HIPERMARC S.A. AND SUBSIDIARES CONSOLIDATED FINANCIAL STATEMENTS. For the year ended December 31, 2014

Transcription

1 HIPERMARC S.A. AND SUBSIDIARES For the year ended December 31, 2014

2 Índex Page CONSOLIDATED STATEMENT OF FINANCIAL POSITION CLASSIFIED... 4 CONSOLIDATED STATEMENTS OF INTEGRAL INCOME BY FUNCTION... 5 ESTADO DE CAMBIOS EN EL PATRIMONIO NETO... 6 ESTADO CONSOLIDADO DE FLUJOS DE EFECTIVO... 7 NOTE 1.- GENERAL INFORMATION... 8 NOTE 2.- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Preparation Basis Consolidation Basis Financial Information by operative segments Transactions in foreign currencies and re-adjustment units Cash and cash equivalents Financial instruments Impairment of financial assets Inventories Prepayment Property, plant and equipment Leasing Investment Properties Non-current assets maintained for sale Intangible assets Goodwill Impairment of non-current assets other than goodwill Income taxes and deferred taxes Employee Benefits Provisions Revenue recognition Commercial agreements with distributors and supermarket chains Cost of product sales Marketing expenses (marketing and sales) Distribution costs Administrative expenses Environment NOTE 3.- ESTIMATES AND PROFESSIONAL JUDGMENT APPLICATIONS NOTE 4.- RISK MANAGEMENT NOTE 5.- FINANCIAL INSTRUMENTS NOTE 6.- FINANCIAL INFORMATION BY OPERATING SEGMENTS NOTE 7.- BUSINESS COMBINATIONS NOTE 8.- NET SALES NOTE 9.- COSTS AND EXPENSES BY NATURE NOTE 10.- OTHER GAINS OR LOSSES... 44

3 NOTE 11.- TRADE AND OTHER RECEIVABLES NOTE 12.- ACCOUNTS RECEIVABLE FROM RELATED PARTIES NOTE 13.- INVENTORIES NOTE 14.- PREPAID EXPENSES NOTE 15.- INVESTMENTS IN ASSOCIATED COMPANIES NOTE 16.- PLUSVALIA NOTE 17.- PROPERTY, PLANT AND EQUIPMENT NOTE 18.- INVESTMENT PROPERTIES NOTE 19.- NON-CURRENT ASSETS HELD FOR SALE NOTE 20.- INCOME TAXES AND DEFERRED TAXES NOTE 21- LOANS AND FINANCIAL OBLIGATIONS ACCRUING INTERESTS NOTE 22.- TRADE CREDITORS AND OTHER ACCOUNTS PAYABLE NOTE 23.- PROVISIONS NOTE 24- MINORITY INTEREST NOTE 25- EQUITY ATTRIBUTABLE TO SHAREHOLDERS NOTE 26- COMMITMENTS AND CONTINGENCIES NOTE 27.- ENVIRONMENT NOTE 28.- POST-EVENTS... 69

4 REPORT OF INDEPENDENT AUDITORS Financial statements at December 31, 2014 and 2013 RUT Auditores : Company Name External Auditors : SMS CHILE S.A. Messrs President, Directors and Shareholders Hipermarc S.A. and Subsidiaries Report on the consolidated financial statements We have audited the attached consolidated financial statements of Hipermarc SA and subsidiaries, which comprise the consolidated balance sheet at December 31, 2014, and the related consolidated statements of income, comprehensive income, statements of changes in equity and statements of cash flows for the year then ended and the accompanying notes to the consolidated financial statements. Responsibility of the management for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of these consolidated in accordance with instructions and standards of preparation and presentation of financial information issued by the Superintendency of Securities and Insurance described in Note 2 to the consolidated financial statements financial statements. This responsibility includes designing, implementing and maintaining 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 basis for our audit financial statements. 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 financial statements are free of material misstatement. An audit involves effect 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 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 preparation and fair presentation of the consolidated financial statements of the entity for the purpose of design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of internal control of the entity. Accordingly, we express no such opinion. An audit also includes assessing what are the appropriate accounting policies used and the reasonableness of significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

5 We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Hipermarc S.A. and Subsidiaries at December 31, 2014, results of operations and cash flows for the year then ended in accordance with instructions and standards of preparation and presentation of financial information issued by the Superintendency of Securities and Insurance described in Note 2. Basis of Accounting As described in Note 2 to the consolidated financial statements under its authority the Superintendency of Securities and Insurance dated October 17, 2014 issued Circular No. 856 instructing audited entities, registered in equity differences assets and deferred tax liabilities that occur with direct effect of the increase in the rate of first category tax introduced by Law 20,780. This fact has caused a change in the context of preparation and presentation of financial information applied to date, which corresponded to the International Financial Reporting Standards. At December 31, 2014 and for the year ended on that date, the effects of changing the accounting framework are described in Note 2. Our opinion is not modified in this matter. Other issues Previously, we conducted an audit in accordance with auditing standards generally accepted in Chile, to the consolidated as of December 31, 2013 financial statements SA Hipermarc and attachments, and our report dated March 24, 2014 Subsidiaries expressed an unmodified audit opinion on those consolidated financial statements. Name of the partner signing: PABLO ÁLVAREZ HENRÍQUEZ RUT partner who signs: SMS CHILE S.A. Santiago, March 26, 2015

6 CONSOLIDATED STATEMENT OF FINANCIAL POSITION CLASSIFIED Consolidated Statement Of Financial 31/12/ /12/2013 Statement of Financial Position Assets Current assets Cash and Equivalent to the Cash Other financial, current assets 2,479,360 1,789,213 Indebted commercial and other accounts to receive, currents 1,920,612 1,761,632 Accounts To receive to Related, current Organizations 4,305,315 41,747,696 Inventories 3,439,346 4,085,916 Assets by taxes, currents 360, ,735 Total current assets other assets or groups of assets for disposal classified as maintained for sale 12,784,362 50,017,982 Non-current assets or groups of assets for disposal classified as maintained for sale 19,985,082 0 Non-current assets or groups of assets for disposal classified as maintained for sale 19,985,082 0 Total current assets 32,769,444 50,017,982 Noncurrent assets Other financial, noncurrent assets 1,085,559 1,167,140 Accounts receivable from related entities, non-current 19,266,212 0 Entered investments using the method of the participation 2,726 2,161 Intangible assets other than goodwill 8,339 8,339 Goodwill 9,783,745 18,491,557 Properties, Plant and Equipment 769, ,998 Property of investment 43,303,721 57,556,105 Assets by deferred taxes 3,364,237 3,237,120 Total of noncurrent assets 77,584,057 81,341,420 Total of assets 110,353, ,359,402 The attached notes comprise integral of the consolidated financial statements. 3

7 CONSOLIDATED STATEMENT OF FINANCIAL POSITION CLASSIFIED Consolidated Statement Of Financial 31/12/ /12/2013 Statement of Financial Position Patrimony and liabilities Liabilities Current liabilities Commercial accounts and other accounts to pay, currents 2,129,629 2,524,613 Accounts To pay to Related, current Organizations 5,875,753 21,398,400 Other provisions, currents 538,192 8,161,560 Liabilities by Taxes, currents 926, ,672 Provisions by Employee Benefits, currents 27,258 23,976 Other liabilities nonfinanciers, currents 156, ,649 Total current liabilities 9,654,317 32,843,870 Noncurrent liabilities Other accounts to pay, noncurrent 1,198,792 1,333,422 Accounts To pay to Related, noncurrent Organizations 18,373,163 18,464,273 Liabilities by deferred taxes 3,653,166 1,622,684 Other liabilities nonfinanciers, noncurrent 0 68,785 Total of noncurrent liabilities 23,225,121 21,489,164 Total passive 32,879,438 54,333,034 Patrimony Emitted capital 71,560,356 71,560,356 Gains (losses) accumulated -5,341,695-2,254,233 Other reserves 9,827,718 5,612,670 Patrimony attributable to the proprietors of the controller 76,046,379 74,918,793 Participation noncontroller 1,427,684 2,107,575 Total patrimony 77,474,063 77,026,368 Total of patrimony and liabilities 110,353, ,359,402 The attached notes comprise integral of the consolidated financial statements. 4

8 CONSOLIDATED STATEMENTS OF INTEGRAL INCOME BY FUNCTION Estado de Resultados Por Función Earnings statement Gain (loss) ACCUMULATED 01/01/ /01/ /12/ /12/2013 Income of ordinary activities 10,366,512 9,299,162 Cost of sales -7,625,667-6,338,562 Gross gain 2,740,845 2,960,600 Administrative expenses -2,434,296-2,405,905 Other gains (losses) 0 0 Financial income -1,907,304-62,184 Financial costs 33,393 1,872 Share of profit (losses) of associates and joint ventures accounted for using the equity method -1,696,079-1,733,564 Differences of change Results by readjustment units -583, ,890 Gains (losses) that arise from the difference between the value book previous and the right value of measured reclasificados financial assets to reasonable value -661,489-63,265 Gain (loss), before taxes -1,376, ,230 Gain (loss) -5,884,894-2,403,581 Earnings statement 0 0 Gain (loss) -5,884,894-2,403,581 Gain (loss), attributable a Gain (loss), attributable to the proprietors of the controller -3,072,450-2,149,765 Gain (loss), attributable to participation noncontroller -2,812, ,816 Gain (loss) -5,884,894-2,403,581 Gains by action Gain by basic action Gain (loss) by basic action in continued operations Gain (losses by basic action in discontinued operations 0 0 Gain (loss) by basic action State of the integral result State of the integral result ACCUMULATED 01/01/ /01/ /12/ /12/2013 Gain (loss) -5,884,894-2,403,581 Compounds of other integral result, before taxes Exchange differences by conversion Profits (losses) by Exchange differences by conversion, before taxes -1,876,728-3,231,019 Other integral result, before taxes, Exchange differences by conversion -1,876,728-3,231,019 Financial assets available for sale Gains (losses) on remeasurement of financial assets available for sale, before tax 6,091,776 0 Other comprehensive income, before taxes, financial assets available for sale 6,091,776 0 Cash flow hedges Other comprehensive income, before taxes, cash flow hedges 0 0 Share of other comprehensive income of associates and joint ventures accounted for using the equity method 2,132,553 0 Other Compounds of other integral result, before taxes 6,347,601-3,231,019 Other integral result 6,347,601-3,231,019 Total integral result 462,707-5,634,600 Integral result attributable to Integral result attributable to the proprietors of the controller 1,142,598-5,380,784 Integral result attributable to participation non-comptroller -679, ,816 Total integral result 462,707-5,634,600 The attached notes comprise integral of the consolidated financial statements. 5

9 ESTADO DE CAMBIOS EN EL PATRIMONIO NETO Estado de cambios en el patrimonio Emitted capital Reserves Currency translation differences Reserves gains or losses on the remeasurement of financial assets available for sale Other reserves Gains (losses) accumulated Patrimony attributable to the proprietors of the controller Participation noncontroller Total patrimony Balance on Current Period 01/01/ ,560,356 5,612, ,612,670-2,254,233 74,918,793 2,107,575 77,026,368 Changes in patrimony Integral result Gain (loss) -3,072,450-3,072, Another integral result -1,876,728 6,091,776 4,215,048 4,215, Integral result -1,876,728 6,091,776 4,215,048-3,072,450 1,142, Other increases (decreases) in equity 0-15,012-15, Total of changes in patrimony 0-1,876,728 6,091,776 4,215,048-3,087,462 1,127, , ,695 Final Balance Current Period 31/12/ ,560,356 3,735,942 6,091,776 9,827,718-5,341,695 76,046,379 1,427,684 77,474,063 Emitted capital Reserves Currency translation differences Reserves gains or losses on the remeasurement of financial assets available for sale Other reserves Gains (losses) accumulated Patrimony attributable to the proprietors of the controller Participation noncontroller Total patrimony Saldo Inicial Período Anterior 01/01/ ,560,356 8,843, ,843, ,468 80,299,577 2,361,391 82,660,968 Cambios en patrimonio Resultado Integral Ganancia (pérdida) -2,149,765-2,149, Otro resultado integral -3,231, ,231,019-3,231, Resultado integral -3,231, ,231,019-2,149,765-5,380, Total de cambios en patrimonio 0-3,231, ,231,019-2,149,765-5,380, ,816-5,634,600 Saldo Final Período Anterior 31/12/ ,560,356 5,612, ,612,670-2,254,233 74,918,793 2,107,575 77,026,368 The attached notes comprise integral of the consolidated financial statements. 6

10 ESTADO CONSOLIDADO DE FLUJOS DE EFECTIVO Accumulated actual Accumulated last year Direct Flow Statement Cash 01/01/ /01/ /12/ /12/2013 Receipts from sales of goods and services 11,045,306 9,807,773 Other receipts from operating activities 6,745,645 0 Payments to suppliers for the supply of goods and services Payments to and on behalf of employees Other payments for operating activities Net cash provided by (used in) operating Income taxes paid (reimbursed) classified as operating activities Other inflows (outflows) of cash, classified as operating activities Cash flows from (used in) operating activities Loans to related entities Purchases of Property, Plant and Equipment Classified as investing activities -9,031,038-5,030, , , ,904,692 8,497,426 2,399, , , ,771 7,366,968 1,445,178 5,087,877-2,915,548-45, ,224 Other inflows (outflows) of cash, classified as investing activities -707, ,692 Cash flows from (used in) investing activities 4,335,267-3,639,464 Loans from related 0 2,915,307 Repayments of loans classified as financing activities 0-21,565 Repayment of loans to related entities -11,657, ,189 Interest paid classified as financing activities 0-34,156 Cash flows from (used in) financing activities -11,657,075 2,295,397 Increase (decrease) in cash and cash equivalents before effect of changes in the exchange rate 45, ,111 Effects of changes in exchange rate on cash and cash equivalents Increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and Cash Equivalents at End of Period -1,490-3,502 43,670 97, , , , ,790 The attached notes comprise integral of the consolidated financial statements. 7

11 NOTE 1.- GENERAL INFORMATION Hipermarc S.A. before Supermercados Unimarc S.A. dates back its origins to year 1961 when the predecesor company, Unicoop Limitada, started to operate. Unicoop leaded its efforts to the high incomes segments, first population segment that change its buying habits, passing from the grocery stores to the supermarkets. In 1982 Errázuriz Group, through a brach office, bought Unicoop, and renamed the company Unimarc. At the parchase moment, Unicoop counted with 13 places and a net sale of $ millions. Between 1982 and 1990 Unimarc undertook and implemented an expansion program incorporating 13 new places and introducing the trade mark Multiahorro. Between 1991 and 1998 the company ran in Argentina, under the name of Supermercados Hipermarc S.A., reaching up to 6 places. In June, 1999 the operation of these places was rented to the company Supermercados Norte S.A. Dated April 12,1993. Errázuriz Group proceded to inscribe in the Securities & Insurance Markets the company Comercial e Inmobiliaria Unimarc S.A. in the register of values under N 447. Afterwards, in a Shareholder Extraordinary Meeting held on April 26, 1996, It was agreed the modification of its business name to Supermercados Unimarc S. A., according to registers in the public deed of the same date before the Notary Public Mr. Kamel Saquel Zaror. During 1999 the company decided to have only the trademark Unimarc in its local places in order to capitalize the favorable reputation of the trademark Unimarc, because of which, during the year was changed the format Multiahorro to Unimarc. Some years ago Hipermarc S.A, created an area that proposed to deliver variety and true alternatives to our clients home; Basically, implementing products of the title in selected spaces in certain supermarkets of Unimarc chain, starting in this way its enterprising concept development UNIHOME. Gradually, and as of year 2005 the area was acquiring greater presence and own personality, firstly due to the excellent response and requests(demands) of our loyal clients, as also by the excellent quality of new products irruption to a lower prices. Innovation and important oportunities as it is the import products incorporation within reach of everybody and its expansion to more than 33 rooms in the country with very important presence in each of them, have made of UNIHOME, section of the best clothing, shoes, textile, electrical appliances, decoration and home, the most convenient shop of this title nationwide. Dated December 13th, 2007 the transfering was materialized, cessic bonorum and rent of a joint of assets, as the company as of its comptroller group that in general, allows the business operation of supermarkets (Unimarc) in chile, not including that had signified the company transfering or part of it. The company keeps those business that have been of its line of business and/or complementary to business retail as the rent of the local of La Florida area and the agroindustry title in Chile. Dated December 17th, 2007 in a shareholders extraordinary meeting before the Notary Public Mr. Enrique Tornero Figueroa the company changed its business name to Hipermarc S.A. 8

12 COMPANY INFORMATION Company Name : Hipermarc S.A. R.U.T. : Legal Address : Amunátegui 178, Floor 4 Business Address : Amunátegui 178, Floor 4 Company Type : Public Corporation. Securities Registration Record : 447 CONSTITUTION DOCUMENTS Constitution Act City: Santiago Notary: René Benavente Cash Date: October 24, 1991 Deadline: A folio 32,908, No. 16,756 of October 25, 1991, the Register of Commerce Stgo. Publication in the Official Journal: November 4, 1991 Address: No. 178 Amunategui Floor 4, Santiago Phone: PROPERTY ORGANIZATION PROPERTY AND SHAREHOLDERS SHAREHOLDERS R.U.T. % NUMBER OF SHARES 1 SOC. AGRICOLA Y FORESTAL LAS CRUCES S.A % 566,323,336 2 INVERSIONES FAMILIARES S.A % 260,798,761 3 CIDEF COMERCIAL S.A. (EX - INVERSIONES ALINAC S.A.) % 193,763,643 4 BANCHILE CORREDORES DE BOLSA S.A % 54,524,544 5 CORP. CORREDORES DE BOLSA S.A % 34,826,934 6 SANTANDER INVESTMENT S.A.C. DE B % 32,376,707 7 CONSORCIO CORREDORES DE BOLSA S.A % 23,992,585 8 BTG PACTUAL CHILE S.A. C. DE BOLSA % 18,961,439 9 LARRAIN VIAL CORREDORES DE BOLSA % 15,637, BCI CORREDORES DE BOLSA S.A % 11,108, VALORES SECURITY S.A. C. DE BOLSA % 8,257, EUROAMERICA CORR. DE BOLSA S.A % 4,487, SCOTIA SUD AMERICANO C. DE BOLSA S.A % 3,181, FINANZAS Y NEGOCIOS C. DE BOLSA % 3,137, THE BANK OF NEW YORK K 0.02% 250, PARTICULARES 2.40% 30,222,201 TOTALS % 1,261,849,619 9

13 Type of Shareholder Participation% Number of Shareholders 10% or more ownership 80.90% 3 Less than 10% share 19.10% 216 Totals 100% 219 Company controller 44.88% 1 Company Controller Sociedad Agrícola Ganadera y Forestal Las Cruces S.A % Controller of Sociedad Agrícola Ganadera y Forestal Las Cruces S.A. is: Inversiones Familiares S.A % The ultimate controller of the Company is the Errazuriz family, consisting of the following people: Don Francisco Javier Errázuriz Talavera (Rut: ), your spouse Doña María Victoria Ovalle Ovalle (Rut: ) and their sons; Francisco Javier Errázuriz Ovalle (Rut: ), Matías Rafael Errázuriz Ovalle (Rut: ), María Victoria Errázuriz Ovalle (Rut: ), María Ignacia Errázuriz Ovalle (Rut: ), Macarena Errázuriz Ovalle (Rut: ), Magdalena Errázuriz Ovalle (Rut: ) and Carolina Errázuriz Ovalle (Rut: ). ADMINISTRATION AND PERSONAL The company is administered by its Board, which is made by December 31, 2013 by the following persons, having two vacant positions: A) DIRECTORS Mr. Francisco Javier Errázuriz Ovalle Rut.: Nº 7,982,073-3 President of the Board Mr. Eduardo Viada Aretxabala Rut.: Nº 7,128,931-1 Director Mr. Néstor Velásquez Sánchez Rut.: Nº 10,292,026-0 Director Mr. Hernán Mora Diez Rut.: Nº 11,479,052-4 Director Mr. Pablo Reyes Moore Rut.: Nº 9,258,473-9 Director 10

14 Mr. Nibaldo Sepúlveda Mojer Rut.: Nº 6,183,330-7 General Manager B) ADMINISTRATION Position : General Manager Name : Nibaldo Sepúlveda M. Professional Degree : Business Engineer Position : General Accountant Name : Jaime Flores Professional Degree : General Accountant Identification card n : 10,394,303-5 PERSONAL The parent company and subsidiaries presented at December 31, 2014, the following staffing: Society Staffing No. Hipermarc S.A. (matriz) 1 Interagro S.A. 16 Supermercados Hipermarc S.A. (Argentina) 37 COMMITTEE OF DIRECTORS The Company has not constituted Board of Directors for failure to comply with requirements of Article 50 bis 18,046 law in Circular 1526 of the Superintendencia de Valores y Seguros. REMUNERATION TO DIRECTORS AND / OR DIRECTORS During the exercises 2014 and 2013 were not paid by the matrix, subsidiary or affiliate diet, expenses, travel expenses, royalties, etc. directors for the exercise of their duties, respect of the compensation received by managers of the company listed below historical figures. During 2014 and 2013, the Company has not paid compensation to the executive staff. During the years 2014 and 2013 no compensation and / or incentive plans agreed with the board and / or administrators. During the years 2014 and 2013 there are no advisory board expenses. 11

15 ACTIVITIES AND BUSINESS OF THE COMPANY DESCRIPTION OF SECTORS IN WHICH PARTICIPATES The Company maintains and will power business those that have been of their activity and/or complementary to the business retail as local leases of la Florida, the locals of Argentina and agribusiness industry title in Chile. DESCRIPTION OF ACTIVITIES OF THE COMPANY OR BUSINESS Products, businesses and activities The company transferred and / or leased the locals Unimarc. At present the Company maintains business those items that have been of their business and / or complementary to the supermarket business, namely local leases of Florida and Argentina, and aims in future to add the construction and real estate developments include new shops, including expanding the area of retail and supermarkets. Also, considering the possibility of similar business in foreign lands and related companies in the business of supermarkets, leasing such premises or operated directly if the case. Does not with less important will keep the item through its agroindustrial our affiliates. The above does not happen before achieving commensurate funding to enable their development. Suppliers S.A. Hipermarc suppliers of during the years 2014 and 2013 are all companies that represent goods of services. Properties The Chilean subsidiary Inmobiliaria SA Supermarkets owns land located in the metropolitan area. Insurance The Company has insurance in force by the movable and immovable, in such a way to transfer those risks that are not part of their business to specialized traders. Contracts S.A. Hipermarc and its subsidiaries lease and sublet the premises for supermarkets such as Florida and Argentina for which has contracts for existing leases. Concessions and sub-concessions received (Argentina) a) Municipality of Quilmes The May 14, 1997, the Company entered into an agreement whereby the Municipality granted the construction, management and operation of commercial enterprise "Paseo de Quilmes Old Market" with the Municipality of Quilmes. The duration of the concession is 30 years from the date of final approval of the project, which operated at the time of granting the municipal authorization. The original deadline may be 12

16 extended for successive periods of 10 years as determined under section 231 of the Municipal Law. The only fee that the City received for the award, was the construction of a municipal building. This building is recorded under "Other receivables". At the expiration of the grant and its extensions, all property and buildings to municipal control will. b) Municipality of Tres de Febrero The February 29, 1996, the Company signed with Civic Center Caseros SA (hereinafter "CCC SA"), subconcessionaire of some modules in the construction of the building endeavor "Caseros Civic Center," a contract whereby CCC SA It sub-concessioned the construction, management and operation of a supermarket located in Caseros. The term of the concession is 30 years from the date of final approval of the project, which operated at the time of granting the municipal authorization. The original deadline may be extended for successive periods of 10 years as determined under section 231 of the Municipal Law. Concesiones y sub-concesiones otorgadas (Argentina) a) Agreements with SA INC On 1 July 1999 signed a contract for Partial Transfer of Goodwill with Supermarkets North SA (hereinafter "North") whereby the Company's transfer of leases for premises located in Caballito and San Fernando, to improvements and existing equipment. At the same time, he gave North, for a term of 10 years renewable for 10 more, of the total concessions made, granting the premises of Belgrano and the sub-concession the premises located at Quilmes and Caseros. Additionally, the Company agreed to abandon the development of supermarket activity in Argentina for 10 years. The grant ended June 30, On December 30, 2010 the Company has renewed until June 30, 2014 for contracts granting the premises of Belgrano and local sub-concession located in Quilmes SA INC (hereafter INC), North successor company Supermarkets SA In turn, the Company has managed to INC the cancellation of debt with this customer in respect of costs and expenses incurred by the previous INC December 31, The proposal indicates that the cancellation is made in 42 consecutive monthly installments from January same is subject to the occupation of all properties by INC to the end of the period of remission. At June 30, 2013, the Company received credit notes by SA INC corresponding to the first 30 installments of the proposed remission submitted. b) Agreements with Cencosud SA On December 2, 2005, the Company signed a sub-lease with Cencosud SA (hereinafter "Cencosud") for a period of 20 years for the installation of a local chain of Homecenter in the town of Caseros, having produced its opening in August Trademarks and Patents Currently the company has no ownership of it, or trademark. 13

17 RISK FACTORS Relative Risks and Implications for Chile The Chilean economy slowed in 2014, with growth well below its potential and inflation above the target of the Central Bank. The lower activity due to lower terms of trade, to rebuild, maturation cycle of mining investment and the uncertainty created by the reforms promoted by the government, which have affected the agents' expectations regarding consumption and investment decisions. Chile sigue mostrando una desaceleración en su demanda interna, producto de un menor consumo de bienes durables, a pesar de la reducción en la caída de la inversión. The export sectors accelerate their growth, while business and consumer expectations remain pessimistic. Note that, according to the latest figures, employment and labor force grew 1.8 and 2.1 percent per year, respectively mind. The increase of the wage bill, meanwhile, increases over previous months, while nominal and real salaries are expanded. The Central Bank has decided to keep the TPM, with inflation gradually easing, inflation expectations anchored in the medium term, widening gaps in capacity and reduction in oil prices. These factors increase the likelihood of additional casualties to the TPM during the first half. Regarding the prospects for the world economy, it is estimated that this year the activity grow around 3.5 percent, somewhat higher than the estimated growth for This hand further expansion of US and the UK, and a recovery in the margin of the Euro Area and Japan. By 2015 Chile growth between 2.5 and 3.5 percent and inflation between 2.2 and 2.7 percent is projected. Interest rate Risk and Exchange rate Variation. The company held until 2012 bank debt at an annual nominal rate % and was composed by 100% in foreign currency. At December 31, 2013 the Company and its subsidiaries do not have interest rate risk by not having bank debt. Hipermarc S.A. and affiliates have no financial derivative contracts that may decrease the risk or exchange rate fluctuation of interest. INVESTMENT POLICY AND FINANCING The Company during the years 2014 and 2013 made the investments as established in its bylaws in contributions to its subsidiaries, contributions for investment or formation of subsidiaries or related companies, whose business is related, connected or linked to business of the company. HIPERMARC S.A. During the 2014 and 2013 marketing years Hipermarc SA has unfolded in real estate and agribusiness. Subsidiaries or affiliates of Hipermarc SA mainly developed the following twists: 14