Accounts receivable, non-current UF ARS PGY Accounts receivable related entities, non-current CLP Investments accounted for using the equity method CLP BRL ARS Intangible assets other than goodwill USD CLP BRL ARS PGY Goodwill CLP BRL ARS PGY Property, plant & equipment USD EUR CLP BRL ARS PGY Deferred tax assets CLP Total non-current assets USD 12.31.2019 CLP (000’s) 110,784,311 1,216,865 98,918,457 10,648,989 125,636,150 - 318,533 47,531 122,922,979 2,223,600 123,507 523,769 465,371 636 57,762 283,118 283,118 99,866,733 49,703,673 50,163,060 675,075,375 3,959,421 307,324,953 189,240,893 2,708,445 171,841,663 121,221,661 9,523,767 74,653,328 29,750,238 7,294,328 722,718,863 - - 282,861,852 251,080,517 119,784,304 68,992,190 1,364,340 1,364,340 12.31.2018 CLP (000’s) 97,362,295 87,446,661 9,915,634 34,977,264 22,917 314,283 47,532 32,070,120 2,315,682 206,730 1,270,697 1,204,097 90 66,510 74,340 74,340 102,410,945 50,136,221 52,274,724 - 668,822,553 4,960,399 306,508,710 182,657,545 2,101,571 172,594,328 117,229,173 9,523,767 72,059,356 28,318,129 7,327,921 710,770,968 - 381,732 271,625,978 252,674,783 117,532,176 68,556,299 - - 1,857,474,320 3,959,421 1,732,918,235 4,983,316 EUR UF CLP BRL ARS PGY - 2,000,769 651,109,234 786,979,234 165,116,212 248,309,450 381,732 1,518,380 637,916,548 679,183,189 160,183,282 248,751,788 79 CURRENT LIABILITIES Other financial liabilities, current USD UF CLP BRL ARS PGY Trade accounts and other accounts payable, current USD EUR UF CLP BRL ARS PGY Other currencies Accounts payable to related entities, current USD CLP BRL ARS PGY Other current provisions CLP PGY Current tax liabilities CLP BRL ARS PGY Employee benefits current provisions CLP BRL ARS PGY Other current non-financial liabilities CLP ARS PGY Total current liabilities USD EUR UF CLP BRL ARS PGY Up to 90 days CLP (000’S) 9,719,894 55,388 7,535,228 842,221 1,153,072 75,060 58,925 228,259,216 10,049,567 2,024,156 2,044,871 84,602,547 75,051,089 40,826,489 13,660,497 - 53,637,601 - 28,471,399 19,279,132 5,887,070 1,637,799 1,637,799 - 3,097,223 896,975 2,107,381 92,867 - 26,513,813 1,241,603 20,681,694 4,590,516 - 328,441 327,847 594 - 323,193,987 10,104,955 2,024,156 9,580,099 118,021,391 118,272,368 51,472,596 13,719,422 12.31.2019 90 days up to1 year CLP (000’S) 30,873,984 3,147,441 11,836,936 11,700,946 2,119,141 704,921 1,364,599 15,441,337 - - - 15,441,337 - - - - - - - 431,185 427,697 3,488 3,665,044 - - 3,446,054 218,990 11,879,041 5,509,351 - 5,260,142 1,109,548 26,173,774 26,064,658 5,286 103,830 88,464,365 3,147,441 - 11,836,936 59,143,989 2,119,141 9,416,403 2,800,455 Total Up to 90 days 12.31.2018 90 days up to1 year Total CLP (000’S) CLP (000’S) CLP (000’S) CLP (000’S) 56,114,977 3,434,840 18,368,408 10,342,404 20,674,416 14,876,804 871,811 40,593,878 3,202,829 19,372,164 12,543,167 3,272,213 779,981 1,423,524 46,737,556 3,304,011 10,536,509 9,681,676 20,833,877 1,357,285 1,024,198 9,377,421 130,829 7,831,899 - 1,413,622 1,071 - 243,700,553 10,049,567 2,024,156 2,044,871 100,043,884 75,051,089 40,826,490 13,660,497 - 53,637,601 - 28,471,399 19,279,132 5,887,070 2,068,984 2,065,496 3,488 6,762,267 896,975 2,107,381 3,538,921 218,990 38,392,854 6,750,954 20,681,694 9,850,658 1,109,548 26,502,215 26,392,505 5,880 103,830 411,658,352 13,252,396 2,024,156 21,417,035 177,164,380 120,391,509 60,888,999 16,519,877 251,551,666 11,716,262 2,202,581 2,198,131 82,576,800 74,524,169 69,859,508 8,472,550 1,665 45,687,476 - 27,729,582 12,478,179 5,479,714 - 1,789,275 1,789,275 - 4,302,370 4,302,370 - - 10,189,264 1,177,114 - 9,012,150 - 1,346,839 869,964 476,875 - 307,408,127 14,644,911 4,311,724 8,023,954 116,967,550 82,832,774 69,816,247 10,805,605 3,394,363 - 59,951 - 3,334,412 - - - - 140,383 - 140,383 - - - 1,696,338 1,681,178 15,160 5,036,242 1,184,842 2,980,634 870,766 23,021,715 4,854,163 17,180,455 - 987,097 32,427,375 32,276,377 - 150,998 112,453,972 3,304,011 59,951 10,536,509 53,153,031 38,014,332 4,337,919 3,048,219 238,109,846 14,514,082 4,371,675 192,055 84,433,657 68,940,973 54,846,437 10,805,605 5,362 45,827,858 27,869,965 12,478,179 5,479,714 3,485,613 3,470,453 15,160 9,338,612 5,487,212 2,980,634 870,766 33,210,979 6,031,277 17,180,455 9,012,150 987,097 33,774,214 33,146,341 476,875 150,998 419,862,099 17,948,922 4,371,675 18,560,463 170,120,581 120,847,106 74,154,166 13,853,824 Other currencies - - - 5,362 - 5,362 80 NON-CURRENT LIABILITIES Other financial liabilities, non-current USD UF CLP BRL ARS PGY Accounts payable, non-current USD CLP ARS Accounts payable related entities BRL Other provisions, non-current CLP BRL ARS Deferred Tax liabilities UF CLP BRL ARS PGY Employee benefits non-current provisions CLP ARS PGY Total non-current liabilities USD UF CLP BRL ARS PGY 12.31.2019 12.31.2018 Total 509,366 271,700,335 More than 5 years More than 3 and up to 5 More than 1 year up to 3 More than 1 year up to 3 CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) CLP (000’s) 28,642,101 276,409,074 411,512,603 716,563,778 - 250,976,154 23,105,123 402,045,609 450,785,690 - 14,801,934 - 34,794,568 299,661,490 408,870,999 - 24,627,105 400,393,581 - 8,477,418 - - 743,327,057 272,209,701 447,605,640 7,926,056 15,130,982 55,222 399,456 22,584,954 7,926,056 3,319,514 55,222 399,456 25,634,958 - 3,007,143 - - 3,334,050 - - - 9,466,994 - - 2,327,797 - More than 3 and up to 5 More than 5 years - 250,976,154 Total 619,587 - 618,509 1,078 19,777,812 19,777,812 - - - - - - 968,404 - - 968,404 66,070,162 - 66,070,162 - - - - - - - - - - - 12,834,788 - 1,449,404 - 11,385,384 - 1.114.051 461,587 88,090 564,374 49,848,536 106,766,423 1,298,050 90,271,026 - - 15,197,347 - 181,418 49,667,118 - - 148,954 148,954 - - 8,910,349 8,910,349 - - 619,587 - 618,509 1,078 19,777,812 19,777,812 67,038,566 - 66,070,162 968,404 169,449,747 1,298,050 91,901,847 49,667,118 11,385,384 15,197,347 10,173,354 9,520,890 88,090 564,374 735,665 585,289 148,680 1,696 - - - - - - - - 3,448,042 2,500,000 - 948,042 55,518,871 - 55,518,871 - - - - - - - - - - 735,665 585,289 148,680 1,696 - - 58,966,913 2,500,000 55,518,871 948,042 16,607,605 101,512,040 - 81,630,530 19,881,510 - - - 497,175 - 16,110,430 - 27,126,303 145,245,948 - 94,027,680 19,881,510 16,110,430 15,226,328 - 11,899,975 - - 15,226,328 742,297 230,528 511,769 240,148 240,148 8,433,096 8,433,096 9,415,541 8,903,772 - - 511,769 509,366 271,700,335 70,109,209 415,729,142 524,547,771 1,010,386,123 272,209,701 448,903,690 109,967,302 150,646,074 12,498,178 16,161,177 - 24,627,105 401,691,631 99,181,375 8,477,418 - 15,197,347 22,584,954 10,455,555 330,372 23,097,326 119,071,330 - 12,498,178 - 963,830 81 585,289 250,976,154 50,175,710 433,680,133 447,072,002 930,927,845 - 251,561,443 23,105,123 402,045,609 450,785,690 20,333,071 105,580,132 81,870,678 90,202,315 77,728,178 17,060,169 - 15,738,097 - 25,634,958 3,376,383 3,007,143 17,060,168 511,769 9,466,994 - 15,226,328 31 – THE ENVIRONMENT The Company has made disbursements totaling CLP 2,693 million for improvements in industrial processes, equipment to measure industrial waste flows, laboratory analysis, consulting on environmental impacts and others. These disbursements by country are detailed as follows: 2019 period Capitalized to Property, plant and equipment CLP (000’s) - - - 687,486 687,486 Recorded as expenses CLP (000’s) 1,446,232 205,165 920,255 121,554 2,693,206 Future commitments To be capitalized to Property, plant and equipment CLP (000’s) To be recorded as expenses CLP (000’s) - 15,155 192,320 0 207,475 - - 61,773 0 61,773 Country Chile Argentina Brazil Paraguay Total 32 – SUBSEQUENT EVENTS On January 21, 2020, the Company issued corporate bonds on the international market for USD 300 million. The use of proceeds from this operation will be for general corporate purposes which could include the eventual payment of existing liabilities, financing of potential acquisitions and improving the liquidity of the Company. The transaction consisted of issuing a 30-year bond totaling USD 300 million with a bullet structure and an annual coupon rate of 3.950%. At the same time, derivatives (Cross Currency Swaps) have been contracted hedging 100% of the bond's financial liabilities that are denominated in U.S. dollars by redenominating that liability to UF. On February 24, 2020, the tax reform was approved in Chile, which becomes effective immediately, however, most of the effects will begin to materialize in the 2021 Income Tax Statement, the Company will assess the possible impacts in the relevant period. No other events have occurred after December 31, 2019 that may significantly affect the Company's consolidated financial situation. 82 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. SIGNATURES Santiago, March 13, 2020 EMBOTELLADORA ANDINA S.A. /s/ Andrés Wainer By: Name:Andrés Wainer Title: Chief Financial Officer 83 GRI CONTENT INDEX Indicators that relate to the principles of the United Nations Global Compact are identified in light blue. GRI 102: General Contents GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Perfil Organizacional GRI 102-1 Organization name Chapter 7: Exhibits; Identification of the Company, p. 94 Corporate Name: Embotelladora Andina S.A. Type of Company: Open Stock Corporation Legal Address: Miraflores 9153, comuna de Renca, Santiago Chilean Tax ID No.: 91.144.000-8 GRI 102-2 a. Description of the activities of the organization b. Major brands, products and services Chapter 1: Andina at a Glance, p. 3,4,5,6,7. Chapter 5: We Operate with Integrity, p. 44: Our Portfolio. GRI 102-3 Location of headquarters Chapter 1: Andina at a Glance, p. 8. GRI 102-4 Location of operations. Location of operations: Indicate in how many countries the organization operates and name those countries where the organization conducts meaningful operations or that have specific relevance to the sustainability issues that are the subject of the report Chapter 7: Exhibits; Company Identification, p.94, 95, 96, 97, 98, 99. Corporate office Av. Miraflores 9153, Piso 7, Renca, Santiago de Chile Tel. (56 2)2338 0520 - www.koandina.com GRI 102-5 Ownership and legal form Chapter 7: Exhibits; Company Identification, p.94. Type of Company: Open Stock Corporation. In addition, the Company's shares are traded on the Santiago Stock Exchange. In addition, the Company's shares are traded on the Santiago Electronic Exchange. The registration number in the CMF Securities Register is 00124. The mnemonics code, both for the Santiago Stock Exchange and for the Electronic Exchange, are Andina-A and Andina-B, each corresponding to the respective series of shares. The Company's ADRs have been traded on the New York Stock Exchange since 1994. An ADR is equivalent to six shares of common stock. The mnemonics codes for the NYSE are AKO/A and AKO/B. The depositary bank for ADRs is The Bank of New York Mellon (www.bnymellon.com). HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-6 Markets served. Markets served, and include: i. the geographic locations where the products and services are offered; ii. the sectors served; iii. the types of customers and beneficiaries. Chapter 7: Exhibits; Identification of the Company, p. 94, 95, 96, 97, 98, 99. In addition, in chapter 1. Andina at a Glance, p. 7, 9, 10, 11, 43, 44, 45. GRI 102-7 Organization size Chapter 1: Andina at a Glance, p. 3, 5, 9, 10, 11. Exhibits: Financial Statements. On the website of www.koandina.com: http://www.koandina.com/ pagina.php?p=inversionistas GRI 102-8 Information about employees and other workers Chapter 5: We operate with integrity, from p. 60 to 66. Chapter 6: Our Metrics. GRI 102-9 Supply chain Chapter 1: Andina at a Glance, p. 4. GRI 102-10 Significant changes in the organization and its supply chain No record has been made GRI 102-11 Precautionary principle or approach Chapter 3: Sustainable Value Strategy, p. 20,21,22. GRI 102-12 External initiatives Chapter 1: Andina at a Glance, P. 8, 68, 69. GRI 102-13 Association membership Chapter 5: We operate with Integrity, Entities We Support, p.4, p.68 and p.69. Strategy We have certifications, those detailed in p. 43: Quality ISO 9001 / Environment ISO 14001 / Health and Safety OHSAS 18001/ Food Safety FSSC 22.000/ GAO, Corporate Requirements The Coca-Cola Company Supplier Guiding Principles. See also: Corporate Sustainability Policy. Corporate Policy http://www.koandina.com/ Risk Management. Also, check 20 F at: http://www.koandina.com/pagina.php?p=inversionistas. We participate in various external initiatives of an economic, social and environmental nature, all volunteers and in order to improve our processes and share our experiences. Coca-Cola Andina adheres to the principles and initiatives of which The Coca-Cola Company and the Coca-Cola System participate. These include the principles of the Global Compact and the United Nations Human Rights Declaration. Embotelladora Andina S.A. signed its accession to the United Nations Global Compact in Chile in 2015, which it maintained during 2019. GRI 102-14 Statement by senior executives responsible for decision-making Chapter 1: Andina at a Glance, p. 5, 9, 10, 11. Message from the Chairman of the Board on the web: http://www. koandina.com/pagina.php?p=mensaje-presidente. 6.2 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-15 Main impacts, risks and opportunities Chapter: 3 Sustainable Value Creation strategy, p. 37, 38, 39, 40. Ethics and integrity GRI 102-16 Values, principles, standards and standards of conduct Chapter: 3 Sustainable Value Creation Strategy, p.16 and 17. GRI 102-17 Advisory mechanisms and ethical concerns Chapter: 2 Creation of Sustainable Value, p. 26 and 27. Review 20 F at the following link; http://www.koandina.com/pagina. php?p=inversionistas. Corporate Governance Practices and Policies: http://www.koandina. com/pagina.php?p=gobierno-politicas. Sustainability Policy : http://www.koandina.com/pagina. php?p=sustentabilidad. 7.4.2 Our values are: integrity, teamwork, attitude, austerity, results orientation, customer focus. To review our Code of Ethics and Supplier Code of Ethics: http://www.koandina.com/pagina.php?p=gobierno-politicas. The commitment to sustainable value creation in a framework of transparency, ethics and corporate responsibility is a strategic objective of our Corporate Governance Review the Corporate Crime Prevention Policy: http://www.koandina.com/uploads/Polit.%20 Corp.Prevencion%20de%20delitos%20ley%2020.393.pdf Anonymous Complaints Procedure: http://www.koandina.com/uploads/Proc_Den_ Anoni.pdf. Governance GRI 102-18 Governance structure Chapter 3: Value Creation, Corporate Governance, p. 26-34. In the following link you can review the corporate governance structure http://www.koandina.com/pagina.php?p=gobierno-estructura. In the following link, the Corporate Governance Policies and Procedures http://www.koandina.com/pagina.php?p=gobierno-politicas. GRI 102-19 Delegation of authority Chapter 3: Value Creation, Corporate Governance, p. 26-34. Corporate Bylaws: http://www.koandina.com/uploads/Adjuntos/ Estatutos%20Societarios%20Reforma%2025-06-12.pdf GRI 102-20 Executive-level responsibility for economic, environmental and social issues Chapter 3: Value Creation, Corporate Governance, p. 26-34. Corporate Sustainability Policy:http://www.koandina.com/uploads/ paginas/P.%20Corp.%20Sustent.pdf. GRI 102-21 Consultation of stakeholders on economic, environmental and social issues Chapter 3: Creation of Sustainable Value, Materiality, p. 20. GRI 102-22 Composition of the highest governing body and its committees Chapter 3: Value Creation, Corporate Governance, p. 19-22. An update of the materiality study is carried out every two years at Coca-Cola Andina. The last was performed in 2018 and each result is submitted to the Ethics and Sustainability Committee for validation. In the following link you can review the corporate governance structure http://www.koandina.com/pagina.php?p=gobierno-estructura. In the following link, the Corporate Governance Policies and Procedures http://www.koandina.com/pagina.php?p=gobierno-politicas. GRI 102-23 President of the highest governing body Chapter 3: Value Creation, Corporate Governance, p. 28. Juan Claro (Chairman), Board Member since April 2004. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-24 Nomination and selection of the highest governing body Chapter 3: Value Creation, Corporate Governance, p. 28. GRI 102-25 Conflicts of interest Chapter 3: Value Creation, Corporate Governance, p. 26-34. GRI 102-26 Role of the highest governing body in the selection of objectives, values and strategy Chapter 3: Value Creation, Corporate Governance, p. 26-34. Corporate Bylaws: http://www.koandina.com/uploads/Adjuntos/ Estatutos%20Societarios%20Reforma%2025-06-12.pdf. http://www. koandina.com/uploads/paginas/ComparacionNYSE.pdf. There is a policy that points out how to manage conflicts between the interests of individuals and/or third parties involved in decision-making, with the interests of the Company. http://www.koandina.com/pagina. php?p=gobierno-politicas. Code of Ethics: Provides a guide to minimum principles of conduct for all employees, contractors, consultants and Board members; it is the responsibility of all persons to comply with the provisions of this Code, whatever their contractual condition and position within the group, as well as all those who provide services in the Company. There is a Committee of Ethics of Embotelladora Andina S.A., and that will have at least three members, who will be appointed by the Company's Board of Directors from among its members. The Ethics Committee of Embotelladora Andina S.A. has among its functions: a. Analyze the complaints received through the channels arranged by the Company. b. Receive, know and investigate reports of irregularities and recommend actions to follow in each of the cases. c. Establish and develop procedures to encourage the ethical conduct of people. d. Monitor compliance with the provisions of the Code of Ethics and resolve the queries and conflicts that its application may generate. e. Establish mechanisms for the dissemination of the Code of Ethics, and of general matters of an ethical nature. The Ethics Committee of Embotelladora Andina S.A. will meet at least on a bi-annual basis, upon summons by its president. GRI 102-27 Collective knowledge of the highest governing body Chapter 3: Value Creation, Corporate Governance, p. 27-34. The Exhibit details the Directors' CV p.138 GRI 102-28 Evaluation of the performance of the highest governing body Chapter 3: Value Creation, Corporate Governance, p. 27 to p.34. General Standard No. 385: http://www.koandina.com/uploads/Inf.%20 NCG%20N385%20Marzo-2018.pdf. GRI 102-29 Identification and management of economic, environmental and social impacts Chapter 3: Value Creation, Corporate Governance, p. 21 to 23 and 37 to 40. General Standard No. 385: http://www.koandina.com/uploads/Inf.%20 NCG%20N385%20Marzo-2018.pdf. GRI 102-30 Effectiveness of risk management processes Chapter 3: Value Creation, Corporate Governance, Risk Management p. 37 to 40. The Company has an Executive Committee, within whose responsibilities is to oversee the general progress of social business and the control of operations, thus guaranteeing the operational continuity of the Company in case of contingency or crisis. Response from General Standard No. 385: http://www.koandina.com/uploads/Inf.%20NCG%20N385%20 Marzo-2018.pdf HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-31 Assessment of economic, environmental and social issues Chapter 3: Value Creation, Corporate Governance, p.26 to 34. GRI 102-32 Role of the highest governing body in sustainability reporting Chapter 3: Value Creation, Corporate Governance, p. 26-34. GRI 102-33 Communication of critical concerns GRI 102-34 Nature and total number of critical concerns Chapter 3: Value Creation, Corporate Governance, p.29 and p.30 Although Andina publishes its Sustainability Report on annual basis, which is also disclosed through its website (www.koandina.com), the Company has formally approved its Corporate Sustainability Policy, which among others, will allow to provide annual public information regarding policies adopted by the Company; Stakeholders identified by the Company as relevant; relevant risks, including sustainability; and indicators measured by the Company on social responsibility and sustainable development. Similarly, it has also been agreed to incorporate these subjects into the information presented annually in the Annual Report of the Company. Response of General Standard No. 385: http://www.koandina.com/uploads/Inf.%20NCG%20N385%20 Marzo-2018.pdf. The Integrated Annual Report must be approved by the Board; it is reviewed and approved in the session prior to the Annual General Shareholders' Meeting, which also makes comments on and approves the Integrated Annual Report each year. Andina has a unit dedicated to clarifying doubts that shareholders and investors, national or foreign, may have regarding the Company, its business, main risks, financial, economic or legal situation and publicly known businesses, all in accordance with the applicable legal regulations. This unit is highly qualified to fulfill this work, its members dominate the English language and, in conjunction with the Chief Executive Officer of the Company and its Chief Financial Officer, is the only unit authorized by the Board to respond to inquiries from shareholders, investors and the media. Response from General Standard No. 385: http://www.koandina.com/ uploads/Inf.%20NCG%20N385%20Marzo-2018.pdf. The main issues and concerns conveyed to the senior governing body included reviewing anonymous complaints, analyzing internal audit reports, reviewing and approving corporate policies, such as corporate sustainability and risk management or other standards that apply to corporate governance or the company, internal control systems, review and approval of new businesses , review and approval of results, consolidated and by operation. Some of these subjects were reviewed in the Executive Committee and then discussed by the Board, others were dealt with directly in the Board. Depending on their nature, if they come from a specific operation, from the administration or the Anonymous Complaints Channel, the resolution mechanism is determined. The Board meets once a month to find out the company's results and all the matters that are of its competence HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-35 Remuneration policies Chapter 3: Value Creation, Corporate Governance, p.35. GRI 102-36 Process for determining remuneration In the case of key executives, remuneration plans consist of a fixed remuneration and a performance bonus, which try to adapt to the risk and competitive conditions of each market, and the amounts of which vary according to the position and/or responsibility exercised. Review Minutes of the Annual General Shareholders' Meeting: http://www. koandina.com/pagina.php?p=inversionistas-info#joa Review 20 F on the following link; http://www.koandina.com/pagina. php?p=inversionistas. Corporate Governance Practices and Policies: http://www.koandina. com/pagina.php?p=gobierno-politicas. Sustainability Policy: http://www.koandina.com/pagina.php. Point B Remuneration. GRI 102-37 Involvement of Stakeholders in remuneration Chapter 3: Value Creation, Corporate Governance, p.20, 21, 22. GRI 102-38 Annual total compensation ratio Confidential Information for the Company. GRI 102-39 Ratio of percentage increase in total annual compensation This information is confidential to safeguard the personal safety of employees and the senior managers of our Organization. Participation of stakeholders GRI 102-40 List of stakeholders Chapter 3: Creation of Sustainable Value: Stakeholders, p.74. GRI 102-41 Collective bargaining agreements Chapter 5. We Operate with Integrity, Working Environment, p. 67. Chapter 6: Our Metrics: 89 At Coca-Cola Andina we respect and support the right to freedom of association in all countries where we operate. GRI 102-42 Identification and selection of stakeholders GRI 102-43 Approach to stakeholder participation Chapter 3: Creation of Sustainable Value: Stakeholders, p.74. Chapter 3: Creation of Sustainable Value: Stakeholders, p.74. GRI 102-44 Issues and concerns that have been identified through the participation of stakeholders Chapter 3: Creation of Sustainable Value: Stakeholders, p.19,20, 21, 22, 23, 24. Reporting practices GRI 102-45 Entities included in the consolidated financial statements This annual report consolidates the information of the transactions of the following countries: Argentina, Brazil, Chile and Paraguay. 4.5; 4.3 4.5; 4.4 4.5; 4.5 4.5; 4.6 4.5; 4.7 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Organizational Profile GRI 102-46 Definition of the contents of the reports and coverages of the topic GRI 102-47 List of material topics Chapter 3: Creation of Sustainable Value: Stakeholders, p.19, 20, 21, 22, 23, 24. GRI 102-48 Re-expression of information Not performed this year. It comprises the reporting period between January 1, 2019 and December 31, 2019. It contemplates Coca-Cola Andina's operations in Argentina, Brazil, Chile and Parguay: Andina Chile, Andina Argentina; Andina Brazil; Andina Paraguay and Vital S.A. The currency used, unless otherwise specified, when referring to "US$" indicates United States dollars; when Chilean pesos are indicated "Ch$", when real is indicated "R$" is used. GRI 102-49 Changes in reporting Not performed this year. 4.5 ; 5.3 GRI 102-50 Reporting period Between January 1, 2019 and December 31, 2019. GRI 102-51 Date of last report March 1, 2019 GRI 102-52 Reporting cycle Annually GRI 102-53 Contact point for report questions Chapter 1: Andina at a Glance, p. 8. Sustainability Contact Consuelo Barrera | informesanuales@koandina.com Ruta Nacional 19, Km. 3,7, Córdoba, Argentina Telephone No.: (54) 351 496 8304 GRI 102-54 Statement of preparation of the report in accordance with the GRI Standards GRI Standards, Comprehensive option. GRI 102-55 GRI Content Index Page 170 GRI 102-56 External verification Review Limited and Independent Verification 2019 Integrated Annual Report of Coca-Cola Andina S.A. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI 200: Economic Standards GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Economic performance GRI 201-1 Direct economic value generated and distributed Chapter 1, p.5 6.8.1; 6.8.2; 6.8.3; 6.8.9 GRI 201-2 Financial implications and other risks and opportunities arising from climate change GRI 201-3 Defined benefit plan obligations and other retirement plans Chapter 5, p. 65 GRI 201-4 Financial assistance received from the government Indirect economic impacts GRI 203-1 Investments in infrastructure and services supported Exhibit: Page 116 GRI 203-2 Significant indirect economic impacts Chapter 1, p.5 Risks/opportunities are detected and addressed through the Risk Management process. Reviewed annually and audited to ensure proper mitigation. Some identified during the period can be found on p.39 The Company complies with the system of planned obligations in force in all countries where it has operations. 6.5.5 6.8.7 No financial assistance during the period 6.3.9, 6.8.1; 6.8.2; 6.8.7; 6.8.9 Coca-Cola Andina as part of the Coca-Cola System generates added value in countries where it operates equivalent to approximately 0.3% of the country's GDP. Contributions to tax, salaries to direct employees and investments can also be seen in the distributed economic value table. When we include the indirect impact generated by the Coca- Cola System in each region where it operates, this GDP equivalent amounts to 1%. Supplier development GRI 103-1 Explanation of the material topic and its coverage Chapter 1, p. 19, 20, 21,22, and 23. Chapter 5, p.72 GRI 103-2 Management approach and its components Chapter 1, p. 19, 20, 21,22, and 23. Chapter 5, p.72 GRI 103-3 Assessment of management approach Chapter 1, p. 19, 20, 21,22, and 23. Chapter 5, p.72 GRI 204-1 Proportion of spending on local suppliers Chapter 5. p. 74 and Chapter 6, p.91 Note: we talk about "nationals" as synonymous with "locals". 6.4.3; 6.6.6, 6.8.1,6.8.2,6.8.7 Corporate Governance :Transparency in Corporate Management GRI 103-1 Explanation of the material issue and its coverage Chapter 1, page 37 The Company has a solid Corporate Governance and in addition one of its Committees is the Committee of Directors that ensures transparency in business management the detail is at the following link:http://www. koandina.com/uploads/Adjuntos/ReglatrateDirectoresAuditoria.pdf HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 103-2 Management approach and its components Chapter 1, p. 19, 20,21,22, and 23. Chapter 1, p. 29,30,31,32 The Company has a Committee on Culture, Ethics and Sustainability, which was constituted by the Board in its session held January 28, 2014. Within its duties and responsibilities are: to receive, know and investigate the reports of irregularities referred to in Law No. 20.393 on the basis of crimes and to recommend actions to be taken in each case; establish and develop procedures to promote the ethical conduct of the Company's employees; to monitor compliance with the provisions of the Code of Ethics and to resolve the consultations and conflicts that their implementation may generate; and establish mechanisms for the dissemination of the Code of Ethics and of general ethical matters. GRI 103-3 Assessment of management approach Chapter 1, p. 19, 20,21,22, and 23. Chapter 1, p. 29,30,31,32 GRI 205-2 Communication and training on anti-corruption policies and procedures Chapter 1, p. 21,22, and 23. Chapter 1, p. 26 Thus, in Coca-Cola Andina we have a Model of Crime Prevention according to the provisions of Law No. 20.393, that was certified by the company MC Compliance S.A. http://www.koandina.com/uploads/ Polit.%20Corp.Prevencion%20de%20delitos%20ley%2020.393.pdf 6.6.1; 6.6.2; 6.6.3;6.6.6 GRI 206-1 Legal actions for anti-competitive behavior, anti- trust, and monopoly practices Chapter 1, p. 21,22, and 23. Chapter 1, p. 29,30,31,32 An integral part of the Corporate Governance model is our corporate guidelines, called Corporate Policies, which are mandatory for all Operations and companies in the group. The policies contain precise guidance on substantive matters related to governance, such as delegation of authority, conflicts of interest, powers of attorney, investments in financial instruments, purchases and investments, accounting criteria, use of insider information, performance management, compensation, administration of complaints, crime prevention Law 20.393, code of ethics, regulation of the Audit Committee, among others. GRI 205-3 Confirmed corruption cases and action taken Complaints received through the Ethics Point channel: 71, of which 56 were reviewed, addressed and closed. And 15 are under review. Of the total, 10 complaints were related to Corruption issues. 6.6.1; 6.6.2; 6.6.3; 6.6.6 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Corporate Governance: Risk Management The main purpose is the mitigation of high-impact risks and for this purpose establishes a Risk Committee with its objectives and bylaws and, additionally, a standard methodology for managing such risks. The company has a risk management process, with guidelines that have been approved by the Board and whose management is supervised by the Directors Committee in conjunction with the area of Corporate Internal Audit Management. Notwithstanding the foregoing, the Board has agreed to meet once a year with the Company's Risk Management unit in order to analyze the proper functioning of the risk management process, the risk matrix used by that unit (as well as the main sources of risks and methodologies for the detection of new risks and probability and impact of occurrence of those that are most relevant) and the recommendations and improvements that would be relevant to make in order to better manage the risks of the entity. For more details review responses of General Standard No. 385 at the following link: http:// www.koandina.com/uploads/Inf.%20NCG%20N385%20Marzo-2018.pdf For more detail review 20F, Chapter X and page x on the web. Www. koandina.cl / Investors. For more detail review 20F, Chapter X and page x on the web. www. koandina.cl / Investors. Base salary ratio / legal minimum wage. Chapter 6 p.89. There is no difference in the initial pay among genders. There is no difference in the initial pay among genders. GRI 103-1 Explanation of the material topic and its boundary Chapter 1, p. 21, 22 and 23. Chapter 1, p. 37,38, 39. GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23. Chapter 1, p. 37,38, 39. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23. Chapter 1, p. 37,38, 39. GRI 202-1 Ratio of the standard starting salary by sex versus the local minimum wage GRI 202-2 Proportion of senior executives hired from the local community Chapter 4 p.33 and 34. GRI 203-1 Investments in infrastructure and services supported Chapter 7 p.116. GRI 205-1 Operations assessed for anti-corruption risks Chapter 4 p. 25 6.3.9; 6.6.6; 6.6.7; 6.7.8;6.8.1;6.8.2;6.8.5;6.8.7, 6.8.9 6.6.1, 6.6.2,6.6.3 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI 300: Environmental Standards GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Sustainable Packaging: Waste Management GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23. Chapter 5, p.49, 50, 51, 52. Chapter 6, p. 80 and p.81 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23. Chapter 5, p. 49, 50, 51, 52. Chapter 6, p. 80 and p.81 GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23. Chapter 5, p. 49, 50.5 1, 52. Chapter 6, p. 80 and p.81 GRI 301-1 Materials used by weight or volume Chapter 5, p. 49, 50, 51, 52. Chapter 6, p. 80 and p.81 This document publishes the raw materials used and which are of recycled origin in Chapter 5 p. 50 GRI 301-2 Recycled input materials used Chapter 5, p. 49, 50, 51, 52. Chapter 6, p. 80 and 81 This document publishes the raw materials used and which are of recycled origin in Chapter 5 p. 50 6.5.4 6.5.4 GRI 301-3 Percentage of reclaimed products and their packaging materials for each product category. Chapter 5, p. 48,49,50,51 100% of the secondary packaging cases are regenerated at the end of the life by the Company. 6.5.3, 6.5.4,6.7.5 Energy management and environmental protection GRI 103-1 Explanation of the material issue and its boundary GRI 103-2 Management approach and its components GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23. Chapter 5, p. 59 Chapter 6, p.84 and p.85 Chapter 1, p. 21, 22 and 23. Chapter 5, p. 59 Chapter 6, p. 84 and p.85 Chapter 1, p. 21, 22 and 23. Chapter 5, p. 59 Chapter 6, p.84 and p.85 GRI 307-1 Non-compliance with environmental legislation and regulations The organization has not identified any violations of environmental laws or regulations GRI 302-1 Energy consumption within the organization Chapter 6, p. 84 and p.85 Note: Heating and cooling are included in the value of electricity consumption GRI 302-2 Energy consumption outside the organization Chapter 6, p. 84 and p.85 GRI 302-3 Energy intensity Chapter 6, p. 84 and p.85 GRI 302-4 Reducing energy consumption Chapter 6, p. 84 and p.85 4.6 6.5.4 6.5.4 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 302-5 Reducing energy requirements for products and services Chapter 6, Table "Energy Consumption (MJ)" p.84 and p.85 6.5.4, 6.5.5 Water management GRI 103-1 Explanation of the material issue and its boundary Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and p.83 GRI 103-2 Management approach and its components Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and p.83 GRI 103-3 Assessment of management approach Capítulo 1, p. 21, 22, y 23. Capítulo 5, p.55,56,57 y Capítulo 6 p. 82 y 83. Chapter 1, p. 21, 22, and 23. Chapter 5, p.55,56,57 and Chapter 6 p. 82 and p.83 GRI 303-1 Water withdrawal by source. Desde la p.53 a la p.56 . GRI 303-2 Managing impacts related to water discharge Páginas. 55, 56. From p.53 to p.56 . Calculation and registration methods are standards of The Coca-Cola Company for all bottlers (EOSH, Performance Measurements and Water Resource Sustainability) Following the policy of The Coca-Cola Company, actions are carried out to replenish nature the water used (replenish). p. 55 - 56 Pursuing the policy of The Coca-Cola Company, studies of water source vulnerability are carried out in bottling operations every 5 years. GRI 303-3 Percentage and volume of total water recycled and reused Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and 83 GRI 303-4 Water discharge GRI 303-5 Water consumption Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and 83 Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and p.83 GRI 306-2 Waste by type and method of disposal Capítulo 1, p. 21, 22 y 23. Capítulo 5, p. 55, 56, 57 y Capítulo 6, p. 82 y 83. Chapter 1, p. 21, 22 and 23. Chapter 5, p. 55, 56, 57 and Chapter 6, p.82 and p.83 6.5.4 6.5.4 6.5.4 GRI 306-3 Significant spills GRI 306-4 Transporting hazardous waste No se hubo derrames signaificativos en el período. El 100% de los residuos peligrosos son tratados por terceros dentro de los países donde se originan. Capitulo 6 p. 82 y 83. There were no significant spills in the period. 6.5.3 100% of hazardous waste is treated by third parties within the countries where it originates. Chapter 6 p. xxx GRI 306-5 Bodies of water affected by water discharges and/or runoff El 100% de los efluentes de la Compañía son tratados, por lo que no hay impactos significativos sobre los recursos hídricos. 100% of the Company's effluents are treated, so there are no significant impacts on water resources. 6.5.3, 6.5.4, 6.5.6 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Efficient distribution GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21,22 and 23. Chapter 5, p. 58, 59, 60 and Chapter 6, p.85 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23. Chapter 5, p.58, 59, 60 and Chapter 6, p.85 GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23. Chapter 5, p.58, 59, 60 and Chapter 6, p85 GRI 305-1 Direct GHG emissions (scope 1) Chapter 1, p. 21,22, and 23 and Chapter 6 p.85 GRI 305-2 Indirect GHG emissions when generating energy (scope 2) Chapter 1, p. 21,22, and 23 and Chapter 6 p.85 GRI 305-3 Other indirect GHG emissions (scope 3) Chapter 1, p. 21, 22 and 23 and Chapter 6, p.85 GRI 305-4 Intensity of GHG emissions Chapter 1, p. 21, 22 and 23 and Chapter 6, p.85 GRI 305-5 Reducing GHG emissions Chapter 1, p. 21, 22 and 23 and Chapter 6, p.85 GRI 305-6 Emissions of ozone-depleting substances (ODS) Chapter 1, p. 21 - 23; 59 and Chapter 6, p.85 Cooling gas cold equipment is used, mainly CO2 and HCFC -22. GRI 305-7 Nitrogen oxides (NOX), sulfur oxides (SOX) and other significant air emissions NOx 2436 kg (Chile operation) The gases reported below are used by cold equipment. Which are exchanged as needed and arranged according to current country legislation. Refrigerant gases (R134, R513 and others ). Commitment to the environment GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5 p. 58 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 58 GRI 103-3 Assessment of management approach Chapter 1, p. 21 22 and 23 and Chapter 5, p. 58 GRI 304-1 Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas At the close of the report, no operations are in protected areas GRI 304-2 Significant impacts of activities, products and services on biodiversity At the close of the report, no operations are in protected areas 6.5.5 6.5.5 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 304-3 Protected or restored habitats At the close of the report, no operations are in protected areas GRI 304-4 IUCN Red List species and national conservation list species with habitats in areas affected by operations At the close of the report, no operations are in protected areas GRI 306-1 Water discharge according to quality and destination Chapter 6 p.82 and p.83 The output parameters meet the requirements of Coca-Cola Company in its Wastewater Quality document. Delivery is quality suitable for animal life with fish habitat at the end of the process. GRI 306-2 Waste by type and method of disposal P.52 Supplier management GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p.71.72 and 73 and p.90 and 91 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p.71,72,73 and p.90 and 91 GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 71, 72, 73 and p.90 and 91 GRI 308-1 New suppliers who have passed evaluation and selection filters according to environmental criteria p. 71, 72, 73, 74, 75 and p.90 and 91. GRI 414-1 New suppliers who have passed evaluation and selection filters according to social criteria p. 71, 72, 73, 74, 75 and p.90 and 91. 6.5.5 6.5.3, 6.5.4 6.5.3 6.3.5, 6.6.6, 7.3.1 6.3.3; 6.3.4; 6.6.6; 7.3.1 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 308-2 Negative environmental impacts on the supply chain and actions taken p. 71, 72, 73, 74, 75 and p.90 and 91. Work with critical suppliers and significant impacts on the chain:Upstream: initiatives are undertaken with primary and secondary packaging suppliers to reduce their weight. Also to reuse the industrial scrap of the plants to produce new packaging, guaranteeing the quality of waste and managing with partners the transformation of them. In order to reduce the impact of waste generation. Downstream: Initiatives are undertaken with cold equipment suppliers to place more efficient equipment and distribution providers in customers to make delivery routes more efficient, seeking to reduce fuel consumption and carbon footprint. Commercial initiatives are being promoted aimed at higher percentage of sales in returnable bottles, to reduce the use of inputs." HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTGRI 400: Social Standards GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Contributors: Employment GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-65. GRI 103-2 Management approach and its components GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.61 to 65. Chapter 1, p. 21, 22 and 23 and Chapter 5, p.61 to 65. GRI 401-1 New employee hires and staff turnover Chapter 6, p.88. GRI 401-2 Benefits for full-time employees not given to part-time or temporary employees Chapter 6, p.64. The same benefits are granted regardless of the length of the working day, at all significant sites of the activity. GRI 401-3 Parental leave Chapter 6, p.90. GRI 402-1 Minimum periods of notice of operational changes and possible inclusion of these in collective agreements Collaborators: Occupational Health and Safety GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. GRI 403-1 Occupational health and safety management system p. 65 GRI 403-2 Hazard identification, risk assessment and incident investigation Chapter 6, p.90. As a general provision, the minimum number of notice is 30 days in all regions. 6.4.7 6.4.7; 6.8.5 6.4.7 6.4.4; 6.4.5 6.4.6 6.4.6, 6.8.8 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 403-3 Occupational health services GRI 403-4 Worker participation, consultation, and communication on occupational health and safety p.65 GRI 403-5 Worker training on occupational health and safety Chapter 6, p.65 GRI 403-6 Promotion of worker health Chapter 6 p.88 GRI 403-7 Prevention and mitigation of occupational health and safety impacts directly linked by business relationships Chapter p.64 GRI 403-8 Workers covered by an occupational health and safety management system Chapter 6 p.64 GRI 403-9 Work-related injuries Chapter 6 p. 90 Collaborators: Training and teaching GRI 103-1 Explanation of the material issue and its boundary GRI 103-2 Management approach and its components GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.62, 88 and 89. Chapter 1, p. 21, 22 and 23 and Chapter 5, p.62, 88 and 89. Chapter 1, p. 21, 22 and 23 and Chapter 5, p.62, 88 and 89. GRI 404-1 Average annual training hours per employee, broken down by gender and by job category P- 66 and p.63, Chapter 6, p.62,88 and 89. GRI 404-3 Percentage of employees receiving regular performance and professional development assessments, broken down by sex and by professional category Chapter 6, p.62,88 and 89. Andina has a detailed analysis by type of worker and position performed, regarding the risks to which they may be subjected (e.g. professional deafness, possible skeletal diseases, respiratory diseases). Specific mitigation measures are available for each type of risk. These measures include equipment and facility adaptations to meet established standards, the delivery of personal protective equipment (PPE) appropriate to each type of risk, training on the importance of their use, and follow-up measures for verifying their use. Also, annual or periodic medical checks are carried out for the purpose of monitoring the identified risks The functioning of the committees is defined in the Behavioral-Based Safety Program 6.4.6 6.4.7 6.4.7 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses Collaborators Diversity and Equal Opportunities GRI 103-1 Explanation of the material issue and its boundary GRI 103-2 Management approach and its components GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.63.90 and 92. Chapter 1, p. 21, 22 and 23 and Chapter 5, p.63.90 and 92. Chapter 1, p. 21, 22 and 23 and Chapter 5, p.63.90 and 92. GRI 405-1 Diversity in governing bodies and employees p. 10, 27, 28, 33, 34 , 36 and Chapter 6, p.63, 86, 87, 90 and 92. GRI 405-2 Ratio of base salary and women's pay against men p.86 6.2.3, 6.3.7, 6.3,10,6.4.3 6.3.7, 6.3.10, 6.4.4 GRI 406-1 Discrimination cases and corrective actions taken There were no cases reported in the period 6.3.6; 6.3.7; 6.3.10; 6.4.3 GRI 407-1 Identification of operations and suppliers where freedom of association and the right to benefit from collective agreements may be infringed or threatened, and measures taken to defend these rights p.21, 39 and 73. Collaborators: Human rights assessment GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 61-67. All suppliers must comply with the standards and requirements of the Coca-Cola System and the Guiding Principles for Suppliers. 6.3.3; 6.3.4; 6.3.5; 6.3.8; 6.3.10;6.4.5; 6.6.6 GRI 408-1 Identification of operations and suppliers with a significant risk of child exploitation, and measures taken to contribute to the abolition of child exploitation p.73. GRI 409-1 Significant operations and suppliers with a significant risk of being the source of episodes of forced labor, and measures taken to contribute to the elimination of all forms of forced labor p.73. The prohibition on the recruitment of children under 18 years of age is incorporated into the rules of the Internal Regulations on Order, Hygiene and Safety, as well as in the regulations of contractors. All suppliers must comply with the standards and requirements of the Coca-Cola System and the Guiding Principles for Suppliers. All suppliers must comply with the standards and requirements of the Coca-Cola System and the Guiding Principles for Suppliers. Random checks and audits are performed to detect possible episodes. In addition, the Anonymous Complaints Channel is available to receive complaints. 6.3.3; 6.3.4; 6.3.5;6.3.7; 6.3.10;6.6.6;6.8.4 6.3.3; 6.3.4; 6.3.5; 6.3.10 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 410-1 Percentage of security personnel who have been trained on the organization's human rights policies or procedures relevant to operations p.73. GRI 411-1 Cases of violations of the rights of indigenous peoples GRI 412-1 Number and percentage of operations that have been subject to human rights impact assessments or reviews. p.88 GRI 412-2 Hours of employee training in human rights policies or procedures Chapter 6, p.88. GRI 412-3 Number and percentage of significant investment contracts and agreements that include human rights clauses or that have been subject to human rights analysis. p.73. Local communities GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p.67 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p.67 GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.67 Security personnel at all facilities are outsourced. No cases at the closing of the report or the period. The reporting organization must submit the following information 100% of bottling plants are evaluated in human rights periodically by third parties that contract The Coca-Cola Company. a. X.XXX hours (ethics and code of conduct). An e-learning policy was developed where people from all countries are trained, at pag. b. x% of employees received the training. The reporting organization must submit the following information: a. All raw materials are audited in guiding principles by The Coca-Cola Company. All suppliers must comply with the standards and requirements of the Coca Cola system, and the Guiding Principles for Suppliers. 6.3.3; 6.3.5; 6.6.6 6.3.5 GRI 413-1 Operations with local community participation, impact assessments and development programs From p.67 to p.70 The relationship with the community is managed from those responsible for sustainability and institutional relations, always aligned with The Coca-Cola Company and definitions of its public affairs areas. 6.3.9, 6.5.1, 6.5.2, 6.5.3, 6.8 GRI 413-2 Operations with significant negative impacts – real or potential – on local communities There have not been any identified significant negative effects on the local communities where we have operations. Public policy GRI 415-1 Contributions to political parties and/or representatives Not performed 20 F. /www.koandina.cl/investors. Beverage benefit and quality and excellence of products GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 45-49. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 45-49. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 45-49. GRI 416-1 GRI 416-2 Percentage of significant product and service categories whose health and safety impacts have been assessed to promote improvements. 100% of products are analyzed and their ingredients are adapted as sugar content in new versions or new brands. Cases of non-compliance relating to the health and safety impacts of product and service categories the organization has not identified violations of voluntary regulations or codes. Responsible Marketing GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p. 47 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p.47. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.47. GRI 417-1 Requirements for information and labelling of products and services Chapter 5, p. 47. GRI 417-2 Cases of non-compliance related to information and labelling of products and services Chapter 5, p. 47. GRI 417-3 Non-compliance cases related to marketing communications The Organization has not identified violations of voluntary regulations or codes. Economic and social development of local communities GRI 103-1 Explanation of the material issue and its boundary GRI 103-2 Management approach and its components GRI 103-3 Assessment of management approach GRI 418-1 Substantiated complaints regarding concerning breaches of customer privacy and losses of customer data Chapter 1, p. 21, 22 and 23 and Chapter 5, p.70 to 72 Chapter 1, p. 21, 22 and 23 and Chapter 5, p.70 to 72 Chapter 1, p. 21, 22 and 23 and Chapter 5, p.70 to 72 6.3.9, 6.5.1,6.5.2, 6.5.3, 6.8 6.3.9, 6.3.5, 6.8 6.7.1 6.6.1, 6.6.2, 6.6.3, 6.6.6 4.6 It has not been recorded in the period 6.7.1, 6.7.2, 6.7.7 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT GRI Standard Content Chapter / Page Response ISO 2600, Linked Clauses GRI 419-1 Non-compliance with laws and regulations in the social and economic area The Organization has not identified any violations of laws or regulations. 4.6 Customer development GRI 103-1 Explanation of the material issue and its boundary Chapter 1, p. 21, 22 and 23 and Chapter 5, p.46 GRI 103-2 Management approach and its components Chapter 1, p. 21, 22 and 23 and Chapter 5, p.46. GRI 103-3 Assessment of management approach Chapter 1, p. 21, 22 and 23 and Chapter 5, p.46. Social assessment of suppliers GRI 414-1 Percentage of new suppliers examined based on human rights criteria p.72, 73 and p.74. GRI 414-2 Negative social impacts on the supply chain and measures taken p.9 and p.73. 6.3.3, 6.3.4, 6.3.5, 6.6.6 6.3.5, 6.4.3,6.6.6, 7.3.1 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT STATEMENT OF RESPONSIBILITY JUAN CLARO GONZÁLEZ Chairman of the Board of Directors / Entrepreneur RUT: 5.663.828-8 GONZALO SAID HANDAL Vice Chairman of the Board of Directors / Business Administrator RUT: 6.555.478-K PILAR LAMANA GAETE Independent Director / Business Administrator RUT: 8.538.550-K ENRIQUE RAPETTI Director / CPA Foreign Citizen JOSÉ ANTONIO GARCÉS SILVA Director / Business Administrator RUT: 8.745.864-4 GONZALO PAROT PALMA Independent Director / Civil Industrial Engineer RUT: 6.703.799-5 GEORGES DE BOURGUIGNON ARNDT Director / Economist RUT: 7.269.147-4 RODRIGO VERGARA MONTES Director / Business Administrator RUT: 7.980.977-2 ARTURO MAJLIS ALBALA Director / Attorney at Law RUT: 6.998.727-3 he Directors of Embotelladora Andina S.A. and the Chief Executive Officer who have signed this statement, are responsible under oath of the accuracy of the information provided in the 2019 Integrated Annual Report, in accordance with the provisions of General Rule N° 346 dated May 3, 2013, of Chile’s Financial Market Commission. SALVADOR SAID SOMAVÍA Director / Business Administrator RUT: 6.379.626-3 EDUARDO CHADWICK CLARO Director / Civil Industrial Engineer RUT: 7.011.444-5 FELIPE JOANNON VERGARA Director / Economist RUT: 6.558.360-7 MARIANO ROSSI Director / Bachelor's Degree in Business Administration Foreign Citizen ROBERTO MERCADÉ Director / Industrial Engineer Foreign Citizen MIGUEL ÁNGEL PEIRANO Chief Executive Officer/ Electrical Engineer RUT: 23.836.584-8 HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORTACKNOWLEDGEMENTS GENERAL COORDINATION CONSUELO BARRERA and PAULA VICUÑA. Collaborators Juan Antonio Miranda; Neiva Fátima Vieira; Carlos Moncada; Sheila Chiriani Candia; María Victoria Claro; Maria Francisca Ariztia Von Wussow; Gonzalo Aguirre; Mariana Paz González Cortés; Jenny Navas Ramírez; Sergio Danilo Vallejos Berrios; Florencia Allende and Cecilia Abati. Content support and editing www.deva.es Design www.disenohumano.cl We are interested in your opinion. It is important for us to have your opinion to improve our sustainability management. We invite you to send your suggestions, questions or any comments regarding this Integrated Report to: andina.ir@koandina.com, as well as to the offices of our operations. HOME1ANDINA AT A GLANCE3SUSTAINABLE VALUECREATION STRATEGY4VALUE CREATION 5WE OPERATE WITHINTEGRITY2OUR HISTORY6OUR PRINCIPAL METRICS7CORPORATEINFORMATION8EXHIBITS2019 INTEGRATED ANNUAL REPORT

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