SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
January 19, 2005
Commission File Number 1-12752
Glassworks of Chile
(Translation of registrant's name into English)
Hendaya 60
Las Condes
Santiago, Chile
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form 20-F [X] Form 40-F [ ]
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(1): ______
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes [ ] No [X]
FECU (Standardized Quarterly Financial Report)
1. IDENTIFICATION
1.01.05.00 Firm Name
CRISTALERIAS DE CHILE S.A.
1.01.04.00 Company RUT 90331000-6
1.00.01.10 Starting date 1/1/2004
1.00.01.20 Closing date 9/30/2004
1.00.01.30 Type of Currency Chilean Pesos
1.00.01.40 Type of Financial Statements Individual
ASSETS
2.0 FINANCIAL STATEMENTS
2.01 BALANCE SHEET
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance: Individual
ASSETS NOTE No. 09-30-04 09-30-03
------------------------------------------------------------ -------- ----------- ----------
5.11.00.00 TOTAL CURRENT ASSETS 118,942,309 99,010,783
5.11.10.10 Cash 878,177 1,293,366
5.11.10.20 Time deposits 41 5,000,900 5,345,527
5.11.10.30 Marketable securities (net) 4 61,712,215 56,853,859
5.11.10.40 Debtors from sales (net) 5 22,571,956 19,907,104
5.11.10.50 Documents receivable (net) 5 988,515 1,866,117
5.11.10.60 Sundry debtors (net) 5 832,056 845,053
5.11.10.70 Doc. & accts receivable related Co. 6 5,022,190 2,390,646
5.11.10.80 Inventories (net) 7 7,307,287 5,750,535
5.11.10.90 Recoverable taxes 8 0 1,751,790
5.11.20.10 Prepaid expenses 168,151 208,996
5.11.20.20 Deferred taxes 8 702,681 379,198
5.11.20.30 Other current assets 10-11 13,758,181 2,418,592
5.11.20.40 Leasing contracts (net) 0 0
5.11.20.50 Leasing assets (net) 0 0
5.12.00.00 TOTAL FIXED ASSETS 77,683,404 80,092,520
5.12.10.00 Land 12 1,531,255 1,532,050
5.12.20.00 High rises & infrastructure 12 23,540,105 22,890,718
5.12.30.00 Machinery & equipment 12 107,665,497 104,375,105
5.12.40.00 Other fixed assets 12 11,953,761 7,686,427
5.12.50.00 Positive goodwill from technical
revaluation of fixed assets 12 6,732,617 6,725,906
5.12.60.00 Depreciation (minus) 12 (73,739,831) (63,117,686)
5.13.00.00 TOTAL OTHER ASSETS 174,289,049 185,407,477
5.13.10.10 Investment in related companies 14 148,128,783 149,193,545
5.13.10.20 Investment in other companies 0 0
5.13.10.30 Negative goodwill 16 1,797,583 1,970,339
5.13.10.40 Positive goodwill (minus) 0 0
5.13.10.50 Long-term debtors 5 112,575 145,111
5.13.10.60 Doc. & accts receivable related Co. 6 21,292,513 21,675,448
5.13.10.65 Long-term deferred taxes 0 0
5.13.10.70 Intangibles 0 0
5.13.10.80 Amortization (minus) 0 0
5.13.10.90 Other 18 2,957,595 12,423,034
5.13.20.10 Long-term leasing contracts (net) 0 0
5.10.00 TOTAL ASSETS 370,914,762 364,510,780
1
LIABILITIES
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance: Individual
LIABILITIES NOTE No. 09-30-04 09-30-03
------------------------------------------------------------ -------- ----------- ----------
5.21.00.00 TOTAL CURRENT LIABILITIES 26,093,685 18,982,431
5.21.10.10 Short-term oblig. Banks & Fin. Inst. 0 0
5.21.10.20 Short-term portion - Long-term
oblig. Banks & Financial Institutions 19 292,991 138,250
5.21.10.30 Obligations with the public (notes) 0 0
5.21.20.40 Short-term portion oblig with public 9,382,181 787,998
5.21.10.50 Long-term oblig. due within 1 year 0 0
5.21.10.60 Dividends payable 652,273 512,868
5.21.10.70 Accounts payable 2,291,268 2,521,597
5.21.10.80 Notes payable 2,613,646 2,096,218
5.21.10.90 Sundry creditors 383,845 1,025,162
5.21.20.10 Notes & accts payable related Co. 6 832,342 810,885
5.21.20.20 Provisions 23 7,806,558 5,441,149
5.21.20.30 Withholdings 1,015,459 1,529,309
5.21.20.40 Income tax 823,122 0
5.21.20.50 Earned income 0 0
5.21.20.60 Deferred taxes 0 0
5.21.20.70 Other current liabilities 34 0 4,118,995
5.22.00.00 TOTAL LONG-TERM LIABILITIES 102,008,704 114,510,722
5.22.10.00 Oblig with Banks & Financial Inst. 21 30,445,000 33,577,276
5.22.20.00 Long-term oblig with public (bonds) 61,886,808 70,590,383
5.22.30.00 Long-term notes payable 0 0
5.22.40.00 Long-term sundry debtors 146,647 171,314
5.22.50.00 Long-term notes & accts. payable
related companies 6 0 0
5.22.60.00 Long-term provisions 23 6,604,096 7,745,359
5.22.70.00 Long-term deferred taxes 8 2,926,153 2,426,390
5.22.80.00 Other long-term liabilities 0 0
5.23.00.00 MINORITY INTEREST 0 0
5.24.00.00 TOTAL EQUITY 242,812,373 231,017,627
5.24.10.00 Paid-in capital 27 65,396,749 65,785,245
5.24.20.00 Reserve capital revaluation 27 1,242,538 789,423
5.24.30.00 Premium in sale of own shares 27 28,403,990 28,376,447
5.24.40.00 Other reserves 27 6,677,095 8,242,181
5.24.50.00 Retained earnings (addition of codes
5.24.51.00 to 5.24.56.00) 27 141,092,001 127,824,331
5.24.51.00 Reserve future dividends 27 129,427,446 126,346,020
5.24.52.00 Accrued profits 27 0 0
5.24.53.00 Accrued losses (minus) 27 0 0
5.24.54.00 Profit (loss) for the year 27 14,237,355 2,454,646
5.24.55.00 Prov. dividends (minus) 27 (2,572,800) (976,335)
5.24.56.00 Accr. deficit dev. period 27 0 0
5.20.00.00 TOTAL LIABILITIES 370,914,762 364,510,780
2
INCOME STATEMENT
2.02 INCOME STATEMENT
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance: Individual
INCOME STATEMENT NOTE No. 09-30-04 09-30-03
------------------------------------------------------------------ -------- ----------- ----------
5.31.11.00 OPERATING RESULTS 18,250,638 17,633,228
5.31.11.10 Gross Margin 22,969,583 21,611,109
5.31.11.11 Sales 55,125,736 55,405,249
5.31.11.12 Costs (minus) (32,156,153) (33,794,140)
5.31.11.20 Adm. & sales expenses (minus) (4,718,945) (3,977,881)
5.31.12.00 NON-OPERATING RESULTS (1,144,215) (14,276,628)
5.31.12.10 Interest income 1,557,365 2,037,296
5.31.12.20 Income from invmnts Rel. Co. 14 6,059,364 3,722,990
5.31.12.30 Other non-operating income 28 425,365 292,827
5.31.12.40 LOSS invmnts Rel. Co.(-) (5,565,845) (5,335,051)
5.31.12.50 Amortization neg.goodwill (-) 16 (131,001) (130,874)
5.31.12.60 Interest expenses (minus) (3,631,937) (3,727,123)
5.31.12.70 Other non-operat expenses (-) 28 (724,138) (637,254)
5.31.12.80 Price level restatement 29 (398,945) (439,377)
5.31.12.90 Exchange differences 30 1,265,557 (10,060,062)
5.31.10.00 RESULTS BEFORE INCOME TAX
AND EXTRAORDINARY ITEMS 17,106,423 3,356,600
5.31.20.00 INCOME TAX 8 (2,869,068) (901,954)
5.31.30.00 EXTRAORDINARY ITEMS 0 0
5.31.40.00 PROFIT (LOSS) BEFORE
MINORITY INTEREST 14,237,355 2,454,646
5.31.50.00 MINORITY INTEREST 0 0
5.31.00.00 NET INCOME (LOSS) 14,237,355 2,454,646
5.32.00.00 Amortization of positive goodwill 16 0 0
5.30.00.00 INCOME (LOSS) FOR THE YEAR 14,237,355 2,454,646
3
DIRECT CASH FLOW STATEMENT
2.03 CASH FLOW STATEMENT
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance: Individual
DIRECT CASH FLOW STATEMENT NOTE No. 09-30-04 09-30-03
----------------------------------------------------------------------- -------- ----------- ----------
5.41.11.00 NET FLOW FROM OP. ACT. 23,687,919 18,771,098
5.41.11.10 Collection from sales debtors 66,465,614 68,217,523
5.41.11.20 Interests received 2,678,287 2,670,297
5.41.11.30 Dividends & other distributions funds received 1,760,843 1,732,515
5.41.11.40 Other income 1,273,908 912,659
5.41.11.50 Payments to suppliers & personnel (-) (37,761,239) (40,442,522)
5.41.11.60 Interest paid (minus) (4,092,539) (4,396,967)
5.41.11.70 Income tax paid (minus) (1,440,837) (2,253,425)
5.41.11.80 Other expenses 33 (305,798) (5,389,448)
5.41.11.90 V.A.T. & other taxes (4,890,320) (2,279,534)
5.41.12.00 CASH FLOW FINANCING ACTIVITIES (3,891,673) (7,832,786)
5.41.12.05 Proceeds from share issue 0 0
5.41.12.10 Loans received 0 0
5.41.12.15 Obligations with the public 0 0
5.41.12.20 Secured loans from related companies 0 45,621
5.41.12.25 Other loans from related companies 0 0
5.41.12.30 Other financing resources 0 0
5.41.12.35 Dividends paid (minus) (3,891,673) (7,878,407)
5.41.12.40 Capital distributions (minus) 0 0
5.41.12.45 Repayment of loans (minus) 0 0
5.41.12.50 Payment of obligations with the public (-) 0 0
5.41.12.55 Repayment of secured loans from rel Co. (-) 0 0
5.41.12.60 Repayment other loans from related Co. (-) 0 0
5.41.12.65 Share issue payment (minus) 0 0
5.41.12.70 Payment of issue publ oblig (minus) 0 0
5.41.12.75 Other financing payments (minus) 33 0 0
5.41.13.00 CASH FLOW FROM INVESTING ACTIVITIES (6,897,405) (23,613,343)
5.41.13.05 Sale of fixed assets 49,469 111,443
5.41.13.10 Sale of permanent investments 0 0
5.41.13.15 Sale of other investments 33 5,115,961 313,172
5.41.13.20 Proceeds secured loans to related Comp. 1,025,615 3,097,144
5.41.13.25 Proceeds other loans to related companies 0 0
5.41.13.30 Other investment income 33 659,830 1,492,737
5.41.13.35 Incorporation of fixed assets (minus) (7,530,320) (18,156,591)
5.41.13.40 Capitalized interests payment (minus) 0 0
5.41.13.45 Permanent Investments (minus) (199) (4,086,905)
5.41.13.50 Investments in financial instruments (minus) 0 0
5.41.13.55 Other loans to related companies (minus) (3,936,873) (68,000)
5.41.13.60 Other loans to related companies (minus) (12,394) (7,639)
5.41.13.65 Other distrib of funds on invest activities (-) 33 (2,268,494) (6,308,704)
5.41.00.00 TOTAL NET CASH FLOW FOR THE PERIOD 12,898,841 (12,675,031)
5.42.20.00 EFFECT OF INFLATION ON CASH & CASH EQUIV. (1,369,038) (988,247)
5.41.00.00 NET CHANGE IN & CASH EQUIVALENT 11,529,803 (13,663,278)
5.42.00.00 CASH & CASH EQUI AT BEGINNING OF PERIOD 61,139,913 75,327,604
5.43.00.00 CASH & CASH EQUIV BALANCE AT END OF PERIOD 72,669,716 61,664,326
4
INCOME STATEMENT RECONCILIATION
CONCILIATION BETWEEN CASH FLOW GENERATED BY THE OPERATION'S ACTIVITIES AND
THE INCOME STATEMENT FOR THE YEAR
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance: Individual
CASH FLOW - INCOME STATEMENT RECONCILIATION NOTE No. 09-30-04 09-30-03
------------------------------------------------------------ -------- ----------- ----------
5.50.10.00 Profit (Loss) for the year 14,237,355 2,454,646
5.50.20.00 Profit in sale of assets (8,676) (4,599)
5.50.20.10 (Profit) Loss in sale of fixed assets (8,676) (4,599)
5.50.20.20 Profit in sale of investments (minus) 0 0
5.50.20.30 Loss in sale of investments 0 0
5.50.20.40 (Profit) Loss in sale of other assets 0 0
5.50.30.00 Non-cash losses (gains) 12,033,837 17,971,091
5.50.30.05 Depreciation for the year 12 7,984,244 7,413,630
5.50.30.10 Amortization of intangibles 636,720 659,414
5.50.30.15 Write-offs and provisions 2,157,926 747,287
5.50.30.20 Accrued earnings from investments in related
companies (minus) 14 (6,059,364) (3,722,990)
5.50.30.25 Accrued losses from investments in related Co. 14 5,565,845 5,335,051
5.50.30.30 Negative goodwill amortization 16 131,001 130,874
5.50.30.35 Positive goodwill amortization (minus) 0 0
5.50.30.40 Price level restatement 29 398,945 439,377
5.50.30.45 Net exchange difference 30 (1,265,557) (10,060,062)
5.50.30.50 Other non-cash credits to results (minus) (25,156) (25,131)
5.50.30.55 Other non-cash debits to results 2,509,233 (3,066,483)
5.50.40.00 Changes in Assets affecting cash flow (incr)
decreases (5,371,394) (1,199,132)
5.50.40.10 Debtors from sales (3,355,449) (958,289)
5.50.40.20 Inventory (2,468,302) (259,443)
5.50.40.30 Other assets 452,357 18,600
5.50.50.00 Changes in liabilities affecting cash flow increases
(decr) 2,796,797 (450,908)
5.50.50.10 Accounts payable related to results for
the year 85,452 7,832
5.50.50.20 Interests payable (780,775) (1,006,292)
5.50.50.30 Income tax payable (net) 2,971,856 414,979
5.50.50.40 Other accounts payable related to non-oper results 353,239 (320,696)
5.50.50.50 VAT and other taxes payable (net) 167,025 453,269
5.50.60.00 Profit (Loss) of minority interest 0 0
5.50.00.00 NET OPERATING CASH FLOW 23,687,919 18,771,098
5
01. Registration In The Securities Register
1. IDENTIFICATION OF THE COMPANY AND REGISTRATION IN THE SECURITIES
REGISTER
The company is registered in the Securities Register under N 061 and is
supervised by the Securities and Insurance Commission.
6
02. Applied Accounting Criteria
a) Accounting Period
These financial statements correspond to the period between January 1 and
September 30 of 2004 and 2003.
b) Preparation basis of financial statements:
These individual financial statements as of September 30, 2004 and 2003 have
been prepared on the basis of generally accepted accounting principles and
specific norms issued by the S.V.S., with the former prevailing in case of
discrepancies.
Investments in subsidiaries are recorded on one line in the general balance
sheet at their net worth and, therefore, they have not been consolidated line
by line. This treatment does not modify the net income of the fiscal year nor
the net worth.
These financial statements have been issued only for purposes of making an
individual analysis of the Company and, in consideration thereof, shall be
read together with the consolidated statements, which are required by
generally accepted accounting principles in Chile.
c) Presentation Basis
For comparison purposes, the financial statements and figures included in the
disclosures for the 2003 fiscal year are presented updated according to
non-accounting terms as of September 30, 2004 by 1.6%.
d) Adjustment for Currency Devaluation (Price Level Restatement)
Financial statements have been corrected monetarily on the basis of
considering the variation in the purchasing power of the currency which
occurred in the 2004 fiscal year, which was 1.9% (1.2% in 2003).
For financial effects, the variations have been considered effective been
every month of the year 2003 and 2004, with respect to September of 2004 and
2003. For tax purposes, negative variations occurred in some months of 2003
and 2004 with respect to September 2003 and 2004, were equaled to zero,
according to the instructions of the of Internal Revenue Service, not
significantly affecting the financial statements.
7
e) Conversion Basis
Balances in foreign currency and indexed currency units have been converted to
pesos at the indicated parities:
2004 2003
-------------- --------------
Ch$ Ch$
U.S. Dollar 608.90 660.97
Pound Sterling 1,091.41 1,099.23
Swiss Franc 482.14 501.76
EURO 757.34 770.81
Unidad de Fomento 17,190.78 16,946.03
f) Marketable Securities and Time Deposits
Transactions in fixed income instruments are shown at the return value of the
investment, which does not exceed the market value as of September 30, 2004.
Investments in stock are shown at the lowest value between the corrected cost
and market value.
Time deposits are shown at the value of the investment, plus adjustments and
interest accrued as of the date of the fiscal year.
Investments in Mutual Funds are valued at the liquidation value at the close
of the fiscal year.
g) Inventory
Inventory of finished products has been valued as of September 30, 2004 and
2003 at the direct production cost, duly updated, and raw materials and
materials at the cost of the last purchase or its corrected cost. Those
valuations do not exceed the net liquidation value.
h) Bad Debts (Uncollectibles)
The parent company and subsidiaries have made provision for bad debts that is
deducted from debtors for sales. The criterion adopted to estimate them is the
age of the balances.
i) Fixed Assets
Fixed assets are shown at purchase cost plus legal and regulatory revaluations
accumulated until September 30, 2004 and 2003.
8
j) Depreciation of Fixed Assets
Depreciation of this property is calculated on updated values, according to
the straight-line depreciation system, considering the estimated useful life
of the property.
k) Assets in Leasing
None.
l) Sales Transactions with Leaseback
None.
m) Intangibles
None.
n) Investments in Related Companies
Investments in stock and rights in related companies have been valued
according to the percentage of the holding that corresponds to the Company in
the equity of its affiliates (VPP), according to procedures established for
these purposes by circular 368 of the Securities and Insurance Commission.
o) Negative and Positive Investment Goodwill:
Negative and positive investment goodwill have arisen when comparing the price
paid for the investment made and the proportional value that corresponds to
that investment in the net worth of the company.
Negative goodwill amortizations are carried out over a twenty-year period.
As of September 30, 2004 and 2003 there was no positive investment goodwill.
p) Operations with buyback and sellback agreement
Financial instruments acquired with a sellback agreement are shown at their
purchase value plus interest and adjustments accrued at the closing of the
fiscal year, and they are classified in Other
9
Current Assets, in the terms established in Circular No. 768 of the Securities
and Insurance Commission.
q) Deferred Taxes and Income Tax
The company has complied with deferred taxes, in accounting terms, as
established in Technical Bulletin No. 60 and the norms indicated in Circular
1466 of the S.V.S.
Income tax is recorded in the accounting on the basis of the calculation of
net taxable income determined according to norms established in the Income Tax
Law.
r) Severance payment
The parent company has established a reserve for all of the personnel's
severance payment, according to the union contracts signed with their workers.
This reserve is shown at the present value of the obligation.
s) Sales
The company recognizes the income from its operations on an accrued basis
according to generally accepted accounting principles in Chile.
t) Derivative Contracts
The company maintains Future contracts in foreign currency, which have been
recorded as established in Technical Bulletin 57 of the Accountants
Association of Chile.
u) Computer Software
The company develops computer software with its own resources, and it also
acquires computer packages from third parties. Disbursements for its own
development are charged to results as they are generated. Computer packages
are recorded in Fixed Assets and amortized in 36 months.
v) Research and Development Expenses
The company records expenses for this concept directly in results as they are
generated.
10
w) Cash Flow Statement:
According to current regulations of the Securities and Insurance Commission
and the Accountants Association of Chile, in preparing the cash flow
statement, the Company has considered time deposits, fixed rate mutual fund
investments and deposits with maturities under 90 days as cash.
Such cash flows related to the Company's line of business, interest paid,
interest income received, dividends received, and all such that is not defined
as investment or Financing is included under the heading "Flow Originating in
Activities of the Operation."
Income by time deposits and agreements with maturity more than 90 days has
been classified in the item "Investments in Financial Instruments".
11
03. Accounting Changes
As of September 30, 2004 and 2003, there have not been any changes in the
accounting criteria that affect the individual financial statements.
12
04. Marketable Securities
As of September 30, 2004, this item is composed by the following investments:
a) Th Ch$ 53,833,075 of investments in bonds and fixed rate Instruments
equivalent to US$ 41,389,097 and Euros 37,805,020; mainly
corresponding to investments in State Bonds and bonds of financial
institutions in USA, Germany, and Holland, Collateralized Bonds of
Private Companies in USA (guaranteed by accounts receivable) and USA
Mortgage Bonds with state guarantee.
b) Th Ch$ 4,233,486 in shares.
c) Th Ch$ 3,635,133 in investment bonds of Celulosa Arauco equivalent
to US$ 5,970,000, at an annual rate of 6.95% with maturity on
September 15, 2005.
d) Th Ch$ 10,521 in interest of Celulosa Arauco bonds.
As of September 30, 2003 investments in shares are included as follows:
a) Th Ch$ 52,310,976 of investments in bonds and fixed rate
Instruments; mainly corresponding to investments in State Bonds and
bonds of financial institutions in USA, Germany, and Holland,
Collateralized Bonds of Private Companies in USA (guaranteed by
accounts receivable) and USA Mortgage Bonds with state guarantee.
b) Th Ch$ 4,229,711 in shares.
c) Th Ch$ 313,172 in interest of Celulosa Arauco bonds.
CRISTALERIAS DE CHILE S.A.
NOTE 4 -MARKETABLE SECURITIES- BALANCE COMPOSITION
Type of Security Book Value
-------------------------------- --------------- ----------------
09-30-2004 09-30-2003
--------------- ----------------
Stock 4,233,486 4,229,711
Bonds 0 0
Mutual fund shares 0 0
Investment fund shares 0 0
Public tender promissory notes 0 0
Mortgage bonds 0 0
Fixed rate instruments and bonds 57,468,208 52,310,976
Interest of Celulosa Arauco bonds 10,521 313,172
Total Marketable Securities 61,712,215 56,853,859
13
CRISTALERIAS DE CHILE S.A.
NOTE 4 - MARKETABLE SECURITIES - SHARES
Unit Market
Number of Share Market Investment Corrected
R.U.T. Company Name Shares Percentage Value Value Cost
------------------- ------------------------------------- ----------- ------------ -------- ----------- ----------
96.512.200-1 Bodegas y Vinedos Santa Emiliana S.A. 63,642,856 9.9980 90 5,727,857 4,233,486
Value Investment Portfolio 5,727,857 4,233,486
Adjustment Reserve
Book value, Investment Portfolio 4,233,486
14
CRISTALERIAS DE CHILE S.A.
NOTE 4 - MARKETABLE SECURITIES - FIXED RATE
INSTRUMENTS
Book Value
Par ------------------------- Market
Type of Security Value Amount Rate % Value Reserve
---------------------------------------------- ----------------- ----------- ------------ ------------ ------------
Financial Institutions bonds Germany and
Holland (1) 32,470,490 32,470,490 1.93 32,470,490 0
US treasury bonds (2) 18,133,100 18,133,100 0.70 18,133,100 0
Mortgage bonds USA, with state guarantee (2) 6,852,522 6,852,522 0.70 6,852,522 0
Call Deposit (2) 12,096 12,096 0.70 12,096 0
Celulosa Arauco bonds, interest (2) 10,521 10,521 4.02 10,521 0
TOTAL 57,478,729 57,478,729 57,478,729 -
Note:
(1) The investments were made in EUROS.
(2) The investments were made in US Dollars.
(3) Rate for period from 01-01-2004 to 09-30-2004.
(4) These investments can be rescued within 48 hours warning.
15
05. Short-Term and Long-Term Debtors
At September 30, 2004 and 2003 there are balances of short-term debtors of Th
Ch$ 24,392,527 and Th Ch$ 22,618,274, respectively.
In addition there is a balance of Th Ch$ 112,575 for Long-Term debtors in 2004
(Th Ch$ 145,111 in 2003).
As of September 30, 2004 and 2003 the company has established a reserve for bad
debts of Th Ch$ 173,127 in 2004 (Th Ch$ 145,417 in 2003), which is deducted from
Debtors for Sales.
The balance of Short-term Debtors is shown net of the reserve for bad debtors
and customer advances.
16
CRISTALERIAS DE CHILE S.A.
NOTE 5 -SHORT AND LONG TERM DEBTORS
Current Assets
--------------
Item Up to 90 days Over 90 days up to 1 year Subtotal Total Current (net)
____ ------------- ------------------------- -------- -------------------
09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ---------- ---------- ----------
Debts from Sales 21,419,412 19,018,736 1,325,671 1,033,785 22,745,083 22,571,956 19,907,104
Estimate of non-collectable debt -- -- -- 173,127 -- --
Documents receivable 943,581 1,744,243 44,934 121,874 988,515 988,515 1,866,117
Estimate of bad debtors -- -- -- -- -- -- --
Misc. debtors 738,362 812,582 93,694 32,471 832,056 832,056 845,053
Estimate of bad debtors -- -- -- -- -- -- --
Long Term
Item ---------
---- 09-30-2004 09-30-2003
---------- ----------
Debts from Sales 0 0
Estimate of non-collectable debt -- --
Documents receivable 0 0
Estimate of bad debtors -- --
Misc. debtors 112,575 145,111
Estimate of bad debtors -- --
Total Long Term Debtors 112,575 145,111
17
06. Balances and Transactions with related entities
I. Balances receivable in the Short-Term as of September 30, 2004 and 2003
amount Th Ch$ 5,022,190 and Th Ch$ 2,390,646 respectively. In the Long-Term
a balance of Th Ch$ 21,292,513 and Th Ch$ 21,675,448 is recorded,
respectively.
1) Th Ch$ 19,207,576 in 2004 (Th Ch$ 20,211,988 in 2003) correspond to the
sale of Rayen Cura S.A.I.C. shares to the subsidiary Cristalchile
Inversiones S.A., equivalent to UF 1,117,318, without interests which are
shown in long-term.
2) Detail of outstanding credits from related companies:
a) Th Ch$ 876,730 in 2004 (Th Ch$ 1,463,460 in 2003) Loan to Red Televisiva
Megavision S.A., annual rate 2.49%, UF adjustability
07.05.2006 17,000 UF Th Ch$ 292,243
01.05.2007 17,000 UF Th Ch$ 292,243
07.05.2007 17,000 UF Th Ch$ 292,244
b) Loan to Metropolos-Intercom S.A., annual rate 3.0% in Ch$
06.09.2005 Th Ch$ 2,725,425 Short-Term.
04.18.2006 Th Ch$ 861,688 Long-Term.
c) Loan to Inmob. Monte Azul S.A. UF 20,000 (Th Ch$ 346,519), annual rate 3.0%
in Long-Term.
3) There are balances for invoicing of Sales of bottles and services with the
following related companies with expiration under 90 days:
2004 2003
--------- --------
Th Ch$ Th Ch$
S.A. Vina Santa Rita 2,197,371 2,040,804
Vina Carmen S.A. 2,382 0
Vina Los Vascos S.A. 87,013 147,042
Servicios y Consultorias Hendaya S.A 208 1,930
Rayen Cura S.A.I.C. 0 183,530
Vina Dona Paula S.A. 0 2,192
_________ ________
Total 2,286,974 2,375,498
18
Balances Payable in the Short-Term amount Th Ch$ 832,342 in 2004 and Th Ch$
810,885 in 2003, which correspond to invoicing balances with expirations under
90 days:
2004 2003
-------- -------
Th Ch$ Th Ch$
S.A. Vina Santa Rita 140,395 207,172
Ediciones Financieras S.A. 204 0
Vina Los Vascos S.A. 14,413 8,955
Cia. Electro Metalurgica S.A. 1,141 0
_______ _______
TOTAL 156,153 216,127
For dividends payable to related companies there is the following detail:
2004 2003
-------- -------
Th Ch$ Th Ch$
Cia. Electro Metalurgica S.A. 435,600 331,927
Servicios y Consultorias Hendaya S.A, 113,587 86,553
Bayona S.A. 118,251 90,107
------- -------
TOTAL 667,438 508,587
For balances in favor in Cristalchile Inversiosnes S.A.'s current account for Th
Ch$ 7,932 and Cristalchile Comunicaciones S.A. Th Ch$ 819.
19
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCE AND TRANSACTIONS WITH RELATED COMPANIES
DOCUMENTS AND ACCOUNTS RECEIVABLE
R.U.T. Company Short Term Long Term
------ ------- ---------- ---------
09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ----------
86547900-K S.A. VINA SANTA RITA 2,197,371 2,040,804 0 0
79952350-7 RED TEL. MEGAVISION S.A. 5,579 15,148 876,730 1,463,460
89150900-6 VINA LOS VASCOS S.A. 87,013 147,042 0 0
96721580-5 CRISTACHILE COMUNICACIONES S.A. 1,375 0 0 0
96972440-5 CRISTALCHILE INVERSIONES S.A. 0 0 19,207,576 20,211,988
83032100-4 SERV. Y CONSULTORIAS HENDAYA S.A. 208 1,930 0 0
87941700-7 VINA CARMEN S.A. 2,382 0 0 0
96787750-6 METROPOLIS INTERCOM S.A. 2,725,425 0 861,688 0
78936090-1 INMOB. Y CONSTRUCTORA MONTE AZUL S.A. 0 0 346,519 0
96608270-4 CIECSA S.A. 2,837 0 0 0
0-E VINA DONA PAULA S.A. 0 2,192 0 0
0-E RAYEN CURA S.A.I.C. 0 183,530 0 0
TOTAL 5,022,190 2,390,646 21,292,513 21,675,448
20
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCES AND TRANSACTIONS WITH RELATED COMPANIES
DOCUMENTS AND ACCOUNTS PAYABLE
R.U.T. Company Short Term Long Term
------ ------- ---------- ---------
09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ----------
86547900-K S.A. VINA SANTA RITA 140,395 207,172 0 0
89150900-6 VINA LOS VASCOS S.A. 14,413 8,955 0 0
96972440-5 CRISTALCHILE INVERSIONES S.A. 7,932 9,074 0 0
96721580-5 CRISTALCHILE COMUNICACIONES S.A. 819 31,962 0 0
96539380-3 EDICIONES FINANCIERAS S.A. 204 0 0 0
86755600-1 BAYONA S.A. 118,251 90,107 0 0
96608270-4 CIECSA S.A. 0 45,135 0 0
90320000-6 CIA. ELECTROMETALURGICA S.A. 436,741 331,927 0 0
83032100-4 SERV. Y CONSULTORIAS HENDAYA S.A. 113,587 86,553 0 0
TOTAL 832,342 810,885 0 0
21
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCES AND TRANSACTIONS WITH RELATED COMPANIES TRANSACTIONS
09-30-2004 09-30-2003
---------- ----------
Effect on Effect on
Description of Results Results
Company R.U.T. Relationship Transaction Amount (Debit/Credit) Amount (Debit/Credit)
------- ------ ------------ -------------- ------ -------------- ------ --------------
Container
S.A. VINA SANTA RITA 86547900-K Subsidiary Sales 4,488,007 1,290,451 4,435,729 1,149,407
Packaging
Subsidiary sales 431,757 0 376,668 0
Materials
Subsidiary Purchase 427,162 6,815 481,729 128,212
Rent of
Subsidiary Vineyard 16,503 16,503 14,040 14,040
Dividends
Subsidiary Received 649,952 0 1,530,682 0
SERV. Y CONS. HENDAYA Controlling Received
S.A. 83032100-4 stockholder services 781,298 -781,298 793,069 -793,069
Controlling
stockholder Given services 14,551 14,551 15,960 15,960
Controlling
90320000-6 stockholder Dividends paid 341,897 0 705,988 0
CLARO Y CIA. 79753810-8 With the Chairman Legal assesment 35,322 -35,322 31,748 -31,748
Indirect
NAVARINO S.A. 96566900-0 subsidiary Loaned services 7,624 7,624 7,707 7,707
Indirect
QUEMCHI S.A. 96640360-8 affiliate Loaned services 7,624 7,624 8,346 8,346
CIA. SUDAMERICANA DE Indirect Carrier
VAPORES S.A. 90160000-7 affiliate services 82,982 0 190,570 0
Controlling
BAYONA S.A. 86755600-1 stockholder Dividends paid 355,935 0 734,973 0
Indirect
VINA LOS VASCOS S.A. 89150900-6 affiliate Direct sales 543,522 156,281 312,065 80,863
Indirect Materials
affiliate purchased 41,156 0 29,644 0
EDICIONES FINANCIERAS Indirect Received
S.A. 96793770-3 affiliate services 3,870 -3,870 3,808 -3,808
CIA. ELECTROMETALURGICA Controlling
S.A. 90320000-6 stockholder Dividends paid 1,311,156 0 2,707,420 0
Controlling Materials
stockholder purchased 5,647 0 3,642 0
Controlling Account
stockholder Payments 0 0 284 0
RED TELEVISIVA Related with
MEGAVISION S.A. 79952350-7 Subsidiary Interests 33,042 33,042 93,394 93,394
Related with
Subsidiary Adjustments 13,810 13,810 31,417 31,417
Related with
Subsidiary Loan repayment 0 0 1,170,798 0
Related with
Subsidiary Advertisements 5,000 -5,000 0 0
Indirect Long-term loan
METROPOLIS INTERCOM S.A. 96787750-6 affiliate granted 861,688 0 0 0
Indirect Short-term
affiliate loan granted 2,725,425 0 0 0
CRISTALCHILE Capital
COMUNICACIONES 96721580-5 Subsidiary Contribution 0 0 2,550,160 0
Subsidiary Adjustments 42 42 0 0
CRISTALCHILE INVERSIONES
S.A. 96972440-5 Subsidiary Credit return 1,025,615 0 1,816,678 0
Subsidiary Adjustments 302,547 302,547 249,258 249,258
Related with
VINA CARMEN S.A. 87941700-7 Subsidiary Rent 32,955 32,955 0 0
Capital
CIECSA S.A. 96608270-4 Subsidiary Contribution 0 0 1,536,216 0
Subsidiary Adjustments 15 -15 92 -92
Related with
VINA DONA PAULA S.A. 0-E Subsidiary Direct Sales 23,556 6,773 0 0
Indirect
RAYEN CURA S.A.I.C. 0-E affiliate Direct Sales 115,771 40,106 442,560 137,340
INMOB. Y CONSTRUCTORA
MONTE AZUL 78936090-1 Affiliate Loan granted 343,815 0 0 0
Affiliate Interest 2,705 2,705 0 0
22
07. Inventory
The balance of the inventory item corresponds to finished products and materials
that are valued as described in Note 2 g). A detail of its composition is shown
below:
2004 2003
--------- ---------
Th Ch$ Th Ch$
Finished Products 4,165,325 2,723,155
Raw Materials and Fuel 1,242,139 1,661,580
Materials and spare parts to be consmed 873,822 1,058,114
Materials in transit 1,026,001 307,686
TOTAL 7,307,287 5,750,535
23
08. Deferred taxes and income taxes
A) DEFERRED TAXES.
Accumulated balances of deferred taxes for temporary differences, and their
composition in the income tax account for effects of fiscal year results and
recognition of deferred taxes, are presented on the attached charts.
Estimated amortization periods of deferred taxes have been estimated on the
average at 1 years for Short-Term Assets, 4 for Long-Term Assets, and 14 for
Long-Term Liabilities.
B) INCOME TAX
The Company established tax provisions of 17% of First Category Income Tax in
2004 and 16.5% in 2003, and 35% as single tax under Art. 21, for the 2004 and
2003 fiscal years.
Credits against taxes are shown deducting the payable obligation.
The itemized list is the following:
2004 2003
Th Ch$ Th Ch$
Fiscal year income tax reserve (2,839,048) (666,811)
Single tax reserve (10,176) (8,161)
------------ -----------
SUBTOTAL (2,849,224) (674,972)
Credits:
Monthly reserve payments 1,227,631 2,154,631
Training expenditure 40,518 36,040
Credit fixed assets 0 0
Donations 12,500 0
Recoverable VAT 0 0
------------ ----------
CREDIT SUBTOTAL 1,280,649 2,190,671
VAT Tax Credit previous fiscal year 745,453 236,091
TOTAL TAXES TO BE ------------ ----------
RECOVERED (823,122) 1,751,790
24
C) TAXABLE PROFIT FUND
The company showed the following taxable profits to be distributed:
2004 2003
Thou Ch$ Thou Ch$
Generated as of 31.12.1983:
Profit Adjustment 1,955,579 1,955,579
Generated since 01.01.1984:
Without Credit 1,952,737 1,092,551
With 10% First Category Credit 22,897 23,125
With 15% First Category Credit 83,691,680 87,635,035
With 16% First Category Credit 14,608,036 16,432,597
With 15% Additional Rate Credit 725 736
With 16.5% First Category Credit 7,024,928 4,179,243
With 17% First Category Credit 16,845,057 0
------------- ----------
SUBTOTAL TAX PROFITS 124,146,060 109,363,287
Non-income revenues 6,886,405 6,955,188
------------- ------------
Total earnings to distribute 131,032,465 116,318,475
25
CRISTALERIAS DE CHILE S.A.
NOTE 8 - DEFERRED TAXES AND INCOME TAX
DEFERRED TAXES
09-30-2004
-----------------------------------------------------------
Asset Deferred Tax Liability Deferred Tax
-------------------------- ---------------------------
Item Short term Long Term Short Term Long Term
------------------------------------------------- ---------- --------- ---------- ---------
Temporary Differences
Reserve non-collectable accounts 29,431 0 0 0
Expected revenue 0 0 0 0
Vacation reserve 69,728 0 0 0
Amortization intangibles 0 0 0 0
Leased assets 0 0 0 0
Manufacturing expenses 0 0 0 0
Fixed asset depreciation 0 0 0 4,813,625
Severance 1,507 150,147 0 0
Other events 0 0 54,143 502,789
Packaging reserve 154,061 0 0 0
Others reserve 20,400 0 0 0
Furnace repair reserve 325,031 401,392 0 0
Refractories obsolescence reserve 7,135 0 0 0
Spare parts obsolescence reserve 109,251 0 0 0
Deferred customs duties 729 20,087 0 73,330
Accumulated depreciation automobiles 0 20,698 0 0
Unrealized profit 39,551 10,836 0 0
Fixed asset, molds 0 0 0 289,762
Amortization lower valued bonds 0 0 0 0
OTHERS
Complementary accounts-net amortization 0 5,586 0 2,155,779
Valuation reserve 0 0 - -
Total 756,824 597,574 54,143 3,523,727
26
CRISTALERIAS DE CHILE S.A.
NOTE 8 - DEFERRED TAXES AND INCOME TAX
DEFERRED TAXES
09-30-2003
-----------------------------------------------------------
Asset Deferred Tax Liability Deferred Tax
-------------------------- ---------------------------
Item Short term Long Term Short Term Long Term
------------------------------------------------- ---------- --------- ---------- ---------
Temporary Differences
Reserve non-collectable accounts 23,994 0 0 0
Expected revenue 0 0 0 0
Vacation reserve 63,086 0 0 0
Amortization intangibles 0 0 0 0
Leased assets 0 0 0 0
Manufacturing expenses 0 0 0 0
Fixed asset depreciation 0 0 0 4,682,023
Severance 1,784 147,543 0 0
Other events 0 0 54,133 560,950
Packaging reserve 196,711 0 0 0
Others reserve 0 0 0 0
Furnace repair reserve 0 589,832 0 0
Refractories obsolescence reserve 7,203 0 0 0
Spare parts obsolescence reserve 98,860 0 0 0
Deferred customs duties 0 0 0 1,990
Accumulated depreciation automobiles 0 16,864 0 81,841
Unrealized profit 41,693 7,102 0 0
Fixed asset, molds 0 0 0 268,229
Amortization lower valued bonds 0 0 0 0
OTHERS
Complementary accounts-net amortization 0 12,753 0 2,420,055
Valuation reserve - -
Total 433,331 748,588 54,133 3,174,978
27
CRISTALERIAS DE CHILE S.A.
NOTE 8 - DEFERRED TAXES AND INCOME TAX
INCOME TAX
ITEM 09-30-2004 09-30-2003
--------------------------------------------------------------------- ---------------- ----------------
Current tax costs (tax reserve) -2,849,224 -674,971
Adjustment tax cost (previous year) 0 0
Effect on assets or liabilities from deferred tax of fiscal year 235,987 -99,677
Tax benefit from tax losses 0 0
Effect of amortization of complementary accounts of deferred
assets and liabilities -213,963 -127,306
Effect on assets or liabilities of deferred tax for changes in
evaluation reserve 0 0
Other debits or credits in the account -41,868 0
Total -2,869,068 -901,954
28
09. Short-term and long-term leasing contracts and leasing assets
(note required only for leasing companies defined in circular No. 939 of 1990).
As of September 30, 2004 and 2003, there are no transactions for this concept.
29
10. Other current assets
As of September 30, 2004, investments in financial instruments for Th Ch$
12,947,043, with resale agreements, valued as stated in note 2 p) for Th Ch$
11,732,400 corresponding to agreements in pesos, and agreements in US$ under 90
days for Th$ 1,214,643.
On September, 2004 Th Ch$ 328,138 are included corresponding to issuance
expenses and rate placement difference of bonds series C and D.
Also there was a balance in favor of Cristalerias de Chile for Th Ch$ 483,000
for Future Contracts, more detail of these is shown in note 34 Derivative
Contracts.
As of September 30, 2003, there was a balance of Th Ch$ 2,088,112 investments in
financial instruments with resale agreements in pesos for Th Ch$ 840,232, valued
as stated in note 2 p), and agreements in US$ under 90 days for Th$ 1,247,880.
Th Ch$ 330,480 are also included, corresponding to issuance expenses and rate
placement difference of bonds series C and D.
30
11. Information on operations involving purchase agreements,
sales agreements, sale with buyback agreement, and purchase
with sellback agreement of commercial paper or bearer securities
Information about these transactions is presented on attached charts.
31
CRISTALERIAS DE CHILE S.A.
NOTE 11 - Information on operations involving purchase agreements, sales
agreements, sale with buyback agreement, and purchase with sellback agreement of
commercial paper or bearer securities
Sale Operations with buyback agreement (VRC) and Purchase with resale agreement
(CRV)
Dates
-------------------------- Original Price
Code Start End Counterpart Currency Set
---------- ------------ ------------ ----------------------------------------------- ----------- ---------------
CRV 09.24.2004 10.01.2004 BCI CB PESO 500,000
CRV 09.24.2004 10.12.2004 BANCHILE PESO 5,100,000
CRV 09.28.2004 10.05.2004 BANCHILE PESO 2,000,000
CRV 09.28.2004 10.01.2004 BANCHILE PESO 300,000
CRV 09.29.2004 10.06.2004 BANCHILE PESO 940,000
CRV 09.30.2004 10.07.2004 BCI CB PESO 1,590,000
CRV 09.27.2004 10.04.2004 SANTANDER INVESTMENT PESO 1,300,000
CRV 09.27.2004 10.12.2004 SANTANDER S.A. AGENTE VALORES DOLLAR 608,900
CRV 09.27.2004 10.18.2004 SANTANDER S.A. AGENTE VALORES DOLLAR 605,572
Dates
-------------------------- Market
Code Start End Rate Final Value Document ID Value
---------- ------------ ------------ ------------------ --------------------- ----------------- ---------------
CRV 09.24.2004 10.01.2004 0.16 500,198 PDBC-BCP 500,160
CRV 09.24.2004 10.12.2004 0.16 5,104,896 BCP-BUCER 5,101,632
CRV 09.28.2004 10.05.2004 0.19 2,000,887 STGEC-STGCC-CHI 2,000,253
CRV 09.28.2004 10.01.2004 0.19 300,057 STD-STGCC 300,039
CRV 09.29.2004 10.06.2004 0.18 940,395 PRC-BCU 940,056
CRV 09.30.2004 10.07.2004 0.20 1,590,742 CERO-DUSAN-PDBC 1,590,000
CRV 09.27.2004 10.04.2004 0.20 1,300,516 PRC-ZERO 1,300,260
CRV 09.27.2004 10.12.2004 1.70 609,331 PRD-BCD-BCP-STD 608,986
CRV 09.27.2004 10.18.2004 1.70 606,172 PRD-BCD-BCP-STG 605,657
32
12. Fixed Assets
Fixed Assets:
The Fixed Assets are shown at purchase cost plus the legal and regulatory
revaluations accumulated as of September 30, 2004 and 2003.
The items that make up the Company's fixed assets as of September 30, 2004 and
2003 include mainly Land, Industrial Constructions, Infrastructure Works,
Machinery and Equipment distributed in the Padre Hurtado Plant.
Technical Reappraisal and Adjustment of Accounting Values
The company carried out a technical reappraisal of its fixed assets in 1979.
Likewise, in June 1986 it adjusted those assets. Both operations were carried
out according to the provisions established in Circular Letters No. 1529 and No.
550 respectively of the Securities and Insurance Commission.
The effects of these operations, including write-offs of property, are shown on
the attached chart.
Depreciations:
The charge against results for this item is Th Ch$ 7,984,245 in 2004 and Th Ch$
7,413,630 in 2003.
The detail is shown on an attached chart.
33
FIXED ASSETS
2004 2003
-------------- --------------
Th Ch$ Th Ch$
LAND
Land & mining claims 1,531,255 1,532,050
Subtotal land 1,531,255 1,532,050
Subtotal land 1,531,255 1,532,050
High rises and industrial const. 13,633,867 13,608,892
Facilities 9,879,527 9,255,141
Housing developments 26,711 26,685
Subtotal constructions &
infrastrucrture 23,540,105 22,890,718
Accumulated depreciation (10,386,787) (9,063,863)
Depreciation for the fiscal year (1,005,708) (982,283)
Subtotal depreciation (11,392,495) (10,046,146)
SUBTOTAL CONSTRUCTIONS & INFRASTRUCTURE 12,147,610 12,844,572
MACHINERY & EQUIPMENT
---------------------
Machinery 58,359,398 55,405,912
Furnaces 47,258,066 47,107,775
Furniture and Materials 1,386,608 1,291,881
Tools 445,987 354,302
Vehicles 215,438 215,235
Subtotal Machinery & equipment 107,665,497 104,375,105
Accumulated depreciation (50,212,007) (41,700,742)
Depreciation for the fiscal year (6,819,127) (6,272,091)
Subtotal depreciation (57,031,134) (47,972,833)
Subtotal machinery & equip 50,634,363 56,402,272
OTHER FIXED ASSETS
------------------
Spare parts 6,860,830 5,634,169
Imports in transit 1,554,380 125,639
Works underway 2,716,718 1,129,900
Lots in Pirque and Leyda 418,042 471,719
Other 403,791 325,000
Subtotal other assets 11,953,761 7,686,427
TOTAL FIXED ASSETS 144,690,618 136,484,300
TOTAL ACCUMUL. DEPREC. (60,598,794) (50,764,605)
TOTAL DEPREC FOR F. YEAR (7,824,835) (7,254,374)
TOTAL NET FIXED ASSETS 76,266,989 78,465,321
34
TECHNICAL REVALUATION AND ADJUSTMENT OF ACCOUNTING VALUES
2004 2003
----------- -----------
Th Ch$ Th Ch$
LAND
----
Land and mining claims 319,012 318,603
Subtotal land and mining claims net 319,012 318,603
CONSTRUCTIONS & INFRASTRUCTURE
------------------------------
High rises and industrial constructions 6,371,495 6,365,235
Facilities 42,110 42,068
Subtotal Constructions 6,413,605 6,407,303
Accumulated depreciation (5,156,792) (4,939,451)
Depreciation for the fiscal year (159,410) (159,256)
Subtotal depreciations (5,316,202) (5,098,707)
Subtotal Constuctions & Infrastucture net 1,097,403 1,308,596
MACHINERY & EQUIPMENT
---------------------
Furnaces 0 0
Machinery 0 0
Tools 0 0
Furniture and Materials 0 0
Subtotal Machinery & equipment 0 0
Accumulated depreciation 0 0
Depreciation for the fiscal year 0 0
Subtotal depreciation 0 0
Subtotal machinery & equip 0 0
Total Net Technical Revaluation 1,416,415 1,627,199
----------- -----------
TOTAL REVALUATED ASSET 6,732,617 6,725,906
TOTAL ACCUMULATED DEPRECIATION (5,156,792) (4,939,451)
TOTAL DEPRECIATION FOR YEAR (159,410) (159,256)
TOTAL NET 1,416,415 1,627,199
35
13. Sales transactions with leaseback
These type of transactions were not carried out as of September 30, 2004 and
2003.
36
14. Investments in related companies
In agreement with established in Circular N(0) 1697de the SVS, for the
investments valuation in related companies carried out prior to the January 1,
2004, the Equity Method (VPP) has continued to be used.
This method consists of assigning the investment a value equivalent to the
proportion that corresponds to the company in the issuer's equity at book value,
and recognizing proportionally, the variations that it experiences.
CIECSA S.A.
On April 20, 2000 the Shareholders of Ciecsa S.A. agreed to increase its equity
by the equivalent to UF 359,921 through the issue of 343,750,000 shares that
were fully subscribed by Cristalchile S.A.
On April 18, 2003 such subscription was paid. On August 26, 2003 it was agreed
to increase CIECSA's capital by Th Ch$ 910,000, through the issue of
36,400,000 shares totally subscribed and paid by Cristalchile, with which the
participation in the subsidiary increased to 98.45%.
CRISTALCHILE INVERSIONES S.A.
This company was formed at the end of 2001 in which Cristalerias de Chile S.A.
has a 99.99% share of the equity. Cristalchile Inversiones S.A., in turn,
registers a 40% investment in Rayen Cura S.A.I.C., a company constituted in the
city of Mendoza, Republic of Argentina.
On January 31, April 25 and June 30 of 2003 Rayen Cura S.A.I.C. made capital
reimbursements of part of a capital increase paid on April 29, 2002. Reimbursed
amounts totaled Th US$ 2,600.
As of September 30, 2004 the financial statements of Rayen Cura S.A.I.C. have
recognized an exchange rate of $2.96 Argentine pesos per US Dollar.
CristalChile Inversiones S.A., in turn, has adjusted the financial statements of
Rayen Cura S.A.I.C. in order to acknowledge the variation occurred from $2.91
Argentine pesos (exchange rate used as of December 31, 2003) and $2.96 Argentine
pesos per US dollar as of September 30, 2004.
As an effect of the result of this affiliate and the conversion of the financial
statements of Rayen Cura S.A.I.C., according to Chilean normative, CristalChile
Inversiones S.A., has recognized a Th Ch$ 837,914 income as of September 30,
2004, and a Th Ch$ 728,836 income as of September 30, 2003.
On the other hand, the dollar exchange rate variation during the 2004 and 2003
fiscal years originated a Th Ch$ 61,568 charge in 2004 and a Th Ch$ 1,252,448
credit in 2003 in the item Other Equity Reserves, for the investment in Rayen
Cura S.A.I.C. and from the negative goodwill produced by the purchase of shares
of that company.
37
CRISTALCHILE COMUNICACIONES S.A.
As of September 29, 2003 the Shareholders agreed to increase the company's
equity by issuing 3,861,538 shares, without nominal value, at a value of Ch$ 650
each, which represents Th Ch$ 2,510,000.
Such increase was subscribed and paid by Cristalerias de Chile S.A., with which
its participation in the company's equity reaches 99.998%.
S.A. VINA SANTA RITA
As of September 30, 2004, the company has registered an unrealized income of Th
Ch$ 44,915, corresponding to container sales to the subsidiary S.A. Vina Santa
Rita.
As of September 30, 2004, the balance accumulated for this concept totaled Th
Ch$ 239,700 (Th Ch$ 252,684 in 2003).
INMOBILIARIA MONTE AZUL S.A.
On May 14, 2004, Cristalchile S.A. paid its subsidiary Constructora Apoger Th
Ch$196 corresponding to 49% of the rights of that society. With this
contribution the participation in the coligate reaches 50% as of September 30,
2004. In order to determine the fair value, the paid value corresponds to market
value, thus adjustment for present value has not originated.
38
CRISTALERIAS DE CHILE S.A.
NOTE 14 - INVESTMENTS IN RELATED COMPANIES
DETAIL OF INVESTMENTS
Shareholder Company
Country Investment (Percentage) Equity
of Control Number ---------------------- -----------------------
R.U.T. Company Origin Currency of Shares 09-30-2004 09-30-2003 09-30-2004 09-30-2003
------ ------- ------ -------- --------- ---------- ---------- ---------- ----------
Cristalchile
Comunicaciones
96721580-5 S.A. Chile Peso 105,074,698 99.99820 99.99820 70,207,975 71,743,988
S.A. Vina Santa
86547900-K Rita S.A. Chile Peso 493,959,597 54.09700 54.09700 81,722,164 82,649,498
86881400-4 Envases CMF S.A. Chile Peso 28,000 50.00000 50.00000 33,075,371 33,617,484
96608270-4 Ciecsa S.A. Chile Peso 689,301,305 98.44580 98.44580 18,477,821 16,673,471
Constructora
96767580-6 Apoger S.A. Chile Peso 800,000 80.00000 80.00000 3,147 5,158
Inmobiliaria Don
96826870-8 Alberto S.A. Chile Peso 3,817 0.00000 38.17000 0 27
Cristalchile
96972440-5 Inversiones S.A. Chile Peso 9,999 99.99000 99.99000 -3,135,698 -2,169,804
Inmobiliaria
78936090-1 Monte Azul S.A. Chile Peso 50 50.00000 0.00000 -9,169 0
TOTAL
Equity of societies Net Income at Result of
R.U.T. Company Net Income at Fair Value Fair Value Accrual
------ ------- ---------- ------------------- ------------- ----------
09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Cristalchile
Comunicaciones
96721580-5 S.A. -5,559,749 -5,334,291 -5,559,647 -5,334,192
S.A. Vina Santa
86547900-K Rita S.A. 5,395,156 3,704,890 2,918,618 2,052,922
86881400-4 Envases CMF S.A. 750,439 724,835 375,220 362,417
96608270-4 Ciecsa S.A. 2,101,212 838,952 2,068,555 825,914
Constructora
96767580-6 Apoger S.A. -1,637 -1,068 -1,310 -854
Inmobiliaria Don
96826870-8 Alberto S.A. 0 -8 0 -4
Cristalchilz
96972440-5 Inversiones S.A. 697,041 481,785 696,971 481,736
Inmobiliaria
78936090-1 Monte Azul S.A. -9,776 0 -9,169 0 -9,776 0 -4,888 0
TOTAL
Income not Book value
R.U.T. Company VPP Realized of Investment
------ ------- --- ---------- -------------
09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ---------- ---------- ----------
Cristalchile
Comunicaciones
96721580-5 S.A. 64,647,043 71,742,674 0 0 64,647,043 71,742,674
S.A. Vina Santa
86547900-K Rita S.A. 47,127,865 44,710,907 239,700 252,684 46,888,165 44,458,223
86881400-4 Envases CMF S.A. 16,537,685 16,808,743 0 0 16,537,685 16,808,743
96608270-4 Ciecsa S.A. 20,259,204 16,414,329 201,247 234,561 20,057,957 16,179,768
Constructora
96767580-6 Apoger S.A. 2,517 4,127 0 0 2,517 4,127
Inmobiliaria Don
96826870-8 Alberto S.A. 0 10 0 0 0 10
Cristalchile
96972440-5 Inversiones S.A. 0 0 0 0 0 0
Inmobiliaria
78936090-1 Monte Azul S.A. -4,584 0 0 0 -4,584 0
TOTAL 148,569,730 149,680,790 440,947 487,245 148,128,783 149,193,545
39
15. Investments in other companies
As of September 30, 2004 and 2003 there are no investments in other companies.
40
16. Goodwill Amortization
NEGATIVE GOODWILL
Stock purchases made among years 1993 and 1999 of S.A. Vina Santa Rita and
Ciecsa S.A., have produced negative goodwill whose net balance to be amortized
as of September 30, 2004 totaled Th Ch$ 1,797,583 (Th Ch$ 1,970,339 in 2003).
POSITIVE GOODWILL
As of September 30, 2004 and 2003 there are no transactions for this concept.
41
CRISTALERIAS DE CHILE S.A.
NOTE 16 - GOODWILL ON INVESTMENTS
Negative Goodwill
R.U.T. Company Name 09-30-2004 09-30-2003
------ ------------ ------------------------------- -------------------------------
Balance of Balance of
Amount Amortiz. Negative Amount Amortiz. Negative
this period Goodwill this period Goodwill
-------------- ----------- -------------- ----------
86547900-K S.A. Vina Santa Rita 38,347 531,312 38,310 581,877
96608270-4 Ciecsa S.A. 92,654 1,266,271 92,564 1,388,462
TOTAL 131,001 1,797,583 130,874 1,970,339
42
17. Intangibles
As of September 30, 2004 and 2003 there are no values for these concepts.
43
18. Other (Assets)
As of September 30, 2004 there is a balance for issuance expenses of bond series
C and D for Th Ch$ 791,077 and the negative goodwill produced as a result of
their placement of Th Ch$ 2,166,518
As of September 30, 2003 there is a balance for issuance expenses of bond series
C and D for Th Ch$ 933,271 and the negative goodwill produced as a result of
their placement of Th Ch$ 2,374,617.
As of September 30, 2003, the sum of Th Ch$ 9,012,140 for investments in Bonds
of Celulosa Arauco y Constitucion S.A., equivalent to US$ 13,420,000 at an
annual rate of 6.95%, with maturity on September 15, 2005 and Th Ch$ 103,006 for
overprice paid in the acquisition of the bonds which are amortized during their
maturity, are included in Other Long-term Assets.
44
19. Short-term obligations with banks and financial institutions
a) Short-term obligations with Banks and Financial Institutions (5.21.10.10).
As of September 30, 2004 and 2003, there are no short-term bank obligations.
b) Long-term obligations with Banks and Financial Institutions (5.21.10.20).
A list of operations is shown on the attached chart.
CRISTALERIAS DE CHILE S.A.
NOTE 19 - OBLIGATIONS WITH BANKS AND FINANCIAL INSTITUTIONS, SHORT TERM
Type of Currency and Readjustment Index
Dollars Euros Yens
Bank or Financial ---------------------- ----------------------- ----------------------
R.U.T. Institution 06-30-2004 06-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
--------- ----------------- ---------- ---------- ---------- ---------- ---------- ----------
Short term (code: 5.21.10.10)
Long Term - Short Term (code: 5.21.10.20)
0-E J.P Morgan Chase Bank 292,991 138,250 0 0 0 0
Others 0 0 0 0 0 0
TOTAL 292,991 138,250 0 0 0 0
Capital amount due 0 0 0 0 0 0
Average annual interest rate 2.05 1.925
Percentage oblig. foreign curr. (%) 100.0000
Percentage oblig. foreign curr. (%) 0.0000
Bank or Financial Other Foreign
R.U.T. Institution Currencies U.F. Non adjustable $ Total
---------- ----------------- ---------------------- ---------------------- --------------------- ----------------------
09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ---------- --------------------- ---------- ----------
Short term (code: 5.21.10.10)
Long Term - Short Term (code:
5.21.10.20)
0-E J.P Morgan Chase Bank 0 0 0 0 0 0 292,991 138,250
Others 0 0 0 0 0 0 0 0
TOTAL 0 0 0 0 0 0 292,991 138,250
Capital amount due 0 0 0 0 0 0 0 0
Average annual interest
rate
45
20. Other Current Liabilities
As of September 30, 2003 , a positive balance of Th Ch$ 4,118,995 in favor of
financial institutions was produced, as a consequence of Future Contracts
subscribed by the Company, more detail of these is shown in note 34 Derivative
Contracts.
46
21. Long term liabilities with banks and financial institutions
The obligations with banks and financial institutions are presented on the
charts attached.
47
01.
CRISTALERIAS DE CHILE S.A.
NOTE 21: LONG-TERM OBLIGATIONS WITH BANKS AND FINANCIAL INSTITUTIONS
Long-term Obligations With Banks and Financial Institution
Maturity
-------------------------------------------------------------------------------------
More than 10 years
Bank or Financial Adjustment From 1 From 2 From 3 From 5 ------------------
R.U.T. Institution index currency to 2 to 3 to 5 to 10 Amount Term
------- ----------------- -------------- ------ ------ ------ ------- --------- ------
ThCh$ ThCh$ ThCh$ ThCh$ ThCh$
0-E J.P. Morgan Chase Bank Dollars 7,611,250 15,222,500 7,611,250 -- -- --
Euros -- -- -- -- -- --
Yen -- -- -- -- -- --
UF -- -- -- -- -- --
Non-adj.CH$ -- -- -- -- -- --
Others -- -- -- -- -- --
Total 7,611,250 15,222,500 7,611,250 -- -- --
Porcentaje de obligaciones en moneda extranjera 100.00%
Porcentaje de obligaciones en moneda nacional 0.00%
Closing date Closing date
Current period Previous period
-------------------------- ----------------
Total Long-Term Average Total Long-Term
at closing of annual at closing of
Bank or Financial Adjustment Financial interest Financial
R.U.T. Institution index currency Statements rate Statements
------ ----------------- -------------- -------------- -------- ---------------
0-E J.P. Morgan Chase Bank Dollars 30,445,000 2.05 33,577,276
Euros -- -- --
Yen -- -- --
UF -- -- --
Non-adj.CH$ -- -- --
Others -- -- --
Total 30,445,000 33,577,276
48
22. Short-term and long-term obligations with the public
(promissory notes and bonds)
As of September 30, 2004, there are obligations with the public for UF
4,100,000, equivalent to Th Ch$ 70,482,198 (Th Ch$ 70,590,383 in 2003) divided
in series C1, C2, D1 and D2, with a 4.75% annual interest in series C and 5.80%
in series D. During 2004, are represented UF 500,000 in short term (Ch$
8,595,390) and UF 3,600,000 in long term (Th Ch$ 61,886,808).
In the short term there is a balance of Th Ch$ 786,791 (Th Ch$ 787,998 in 2003)
corresponding to accrued interests for UF 45,768.20.
Bond series C have a tenor of 6 years with amortizations beginning 2 years from
the placement date. Bond series D have a tenor of 21 years with amortizations
beginning 6 years from the placement date.
49
Cristalerias de Chile S.A.
NOTE 22: SHORT-TERM AND LONG-TERM OBLIGATIONS WITH PUBLIC (PROMISSORY NOTES AND
BONDS) BONDS
REGISTRATION OR
IDENTIFICATION No. CURRENT INDEXING INTEREST FINAL
OF INSTRUMENT SERIES FACE VALUE UNIT OF BOND RATE MATURITY
----------------- ----------- ---------- ------------ ------- --------
LONG-TERM BONDS-CURRENT PORTION
296-09.07.02 C1 Interests 0 UF 4.75 01-15-2005
296-09.07.02 C2 Interests 0 UF 4.75 01-15-2005
296-09.07.02 D1 Interests 0 UF 5.80 01-15-2005
296-09.07.02 D2 Interests 0 UF 5.80 01-15-2005
296-09.07.02 C1 500,000 UF 4.75 07-15-2005
INSTALLMENTS PAR VALUE
-------------------------------- ----------------------------
REGISTRATION OR ISSUE
IDENTIFICATION No. INTEREST AMORTIZATION IN CHILE OR
OF INSTRUMENT PAYMENT PAYMENT 09-30-2004 09-30-2003 ABROAD
----------------- -------- ------------- ---------- ---------- -----------
LONG-TERM BONDS-CURRENT PORTION
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 258,941 259,338 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 86,314 86,446 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 399,485 400,099 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 42,051 42,115 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 8,595,390 0 LOCAL
TOTAL CURRENT PORTION 9,382,181 787,998
REGISTRATION OR
IDENTIFICATION No. CURRENT INDEXING INTEREST FINAL
OF INSTRUMENT SERIES FACE VALUE UNIT OF BOND RATE MATURITY
----------------- ----------- ---------- ------------ ------- --------
LONG-TERM BONDS
296-09.07.02 C1 1,500,000 UF 4.75 07-15-2008
296-09.07.02 C2 500,000 UF 4.75 07-15-2008
296-09.07.02 D1 1,900,000 UF 5.80 07-15-2023
296-09.07.02 D2 200,000 UF 5.80 07-15-2023
INSTALLMENTS PAR VALUE
-------------------------------- ----------------------------
REGISTRATION OR ISSUE
IDENTIFICATION No. INTEREST AMORTIZATION IN CHILE OR
OF INSTRUMENT PAYMENT PAYMENT 09-30-2004 09-30-2003 ABROAD
----------------- -------- ------------- ---------- ---------- -----------
LONG-TERM BONDS
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 17,190,780 25,825,750 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 8,595,390 8,608,583 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 32,662,482 32,712,616 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 3,438,156 3,443,434 LOCAL
LONG-TERM TOTAL 61,886,808 70,590,383
50
23. Provisions and Write-offs
Provisions:
As of September 30, 2004, the Company has short-term provisions of Th Ch$
7,806,558 and Th Ch$ 5,441,149 in 2003.
In the Long-term, provisions are recorded of Th Ch$ 6,604,096 as of September
30, 2004 and Th Ch$ 7,745,359 as of September 30, 2003.
a) Bad Debt Reserves:
The Company has established a reserve for bad debts of Th Ch$ 173,127, and Th
Ch$ 145,417, respectively, as of September 30, 2004 and 2003.
This provision is deducted from the balance of debtors from sales, as stated in
note 5.
b) Vacation Provision:
The company has established a provision for the total cost of vacations pending
as of September 30, 2004 and 2003, as established in Technical Bulletin No. 47
of the Accountants Association of Chile.
The net balance for this item amounts Th Ch$ 410,164 as of September 30, 2004
(Th Ch$ 382,338 in 2003).
c) Provision for Furnace Reconstruction:
This provision is established throughout the useful life of the refractories of
each smelting furnace so their repair will not have a distort the result of the
fiscal year when the repairs are made.
The Company has established a provision for this item in the amount of Th Ch$
4,273,077 and Th Ch$ 3,571,074 as of September 30, 2004 and 2003, respectively.
An itemized list of the amounts provisioned is shown in the attached chart.
51
Cristalerias de Chile S.A.
Note Provisions and Write-offs 2004 2003
--------- ---------
Short term ThCh$ ThCh$
----------
Packing for Client Return 906,239 1,168,581
Furnace Reconstruction 1,911,946 0
Board Share 569,494 98,186
Reserve Spare Parts 375,866 445,200
Legal Holiday 410,164 382,338
Severance Pay 185,695 184,430
Provision Subsidiary Losses 2,305,248 2,169,587
Provision Indirect Expenses 721,337 698,262
Provision Legal Gratification 86,090 83,141
Other Provisions 334,479 211,424
--------- ---------
Total Short Term 7,806,558 5,441,149
Long term
---------
Severance Pay 4,242,965 4,174,285
Furnace Reconstruction 2,361,131 3,571,074
--------- ---------
Total Long-Term 6,604,096 7,745,359
52
24. Severance Payments
The reserve for severance payments to personnel is included at its current
value, as expressed in note 2 r). As of September 30, 2004 it totals Th Ch$
4,428,660 (Th Ch$ 4,358,715 in 2003).
As of September 30, 2004 and 2003 the parent company has paid severance payments
of Th Ch$ 180,607 and Th Ch$ 140,701 respectively, chargeable against the
reserve.
53
25. Other long-term liabilities
As of September 30, 2004 and 2003 there are no values for this concept.
54
26. Minority interest
Not applicable to individual financial statements.
55
27. Changes in Equity
a) Activity in 2004 and 2003
The activity of the capital and reserve accounts in the fiscal years ended on
September 30, 2004 and 2003, are shown in the attached charts.
b) Other Reserves
The detail of Other Reserves is the following:
2004 2003
--------- ---------
Th Ch$ Th Ch$
Future capital increases 4,667,636 4,450,953
Reserve for adjustment of value 1,416,415 1,627,199
of fixed assets
Adjustment for conversion difference 593,044 2,164,029
in investment in Rayen Cura S.A.I.C. --------- ---------
TOTAL OTHER RESERVES 6,677,095 8,242,181
56
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NET WORTH
Reserve Premium
Paid-in capital in sale of Other Reserve
Items Capital revaluation shares Reserves Future Dividends
---------------------------------------- ---------- ----------- ----------- --------- ----------------
Balances as of 09-30-2004
Initial balance 65,396,749 0 27,874,377 6,421,900 123,160,119
Distribution result previous fiscal year 0 0 0 0 5,468,440
Final dividend previous fiscal year 0 0 0 0 -1,612,800
Capital increases with cash stock issue 0 0 0 0 0
Reserves and/or Profits Capitalization 0 0 0 0 0
Development period Accumulated deficit 0 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 133,179 0
Eventual Dividend 0 0 0 0 0
Payment shares 0 0 0 0 0
Owner's equity Revaluation 0 1,242,538 529,613 122,016 2,411,687
Fiscal Year Result 0 0 0 0 0
Provisional Dividends 0 0 0 0 0
---------- --------- ---------- --------- -----------
Final balances 65,396,749 1,242,538 28,403,990 6,677,095 129,427,446
---------- --------- ---------- --------- -----------
Balances as of 09-30-2003
Initial balance 64,749,257 0 27,598,393 9,713,099 114,912,655
Distribution result previous fiscal year 0 0 0 0 14,356,726
Final dividend previous fiscal year 0 0 0 0 -5,526,400
Capital increases with cash stock issue 0 0 0 0 0
Reserves and/or profit Capitalization 0 0 0 0 0
Development period accumulated deficit 0 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 -1,717,273 0
Eventual Dividend 0 0 0 0 -960,000
Payment shares 0 0 0 0 0
Owner's equity revaluation 0 776,991 331,181 116,557 1,573,338
Fiscal Year Result 0 0 0 0 0
Provisional Dividends 0 0 0 0 0
Final balances 64,749,257 776,991 27,929,574 8,112,383 124,356,319
---------- --------- ---------- --------- -----------
Updated balances 65,785,245 789,423 28,376,447 8,242,181 126,346,020
---------- --------- ---------- --------- -----------
57
Devel. Fiscal
Accumulated Provisional Period Year
Items Results Dividends Deficit Result
---------------------------------------- ------------ ----------- -------- -------
Balances as of 09-30-2004
Initial balance 6,426,520 -958,080 0 0
Distribution result previous fiscal year -6,426,520 958,080 0 0
Final dividend previous fiscal year 0 0 0 0
Capital increases with cash stock issue 0 0 0 0
Reserves and/or Profits Capitalization 0 0 0 0
Development period Accumulated deficit 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 0
Eventual Dividend 0 0 0 0
Payment shares 0 0 0 0
Owner's equity Revaluation 0 -12,800 0 0
Fiscal Year Result 0 0 0 14,237,355
Provisional Dividends 0 -2,560,000 0 0
----------- ----------- ----------- -----------
Final balances 0 -2,572,800 0 14,237,355
----------- ----------- ----------- -----------
Balances as of 09-30-2003
Initial balance 17,660,662 -3,303,936 0 0
Distribution result previous fiscal year -17,660,662 3,303,936 0 0
Final dividend previous fiscal year 0 0 0 0
Capital increases with cash stock issue 0 0 0 0
Reserves and/or profit Capitalization 0 0 0 0
Development period accumulated deficit 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 0
Eventual Dividend 0 0 0 0
Payment shares 0 0 0 0
Owner's equity revaluation 0 -960 0 0
Fiscal Year Result 0 0 0 2,415,990
Provisional Dividends 0 -960,000 0 0
Final balances 0 -960,960 0 2,415,990
----------- ----------- ----------- -----------
Updated balances 0 -976,335 0 2,454,646
----------- ----------- ----------- -----------
58
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN EQUITY - NUMBER OF SHARES
No. No. No.
SHARES SHARES SHARES
SERIES SUBSCRIBED PAID WITH VOTING
------ ---------- ---------- -----------
SINGLE 64,000,000 64,000,000 64,000,000
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NET WORTH - CAPITAL (AMOUNT - TH CH$)
SUBSCRIBED PAID-IN
SERIES CAPITAL CAPITAL
------ ------- -------
SINGLE 65,396,749 65,396,749
59
28. Other Non-operating Income and Expenses
As of September 30, 2004 non-operating income amounted Th Ch$ 425,365 and Th Ch$
292,827 in 2003.
Non-operating expenses amounted to Th Ch$ 724,138 as of September 30, 2004 and
Th Ch$ 637,254 in fiscal year 2003.
More detail is shown in annexed chart.
60
Non-operating Income and Expenses
CRISTALERIAS DE CHILE S.A.
NOTE 28: OTHER NON-OPERATING INCOME AND EXPENSES
2004 2003
------- -------
Th Ch$ Th Ch$
INCOME
Offices and establishments rental 129,385 125,099
Sale of fixed assets 8,676 4,599
Compensation for Damage 988 2,592
Sale of materials 33,245 21,254
Agricultural Division 15,674 56,393
Amortization of non-realized profits 25,156 25,132
Prize Soda Ash contract 34,046 0
Condonation deferred custom duties 47,834 0
Sundry income 130,361 57,758
------- ------
TOTAL NON-OPERATING INCOME 425,365 292,827
EXPENSES
Professional advice 490,524 509,054
Other expenses 178,500 75,750
Insurances 5,725 0
ADR's Expenses 49,389 52,450
------ ------
TOTAL NON-OPERATING EXPENSES 724,138 637,254
61
29. Price-level Restatement
As a result of the application of price-level restatement as described in Note 2
d), a net charge to results was generated in the 2004 and 2003 fiscal year of Th
Ch$ 398,945 and Th Ch$ 439,377 respectively.
Additional Balance-itemized information is shown in the annexed chart.
62
Cristalerias de Chile S.A.
NOTE 29: ADJUSTMENT FOR PRICE LEVEL RESTATEMENTS
ADJUSTABILITY
ASSETS (CHARGES)/CREDITS INDEX 09-30-2004 09-30-2003
-------------------- ----------- ----------
INVENTORY Consumer Price Index 124,605 17,978
FIXED ASSET CPI 1,790,366 827,397
INVESTMENTS IN RELATED COMPANIES CPI 2,804,065 1,796,532
MARKETABLE SECURITIES CPI 78,936 46,727
SHORT TERM DEBTORS CPI 3,072 1,952
SHORT TERM DEBTORS UF 1,563 1,025
LONG-TERM DEBTORS UF 6,172 1,974
ACCOUNTS RECEIVABLE RELATED COMPANIES UF 320,180 266,548
INFLATIONARY EFFECT CPI 1,156,347 397,518
RATE ISSUANCE DIFFERENCE LONG-TERM BOND UF 37,292 28,294
OTHER NON-MONETARY ASSETS CPI 47,031 15,225
EXPENSE AND COST ACCOUNTS CPI -81,799 -7,769
TOTAL (CHARGES)/CREDITS -- 6,287,830 3,393,401
LIABILITIES (CHARGES)/ CREDITS
NET WORTH CPI -4,305,854 -2,854,066
ACCOUNTS RECEIVABLE RELATED COMPANIES UF -12 -92
SHORT-TERM RESERVES CPI -49,106 -5,167
LONG-TERM CREDITORS CPI -470 -544
LONG-TERM RESERVES CPI -54,795 -72,511
PUBLIC OBLIGATION UF -1,110,198 -841,076
INFLATIONARY EFFECT CPI -710,833 0
NON-MONETARY LIABILITIES CPI -128,681 16,492
INCOME ACCOUNTS CPI -326,826 -75,814
TOTAL (CHARGES)/ CREDITS -- -6,686,775 -3,832,778
(LOSS) PROFIT FROM ADJUSTMENT FOR PRICE LEVEL RESTATEMENT -398,945 -439,377
63
30. Exchange Differences
A net credit to results was produced due to exchange differences of Th Ch$
1,265,557 in 2004 and a net charge of Th Ch$ 10,060,062 in 2003.
According to the provisions in Circular Letter 1560 of the SVS of 09/20/2001,
the net effect of the adjustment of adjustable assets and liabilities in foreign
currency on results deducting the effect of inflation is presented in this item.
Further information is shown on the table attached.
64
Cristalerias de Chile S.A.
NOTE 30: EXCHANGE DIFFERENCES
AMOUNT
--------------------------
ITEM CURRENCY 09-30-2004 09-30-2003
---------------------------------- -------------- ---------- ----------
FIXED (CHARGES) /CREDITS
AVAILABLE DOLLARS -9,910 -22,029
MARKETABLE SECURITIES DOLLARS 615,224 -4,369,008
MARKETABLE SECURITIES EUROS 460,083 0
TIME DEPOSITS DOLLARS 0 -96,809
INVENTORY DOLLARS -44,141 -71,237
BONDS INSTALLMENT DOLLARS 90,147 -795,834
SUNDRY DEBTORS DOLLARS -8,689 -32,208
OTHER ASSETS DOLLARS 828,156 -255,994
INFLATIONARY EFFECT DOLLARS -1,156,347 -397,518
TOTAL (CHARGES) /CREDITS 774,523 -6,040,637
LIABILITIES (CHARGES) /CREDITS
NOTES PAYABLE DOLLARS 94,981 177,477
NOTES PAYABLE OTHER CURRENCY 7,356 9,497
SUNDRY CREDITORS - SHORT TERM DOLLARS -106 65,749
LONG- TERM BANK LOANS DOLLARS -755,000 2,928,112
SHORT-TERM RESERVES DOLLARS -47,414 0
LONG-TERM RESERVES DOLLARS -26,083 263,530
SUNDRY CREDITORS - LONG TERM DOLLARS -2,930 11,776
OTHER LIABILITIES DOLLARS -114,165 53,609
ADJUSTMENT FUTURE CONTRACTS DOLLARS 623,562 -7,529,175
INFLATIONARY EFFECT DOLLARS 710,833 0
TOTAL (CHARGES)/ CREDITS 491,034 -4,019,425
(LOSS) PROFIT FROM EXCHANGE DIFFERENCE 1,265,557 -10,060,062
65
31. Extraordinary Items
As of September 30, 2004 and 2003 there are no transactions for this item.
66
32. Expenses incurred in the sale of shares and debt instruments
On August, 2002 the parent company placed bond series C1, C2, D1 and D2 for
UF 4,100,000, which resulted in expenses and rate placement difference
which balance as of September 30, 2004 amounts Th Ch$ 3,285,732 (Th Ch$
3,638,368 in 2003). Amortization is being done according to the maturity of
each series.
Classified under other current assets are Th Ch$ 328,137 (Th Ch$ 330,480 in
2003) and Th Ch$ 2,957,595 (Th Ch$ 3,307,888 in 2003) under other long-term
fixed assets.
As of September 30, 2004, the charge to results for their amortization
amounts Th Ch$ 249,541 (Th Ch$ 251,284 in 2003).
Short-Term Long-Term
------------------------ -----------------------
DETAIL 2004 2003 2004 2003
----------------------------------- -------- -------- --------- ---------
Issue expenses 127,148 129,183 791,077 933,271
Difference in bonds placement rate 200,989 201,297 2,166,518 2,374,617
Total 328,137 330,480 2,957,595 3,307,888
67
33. Cash Flow Statement
An itemized list is included in the attached chart.
CRISTALERIAS DE CHILE S.A.
CASH FLOW STATEMENT
1. The following is the detail of the item OTHERS:
Sep 2004 Sep 2003
-------- --------
Th Ch$ Th Ch$
541.11.40 Other income received
Exchange differences 333,209 0
Discount for Custom Duties 37,886 0
Accountent Return 897,097 909,776
Other income 5,716 2,883
Total 1,273,908 912,659
541.11.80 Other expenses paid
Exchange differences 219,861 5,326,938
Donations 82,743 59,819
Other expenses 3,194 2,691
Total 305,798 5,389,448
541.13.15 Sale of other investments
Sale bonds 4,972,567 0
Sale bonds Profit 143,394 0
Redemption LT bonds 0 313,172
Total 5,115,961 313,172
541.13.30 Other investment income
Maturity of future contracts 659,830 1,492,737
541.13.65 Other investment disbursements
Purchase of shares 0 323,261
Future Contracts 2,268,494 5,985,443
Total 2,268,494 6,308,704
Following are financing and investment activities that did not generate cash
flow during the fiscal year, but that commit future cash flows:
ITEM Amount Th Ch $ Maturity
---- -------------- --------
Dividend No.159 1,280,000 October -2004
Payable investment project imports 1,001,516 4th Quarter
_________
TOTAL 2,281,516
68
34. Derivative Contracts
The parent company has signed future sale contracts in foreign currency of Th
US$ 38,200 as of September 2004 (purchase contracts of Th US$ 76,600 in 2003)
subject to the regulations of Chapter VII of the Compendium of International
Exchange Regulations of the Central Bank of Chile and Chapter 13-2 of the
compilation of Regulations of Banks and Financial Institutions.
As of September 30, 2004 there was a difference in favor of Cristalerias de
Chile S.A. of Th Ch$ 483,000 classified under Other Current Assets.
As of September 30, 2003 there was a difference in favor of the financial
institutions of Th Ch$ 4,118,995 classified under Other Current Liabilities.
69
CRISTALERIAS DE CHILE S.A.
NOTE 34: DERIVATIVE CONTRACTS
DESCRIPTION OF CONTRACTS
-------------------------------------------------
PROTECTED ITEM OR
TRANSACTION
MATURITY OR PURCHASE/ VALUE OF
TYPE OF TYPE OF VALUE OF EXPIRATION SPECIFIC SALE PROTECTED
DERIVATIVE CONTRACT CONTRACT DATE ITEM POSITION NAME AMOUNT ITEM
---------- -------- ---------- ------------ ------------- -------- ---- ------ --------
FR CI 12,908,680 FOURTH 2004 EXCHANGE RATE S - 0 0
FR CI 10,351,300 FIRST 2005 EXCHANGE RATE S - 0 0
ACCOUNTS AFFECTED
--------------------------------------------
ASSET/LIABILITY EFFECT ON RESULT
------------------- --------------------------
MATURITY OR
TYPE OF TYPE OF VALUE OF EXPIRATION
DERIVATIVE CONTRACT CONTRACT DATE NAME AMOUNT REALIZED NOT REALIZED
---------- -------- -------- ----------- ------ ------ -------- ------------
FR CI 12,908,680 FOURTH 2004 ASSETS 204,528 204,528 0
FR CI 10,351,300 FIRST 2005 ASSETS 278,742 278,472 0
69
Analysis of Forward Contracts in foreign currency as of 09.30.2004
PROFIT
DATE FUTURE VALUE (Loss)
--------------------------- ------------ ------
INSTITUTION Investment Maturity US$ ThCh$
-------------------------- ---------- --------
Deutsche Bank (Chile) S.A. 06.04.2004 10.04.2004 3,000,000 109,491
Deutsche Bank (Chile) S.A. 07.27.2004 01.24.2005 5,000,000 183,483
Bank Boston 08.23.2004 12.01.2004 3,000,000 72,355
Deutsche Bank (Chile) S.A. 08.23.2004 12.01.2004 1,500,000 36,172
BBVA 09.01.2004 12.10.2004 1,500,000 25,670
Deutsche Bank (Chile) S.A. 09.09.2004 12.20.2004 1,500,000 17,031
Banco Santander 09.20.2004 12.20.2004 3,000,000 6,790
Scotiabank 09.20.2004 12.29.2004 2,000,000 4,468
Banco Santander 09.23.2004 12.22.2004 1,500,000 6,495
Deutsche Bank (Chile) S.A. 09.27.2004 03.29.2005 8,000,000 36,800
Deutsche Bank (Chile) S.A. 09.30.2004 01.05.2005 8,200,000 (15,755)
Total 38,200,000 483,000
As of September 30, 2003 there were future purchase contracts for US$
76,600,000, which caused a difference in favor of the financial institutions of
Th Ch$ 4,118,995.
70
35. Contingencies and Restrictions
As of September 30, 2004, there is a guarantee delivered in the amount of Th Ch$
8,547 (Th Ch$ 8,071 in 2003), according to the detail in the attached chart.
LAWSUITS OR OTHER LEGAL ACTIONS THE COMPANY IS INVOLVED IN
As of September 30, 2004 and 2003 there are no lawsuits and other legal actions
pending.
RESTRICTIONS
I. SYNDICATED LOAN
In relation to the syndicated loan subscribed with JP Morgan Chase Bank and
other 8 creditor banks for US$ 50 million, there are certain financial
obligations mentioned as follows:
a) TOTAL CONSOLIDATED DEBT TO CAPITALIZATION RATIO
Cristalerias de Chile S.A will not allow the Total Consolidated Debt to
Capitalization Ratio exceed the 0.45 to 1.0 ratio at any time.
Capitalization is defined as the sum of Net Worth plus Minority Interest plus
total consolidated debt.
b) NET CONSOLIDATED DEBT TO EBITDA RATIO
Cristalerias de Chile S.A will not allow the Net Consolidated Debt to EBITDA
ratio to exceed the 2.5 to 1.0 ratio at any time.
Consolidated EBITDA is defined as the following: operating income plus
depreciation and amortization, plus non-cash charges (as long as they have been
deduced when determining operating income) and cash income from interests minus
non-cash credits (as long as they have been added when determining operating
income), in each case for each period.
c) INTEREST COVERAGE RATIO
Cristalerias de Chile S.A. will not allow the Interest Coverage Ratio to be
lower than the 4.0 ratio.
71
Interest coverage at the day of determination is defined as the ratio between
unconsolidated EBITDA for the period of four consecutive fiscal quarters that
end on or most recently ended before, that date; and interest expenses for that
period.
d) NET EQUITY
Cristalerias de Chile S.A. should maintain a minimum amount of UF 10,000,000.
Cristalerias de Chile S.A. complies with 100% of the restrictions agreed with
the creditor banks.
II. BOND ISSUE
The bond issue contract signed on May 29, 2002 with Banco Chile as the bonds
owners' representative, establishes among others the following obligations:
a) Financial Indicators
Individual Balance: Indebtedness no higher than 1.2 times.
Consolidate Balance: Indebtedness no higher than 1.4 times.
b) Insurances for the Company and its subsidiaries' fixed assets.
c) The operations referred to by art. 44 and 89 of law 18,046 must be carried
out according to the conditions that these establish.
d) Other minor restrictions related with the bond issue contract.
Cristalerias de Chile S.A. complies with 100% of restrictions agreed with the
bonds' creditors.
OTHER CONTINGENCIES
As of September 30, 2004 and 2003, management is not aware of any other
contingencies that could affect the company.
72
CRISTALERIAS DE CHILE S.A.
NOTE 35: CONTINGENCIES AND RESTRICTIONS - DIRECT GUARANTEES
BALANCES PENDING PAYMENT
AS OF CLOSING DATE OF
DEBTOR ASSETS COMMITTED FINANCIAL STATEMENTS
------ ---------------- --------------------
TYPE OF BOOK
CREDITOR OF GUARANTEE NAME RELATION SHIP GUARANTEE TYPE VALUE 09-30-2004 09-30-2003
---------------------------- --------------- ------------- --------- ---- ----- ---------- ----------
CRISTALERIAS DE
EDIFICIO METROPOLIS AGF CHILE S.A. COMMERCIAL DEPOSIT -- 8,547 8,547 8,071
RELEASE OF GUARANTEES
------------------------------------------------------------------------
CREDITOR OF GUARANTEE 09-30-2005 ASSETS 09-30-2006 ASSETS 09-30-2007 ASSETS
---------------------------- ---------- ------ ---------- ------ ---------- ------
EDIFICIO METROPOLIS AGF -- -- -- -- 8,547 --
73
CRISTALERIAS DE CHILE S.A.
NOTE 35: CONTINGENCIES AND RESTRICTIONS - INDIRECT GUARANTEES
BALANCES PENDING PAYMENT
AS OF CLOSING DATE OF
DEBTOR ASSETS COMMITTED FINANCIAL STATEMENTS
-------------------------- ---------------- -------------------------
TYPE OF BOOK
CREDITOR OF GUARANTEE NAME RELATION SHIP GUARANTEE TYPE VALUE 09-30-2004 09-30-2003
--------------------------- ---- ------------- --------- ---- ----- ---------- ----------
Societe de
Participations
Financieres et Rayen Cura
Industrielles S.A. Affiliate Solidary -- -- 1,753,632 2,707,671
Cristalerias
Envases CMF de Chile S.A. Affiliate Solidary -- -- 205,763 230,479
RELEASE OF GUARANTEES
------------------------------------------------------------------------
CREDITOR OF GUARANTEE 09-30-2005 ASSETS 09-30-2006 ASSETS 09-30-2007 ASSETS
--------------------- ---------- ------ ---------- ------ ---------- ------
Societe de Participations
Financieres et
Industrielles 701,453 -- 701,453 -- 350,726 --
Envases CMF -- -- -- -- 205,763 --
74
36. Guarantees obtained from third parties
As of September 30, 2004 and 2003 the company has received guarantees from third
parties, which are shown below:
ITEM 2004 2003
---- ---- ----
Th Ch$ Th Ch$
Real Estate Lease Security Bank UF 304 0 5,235
Real Estate Lease to Telecomunicaciones
and Services Cono Sur Ltda. UF 130 0 2,238
Real Estate Lease AGF Building UF 365.9 0 6,300
Real Estate Lease to Irarrazabal Ruiz Tagle
AGF Building (UF 235.0) 4,040 0
Real Estate Lease Metropolis Building UF 189.2 0 3,219
Real Estate Lease to Eyzaguirre y Cia Metropolis
Building (UF 2.2) 38 38
Real Estate Lease to Sur Andino Cafe
AGF Building (UF 260) 4,470 0
Suppliers Sight Drafts 1,674 1,701
_______ _____
TOTAL 10,222 18,731
75
37. Local and Foreign Currency
Charts are attached showing the foreign currency balance as of September 30,
2004 and 2003.
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - ASSETS
ITEMS Currency Amount
--------------------- --------------- --------------------------
09-30-2004 09-30-2003
---------- ----------
Current Assets
CASH Non-adjust Ch$ 674,286 1,194,472
CASH Dollars 203,891 98,894
TIME DEPOSITS Adjustable Ch$ 5,000,900 5,345,527
MARKETABLE SECURITIES Adjustable Ch$ 4,244,007 4,575,940
MARKETABLE SECURITIES Dollars 28,836,954 52,277,919
MARKETABLE SECURITIES Euros 28,631,254 0
DEBTORS FROM SALES Non-adjust. Ch$ 22,571,956 19,907,104
DOCUMENTS RECEIVABLE Non-adjust. Ch$ 988,515 1,866,117
MISCELLANEOUS DEBTORS Adjustable Ch$ 93,694 79,250
MISCELLANEOUS DEBTORS Non-adjust. Ch$ 69,944 16,821
MISCELLANEOUS DEBTORS Dollars 668,418 748,982
DOC.&ACTS. REC. REL. CO'S. Non-adjust. Ch$ 5,016,611 2,375,499
DOC.&ACTS. REC. REL. CO'S. Adjustable Ch$ 5,579 15,147
STOCK Adjustable Ch$ 5,426,905 3,657,649
STOCK Dollars 1,880,382 2,092,886
TAXES TO BE RECOVERED Adjustable Ch$ 0 1,751,790
EXPENSES PAID IN ADVANCE Dollars 168,151 208,996
DEFERRED TAXES Non-adjust Ch$ 702,681 379,198
OTHER CURRENT ASSETS Non-adjust Ch$ 11,732,400 840,232
OTHER CURRENT ASSETS Dollars 1,697,644 1,247,880
OTHER CURRENT ASSETS Adjustable Ch$ 328,137 330,480
Fixed Assets
FIXED ASSETS Adjustable Ch$ 77,683,404 80,092,520
Other Assets
INVESTMENT REL. CO'S. Adjustable Ch$ 148,128,783 149,193,545
NEG. INVESTMENT GOODWILL Adjustable Ch$ 1,797,583 1,970,339
LONG-TERM DEBTORS Adjustable Ch$ 112,575 145,111
L-T DOC. REC. REL. CO'S. Adjustable Ch$ 21,292,513 21,675,448
OTHERS Dollars 0 9,115,146
OTHERS Adjustable Ch$ 2,957,595 3,307,888
Total Assets
Non-adjust. Ch$ 41,756,393 26,579,443
Dollars 33,455,440 65,790,703
Adjustable Ch$ 267,071,675 272,140,634
Euros 28,631,254 0
76
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - CURRENT LIABILITIES
Up to 90 days
-----------------------------------------------
09-30-2004 09-30-2003
-------------------- -----------------------
Amount Avg. Annual Amount Avg. Annual
ITEM Currency -------- ----------- -------- -----------
--------------------------------- ------------- Thou Ch$ Int. Rate Thou Ch$ Int. Rate
Long-Term Obligations
1-year maturity Dollars 292,991 2.05 138,250 1.925
L-T Obligations with public bonds
series C Adjustable Ch$ 0 -- 0 --
L-T Obligations with public bonds
series D Adjustable Ch$ 0 -- 0 --
L-T Obligations with public bonds
series C Adjustable Ch$ 0 -- 0 --
Dividend Payable Non-adjust. Ch$ 652,273 -- 512,868 --
Dollars 493,256 -- 550,293 --
Accounts Payable Non-adjust. Ch$ 1,798,012 -- 1,971,304 --
Documents Payable Dollars 2,264,474 -- 1,921,159 --
Documents Payable Other Currencies 349,172 -- 175,059 --
Miscellaneous Creditors Dollars 4,289 12.25 753,958 12.25
Miscellaneous Creditors Non-adjust. Ch$ 379,556 -- 271,204 --
Doc. and Accts. Payable rel Co Adjustable Ch$ 0 -- 45,134 --
Doc. and Accts. Payable rel Co Non-adjust. Ch$ 832,342 -- 765,751 --
Reserves Adjustable Ch$ 655,584 -- 184,430 --
Reserves Dollars 0 -- 0 --
Reserves Non-adjust. Ch$ 5,239,028 -- 5,256,719 --
Withholding Non-adjust. Ch$ 1,015,459 -- 1,529,309 --
Other Current Liabilities Adjustable Ch$ 0 -- 4,118,995 --
Income Taxes Non-adjust. Ch$ 823,122 0 --
Total Current Liabilities Dollars 3,055,010 -- 3,363,660 --
Adjustable Ch$ 655,584 -- 4,348,559 --
Non-adjust. Ch$ 10,739,792 -- 10,307,155 --
Other Currencies 349,172 -- 175,059 --
77
90 Days to 1 Year
------------------------------------------------
09-30-2004 09-30-2003
----------------------- ----------------------
ITEM Currency Amount Avg. Annual Amount Avg. Annual
--------------------------------- --------------- -------- ----------- ------ -----------
Thou Ch$ Int. Rate Thou Ch$ Int. Rate
Long-Term Obligations
1-year maturity Dollars 0 -- 0 --
L-T Obligations with public bonds
series C Adjustable Ch$ 345,255 4.75 345,784 4.75
L-T Obligations with public bonds
series D Adjustable Ch$ 441,536 5.80 442,214 5.80
L-T Obligations with public bonds
series C Adjustable Ch$ 8,595,390 4.75 0 --
Dividend Payable Non-adjust. Ch$ -- -- -- --
Dollars -- -- -- --
Accounts Payable Non-adjust. Ch$ -- -- -- --
Documents Payable Dollars -- -- -- --
Documents Payable Other Currencies -- -- -- --
Miscellaneous Creditors Dollars -- -- -- --
Miscellaneous Creditors Non-adjust. Ch$ -- -- -- --
Doc. and Accts. Payable rel Co Adjustable Ch$ -- -- -- --
Doc. and Accts. Payable rel Co Non-adjust. Ch$ -- -- -- --
Reserves Adjustable Ch$ -- -- -- --
Reserves Dollars 1,911,946 -- -- --
Reserves Non-adjust. Ch$ -- -- -- --
Withholding Non-adjust. Ch$ -- -- -- --
Other Current Liabilities Adjustable Ch$ -- -- -- --
Income Taxes Non-adjust. Ch$ -- -- -- --
Total Current Liabilities Dollars 1,911,946 -- 0 --
Adjustable Ch$ 9,382,181 -- 787,998 --
Non-adjust. Ch$ 0 -- -- --
Other Currencies 0 -- -- --
78
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - LONG-TERM LIABILITIES
CURRENT PERIOD 09-30-2004
1-3 Years 3-5 years
--------------------------- ---------------------------
Average Average
ITEM Currency Amount Interest Rate Amount Interest Rate
----------------------------- ----------------- --------- ------------- ---------- -------------
Thou Ch$ Thou Ch$
Obligations with Banks and
Financial Institutions Dollars 7,611,250 2.05 15,222,500 2.05
Obligations with public bond
Series C Adjust. Ch$ 0 -- 25,786,170 4.75
Obligations with public bond
Series D Adjust. Ch$ 0 -- 232,908 5.80
Deferred Custom Duties Dollars 118,157 12.25 0 --
Long-term Creditors Adjust. Ch$ 28,490 -- 0 --
Long-term Reserves Dollars 2,361,131 -- 0 --
Long-term Reserves Adjust. Ch$ 4,242,965 -- 0 --
Deferred Taxes Non-adjust. Ch$ 2,926,153 -- 0 --
Total Long-term Liabilities
Dollars 10,090,538 -- 15,222,500 --
Adjust. Ch$ 4,271,455 -- 26,019,078 --
Non-adjust. Ch$ 2,926,153 -- 0 --
5-10 Years More than 10 years
-------------------------- ---------------------------
Average Average
ITEM Currency Amount Interest Rate Amount Interest Rate
----------------------------- ----------------- --------- ------------- ---------- -------------
Thou Ch$ Thou Ch$
Obligations with Banks and
Financial Institutions Dollars 7,611,250 2.05 0 --
Obligations with public bond
Series C Adjust. Ch$ 0 -- 0 --
Obligations with public bond
Series D Adjust. Ch$ 5,822,705 5.80 30,045,025 5.80
Deferred Custom Duties Dollars 0 0 --
Long-term Creditors Adjust. Ch$ 0 -- 0 --
Long-term Reserves Dollars 0 -- 0 --
Long-term Reserves Adjust. Ch$ 0 -- 0 --
Deferred Taxes Non-adjust. Ch$ 0 -- 0 --
Total Long-term Liabilities
Dollars 7,611,250 -- 0 --
Adjust. Ch$ 5,822,705 -- 30,045,025 --
Non-adjust. Ch$ 0 -- 0 --
79
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - LONG-TERM LIABILITIES
PREVIOUS PERIOD 09-30-2003
1-3 Years 3-5 years
---------------------------- -------------------------
Average Average
ITEM Currency Amount Interest Rate Amount Interest Rate
------------------------------------- --------------- ------ ------------- ------ -------------
Obligations with banks and financial
institutions Dollars 8,394,319 1.925 25,182,957 1.925
Obligations with public bond series C Adjustable Ch$ 17,217,166 4.75 17,217,167 4.75
Obligations with public bond series D Adjustable Ch$ 0 -- 0 --
Long-term Creditors Dollars 135,043 11.06 0 --
Long-term Creditors Adjust. Ch$ 36,271 -- 0 --
Long-term Reserves Dollars 3,571,074 -- 0 --
Long-term Reserves Adjustable Ch$ 4,174,285 -- 0 --
Deferred Taxes Non-adjust. Ch$ 2,426,390 -- 0 --
Total Long-term Liabilities
- Dollars 12,100,436 -- 25,182,957 --
- Adjust. Ch$ 21,427,722 -- 17,217,167 --
- Non-adjust. Ch$ 2,426,390 -- 0 --
5-10 Years More than 10 Years
---------------------------- -------------------------
Average Average
ITEM Currency Amount Interest Rate Amount Interest Rate
------------------------------------- --------------- ------ ------------- ------ -------------
Obligations with banks and financial
institutions Dollars 0 -- 0 --
Obligations with public bond series C Adjustable Ch$ 0 -- 0 --
Obligations with public bond series D Adjustable Ch$ 4,276,538 5.80 31,879,512 5.80
Long-term Creditors Dollars 0 -- 0 --
Long-term Creditors Adjust. Ch$ 0 -- 0 --
Long-term Reserves Dollars 0 -- 0 --
Long-term Reserves Adjustable Ch$ 0 -- 0 --
Deferred Taxes Non-adjust. Ch$ 0 -- 0 --
Total Long-term Liabilities
- Dollars 0 -- 0 --
- Adjust. Ch$ 4,276,538 -- 31,879,512 --
- Non-adjust. Ch$ 0 -- 0 --
80
38. Penalties
As of September 30, 2004 and 2003 no penalties have been applied to the company,
the members of the Board or Company Managers by the SVS or other administrative
authorities.
81
39. Subsequent Events
On September 28, 2004, the Parent Company agreed to pay the interim dividend No.
159 of Ch$ 20 per share, over 64,000,000 shares (Th Ch$ 1,280,000) which was
paid on October 21, 2004.
On October 25, 2004 the Chilean Anti-trust Commission approved the merger
between Metropolis-Intercom S.A. and VTR S.A.; imposing the new company certain
operative and commercial restrictions, which are currently being analyzed.
Between the closing date of the financial statements and the issue date of the
present report there have not been other subsequent events that could alter
significantly the Company's financial and economic situation.
82
40. Environment
On its ongoing concern for environmental preservation, as of September 30, 2004
the Parent Company has paid Th Ch$ 3,365 for advisory services in relation to
this, which have been charged to the 2004 fiscal year.
During 2003, the company carried out investments of Th Ch$ 209,323,
corresponding to the purchase of NOX emission treatment equipment, installed on
new Furnace B.
83
41. TIME DEPOSITS
As of September 30, 2004 and 2003 the Company presents the following
information:
INSTITUTION Currency 2004 2003
----------- -------- -------- ---------
Th Ch$ Th Ch$
Banco SantanderSantiago US$ 0 5,345,527
Banco SantanderSantiago Ch$ 5,000,900 0
_________ _________
TOTAL 5,000,900 5,345,527
84
42. STOCK TRANSACTIONS
During 2004 and 2003 fiscal years, members of the board, controlling
stockholders, related individuals and entities did not carry out stock
transactions.
TRANSACTIONS RELATED TO MEMBERS OF THE BOARD
2004 2003
----------------- ---------------
NAME Initial Purchase Sale Purchase Sale
------------------------------ ------- -------- ---- -------- ----
Asesorias Portofino Ltda. BSG 21,000 0 0 0
Inmobiliaria Villarrica Ltda. RCV 181,669 0 0 0
Vial de Claro Maria Luisa RCV 650
Invers. Alonso de Ercilla S.A. PGD 48,000
Invers. San Benito S.A. PGD 10,894 0 0 0
o BSG related with Director Mr. Baltazar Sanchez
o RCV related with President Mr. Ricardo Claro
o PGD related with Director Mr. Patricio Garcia Domiguez
TRANSACTIONS OF DIRECTORS, ADMINISTRATIVES AND ACCOUNT INSPECTORS
None.
TRANSACTIONS OF MAJORITY SHAREHOLDERS
None.
85
43. DISTRIBUTION OF SHAREHOLDERS
The distribution of stockholders as of September 30, 2004 and 2003 is the
following:
% of Shareholding No. of Shareholders
----------------- --------------------
TYPE OF SHAREHOLDER 2004 2003 2004 2003
------------------- ---- ---- ---- ----
10% or more shareholding 34.03 34.03 1 1
Less than 10% shareholding
with investment equal to or
higher than 200 UF 65.83 65.83 286 263
Less than 10% shareholding
with investment lower than
200 UF 0.14 0.14 745 774
TOTAL 100.00 100.00 1,032 1,038
CONTROLLER OF
THE COMPANY 52.14 52.14 3 3
86
44. BOARD COMPENSATION
As of September 30, 2004 and 2003 Th Ch$ 269,636 and Th Ch$ 723,114
respectively, were paid for compensations and income participation according to
the following detail:
2004 2003
---- ----
ThCh$ ThCh$
Participation in previous fiscal year profits 262,202 717,729
Compensation for session attendance 5,632 4,019
Board Committee Compensations 1,802 1,366
_________ _________
TOTAL 269,636 723,114
On the other hand, provisions were made for fiscal year 2004 income
participation in the amount of Th Ch$ 569,494 (Th Ch$ 98,186 in 2003).
87
RELEVANT EVENTS
None.
88
CRISTALERIAS DE CHILE S.A.
NOTES TO FINANCIAL STATEMENTS AS OF SEPTEMBER 30, 2004
1.- FINANCIAL INDICATORS
09-30-2004 09-30-2003 12-31-2003
---------- ---------- ----------
LIQUIDITY
Current liquidity times 4.56 5.22 5.98
Acid ratio times 4.24 4.79 5.50
INDEBTEDNESS
Leverage ratio times 0.53 0.58 0.55
Short-term debt % 20.37 14.22 12.79
Long-term debt % 79.63 85.78 87.21
Interest Expenses Coverage times 5.28 1.35 2.14
ACTIVITY
Total assets MM Ch$ 370,915 364,511 360,284
Investments MM Ch$ 7,077 21,219 23,053
Disposal of property MM Ch$ 49 112 139
Inventory turnover times 4.2 8.1 12.8
Inventory permanence days 49.7 44.4 28.2
RESULTS
Sales MM Ch$ 55,126 55,405 75,966
Costs of sales MM Ch$ 32,156 33,794 45,484
Operating result MM Ch$ 18,251 17,633 24,809
Interest expenses MM Ch$ 3,632 3,727 4,933
Non-operating result MM Ch$ (1,144) (14,277) (16,769)
E.B.I.T.D.A. MM Ch$ 27,296 12,591 21,296
After-tax profit MM Ch$ 14,237 2,455 6,549
PROFITABILITY
Return on equity % 6.0 1.1 2.8
Return on assets % 3.9 0.7 1.8
Return on operating assets % 16.5 16.1 23.2
Profit per share $ 222.5 38.4 102.3
Return on dividends % 1.3 2.1 2.4
Current liquidity Ratio of current assets to current liabilities.
Acid ratio: Ratio of uncommitted funds to current liabilities.
Leverage ratio: Ratio of total current liabilities to net worth.
Interest Expenses Coverage: Earnings before taxes and interest divided by interest expenses.
Inventory turnover: Ratio between sales cost of the period and average inventory.
Ratio between average inventory and sales cost of the period,
Inventory permanence: multiplied by 360 days
Earnings before interest, taxes, depreciation, amortization and
E.B.I.T.D.A: extraordinary items.
Sum of dividends paid in the last twelve months divided by market price
Return on dividends: of stock at closing of period.
89
The main trends observed in the 2004 fiscal year indicators are:
LIQUIDITY INDICES
Despite the indices increasing with respect to September and December 2003, a
reduction is observed in the liquidity indices due to a shift of bond quotas
issued by the company that are due within next year.
INDEBTEDNESS INDICES
The leverage ratio has kept almost constant for the analyzed period.
The percentage of short term debt shows an increase due to the aforementioned,
this is the shift of bond quotas issued by the company.
The interest expenses coverage index registered increased with respect to the
previous year due to higher net income during the present fiscal year.
ACTIVITY INDICES
Inventory turnover and permanence indices shows a slight deterioration, due to
the increase of the finished product inventory. This increase is the result of
the stationality in the demand of glass containers.
RESULTS
The operating result shows to a slight increase with respect to September of
2003 due to lower operating costs.
Likewise, non-operating result shows a decrease in the loss as a result of
positive exchange difference registered during the present fiscal year, as well
as due to the net income from investments in related companies.
PROFITABILITY INDICES
Equity and asset profitability indices show an increase with respect to
September and December 2003, due to a higher net income during the present
fiscal year.
On the other hand, the return of dividends index shows a decrease with respect
to the previous year due to lower dividends distributed during the last twelve
months.
90
2. DIFFERENCE BETWEEN BOOK VALUE AND MARKET VALUE OF MAIN ASSETS.
-------------------------------------------------------------
The financial statements of the company have been prepared according to
generally accepted accounting principles and general and specific norms of the
Securities and Insurance Commission, which is the agency that regulates the
Company. The valuation of the assets includes adjustment for currency
devaluation, reserves, and technical revaluations. We believe the foregoing is a
reasonable way to value the company's permanent investments.
As of September 30, 2004, there were financial investments in stocks recorded in
the accounting according to their purchase price of Th Ch$ 4,233 million whose
market value on the same date was Th Ch$ 5,727 million.
3. RESULTS AS OF SEPTEMBER 2004
----------------------------
3a. Individual Result
The Company had non-consolidated sales of Ch$ 55,126 million as of September
2004, compared to Ch$ 55,405 million the previous fiscal year. Volumes sold
increased by 5.9% reaching 196,937 tons, mainly due to higher sales of bottles
for the wine, returnable beer, non-returnable soft drinks and food markets;
partially compensated by lower sales to the non-returnable, liquor and
returnable soft drink markets. The level of average prices decreased by 6.0%,
mainly explained by a sharp decline of the nominal rate of exchange that passed
from Ch$ 713.59 per Dollar on average during the first nine months of 2003 to
Ch$ 614.91 per Dollar on average during the same period of this year. Operating
income reached Ch$ 18,251 million, 3.5% over 2003.
Non-operating result was a loss of Ch$ 1,144 million in 2004, compared to Ch$
14,277 million loss in 2003. The aforementioned was due to a Ch$ 1,266 million
income from exchange differences, compared to a Ch$ 10,060 million loss in 2003.
During 2004 a Ch$ 494 million net income was registered from investments in
related companies (Ch$ 1,612 million net loss in 2003) mainly due to higher
income in Vina Santa Rita and CIECSA.
3b. Results in Subsidiaries
Santa Rita's net income amounted Ch$ 5,395 million, compared to Ch$ 3,795
million income in 2003, which is explained by a better non-operating result. In
the local market, prices increased by 13.5% in real terms, while volumes
maintained without variation. Sales in this market increased 13,6%, reaching Ch$
27,576 million. During the period, exports increased by 19.7% representing 52.3%
of revenues, to reach US$51.3 million (US$ 41.90 million in 2003). Operating
income reached Ch$ 6,891 million, compared to Ch $ 7,989 million in 2003, mainly
due to higher costs of musts and a decline in the Peso US Dollar exchange rate,
which affects exports returns. The average price in dollars per case for the
export market for Santa Rita was US$ 33.8 (US$ 33.0 in 2003) whereas the average
price for the industry was US$23.9 per case
91
(US$ 23.6 in 2003). Santa Rita recorded a Ch$270 million non-operating loss,
compared to a Ch$ 3,228 million non-operating loss in 2003, mainly due to a Ch$
1,116 million income form exchange differences in 2004, compared to a Ch$ 2,098
million loss in 2003.
Red Televisiva Megavision, CIECSA's main subsidiary, registered a Ch$ 2,862
million operating income, 59.9% over 2003. MEGA had the first place in audience
reaching 26.0% audience share during the period (22.8% in 2003)1. Net sales
increased by 8.2% reaching Ch$ 20,367 million, due to an increase in live
programming, which has resulted in higher audience share. As of September 2004,
MEGA had a net income of Ch$ 2,102 million compared to Ch$ 1,042 million net
income in 2003. CIECSA had a Ch$ 2,101 million net income, compared to a Ch$ 839
million net income the previous year.
Envases CMF S.A. registered a Ch$ 750 million net income in 2004 compared with a
Ch$730 million net income in 2003. Volume sales decreased by 3.2%, reaching
16,162 tons, due to lower pre forms volume exports sales, while average prices
deceased by 5,1% influenced by a drop of the exchange rate. Due to the
aforementioned sales reached Ch$ 23,461 million during the period, compared with
Ch$ 25,522 million in 2003. Operating income reached Ch$ 2,023 million, compared
to Ch$ 2,283 million in 2003. Non-operating loss reached Ch$ 1,136 million,
compared to Ch$ 1,341 million loss in 2003.
In the cable TV business, Cristalchile Comunicaciones S.A. (99.99% owned by
Cristalerias), is the owner of 50% of Cordillera Comunicaciones Ltda., which in
turn is the owner of Metropolis-Intercom S.A.
During 2004, Metropolis-Intercom S.A. registered sales of Ch$ 33,674 million
compared with Ch$34,301 million the previous year. Metropolis-Intercom had a net
loss of Ch$ 7,920 million compared with a net loss of Ch$ 7,515 million in 2003.
The aforementioned was due to a lower operating result, mainly due to higher
depreciation charges; partially compensated by better non-operational result, in
turn due to lower interest expenses and the appreciation of the exchange rate.
Metropolis-Intercom's EBITDA reached Ch$ 4,608 million during the period (Ch$
4,521 million in 2003). This figure includes a depreciation charge of Ch$ 11,260
million (Ch$10,200 million in 2003) mainly corresponding to the HFC network
acquired in July 2000. The company ended the period with 224,657 subscribers of
the basic service (235,596 in 2003), 27,989 subscribers of premium service
(33,305 in 2003), 38,735 of the broadband service (32,227 in 2003) and 10,999
subscribers of IP Telephony (1,451 in 2003).
As a result of the abovementioned and a negative goodwill amortization charge
through Cordillera Comunicaciones of Ch$3,149 million during the period
(Ch$3,178 million in 2003), Cristalchile Comunicaciones recorded a net loss of
Ch$ 5,560 million (net loss of Ch$5,334 in 2003).
--------
1 Measured between 7:30AM and 1:30AM; i.e: 18 hours daily, Monday through
Sunday.
92
4. CASH FLOW STATEMENT
As of September, 2004 a total net positive flow of Ch$ 12,899 million was
generated, which is explained by a positive flow generated by operating
activities of Ch$ 23,688 million, decreased by a negative financing flow of Ch$
3,892 million and a negative flow of investment activities for Ch$ 6,897
million.
The operating flow corresponds basically to the collection of sales and
interests income that were reduced by payment to suppliers, personnel and tax
and interests payments.
The negative financing flow can be explained by the payment of dividends.
The investment flow is mainly explained by the incorporation of fixed assets for
Ch$ 7,530 million, loans to related companies for Ch$ 3,937 million and future
purchase contracts for Ch$ 2,268 million, that were partially financed by Ch$
5,116 of sales of bonds and payments of loans to related companies for Ch$ 1,026
million.
The foregoing results in an increase in the final balance of cash and cash
equivalent, which passed from Ch$ 61,140 million as of December 31, 2003 to Ch$
72,670 million as of September 30, 2004.
According to the current regulations of the SVS and the Association of
Accountants of Chile, time deposits and agreements with due date under 90 days
have been considered cash and cash equivalent.
5. INTEREST RATES AND EXCHANGE RATE RISK ANALYSIS
o Interest rates
The Company is exposed to the risk of fluctuations in interest rates on its
long-term debt, corresponding to a loan of US$50 million, which has a variable
annual rate of Libor plus 0.8% percentage points. In addition, the Company
issued two bond series, for a total of UF 4.1 million, for a period of 6 and 21
years, and which pay a fixed rate of 4.75% and 5.8% respectively (the actual
placement rate was 5.3% and 6.5% respectively).
At the same time, as of September 30, 2004, the Company had available funds in
the amount of Ch$71,781million, invested at different terms in financial
instruments such as time deposits, bonds, fixed rate mutual funds and agreements
with resale commitment. This figure does not consider Ch$ 3,635 million in bonds
with maturity on September 15, 2005 and investments in shares for Ch$ 4,233
million.
Currently the Company does not use secondary financial instruments to reduce
risk in the event of fluctuations in interest rates. This policy will be studied
permanently to evaluate the alternatives offered by the market.
93
o Exchange rate
The Company maintains liabilities in dollars of US$62.2 million, which represent
10.2% of its assets, and which include a balance of a long-term syndicated loan
of US$50 million.
As of September 30, the Company has investments in dollars of US$49.4 million in
time deposits, bonds and fixed rate mutual funds. In addition, it also has
investments in Euros of 37.8 million in fixed rate instruments. Likewise, there
are future sale Dollar contracts of US$38.2 million.
On the other hand, approximately 35.9% of the company's revenues are adjusted by
the exchange rate variation. Costs in foreign currency represent approximately
27.5% of the total costs.
94
FECU (Standardized Quarterly Financial Report)
1. IDENTIFICATION
1.01.05.00 Firm Name
CRISTALERIAS DE CHILE S.A.
1.01.04.00 Company RUT 90331000-6
1.00.01.10 Starting date 1/1/2004
1.00.01.20 Closing date 9/30/2004
1.00.01.30 Type of Currency Chilean Pesos
1.00.01.40 Type of Financial Statements Consolidated
ASSETS
2.0 FINANCIAL STATEMENTS
2.01 BALANCE SHEET
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance : Consolidated
ASSETS NOTE No. 09-30-04 09-30-03
------ -------- -------- --------
5.11.00.00 TOTAL CURRENT ASSETS 198,490,176 174,344,216
5.11.10.10 Cash 1,372,180 1,925,392
5.11.10.20 Time deposits 41 5,431,649 7,033,955
5.11.10.30 Marketable securities (net) 4 69,876,826 65,437,650
5.11.10.40 Debtors from sales (net) 5 45,696,034 41,218,355
5.11.10.50 Documents receivable (net) 5 4,123,073 4,656,426
5.11.10.60 Sundry debtors (net) 5 1,823,486 1,577,017
5.11.10.70 Doc. & accts receivable 6 3,178,597 756,059
related Co.
5.11.10.80 Inventories (net) 7 42,206,374 37,072,485
5.11.10.90 Recoverable taxes 8 0 2,724,484
5.11.20.10 Prepaid expenses 1,512,574 1,410,377
5.11.20.20 Deferred taxes 8 1,709,044 1,455,155
5.11.20.30 Other current assets 10 21,560,339 9,076,861
5.11.20.40 Leasing contracts (net) 0 0
5.11.20.50 Leasing assets (net) 0 0
5.12.00.00 TOTAL FIXED ASSETS 12 138,345,917 140,894,375
5.12.10.00 Land 12 13,590,995 13,326,621
5.12.20.00 High rises & infrastructure 12 65,040,108 62,357,404
5.12.30.00 Machinery & equipment 12 150,861,624 145,862,680
5.12.40.00 Other fixed assets 12 15,857,598 11,506,268
5.12.50.00 Positive goodwill from 12 6,732,617 6,725,906
technical revaluation of fixed
assets
5.12.60.00 Depreciation (minus) 12 (113,737,025) (98,884,504)
5.13.00.00 TOTAL OTHER ASSETS 128,001,937 143,772,401
5.13.10.10 Investment in related companies 14 99,923,294 107,350,368
5.13.10.20 Investment in other companies 15 770,586 840,471
5.13.10.30 Negative goodwill 16 8,696,914 9,761,218
5.13.10.40 Positive goodwill (minus) 0 0
5.13.10.50 Long-term debtors 5 194,609 231,635
5.13.10.60 Doc. & accts receivable 6 1,212,596 2,944
related Co.
5.13.10.65 Long-term deferred taxes 0 0
5.13.10.70 Intangibles 17 12,050,313 12,003,589
5.13.10.80 Amortization (minus) 17 (1,395,740) (1,173,631)
5.13.10.90 Other 18 6,549,365 14,755,807
5.13.20.10 Long-term leasing contracts 0 0
(net)
5.10.00.00 TOTAL ASSETS 464,838,030 459,010,992
1
LIABILITIES
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance : Consolidated
LIABILITIES NOTE No. 09-30-04 09-30-03
----------- -------- -------- --------
5.21.00.00 TOTAL CURRENT LIABILITIES 52,756,139 45,680,494
5.21.10.10 Short-term oblig. Banks & 19 15,884 153,312
Fin. Inst.
5.21.10.20 Short-term portion - Long-term 19 2,699,525 3,933,977
oblig. Banks & Financial
Institutions
5.21.10.30 Obligations with the public 0 0
(notes)
5.21.10.40 Short-term portion oblig with 22 9,753,398 1,159,784
public
5.21.10.50 Long-term oblig. due within 1 72,225 202,467
year
5.21.10.60 Dividends payable 652,697 513,724
5.21.10.70 Accounts payable 14,176,290 12,216,996
5.21.10.80 Notes payable 3,149,797 2,502,623
5.21.10.90 Sundry creditors 445,748 1,065,524
5.21.20.10 Notes & accts payable related 6 1,101,916 850,380
Co.
5.21.20.20 Provisions 23 14,212,657 9,818,920
5.21.20.30 Withholdings 2,372,537 3,127,966
5.21.20.40 Income tax 905,158 0
5.21.20.50 Unearned income 3,198,307 4,997,864
5.21.20.60 Deferred taxes 8 0 0
5.21.20.70 Other current liabilities 20 0 5,136,957
5.22.00.00 TOTAL LONG-TERM LIABILITIES 128,823,542 144,062,975
5.22.10.00 Oblig with Banks & Financial 21 33,638,245 39,909,156
Inst.
5.22.20.00 Long-term oblig with public 22 82,515,744 91,250,982
(bonds)
5.22.30.00 Long-term notes payable 0 0
5.22.40.00 Long-term sundry debtors 1,379,772 366,291
5.22.50.00 Long-term notes & accts. 6 0 0
payable related companies
5.22.60.00 Long-term provisions 23 6,604,096 7,745,359
5.22.70.00 Long-term deferred taxes 8 4,685,685 4,791,187
5.22.80.00 Other long-term liabilities 0 0
5.23.00.00 MINORITY INTEREST 26 40,445,976 38,249,896
5.24.00.00 TOTAL EQUITY 27 242,812,373 231,017,627
5.24.10.00 Paid-in capital 27 65,396,749 65,785,245
5.24.20.00 Reserve capital revaluation 27 1,242,538 789,423
5.24.30.00 Premium in sale of own shares 27 28,403,990 28,376,447
5.24.40.00 Other reserves 27 6,677,095 8,242,181
5.24.50.00 Retained earnings (addition 27 141,092,001 127,824,331
of codes 5.24.51.00 to 5.24.56.00)
5.24.51.00 Reserve 27 129,427,446 126,346,020
future dividends
5.24.52.00 Accrued 27 0 0
profits
5.24.53.00 Accrued 27 0 0
losses (minus)
5.24.54.00 Profit 27 14,237,355 2,454,646
(loss) for the year
5.24.55.00 Prov. 27 (2,572,800) (976,335)
dividends (minus)
5.24.56.00 Accr. 27 0 0
deficit dev. period
5.20.00.00 TOTAL LIABILITIES 464,838,030 459,010,992
2
INCOME STATEMENT
2.02 INCOME STATEMENT
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance : Consolidated
INCOME STATEMENT NOTE No. 09-30-04 09-30-03
---------------- -------- -------- --------
5.31.11.00 OPERATING INCOME 28,326,307 27,540,725
5.31.11.10 Gross Margin 50,342,530 46,268,544
5.31.11.11 Sales 133,046,076 125,626,008
5.31.11.12 Costs (minus) (82,703,546) (79,357,464)
5.31.11.20 Adm. & sales expenses (22,016,223) (18,727,819)
(minus)
5.31.12.00 NON-OPERATING RESULTS (7,368,502) (21,706,265)
5.31.12.10 Interest income 1,678,416 2,216,585
5.31.12.20 Income investments 14 1,696,954 1,576,541
Rel. Co.
5.31.12.30 Other non-operating 28 898,101 562,302
income
5.31.12.40 Loss investments Rel. 14 (5,713,350) (5,599,136)
Co. (-)
5.31.12.50 Amortization 16 (477,694) (471,323)
neg.goodwill (-)
5.31.12.60 Interest expenses (5,022,070) (5,262,484)
(minus)
5.31.12.70 Other non-operat 28 (2,033,862) (1,546,073)
expenses (-)
5.31.12.80 Price level 29 (768,421) (716,961)
restatement
5.31.12.90 Exchange differences 30 2,373,424 (12,465,716)
5.31.10.00 RESULTS BEFORE INCOME TAX 20,957,805 5,834,460
AND EXTRAORDINARY ITEMS
5.31.20.00 INCOME TAX 8 (4,131,202) (1,615,276)
5.31.30.00 EXTRAORDINARY ITEMS 31 0 0
5.31.40.00 PROFIT (LOSS) BEFORE 16,826,603 4,219,184
MINORITY INTEREST
5.31.50.00 MINORITY INTEREST 26 (2,589,248) (1,764,538)
5.31.00.00 NET INCOME (LOSS) 14,237,355 2,454,646
5.32.00.00 Amortization of positive goodwill 0 0
5.30.00.00 INCOME (LOSS) FOR THE YEAR 14,237,355 2,454,646
3
DIRECT CASH FLOW STATEMENT
2.03 CASH FLOW STATEMENT
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance : Consolidated
DIRECT CASH FLOW STATEMENT NOTE No. 09-30-04 09-30-03
-------------------------- -------- -------- --------
5.41.11.00 NET FLOW FROM OPERATING ACTIVITIES 30,868,796 26,867,411
5.41.11.10 Collection from sales debtors 153,450,447 153,986,785
5.41.11.20 Interests received 2,790,863 2,864,444
5.41.11.30 Dividends & other distributions 1,110,891 165,498
funds received
5.41.11.40 Other income 2,841,854 2,796,019
5.41.11.50 Payments to suppliers & (109,337,207) (109,699,300)
personnel (-)
5.41.11.60 Interest paid (minus) (5,822,032) (5,713,335)
5.41.11.70 Income tax paid (minus) (2,113,461) (3,874,470)
5.41.11.80 Other expenses (minus) 33 (1,421,260) (6,163,425)
5.41.11.90 V.A.T. & other taxes (minus) (10,631,299) (7,494,805)
5.41.12.00 CASH FLOW FINANCING ACTIVITIES (5,784,656) (12,148,666)
5.41.12.05 Proceeds from share issue 0 0
5.41.12.10 Loans received 107,988 135,243
5.41.12.15 Obligations with the public 0 0
5.41.12.20 Secured loans from related 66,805 95,162
companies
5.41.12.25 Other loans from related 0 0
companies
5.41.12.30 Other financing resources 0 0
5.41.12.35 Dividends paid (minus) (4,443,604) (9,175,294)
5.41.12.40 Capital distributions (minus) 0 0
5.41.12.45 Repayment of loans (minus) (1,449,040) (2,138,070)
5.41.12.50 Payment of obligations with the 0 (216,258)
public (-)
5.41.12.55 Repayment of secured loans from (66,805) (77,894)
rel Co. (-)
5.41.12.60 Repayment other loans from 0 0
related Co. (-)
5.41.12.65 Share issue payment (minus) 0 0
5.41.12.70 Payment of issue publ oblig 0 0
(minus)
5.41.12.75 Other financing payments (minus) 33 0 (771,555)
5.41.13.00 CASH FLOW FROM INVESTING ACTIVITIES (12,596,472) (29,060,257)
5.41.13.05 Sale of fixed assets 82,363 319,949
5.41.13.10 Sale of permanent investments 0 0
5.41.13.15 Sale of other investments 33 5,116,363 313,172
5.41.13.20 Proceeds secured loans to 0 0
related Comp.
5.41.13.25 Proceeds other loans to related 1,053,913 1,971,152
companies
5.41.13.30 Other investment income 33 839,008 2,297,517
5.41.13.35 Incorporation of fixed assets (12,938,320) (23,575,227)
(minus)
5.41.13.40 Capitalized interests payment 0 0
(minus)
5.41.13.45 Permanent Investments (minus) (1,381) (3,995,852)
5.41.13.50 Investments in financial (300,000) (70,322)
instruments (minus)
5.41.13.55 Other loans to related companies (3,936,873) 0
(minus)
5.41.13.60 Other loans to related companies (3,148) (9,080)
(minus)
5.41.13.65 Other distrib of funds on invest 33 (2,508,397) (6,311,566)
activities (-)
5.41.00.00 TOTAL NET CASH FLOW FOR THE PERIOD 12,487,668 (14,341,512)
5.42.20.00 EFFECT OF INFLATION ON CASH & CASH EQUIV. (942,734) (2,424,927)
5.41.00.00 NET CHANGE IN & CASH EQUIVALENT 11,544,934 (16,766,439)
5.42.00.00 CASH & CASH EQUI AT BEGINNING OF PERIOD 77,112,909 95,926,001
5.43.00.00 CASH & CASH EQUIV BALANCE AT END OF PERIOD 88,657,843 79,159,562
4
INCOME STATEMENT RECONCILIATION
CONCILIATION BETWEEN CASH FLOW GENERATED BY THE OPERATION'S ACTIVITIES AND THE
INCOME STATEMENT FOR THE YEAR
1.00.01.30 Type of Currency: Thousands of Chilean Pesos
1.00.01.40 Type of Balance : Consolidated
CASH FLOW - INCOME STATEMENT RECONCILIATION NOTE No. 09-30-04 09-30-03
---------- ----------- -----------
5.50.10.00 Profit (Loss) for the year 14,237,355 2,454,646
5.50.20.00 Profit (Loss) in sale of assets 307,248 79,304
5.50.20.10 (Profit) Loss in sale of fixed assets 307,052 79,304
5.50.20.20 Profit in sale of investments (minus) 0 0
5.50.20.30 Loss in sale of investments 196 0
5.50.20.40 (Profit) Loss in sale of other assets 0 0
5.50.30.00 Non-cash losses (gains) 20,167,850 27,872,112
5.50.30.05 Depreciation for the year 12 11,754,846 11,065,777
5.50.30.10 Amortization of intangibles 908,238 952,366
5.50.30.15 Write-offs and provisions 2,221,041 1,218,028
5.50.30.20 Accrued earnings from investments in related 14 (1,696,954) (1,576,541)
companies (minus)
5.50.30.25 Accured losses from investments in related Co. 14 5,713,350 5,599,136
5.50.30.30 Negative goodwill amortization 16 477,694 471,323
5.50.30.35 Positive goodwill amortization (minus) 0 0
5.50.30.40 Price level restatement 29 768,421 716,961
5.50.30.45 Net exchange difference 30 (2,373,424) 12,465,716
5.50.30.50 Other non-cash credits to results (minus) (403,762) (309,944)
5.50.30.55 Other non-cash debits to results 2,798,400 (2,730,710)
5.50.40.00 Changes in Assets affecting cash flow (incr) decreases (30,341,342) (25,781,511)
5.50.40.10 Debtors from sales (20,177,995) (19,554,112)
5.50.40.20 Inventory (11,411,029) (5,792,471)
5.50.40.30 Other assets 1,247,682 (434,928)
5.50.50.00 Changes in liabilities affecting cash flow increases 23,908,437 20,478,322
(decr)
5.50.50.10 Accounts payable related to results for the 21,750,425 21,822,422
year
5.50.50.20 Interests payable (1,230,790) (915,506)
5.50.50.30 Income tax payable (net) 3,539,374 (365,782)
5.50.50.40 Other accounts payable related to non-oper 421,365 49,967
results
5.50.50.50 VAT and other taxes payable (net) (571,937) (112,779)
5.50.60.00 Profit (Loss) of minority interest 2,589,248 1,764,538
5.50.00.00 NET OPERATING CASH FLOW 30,868,796 26,867,411
5
1. Registration in the Securities Register
IDENTIFICATION OF THE COMPANY AND REGISTRATION IN THE SECURITIES REGISTER
The Company is registered in the Securities Register under No. 061 and is
supervised by the Securities and Insurance Commission.
The subsidiary S.A. Vina Santa Rita is registered in the Securities
Register under number 390 of the S.V.S. (Securities and Insurance Commission).
6
2. Applied Accounting Criteria
APPLIED ACCOUNTING CRITERIA
a) Accounting Period
These financial statements correspond to the period between January 1 and
September 30 of 2004 and 2003.
b) Preparation basis of financial statements:
These consolidated financial statements as of September 30, 2004 and 2003 have
been prepared on the basis of generally accepted accounting principles and
specific norms issued by the S.V.S.; the former prevailing in case of
discrepancies.
c) Presentation Basis
For comparison purposes, the financial statements and figures included in the
disclosures for the 2003 fiscal year are presented updated according to
non-accounting terms as of September 30, 2004 by 1.6%.
d) Consolidation Basis
The consolidated financial statements include the balances of the following
subsidiaries: Cristalchile Comunicaciones S.A., Cristalchile Inversiones S.A.,
Ciecsa S.A. consolidated, S.A. Vina Santa Rita consolidated, and Constructora
Apoger S.A. consolidated.
The company Ciecsa consolidated includes the balances of its subsidiary Red
Televisiva Megavision S.A. in which it has a 99.99% stake of its net worth and
Simetral S.A. in which it has a 81.5% stake of its net worth.
S.A. Vina Santa Rita consolidated includes the balances of its subsidiaries Vina
Carmen S.A., with a 99.9% stake in its net worth, and Vina Centenaria S.A.,
with a 100% stake, Vina Dona Paula S.A. with a 100% stake in its net worth and
Sur Andino S.A. with a 100% stake in its net worth in 2004 and 2003.
Intercompany balances and effects of transactions were eliminated in the
consolidation and the participation of minority investors has been recognized
presented in the balance as minority interest.
e) Adjustment for Currency Devaluation (Price Level Restatement)
7
Consolidated financial statements have been restated considering the variation
in the purchasing power of the currency occurred during the fiscal year 2004,
which was 1.9% (1.2% in 2003).
For financial effects, the effective variations have been considered for every
month in 2003 and 2004, with respect to September 2004 and 2003. For tax
effects, the negative variations occurred in some months of 2003 and 2004 with
respect to 2003 and 2004 have been equaled to zero, according to the
instructions of the Chilean Internal Revenue Service, not significantly affected
the financial statements.
f) Conversion Basis
Balances in foreign currency and indexed currency units have been converted to
pesos at the indicated parities:
2004 2003
---- ----
Ch$ Ch$
U.S. Dollar 608.90 660.97
Pound Sterling 1,091.41 1,099.23
Swedish Crown 482.14 501.76
EURO 757.34 770.81
Unidad de Fomento 17,190.78 16,946.03
g) Marketable Securities and Time Deposits
Transactions in short-term fixed income instruments are shown at the return
value of the investment, which does not exceed the market value as of September
30, 2004 and 2003.
Investments in shares are shown at the lowest value between the corrected cost
and market value.
Time deposits are shown at the value of the investment, plus adjustments and
interest accrued as of the date of the fiscal year.
h) Inventory
Inventory of finished products has been valued as of September 30, 2004 and 2003
at the direct production cost, duly updated, and raw materials and materials at
the cost of the last purchase or its corrected cost. Those valuations do not
exceed the net liquidation value.
Inventory of foreign television programs to be exhibited are valued at the
purchase cost at the exchange rate in effect at the closing of the fiscal year.
Local programs are valued according to the terms of the respective contracts.
8
Programs inventories at the closing of each fiscal year represent the value of
the films and videos contracted and the proportion of repeats that are pending
exhibition. The actual cost of the programs is charged to results as they are
broadcasted.
i) Bad Debts (Uncollectables)
The parent company and subsidiaries have made provision for bad debts that is
deducted from debtors for sales and documents receivable. The criterion adopted
to estimate them is the age of the balances.
j) Fixed Assets
The property in fixed assets is shown at the purchase cost plus legal and
regulatory revaluations accumulated until September 30, 2004 and 2003.
k) Depreciation of Fixed Assets
Depreciation of these goods is calculated on updated values, according to the
straight-line depreciation method, considering the estimated useful life of the
goods.
l) Assets on Leasing
None.
m) Sales Transactions with Leaseback
None.
n) Intangibles
The corrected purchase value of trademarks of the subsidiary S.A. Vina Santa
Rita which has an amortization period of 40 years, as well as inscription costs
that are amortized over the period of duration of the renovation. The subsidiary
CIECSA consolidated includes channel 9 TV frequency, which has an amortization
period of 40 years, and the amortization method is the one of "Increasing
Digits".
o) Investments in Related Companies
According to the established in the circulating No. 1697 of the VPP, for the
valuation of the investments in related companies, carried out prior to the
January 01, 2004, the equity method (VPP) has continued to be used.
9
This method consists of assigning to the investment an equivalent value to the
proportion that corresponds to the company in the equity at books value of the
issuer, and recognize proportionally, the variations that this experiments.
Investments abroad have been valued according to provisions of Technical
Bulletin No. 64 of the Chilean Accountants Association, A.G.
p) Goodwill Amortization
Goodwill amortization resulted from comparing the price paid for the investment
with the proportional equity value (VPP) that corresponds to the investment in
the company's equity.
Amortizations of these values are carried out in a period of twenty years.
As of September 30, 2004 and 2003 there is no positive goodwill.
q) Operations with repurchase and resale agreement
Financial instruments acquired with a resale agreement are shown at their
purchase value plus interest and adjustments accrued at the closing of the
fiscal year, and they are classified in Other Current Assets, in the terms
established in Circular No. 768 of the Securities and Insurance Commission.
r) Obligations with the public
Obligations for bonds issued are shown at their face value plus adjustments and
interest accrued at the closing of each fiscal year. The negative goodwill
obtained compared to par value is amortized proportionally to payment or
redemption of the capital installments of those bonds and the expenses for the
placement of long-term bonds.
s) Deferred Taxes and Income Tax
The parent company and its subsidiaries has complied with deferred taxes, in
accounting terms, as established in Technical Bulletin No. 60 and 71 of The
Accountants Association and the norms indicated in circular 1466 of the S.V.S.
Income tax is recorded in the accounting on the basis of the calculation of net
taxable income determined according to norms established in the Income Tax Law.
t) Severance payment
10
The parent company has established a reserve for all of the personnel's
severance payment, according to the union contracts signed with their workers.
This reserve is shown at the present value of the obligation.
u) Sales
The consolidated companies recognize operating income on an accrued basis
according to accounting principles generally accepted in Chile.
v) Derivative Contracts
The parent company and its subsidiaries Ciecsa S.A. and S.A. Vina Santa Rita
maintain Future contracts in foreign currency recorded as established in
Technical Bulletin 57 of the Accountants Association of Chile A.G.
w) Computer Software
The parent company and S.A. Vina Santa Rita develop computer software with their
own resources and they also acquire computer packages from third parties.
Development disbursements are charged to results as they are generated. Computer
packages are recorded in Fixed Assets and amortized in 36 months by the parent
company and in 48 months by the subsidiary S.A. Vina Santa Rita.
x) Research and development expenses
The companies register expenses for this item directly in results as they are
generated.
y) Cash flow statement:
According to current regulations of the Securities and Insurance Commission and
the Accountants Association of Chile, in preparing the cash flow statement, the
Company has considered time deposits, fixed rate mutual funds investments and
agreements with maturities under 90 days as cash.
Such cash flows related to the Company's line of business, interest paid,
interest income received, dividends received, and all that is not defined as
investment or Financing is included under the heading "Flow Originating in
Activities of the Operation."
Disbursements originating in time deposits and deposits with maturities over 90
days have been classified in the item "Investments in Financial Instruments."
11
CRISTALERIAS DE CHILE S.A.
NOTE 2 - ACCOUNTING CRITERIA USED - COMPANIES INCLUDED IN THE
CONSOLIDATED REPORT
Percentage of Shareholding
--------------------------------------------------
R.U.T. Company Name 09.30.2004 09.30.2003
------------- -------------------------------- ---------------------------------- ----------
Direct Indirect Total Total
------- -------- -------- --------
96.721.580-5 Cristalchile Comunicaciones S.A. 99.9982 0.0000 99.9982 99.9980
96.767.580-6 Constructora Apoger S.A. 80.0000 0.0000 80.0000 80.0000
96.608.270-4 Ciecsa S.A. 98.4458 0.0000 98.4458 98.4458
86.547.900-K S.A. Vina Santa Rita 54.0970 0.0000 54.0970 54.0970
96.972.440-5 Cristalchile Inversiones S.A. 99.9900 0.0100 100.0000 100.0000
12
3. Accounting Changes
As of September 30, 2004 and 2003, there have not been any changes in the
accounting criteria applied that affect the consolidated financial statements.
13
4. Marketable Securities
As of September 30, 2004, this item is composed by the following investments:
a) Th Ch$ 53,833,075 are included Investments in bonds, Fixed Fate
Instruments equivalent to Th Ch$ 41,389,097 plus 37,805,020 EUROS
which mainly correspond to investments in state bonds and bonds from
financial institutions in USA, Germany, Holland; Collateralized Bonds
of Private Companies in USA (with accounts receivable guarantee) and
USA Mortgage Bonds with state guarantee.
b) Th Ch$ 8,164,611 in fixed rate investment funds in US$.
c) Th Ch$ 4,233,486 in shares.
d) Th Ch$ 3,635,133 investments in bonds of Celulosa Arauco equivalent to
US$ 5,970,000, with a 6.95% rate per year with maturity on September
15, 2005.
e) Th Ch$ 10,521 for accrued interests of bonds of Celulosa Arauco S.A.
As of September 30, 2003, this item is composed by the following investments:
a) Th Ch$ 52,310,976 are included Investments in bonds, fixed rate
instruments which mainly correspond to investments in state bonds of
the Treasury Bills, Collateralized Bonds of Private Companies in USA
(with accounts receivable guarantee) and USA Mortgage Bonds with state
guarantee.
b) Th Ch$ 4,229,712 in fixed rate investment funds in US$.
c) Th Ch$ 8,896,962 in shares.
CRISTALERIAS DE CHILE S.A.
NOTE 4 -MARKETABLE SECURITIES- BALANCE COMPOSITION
Type of Security Book Value
----------------------------------- ---------------------------
09-30-2004 09-30-2003
---------- ----------
Shares 4,233,486 4,229,712
Bonds 57,468,208 52,310,976
Shares of mutual funds 0 0
Shares of investment funds 8,164,611 8,896,962
Public tender notes 0 0
Mortgage bonds 0 0
Bonds and fixed rate instruments 0 0
Interest of Celulosa Arauco bonds 10,521 0
Total Marketable Securities 69,876,826 65,437,650
14
CRISTALERIAS DE CHILE S.A.
NOTE 4 - MARKETABLE SECURITIES - SHARES
Number of Unit Market
of Participation Market Investment Corrected
R.U.T. Company Name Shares Percentage Value Value Cost
------------------ ------------------------------------- ------------- ------------- -------- ---------- ----------
96.512.200-1 Bodegas y Vinedos Santa Emiliana S.A. 63,642,856 9.9980 90 5,727,857 4,233,486
Value Investment Portfolio 5,727,857 4,233,486
Adjustment Provision 0
Book value, Investment Portfolio 4,233,486
15
CRISTALERIAS DE CHILE S.A.
NOTE 4 - MARKETABLE SECURITIES - FIXED RATE
INSTRUMENTS
Market
Book Value Value Reserve
---------------------- ---------- --------
Par Rate %
Type of Security Value Amount (3)
------------------------------------------------------- ---------- ---------- ------
Financial Institutions bonds in Germany and Holland (1) 32,470,490 32,470,490 1.93 32,470,490 0
US treasury bonds (2) 18,133,100 18,133,100 0.70 18,133,100 0
US Collateralized Bonds (2) 6,852,522 6,852,522 0.70 6,852,522 0
Call Deposit (2) 12,096 12,096 0.70 12,096 0
Celulosa Arauco bonds (interests) (2) 10,521 10,521 4.02 10,521 0
BBH U.S. Money Market Portfolio (2) 8,164,611 8,164,611 1.05 8,164,611 0
TOTAL 65,643,340 65,643,340 65,643,340 0
Note:
(1) The investements have been made in EUROS.
(2) The investements have been made in U.S. Dollars.
(3) Rate of period from 01-01-2004 to 09-30-2004.
(4) These investments can be recovered within 48 hrs. warning.
16
5. Short-Term and Long-Term Debtors
As of September 30, 2004, there are balances short-term debtors in the amount of
Th Ch$51,642,593 (Th Ch$ 47,451,798 in 2003).
As of September 30, 2004, there is a bad debt reserve of Th Ch$ 739,424 in 2004
(Th Ch$ 750,280 in 2003), presented deducting the balances of Debtors from Sales
and Documents receivable.
The balances of Short-term Debtors are shown net of Customer Advance Payments.
In addition, there is a balance of Th Ch$ 194,609 in Long-Term Debtors in 2004
(Th Ch$ 231,635 in 2003).
Under accounts receivable are included exports made by the subsidiary Vina Santa
Rita S.A., that represent 63,91% of the total at September 30, 2004 (65,64% in
2003) for Th Ch$11,495,814 in 2004 (Th Ch$ 9.991.823 in 2003).
17
CRISTALERIAS DE CHILE S.A.
NOTE 5 -SHORT AND LONG TERM DEBTORS
Current Assets
Over 90 days Long Term
---------------------------------------------------------------------------------- ----------------------
Up to 90 days up to 1 year Subtotal Total Current (net)
---------------------- ---------------------- ---------- ---------------------- ----------------------
Item 09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003 09-30-2004 09-30-2003
----------------------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Debts from Sales 43,502,117 38,997,274 2,699,166 2,733,439 46,201,283 45,696,034 41,218,355 0 0
Estimate of bad debtors - - - - 505,249 - - - -
Documents receivable 4,312,314 4,772,475 44,934 121,873 4,357,248 4,123,073 4,656,426 0 0
Estimate of bad debtors - - - - 234,175 - - - -
Misc. Debtors 1,729,792 1,544,546 93,694 32,471 1,823,486 1,823,486 1,577,017 194,609 231,635
Estimate of bad debtors - - - - - - - - -
Total Long-Term Debtors 194,609 231,635
18
6. Balances and Transactions with related parties
Balances receivable in the Short-Term as of September 30, 2004 total Th Ch$
3,178,597 (Th Ch$ 756,059 in 2003) and correspond mainly to a loan granted by
the parent company to Metropolis Intercom for Th Ch$ 2,725,425 at an annual
interest rate of 3%, and a loan granted by the subsidiary Ciecsa to Editorial
Zig Zag for Th Ch$ 110,285 (Th Ch$ 850,380 in 2003) including interests, with
maturity on 06-30-2003 at an annual interest rate of 1%. The balance corresponds
to invoicing receivable for Th Ch$ 342,887 (Th Ch$ 478,582 in 2003).
Balances payable in the short term totaling Th Ch$ 1,101,916 at September 30,
2004 (Th Ch$ 850,380 in 2003) mainly correspond to commercial transactions under
90 days for Th Ch $ 434,478 (Th Ch$ 341,793 in 2003) and dividends payable to
Majority shareholders for Th Ch$ 667,438 (Th Ch$ 508,587 in 2003).
In 2004 there is a long-term receivable balance corresponding to accounts
receivable totaling Ch Th$ 1,212,596 (Ch Th$ 2,944 in 2003), which correspond to
a loan granted by the parent company to Metropolis Intercom S.A. for Th Ch$
861,688 and to Inmobiliaria Monte Azul S.A. for Th Ch$ 346,519, the balance
corresponds to invoicing for Th Ch$ 4,389 (Th Ch$ 2,944 in 2003).
19
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCE AND TRANSACTIONS WITH RELATED COMPANIES
DOCUMENTS AND ACCOUNTS RECEIVABLE
R.U.T. Company Short Term Long Term
------------ ------------------------------------- -------------------------- -------------------------
09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ----------
89.150.900-6 Vina Los Vascos S.A. 87,013 147,042 0 0
90.684.000-6 Editorial Zig-Zag S.A. 110,285 166,149 0 0
86.881.400-4 Envases CMF S.A. 15,302 51,482 0 0
83.032.100-4 Serv. Y Consultorias Hendaya S.A. 247 2,009 0 0
90.048.000-4 Sudamericana Agencias Aereas y 1,008 0 0 0
Maritimas S.A.
79.753.810-8 Claro y Cia. 302 660 0 0
96.787.775-1 Metropolis Intercom S.A. 2,905,819 111,329 861,688 0
90.160.000-7 Sudamericana de Vapores S.A. 1,510 28,384 0 0
96.793.770-3 Ediciones Chiloe S.A. 0 0 4,389 2,944
86.963.200-7 Forus S.A. 0 0 0 0
78.936.090-1 Inmob. Y Constructora Monte Azul S.A. 0 0 346,519 0
77.489.120-K Soc. Agr. Vinedos Collipeumo Ltda 0 0 0 0
0-E Rayen Cura SAIC 57,111 249,004 0 0
Total 3,178,597 756,059 1,212,596 2,944
20
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCES AND TRANSACTIONS WITH RELATED COMPANIES
DOCUMENTS AND ACCOUNTS PAYABLE
R.U.T. Company Short Term Long Term
------------ ------------------------------------- -------------------------- -------------------------
09-30-2004 09-30-2003 09-30-2004 09-30-2003
---------- ---------- ---------- ----------
90.320.000-6 Cia. Electro Metalurgica S.A. 443,023 334,209 0 0
83.032.100-4 Serv. Y Consultorias Hendaya S.A. 113,587 112,545 0 0
89.150.900-6 Vina Los Vascos S.A. 14,847 8,955 0 0
79.753.810-8 Claro y Cia. 14,193 62,338 0 0
96.539.380-3 Ediciones Financieras S.A. 204 103 0 0
86.881.400-4 Envases CMF S.A. 201,120 223,907 0 0
90.160.000-7 Cia. Sudamericana de Vapores S.A. 11,718 9,838 0 0
0-E Rayen Cura S.A.I.C. 173,268 0 0 0
86.755.600-1 Inversiones Bayona S.A. 118,251 90,107 0 0
92.048.000-4 Sudamericana Agencias Maritimas S.A. 11,607 0 0 0
96.787.750-6 Metropolis Intercom S.A. 98 8,378 0 0
77.489.120-K Soc. Agr. Vinedos Collipeumo Ltda. 0 0 0 0
Total 1,101,916 850,380 0 0
21
CRISTALERIAS DE CHILE S.A.
NOTE 6 - BALANCES AND TRANSACTIONS WITH RELATED COMPANIES
TRANSACTIONS
09-30-2004 09-30-2003
--------------------- -----------------------
Description of Effect on Effect on
Company R.U.T. Relationship Transaction Amount Result Amount Result
--------------------- ------------ ------------ ---------------------- --------- --------- --------- ---------
Serv. Y Consultorias Majority
Hendaya S.A. 83.032.100-4 shareholder Services received 976,661 -976,661 996,264 -996,264
- Dividends paid 341,897 0 705,988 0
- Services supplied 14,551 14,551 15,960 15,960
- Products sold 201 46 206 64
- Services rendered 51,461 -51,461 29,350 -29,350
Payment Made for own
- Account 0 0 0 0
Quemchi S.A. 96.640.360-8 Same Parent Services rendered 7,624 7,624 8,346 8,346
Indirect
Rayen Cura S.A.I.C. 0-E affiliate Direct sales 115,771 40,106 442,560 137,340
Navarino S.A. 96.566.900-0 Same Parent Services supplied 7,624 7,624 7,707 7,707
Ediciones Indirect
Financieras S.A. 96.793.77-3 affiliate Products sold 0 0 4,138 1,282
- Services purchased 325 -325 309 -309
- Services received 6,034 -6,034 3,808 -3,808
- Advertising hired 652 -652 0 0
- Advertising services 5,592 -5,592 22,666 -22,666
- Advertising hired 738 738 0 0
Indirect
Envases CMF S.A. 86.881.400-4 affiliate Materials purchased 461,301 0 466,241 0
- Products sold 195 45 56,820 17,611
- Other sales 51,235 0 139 0
Forus S.A. 86.963.200-7 Affiliate Advertising hired 4,354 -4,354 0 0
- Advertising hired 4,354 4,354 187,858 187,858
Indirect
Vina Los Vascos S.A. 89.150.900-6 affiliate Direct sales 543,522 156,281 312,065 80,863
- Materials purchased 41,156 0 29,644 0
Cia. Sud-Americana de Freight services
Vapores S.A. 90.160.000-7 Same Parent received 123,252 -40,270 227,155 -36,585
- Other sales 1,230 0 3,085 0
- Product sold 9,528 6,971 27,280 10,951
Cia. Electro Majority
Metalurgica S.A. 90.320.000-6 shareholder Dividends paid 1,311,156 0 2,707,420 0
- Materials purchased 5,647 0 3,642 0
- Others sales 491 0 0 0
- Product sold 2,556 585 1,045 682
Payment Made for own
Account 0 0 284 0
With the
Claro y Cia. 79.753.810-8 Chairman Advice received 126,292 -126,292 156,297 -156,297
- Products sold 543 124 450 136
Inversiones Bayona Majority
S.A. 86.755.600-1 shareholder Dividends paid 355,935 0 734,973 0
Metropolis Intercom Indirect
S.A. 96.787.750-6 affiliate Advertising hired 431,107 380,017 207,460 207,320
- Other sales 0 0 24,158 7,489
- Long-term loan granted 861,688 0 0 0
- Long-term loan granted 2,725,425 0 0 0
- Services purchased 191 -191 0 0
- Land Rent 1,533 1,533 0 0
- Advertising services 15,144 -15,144 11,603 -11,603
- Products sold 0 0 3,534 3,534
Soc Agric. Cullipeumo
Ltda. 77.489.120-K Indirect Raw Material Purchased 9,728 0 41,115 0
- Products sold 551 126 0 0
Reimbursement of
- Expenses 422 0 0 0
Sudamericana Agencias
Aereas y Maritimas
S.A. 92.048.000-4 Indirect Freight services 163,820 -163,820 0 0
- Container rent 15,476 -15,476 0 0
- Products sold 67 15 0 0
- Others sales 768 0 0 0
Carmen Luz Sanchez
Guzman 5.781.266-4 Indirect Raw Material Purchased 37,268 0 38,972 0
Reimbursement of
- Expenses 1,397 0 0 0
Inmobiliaria y
Constructora Monte
Azul S.A. 78.936.090-1 Affiliate Loan granted 343,816 0 0 0
22
Empresa Editora - Interest 2,705 2,705 0 0
Zig-Zag 90.684.000-6 Indirect Services purchased 107 -107 0 0
- Services sold 1,959 1,959 0 0
23
7. Inventory
An itemized list of inventory, valued according to note 2 h), is presented on an
attached chart.
CRISTALERIAS DE CHILE S.A.
NOTE 7 - INVENTORY (Consolidated)
2004 2003
----------- ----------
Th Ch$ Th Ch$
Finished Products
* Cristalerias de Chile S.A. 4,165,325 2,723,155
* S.A. Vina Santa Rita 5,672,310 5,571,287
Subtotal Finished Products 9,837,635 8,294,442
Raw Materials and Fuel
* Cristalerias de Chile S.A. 1,242,139 1,661,580
* S.A. Vina Santa Rita 25,159,925 21,618,880
Subtotal Raw Materials and Fuel 26,402,064 23,280,460
Supply Materials and Parts
* Cristalerias de Chile S.A. 873,822 1,058,114
* S.A. Vina Santa Rita 1,372,303 1,100,763
Subtotal Supply Materials and Parts 2,246,125 2,158,877
Materials in Transit 1,026,001 366,788
Red Televisiva Megavision S.A. (CIECSA S.A.)
* Foreign, taped, for broadcast 2,509,115 2,517,572
* Domestic programming, to be broadcast 185,434 454,346
Subtotal Red Televisiva Megavision S.A. 2,694,549 2,971,918
Total 42,206,374 37,072,485
24
8. Deferred taxes and income taxes
A) DEFERRED TAXES.
Accumulated balances of deferred taxes for temporary differences, and their
composition in the income tax account for effects of fiscal year results and
recognition of deferred taxes, are presented on the attached charts.
Amortization periods of deferred taxes have been estimated on average at 1 year
for Short-Term Assets, 4 years for Long-Term Assets, and 14 years for Long-term
Liabilities.
B) INCOME TAX
The parent company and its subsidiary S.A. Vina Santa Rita, made tax provisions
of 17% of taxable income in 2004 (16.5% in 2003) subject to the First Category,
in addition to a 35% Income Tax under Art. 21, for the 2004 and 2003 fiscal
years.
The other subsidiaries maintain negative taxable rents, therefore they have not
provisioned for this concept.
Credits against taxes are shown deducting the payable obligation.
The itemized list is the following:
2004 2003
----------- -----------
Th Ch$ Th Ch$
Fiscal year income tax reserve (4,113,277) (1,294,403)
Single tax reserve (10,176) (8,161)
----------- -----------
SUB TOTAL (4,123,453) (1,302,564)
Credits:
Monthly reserve payments 1,891,500 3,391,248
Training expenditures 75,288 69,632
Fixed Assets credit 30,803 32,544
Donations 29,437 9,895
----------- -----------
CREDIT SUB TOTAL 2,027,028 3,503,319
Income Tax (2,096,425) 2,200,755
25
Income Tax to be Recovered 0 14,481
Other Taxes to be recovered:
VAT Fiscal Credit 355,118 273,157
Income tax credit, previous year 745,454 236,091
Profit absorption, previous year 79,591 0
Income Tax advance 11,104 0
TOTAL TAXES TO BE ________ _________
RECOVERED (PAID) (905,158) 2,724,484
C) TAXABLE PROFIT FUND
The parent company registered the following balance of profits to be
distributed:
2004 2003
----------- -----------
Th Ch$ Th Ch$
Generated as of 12.31.1983:
Profits adjustment 1,955,579 1,955,579
Generated since 01.01.1984:
Without Credit 1,952,737 1,092,551
With 10% First Category Credit 22,897 23,125
With 15% First category Credit 83,691,680 87,635,035
With 15% Additional rate Credit 725 736
With 16% First Category Credit 14,608,036 16,432,597
With 16.5% First Category Credit 7,024,928 4,179,243
With 17% First Category Credit 16,845,057 0
----------- -----------
SUB-TOTAL TAX PROFITS 124,146,060 109,363,287
Non-income revenues 6,886,405 6,955,188
----------- -----------
TOTAL RETAINED EARNINGS 131,032,465 116,318,475
26
CRISTALERIAS DE CHILE S.A.
NOTE 8 - DEFERRED TAXES AND INCOME TAX
DEFERRED TAXES
09-30-2004 09-30-2003
----------------------------------------------- ---------------------------------------------
Liability Liability
Item Asset Deferred Tax Deferred Tax Asset Deferred Tax Deferred Tax
---------------------------------- ---------------------- ----------------------- ---------------------- ---------------------
Short term Long Term Short Term Long Term Short Term Long Term Short Term Long Term
---------- --------- ---------- --------- ---------- --------- ---------- ---------
Temporary Differences
Reserve non-collectable accounts 132,736 0 0 0 126,820 0 0 0
Prepaid Income 543,712 0 0 0 849,637 0 0 0
Vacation provision 192,385 0 0 0 168,009 0 0 0
Intangible Amortization 0 0 0 0 0 0 0 0
Leased assets 0 0 0 0 0 0 0 0
Manufacturing expenses 0 0 0 0 0 0 0 0
Depreciations fixed assets 0 0 0 8,273,766 0 0 0 8,609,332
Severance payments 1,507 150,147 0 0 1,784 147,543 0 0
Other events 0 0 54,143 502,789 0 0 0 0
Packaging reserve 154,061 0 0 0 196,711 0 0 0
Furnace repair provision 325,031 401,392 0 0 0 589,832 0 0
Stock obsolescence provision 0 0 0 0 0 0 0 0
Spare parts obsolescence provision 109,251 0 0 0 98,860 0 0 0
Amortization lower value bonds 103,807 0 0 0 81,806 0 54,133 793,456
Non realized profits 244,323 10,836 0 0 231,810 7,103 0 0
Other provisions 140,648 0 0 0 21,308 0 0 0
Direct labor 11,337 0 0 0 21,846 0 0 0
Automobiles Accumulated
Depreciation 0 20,698 0 0 0 16,864 0 81,841
Tax losses 0 144,781 0 0 0 4,029,249 0 0
Negative bonds placement (-) 0 0 0 232,002 0 0 0 0
Prepaid expenses 0 0 47,158 0 0 0 37,003 0
Banking reserve 0 0 0 30,042 0 0 0 42,352
Fixed assets, molds 0 0 0 289,762 0 0 0 268,229
Commercial brands 1,957 0 0 0 38,376 0 0 0
Amortization commercial brands 0 0 0 0 0 0 0 0
Expenses assetted 0 0 261,654 0 50,804 0 264,668 0
Deferred customs duties 729 20,087 0 73,330 0 0 0 1,990
Stock obsolescence provision 113,939 0 0 0 90,298 0 0 0
Other expenses provision 0 0 0 0 0 0 0 0
Supplementary accounts-net of
amort. 3,424 5,586 0 3,973,651 167,110 3,341,325 0 3,556,747
Valuation provision 0 0 0 0
Total 2,071,999 742,355 362,955 5,428,040 1,810,959 1,449,266 355,804 6,240,453
27
CRISTALERIAS DE CHILE S.A.
NOTE 8 - DEFERRED TAXES AND INCOME TAX
INCOME TAX
09/30/2004 09/30/2003
----------- -----------
Th Ch$ Th Ch$
Current tax expense (tax provision) -4,123,453 -1,302,564
Adjustment tax expense (previous year) 0 0
Effects from assets or liabilities, deferred year's tax 38,147 -417,124
Tax benefit from tax losses 0 469
Effect of amortiz. of supplementary accounts for deferred assets and -23,544 103,943
liabilities
Effect on assets or liabilities from deferred tax from changes in 0 0
assessment provision
Other charges or credits to the account -22,352 0
Total -4,131,202 -1,615,276
28
9. Short and Long-term Leasing Contracts and Assets for Leasing
As of September 30, 2004, balances are not included under this heading.
29
10. Other Current Assets
As of September 30, 2004, included under this item are investments in:
a) Financial instruments with resale agreement for Th Ch$ 20,146,047
valued as expressed by note 2 q).
b) Deferred expenses for bonds placement for Th Ch$ 359,902.
c) Balance in favor of Cristalerias de Chile y filial S.A. Vina Santa
Rita for Th Ch$ 1,054,390 for Future Contracts in foreign currency.
As of September 30, 2003, there were investments in:
a) Financial instruments with resale agreement for Th Ch$ 8,679,104 valued
as expressed by note 2 q).
b) Deferred expenses for bonds placement for Th Ch$ 369,316.
c) Th Ch$ 28,441 for bank reserve.
30
11. Information on operations involving purchase agreements, sales
agreements, sale with repurchase agreement, and purchase with resale
agreement of titles or real estate securities
Information about these transactions is presented in attached charts.
31
NOTE 11 - INFORMATION ON OPERATIONS WITH PURCHASE COMMITMENT, SALE COMMITMENT,
SALE WITH REPURCHASE AGREEMENTS AND PURCHASE WITH RESALE AGREEMENTS
OPERATIONS OF TITLES AND REAL ESTATE SECURITIES
SALE OPERATIONS WITH REPURCHASE COMMITMENT (VRC) AND PURCHASE OPERATIONS WITH
RESALE COMMITMENT (CRV)
Dates
------------------------
Original Price Final Market
Code Start End Counterpart Currency Set Rate Value Instrument Value
----- ---------- ---------- -------------------- -------- --------- ---- --------- ---------------- ---------
CRV 09.24.2004 10.01.2004 BCI CB Pesos 500,000 0.16 500,198 BCP-PDBC 500,160
CRV 09.24.2004 10.12.2004 Banco de Chile Pesos 5,100,000 0.16 5,104,896 BCP-BUCER 5,101,632
CRV 09.28.2004 10.05.2004 Banco de Chile Pesos 2,000,000 0.19 2,000,887 STEGEC-STGCC-CHI 2,000,253
CRV 09.28.2004 10.01.2004 Banco de Chile Pesos 300,000 0.19 300,057 STD-STGCC 300,039
CRV 09.29.2004 10.06.2004 Banco de Chile Pesos 940,000 0.18 940,395 PRC-BCU 940,056
CRV 09.30.2004 10.07.2004 BCI CB Pesos 1,590,000 0.20 1,590,742 CERO-DUSAN-PDBC 1,590,000
CRV 09.27.2004 10.04.2004 Santander Investment Pesos 1,300,000 0.20 1,300,516 PRC-ZERO 1,300,260
CRV 09.27.2004 10.12.2004 Santander S.A. Dollars 608,900 1.70 609,331 PRD-BCD-BCP-STD 608,986
Agente de Valores
CRV 09.27.2004 10.18.2004 Santander S.A. Dollars 605,572 1.70 606,172 PRD-BCD-BCP-STG 605,657
Agente de Valores
CRV 09.30.2004 10.08.2004 BCI CB Pesos 100,000 0.20 100,053 PRD 100,000
CRV 09.30.2004 10.08.2004 BCI CB Pesos 150,000 0.20 150,080 PRD 150,000
CRV 09.24.2004 10.01.2004 Banco de Chile Pesos 717,190 0.16 717,458 PRD 717,420
CRV 09.30.2004 10.08.2004 Banco de Chile Pesos 1,000,000 0.17 1,000,453 PRD 1,000,000
CRV 09.24.2004 10.01.2004 Banco de Chile Pesos 218,200 0.16 218,281 PRD 218,270
CRV 09.30.2004 10.08.2004 Banco de Chile Pesos 560,000 0.17 560,254 PRD 560,000
CRV 09.30.2004 10.08.2004 Banco BCI Pesos 70,000 0.20 70,037 PRD 70,000
Corredores de
Bolsa
CRV 09.30.2004 10.08.2004 Banco BCI Pesos 90,000 0.20 90,048 PRD 90,000
Corredores de
Bolsa
CRV 09.30.2004 10.08.2004 Banco BCI Pesos 420,000 0.20 420,224 PRD 420,000
Corredores de
Bolsa
CRV 09.30.2004 10.08.2004 Banco de Chile Pesos 180,000 0.17 180,082 PRD 180,000
CRV 09.10.2004 10.05.2004 Banco de Chile Pesos 200,000 0.15 200,250 PRBC 200,210
CRV 09.10.2004 10.04.2004 Banco de Chile Pesos 250,000 0.15 250,300 PRBC 250,263
CRV 09.27.2004 10.25.2004 Banco de Chile Pesos 285,266 0.16 285,692 PRBC 285,327
CRV 09.29.2004 10.25.2004 Banco de Chile Pesos 200,000 0.17 200,295 PRBC 200,023
CRV 09.20.2004 10.22.2004 Scotiabank Pesos 300,000 0.17 300,544 PRBC 300,187
CRV 08.24.2004 11.10.2004 Banco Santander Pesos 301,000 0.17 302,330 PRBC 301,648
CRV 08.31.2004 11.24.2004 Banco Santander Pesos 149,545 0.18 150,308 PRBC 149,823
CRV 08.31.2004 11.10.2004 Banco Santander Pesos 199,850 0.18 200,701 PRBC 200,222
CRV 09.27.2004 11.08.2004 Banco Santander Pesos 296,998 0.18 297,746 PRBC 297,069
CRV 09.27.2004 11.09.2004 Banco Santander Pesos 295,078 0.18 295,839 PRBC 295,149
CRV 09.27.2004 11.10.2004 Banco Santander Pesos 198,225 0.18 198,778 PRBC 198,303
CRV 09.28.2004 11.22.2004 Banco Santander Pesos 297,193 0.19 298,228 PRBC 297,249
CRV 09.28.2004 11.23.2004 Banco Santander Pesos 295,250 0.19 296,298 PRBC 295,306
CRV 09.29.2004 11.25.2004 Banco Santander Pesos 245,012 0.18 245,850 PRBC 245,041
CRV 09.30.2004 11.25.2004 Banco Santander Pesos 177,483 0.18 178,079 PRBC 177,493
32
12. Fixed Assets
Cristalerias de Chile S.A.
The Fixed Assets are valued according to note 2j), and the main goods included
under this item as of September 30, 2004 and 2003 are the ones detailed in the
annexed table.
The items that make up the Company's fixed assets as of September 30, 2004 and
2003 include mainly Land, Industrial Constructions, Infrastructure Works,
Machinery, and Equipment distributed between the Padre Hurtado, Alto Jahuel and
other minor.
S.A. Vina Santa Rita
The increase in land corresponds to the operation of exchange conducted between
Vina Santa Rita S.A. and Empresa de Transporte y Excavaciones Limitada (TRANSEX
LTDA.).
TRANSEX LTDA. granted Vina Santa Rita two pieces of land that totalize 27,242.67
m2, and Vina Santa Rita S.A.in turn granted TRANSEX LTDA. a land of 30,983.35
m2, both located in Buin. The parts agreed the exchange price on Ch$ 269,000
million.
Technical Reappraisal and Adjustment of Accounting Values:
The parent company carried out a technical reappraisal of its fixed assets in
1979. Likewise, in June 1986 it adjusted those assets. Both operations were
carried out according to the provisions established in Circular Letters No. 1529
and No. 550 respectively of the Securities and Insurance Commission.
The effects of these operations, including write-offs of property, are shown on
the attached chart.
Depreciations:
The charge against results for this item amounts to Th Ch$ 11,754,846 in 2004
and Th Ch$ 11,065,777 in 2003.
33
The detail is shown on an attached chart.
Fixed Assets
2004 2003
------------ ------------
ThCh$ Th Ch$
Land
Land and Mining Properties 13,590,995 13,326,621
Subtotal Lands 13,590,995 13,326,621
Buildings and Infrastructure Projects
Hi rises and industrial buildings 31,798,777 31,045,256
Installations 33,214,620 31,285,463
Residences 26,711 26,685
Subtotal 65,040,108 62,357,404
Accumulated depreciation (22,207,123) (19,071,731)
Fiscal year depreciation (2,338,859) (2,267,338)
Subtotal Depreciations (24,545,982) (21,339,069)
Subtotal Constructions and Projects 40,494,126 41,018,335
Machinery and Equipment
Machinery 99,213,011 94,674,738
Furnaces 47,258,066 47,107,774
Furniture and Furnishings 2,731,920 2,567,390
Tools 731,693 635,358
Rolling Stock 926,934 877,420
Subtotal 150,861,624 145,862,680
Accumulated depreciation (74,618,264) (63,807,502)
Fiscal year depreciation (9,256,578) (8,639,226)
Subtotal Depreciations (83,874,842) (72,446,728)
Subtotal Machinery and Equipment 66,986,782 73,415,952
Other Fixed Assets
Spare parts 6,860,830 5,634,169
Imports in transit 1,576,730 133,834
Work in progress 4,691,473 2,778,530
Lots in Pirque and Leyda 418,042 471,719
Deferred Customs Duties 91,727 294,383
Packages and Bundling 240,191 239,958
Other 1,978,605 1,953,675
Subtotal Other Assets 15,857,598 11,506,268
Total Fixed Assets 245,350,325 233,052,973
Total Accumulated Depreciation (96,825,387) (82,879,233)
Total Depreciation of the Period (11,595,437) (10,906,564)
Total Net Fixed Assets 136,929,501 139,267,176
34
TECHNICAL REVALUATION AND ADJUSTMENT TO ACCOUNTING VALUES
2004 2003
------------ ------------
Th Ch$ Th Ch$
Land
Land 319,012 318,603
Subtotal net land and mining properties 319,012 318,603
Buildings and Infrastructure Projects
High rises and industrial buildings 6,371,495 6,365,235
Installations 42,110 42,068
Subtotal Buildings 6,413,605 6,407,303
Accumulated Depreciation (5,156,792) (4,939,451)
Fiscal year depreciation (159,409) (159,256)
Subtotal depreciation (5,316,201) (5,098,707)
Subtotal Buildings and Infrastructure
project 1,097,404 1,308,596
Machinery and Equipment
Furnaces 0 0
Machinery 0 0
Tools 0 0
Furniture and Furnishings 0 0
Subtotal Machinery and Equipment 0 0
Accumulated Depreciation 0 0
Fiscal year depreciation 0 0
Subtotal depreciation 0 0
Subtotal Machinery and Equipment 0 0
Subtotal Net Technical Revaluation 1,416,146 1,627,199
TOTAL REVALUED ASSETS 6,732,617 6,725,906
TOTAL ACCUMULATED DEPRECIATION (5,156,792) (4,939,451)
TOTAL DEPRECIATION OF THE PERIOD (159,409) (159,256)
TOTAL NET 1,416,416 1,627,199
35
13. Sales transactions with leaseback
These type of transactions were not carried out as of September 30, 2004
and 2003.
36
14. Investments in related companies
According to Circulating No. 1697 of the SVS, for the valuation of investments
in related companies, carried out prior to the January 01, 2004, the equity
method (VPP) has continued to be used.
On the other hand, for the investments in which direct participation is lower
than 20%, the equity method (VPP) has continued to be used, since they
correspond to companies within the same business group and therefore significant
influence exists on them.
This method consists of assigning the investment an equivalent value to the
proportion that corresponds to the company in the equity at book value in the
issuer, and recognizing proportionally, the variations that this experiences.
Investments in force as of September 30, 2004 and 2003 are detailed as follows:
METROPOLIS INTERCOM S.A.
On April 30, 2000 the Shareholders of Metropolis Intercom S.A.. agreed to make
a capital increase by issuing 3,923,834 shares for Ch$ 1,256.67 per share,
equivalent to Th Ch$ 4,931,000. Such amount was subscribed 50% by Cristalchile
Comunicaciones S.A. and the remaining 50% by Liberty Comunicaciones de Chile Uno
Ltda.
The payment of such subscription was made by the subsidiary Cristalchile
Comunicaciones S.A. on September 29, 2004, paying 1,961,917 shares for a value
of Th Ch$ 2,462,794.
With this purchase, the subsidiary participates directly in 2.205% and 47.795%
indirectly in Metropolis Intercom S.A.'s equity.
CIECSA S.A.
On August 26, 2004 the Shareholders of Ciecsa S.A. agreed to increase
company's equity through the issue of 36,400,000 shares equivalent to Th Ch$
910,000 which were fully subscribed by Cristalerias de Chile S.A.
This capital increase allowed CIECSA S.A. to complete financing in order to pay
the balance of a Th US$2,100 debt it had with Televisa S.A., produced by the
purchase of 7,885,472 shares of Megavision S.A. in August 2002.
INMOBILIARIA MONTE AZUL S.A.
As of May 14, 2004, Cristalchile S.A. paid to its subsidiary Constructora Apoger
Th Ch$196 for 49% of the rights of Inmobiliaria Monte Azul Ltda. With this
contribution the participation in the affiliate reaches 50% as of June 30, 2004.
In order to determine the fair value, it has been
37
considered that the price paid corresponds to the market value, thus not
originating adjustment to the investment value by present value.
INVESTMENTS ABROAD
RAYEN CURA S.A.I.C.
On January 31, April 25 and June 30 of 2003 Rayen Cura S.A.I.C. carried out
repayment of part of a capital increase paid on April 29, 2002. Total amounts
reimbursed amounted to Th US$ 2,600.
On June 30, 2004 and August 31, 2004, the Board of Rayen Cura S.A.I.C. approved
the reimbursement of part of the irrevocable contributions subscribed and paid
on April 29, 2002. The amount of the reimbursement was US$ 3,400,000, of which
CristalChile Inversiones S.A. received US$ 1,360,000, equivalent to 40% of its
contribution.
As of September 30 the financial statements of Rayen Cura S.A.I.C. acknowledge a
rate of exchange of $ 2.96 Argentine pesos per Dollar. Cristalchile
Inversiones, in turn, has adjusted the financial statements of Rayen Cura
S.A.I.C. in order to acknowledge the variation occurred from $ 2.91 (December
31, 2003) and $2.96 Argentine pesos per US dollar as of September 30, 2004.
As an effect of the result of the subsidiary and the financial statements
conversion of Rayen Cura S.A.I.C., according to the chilean normative,
CristalChile Inversiones S.A. has acknowledged during the period a profit of Th
Ch$ 837,914 and Th Ch$ 728,836 profit as of September 30, 2003.
On the other hand, the Dollar rate of exchange variation in Chile during the
period, originated adjustments and from the investment in Rayen Cura and for
goodwill from the purchase of shares of that company, respectively, which were
charged of Th Ch$61,568 in 2004 (charge Th Ch$ 1,252,448 in 2003) to the item
Other Equity Reserves.
As stipulated in Technical Bulletin No. 64 of the Accountants Association of
Chile, following is the information related to investments abroad:
2004 2003
Th$ Th$
CristalChile Inversiones's share of
Rayen Cura S.A.I.C. 12,248,478 13,124,284
Negative goodwill(net of amortization) 4,116,233 4,842,372
----------- ----------
TOTAL 16,364,711 17,966,656
Loss due to devaluation (2,599,574) (2,088,490)
Accrued Profit (loss) 837,914 728,836
Potentially remitable profit 0 0
38
The investment in Rayen Cura S.A.I.C. is controlled in Dollars of the United
States of America.
The subsidiary CristalChile Inversiones S.A., does not register liabilities
contracted that have been specifically designated and entered to as coverage
instruments for the investment abroad.
39
CRISTALERIAS DE CHILE S.A.
NOTE 14- INVESTMENTS IN RELATED COMPANIES
BREAKDOWN OF INVESTMENTS
Shareholder Company Net
Investment (Percentage) Equity Income
---------------------------- ----------------- ----------------------- -----------------------
Country Number
of Control of 09-30- 09-30- 09-30- 09-30- 09-30- 09-30-
COMPANY Origin Currency Shares 2004 2003 2004 2003 2004 2003
---------------- ------- -------- --------- -------- -------- ----------- ----------- ----------- -----------
Cordillera
Comunicaciones
78.619.410-5 Holding Chile Peso 0 50.00000 50.00000 124,110,332 137,712,838 -10,657,135 -10,612,478
Cordillera
Comunicaciones
78.619.370-2 Ltda. Chile Peso 0 0.00000 0.00000 124,734,002 138,404,862 -10,710,688 -10,665,991
Vina Los Vascos
89.150.900-6 S.A. Chile Peso 60,000,000 43.00000 43.00000 14,862,748 13,221,391 1,125,162 1,128,575
Editora Zig-Zag 114,596,21
90.684.000-6 S.A. Chile Peso 3 49.00000 49.00000 617,778 462,529 -223,778 -328,648
Ediciones Chiloe
96.793.770-3 S.A. Chile Peso 1,570,146 50.00000 50.00000 1,368,080 1,453,797 -133,623 -204,576
Inmobiliaria
Don Alberto
96.826.870-8 S.A. Chile Peso 3,817 0.00000 38.00000 0 27 0 -8
86.881.400-4 Envases CMF S.A. Chile Peso 28,000 50.00000 50.00000 32,324,932 33,617,484 750,439 724,835
98.806.690-0 Proser S.A. Chile Peso 50 0.00000 0.00000 -12,200 -12,395 232 148
Metropolis
96.787.750-6 Intercom S.A. Chile Peso 1,961,918 2.00000 0.00000 69,850,866 79,890,942 -7,919,771 -7,512,179
Inmob. Y
Constructora
Monte Azul
78.936.090-1 S.A. Chile Peso 50 50.00000 0.00000 -9,169 0 -9,776 0
Rayen Cura
0-E S.A.I.C Argentina Dollar 1,376,000 40.00000 40.00000 30,621,196 32,810,711 2,094,785 1,822,089
TOTAL
Companies' equity Net Income Result of
at Fair Value At Fair Value Accrual VPP
------------------- ----------------- ----------------------- -----------------------
09-30- 09-30- 09-30- 09-30- 09-30- 09-30- 09-30- 09-30-
COMPANY 2004 2003 2004 2003 2004 2003 2004 2003
---------------- -------- --------- -------- -------- ----------- ----------- ----------- -----------
Cordillera
Comunicaciones
78.619.410-5 Holding -5,328,567 -5,306,331 62,055,166 68,856,419
Cordillera
Comunicaciones
78.619.370-2 Ltda. -26,777 -26,665 311,835 346,012
Vina Los Vascos
89.150.900-6 S.A. 483,820 485,287 6,390,982 5,685,198
Editora Zig-Zag
90.684.000-6 S.A. -111,696 -163,848 308,201 230,754
Ediciones Chiloe
96.793.770-3 S.A. -66,811 -102,288 684,040 726,898
Inmobiliaria
Don Alberto
96.826.870-8 S.A. 0 -4 0 10
86.881.400-4 Envases CMF S.A. 375,220 362,416 16,537,685 16,808,743
98.806.690-0 Proser S.A. 0 2 -61 1
Metropolis
96.787.750-6 Intercom S.A. -174,611 0 1,540,309 1,761,707
Inmob. Y
Constructora
78.936.090-1 Monte Azul S.A. -9,169 0 -9,776 0 -4,888 0 -4,584 0
Rayen Cura
0-E S.A.I.C 837,914 728,836 12,248,478 13,124,285
TOTAL 100,072,051 107,540,027
Income not Book value
Realized of Investment
----------------------- -----------------------
09-30- 09-30- 09-30- 09-30-
COMPANY 2004 2003 2004 2003
---------------- ----------- ----------- ----------- -----------
Cordillera
Comunicaciones
78.619.410-5 Holding 0 0 62,055,166 68,856,419
Cordillera
Comunicaciones
78.619.370-2 Ltda. 0 0 311,835 346,012
Vina Los Vascos
89.150.900-6 S.A. 0 0 6,390,982 5,685,198
Editora Zig-Zag
90.684.000-6 S.A. 0 0 308,201 230,754
Ediciones Chiloe
96.793.770-3 S.A. 148,757 189,659 535,283 537,239
Inmobiliaria
Don Alberto
96.826.870-8 S.A. 0 0 0 10
86.881.400-4 Envases CMF S.A. 0 0 16,537,685 16,808,743
98.806.690-0 Proser S.A. 0 0 -61 1
Metropolis
96.787.750-6 Intercom S.A. 0 0 1,540,309 1,761,707
Inmob. Y
Constructora
78.936.090-1 Monte Azul S.A. 0 0 -4,584 0
Rayen Cura
0-E S.A.I.C 0 0 12,248,478 13,124,285
TOTAL 148,757 189,659 99,923,294 107,350,368
40
15. Investments in other companies
Investments in other companies that totaled Th Ch$ 770,586 on September 30, 2004
(Th Ch$ 840,471 in 2003) are shown on attached charts.
CRISTALERIAS DE CHILE S.A.
NOTE 15 - INVESTMENTS IN OTHER CORPORATIONS
Book Value
-------------------------
Number of Shareholding
R.U.T. Company Name Shares (Percentage) 09-30-2004 09-30-2003
------------ ------------------------------- ---------- ------------ ---------- ----------
96.895.100-9 Internet Holding S.A. 57,104 7.4200 155,601 226,082
0-E Bazuca.com Inc. 266,500 7.8900 614,985 614,389
41
16. Goodwill Amortization
NEGATIVE GOODWILL
Stock purchases made in different periods of S.A. Vina Santa Rita, Vina Los
Vascos S.A., Ciecsa S.A., Empresa Editora Zig Zag S.A., Ediciones Financieras
S.A., and Rayen Cura S.A.I.C. have produced negative goodwill whose net balance
to be amortized as of September 30, 2004 totaled Th Ch$ 8,696,914 (Th Ch$
9,761,218 in 2003).
POSITIVE GOODWILL
As of September 30, 2004 and 2003 the parent company and the subsidiaries do not
show any balance for this item.
42
CRISTALERIAS DE CHILE S.A.
NOTE 16 - GOODWILL ON INVESTMENTS
NEGATIVE GOODWILL
09-30-2004 09-30-2003
----------------------------- ----------------------------
Amount Amount
Amortiz. Goodwill Amortiz. Goodwill
R.U.T. Company Name this period Balance this period Balance
------------ ------------------------------ ----------- --------- ----------- ----------
99.999.999-9 Rayen Cura S.A. 205,812 4,116,233 226,987 4,842,372
86.547.900-K S.A. Vina Santa Rita 38,347 531,312 38,310 581,877
96.608.270-4 Ciecsa S.A. 92,654 1,266,271 92,564 1,388,462
89.150.900-6 Vina Los Vascos S.A. 67,554 1,121,846 67,947 1,190,433
90.684.000-6 Editorial Zig-Zag S.A. 4,854 99,493 4,849 105,862
79.952.350-7 Red Televisiva Megavision S.A. 40,706 858,331 40,666 911,720
96.787.750-6 Metropolis Intercom S.A. 27,767 703,428 0 740,492
TOTAL 477,694 8,696,914 471,323 9,761,218
43
17. Intangibles
As of September 30, 2004 and 2003 this item is composed as follows:
Th Ch$ Th Ch$
----------- -----------
2004 2003
Concession of Channel 9
frequency and regional network 10,373,684 10,363,625
Trademarks 1,676,629 1,639,964
----------- -----------
TOTAL INTANGIBLES 12,050,313 12,003,589
ACCUMULATED AMORTIZATIONS
From Channel 9 Frequency (1,110,111) (947,892)
From Trademarks (285,629) (225,739)
----------- -----------
TOTAL AMORTIZATIONS (1,395,740) (1,173,631)
44
18. Others (Assets)
As of September 30, 2004 and 2003 the following are included under this item:
2004 2003
--------- ---------
Th Ch$ Th Ch$
Celulosa Arauco bonds (*) 0 9,012,141
Price differential bond acquisition(*) 0 103,006
Negative goodwill Bond Sale (Net) 2,920,603 3,261,087
Expenses of bond sales 933,534 1,110,148
Bank Cash Reserve 0 2,441
Foreign programs to be exhibited over
a year from the present 1,991,396 755,801
Long-Term Tax VAT Vina Dona Paula 631,390 444,138
Presumed Minimum Profit Tax 43,612 21,025
Other 28,830 46,020
--------- ---------
Total 6,549,365 14,755,807
As of September 30, 2003 there were other long-term fixed assets:
(*) Investment in Celulosa Arauco bonds equivalent to US$13,420,000 at an annual
rate of 6.95% and maturity at September 15, 2005, Th Ch$ 103,006 for surplus
Price differential paid in the acquisition of Celulosa Arauco bonds, which will
be amortized in the same term of the bond's maturity date.
(**) Corresponds to long-term refundable taxes of Vina Dona Paula S.A., Mendoza,
Argentina subsidiary of S.A. Vina Santa Rita.
45
19. Short-term obligations with banks and financial institutions
A detailed list of operations is shown on the attached chart.
46
CRISTALERIAS DE CHILE S.A.
NOTE 19- OBLIGATIONS WITH BANKS AND FINANCIAL INSTITUTIONS, SHORT TERM
Type of Currency and Readjustment Index
--------------------------------------------------------------------------------------
Other Foreign
Dollars Euros Yen Currencies
-------------------- ----------------- ----------------------- -----------------------
Bank or Financial 09-30- 09-30- 09-30- 09-30- 09-30- 09-30- 09-30- 09-30-
R.U.T. Institution 2004 2003 2004 2003 2004 2003 2004 2003
------------ ---------------------------- --------- --------- -------- -------- ----------- ----------- ----------- -----------
Short term (code: 5.21.10.10)
0-E Banco Regional de Cuyo 0 0 0 0 0 0 15,884 18,076
97.004.000-5 Banco de Chile 0 135,236 0 0 0 0 0 0
Other 0 0 0 0 0 0 0 0
TOTAL 0 135,236 0 0 0 0 15,884 18,076
Amount capital due 0 134,308 0 0 0 0 15,767 18,076
Annual average interest rate 0.00 1.88 0.00 0.00 0.00 0.00 1.96 2.76
Long Term - Short Term (code: 5.21.10.20)
97.008.000-7 Citibank NA 836,331 1,848,087 0 0 0 0 0 0
97.030.000-5 Banco Estado 0 0 0 0 0 0 0 0
97.018.000-1 Scotiabank Sudamericano 0 0 0 0 0 0 0 0
97.006.000-6 Banco Credito e Inversiones 0 0 0 0 0 0 0 0
97.004.000-4 Banco de Chile 0 0 0 0 0 0 0 0
97.036.000-K Banco SantanderSantiago 0 0 0 0 0 0 0 0
0-E JP Morgan Chase Bank 292,991 138,250 0 0 0 0 0 0
0-E Banco Argentaria 111,355 245,622 0 0 0 0 0 0
Other 0 0 0 0 0 0 0 0
TOTAL 1,240,677 2,231,959 0 0 0 0 0 0
Amount capital due 941,138 2,075,930 0 0 0 0 0 0
Average annual interest rate 2.05 1.83 0.00 0.00 0.00 0.00 0.00 0.00
Percentage oblig. foreign curr. (%) 46.0000
Percentage oblig. foreign curr. (%) 54.0000
Type of Currency and Readjustment Index
-------------------------------------------------------------
U.F. Non adjustable $ Total
------------------- ----------------- -----------------------
Bank or Financial 09-30- 09-30- 09-30- 09-30- 09-30- 09-30-
R.U.T. Institution 2004 2003 2004 2003 2004 2003
------------ ---------------------------- -------- --------- -------- -------- ----------- -----------
Short term (code: 5.21.10.10)
0-E Banco Regional de Cuyo 0 0 0 0 15,884 18,076
97.004.000-5 Banco de Chile 0 0 0 0 0 135,236
Other 0 0 0 0 0 0
TOTAL 0 0 0 0 15,884 153,312
Amount capital due 0 0 0 0 15,767 152,384
Annual average interest rate 0.00 0.00 0.00 0.00
Long Term - Short Term (code: 5.21.10.20)
97.008.000-7 Citibank NA 0 0 0 0 836,331 1,848,087
97.030.000-5 Banco Estado 0 0 268,913 273,217 268,913 273,217
97.018.000-1 Scotiabank Sudamericano 421,190 454,163 0 0 421,190 454,163
97.006.000-6 Banco Credito e Inversiones 172,076 172,872 0 0 172,076 172,872
97.004.000-4 Banco de Chile 126,864 322,590 0 0 126,864 322,590
97.036.000-K Banco SantanderSantiago 469,805 479,176 0 0 469,805 479,176
0-E JP Morgan Chase Bank 0 0 0 0 292,991 138,250
0-E Banco Argentaria 0 0 0 0 111,355 245,622
Other 0 0 0 0 0 0
TOTAL 1,189,935 1,428,801 268,913 273,217 2,699,525 3,933,977
Amount capital due 1,173,790 1,344,683 264,375 268,605 2,379,303 3,689,218
Average annual interest rate 1.39 4.43 4.94 4.94
47
20. Other Current Liabilities
As of September 30, 2003, there was a balance Th Ch$ 5,136,957 in favor of
financial institutions corresponding to future contracts in foreign currency
subscribed by the parent company and the subsidiaries S.A. Vina Santa Rita y
Ciecsa S.A. More detail on these is shown in note 34 Derivative Contracts.
48
21. Long-term obligations with banks and financial institutions
The obligations with banks and financial institutions are presented on the
charts attached.
49
CRISTALERIAS DE CHILE S.A.
NOTE 21: LONG-TERM OBLIGATIONS WITH BANKS AND FINANCIAL INSTITUTIONS
Institution Years of Maturity
--------------------------- ------------------------------
More than More than More than More than
1 2 3 5
up to 2 up to 3 up to 5 up to 10
---------- ---------- ------------ -----------
Currency
Financial adjustment
R.U.T. Institution index Thou Ch$ Thou Ch$ Thou Ch$ Thou Ch$
------------ --------------------------- -------------- ---------- ---------- ------------ -----------
Other
0-E Banco Regional de Cuyo currency 29,181 10,349 0 0
97.030.000-7 Banco Estado Non-adjustment 271,182 132,188 0 0
97.036.000-K Banco Santander Santiago UF 465,297 465,297 0 0
97.018.000-1 Banco Scotiabank UF 412,543 412,543 412,543 0
0-E J.P. Morgan Chase Bank Dollars 7,611,250 15,222,500 7,611,250 0
90.008.000-K Citibank N.A. Dollars 0 0 0 0
97.006.000-6 Banco Credito e Inversiones UF 85,954 0 0 0
97.004.000-5 Banco de Chile UF 124,042 124,042 248,084 0
0-E Banco Argentaria Dollars 0 0 0 0
Total 8,999,449 16,366,919 8,271,877 0
Percentage of obligations in foreign currency 91.0000%
Percentage of obligations in local currency 9.0000%
More than 10 years
------------------------------
Closing
date
Closing date Previous
Amount Period Current period period
-------------- ---------- ------------------------- -----------
Total Total
Long- Long-
Term at Annual Term at
closing of average closing of
Financial Financial interest Financial
R.U.T. Institution Thou Ch$ Statements rate Statements
------------ --------------------------- -------------- ---------- ------------ -----------
0-E Banco Regional de Cuyo 0 0 39,530 1.62 58,383
97.030.000-7 Banco Estado 0 0 403,370 4.94 683,043
97.036.000-K Banco Santander Santiago 0 0 930,594 TAB 180+1.05% 1,398,035
97.018.000-1 Banco Scotiabank 0 0 1,237,629 TAB 180+1.1% 1,652,707
0-E J.P. Morgan Chase Bank 0 0 30,445,000 2.050 33,577,276
90.008.000-K Citibank N.A. 0 0 0 916,332
97.006.000-6 Banco Credito e Inversiones 0 0 85,954 TAB 90+1.05% 258,255
97.004.000-5 Banco de Chile 0 0 496,168 TAB 180+1.05% 1,242,314
0-E Banco Argentaria 0 0 0 122,811
Total 0 33,638,245 39,909,156
50
22. Short-term and long-term obligations with
the public (promissory notes and bonds)
The balance for the short-term as of September 30, 2004 was Th Ch$ 1,158,008,
(Th Ch$ 1,159,784 in 2003) corresponding to interests accrued for bonds issued
by the Parent Company and the subsidiary S.A. Vina Santa Rita.
Also are shown UF 500,000 equivalent to Th Ch$ 8,595,390 which correspond the
maturity of 2 quotas of the bonds capital series C1 issued by the parent
company.
As of September 30, 2004, there are long-term obligations with the public for Th
Ch$ 82,515,744 (Th Ch$ 91,250,982 in 2003), of which Th Ch$ 61,886,808 (Th Ch$
70,590,383 in 2003) correspond to bonds issued in UF's by the parent company, of
series C1, C2, D1, D2; and Th Ch$ 20,628,936 (Th Ch$ 20,660,600 in 2003) which
correspond to bonds series C1, D1 and D2 issued in UF's by the subsidiary S.A.
Vina Santa Rita.
This liability is shown in detail in the appendix.
51
Cristalerias de Chile S.A.
NOTE 22: SHORT-TERM AND LONG-TERM OBLIGATIONS WITH PUBLIC (PROMISSORY NOTES
AND BONDS)
BONDS
REGISTRATION OR CURRENT
IDENTIFICATION No. DEPOSIT INDEXING INTEREST FINAL
OF INSTRUMENT SERIES FACE VALUE UNIT OF BOND RATE MATURITY
------------------------------- ------------ ------------ ------------ ---------- -----------
LONG-TERM BONDS-CURRENT PORTION
296-09.07.02 C1 Interests 0 UF 4.75 01-15-2005
296-09.07.02 C2 Interests 0 UF 4.75 01-15-2005
296-09.07.02 D1 Interests 0 UF 5.80 01-15-2005
296-09.07.02 D2 Interests 0 UF 5.80 01-15-2005
241-15.12.00 C1 Interests 0 UF 6.29 12-15-2005
241-15.12.00 D1 Interests 0 UF 6.29 12-15-2021
241-15.12.00 D2 Interests 0 UF 6.29 12-15-2021
296-09.07.02 C 250,000 UF 4.75 07-15-2005
296-09.07.02 C 250,000 UF 4.75 07-15-2005
TOTAL CURRENT PORTION
LONG-TERM BONDS
296-09.07.02 C1 1,000,000 UF 4.75 07-15-2008
296-09.07.02 C2 500,000 UF 4.75 07-15-2008
296-09.07.02 D1 1,900,000 UF 5.80 07-15-2023
296-09.07.02 D2 200,000 UF 5.80 07-15-2023
241-15.12.00 C1 200,000 UF 6.25 12-15-2005
241-15.12.00 D1 100,000 UF 6.25 12-15-2021
241-15.12.00 D2 900,000 UF 6.25 12-15-2021
LONG-TERM TOTAL
INSTALLMENTS PAR VALUE
------------------------------- ---------------------------
REGISTRATION OR CURRENT ISSUE
IDENTIFICATION No. INTEREST AMORTIZATION IN CHILE OR
OF INSTRUMENT PAYMENT PAYMENT 09-30-2004 09-30-2003 ABROAD
------------------------------- ------------ ------------ ------------ ---------- -----------
LONG-TERM BONDS-CURRENT PORTION
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 258,941 259,338 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 86,314 86,446 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 399,485 400,099 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 42,051 42,115 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 61,869 61,964 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 30,935 30,982 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 278,413 278,840 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 4,297,695 0 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 4,297,695 0 LOCAL
TOTAL CURRENT PORTION 9,753,398 1,159,784
LONG-TERM BONDS
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 17,190,780 25,825,750 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 8,595,390 8,608,583 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 32,662,482 32,172,616 LOCAL
296-09.07.02 SEMI-ANNUAL SEMI-ANNUAL 3,438,156 3,443,433 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 3,438,156 3,443,433 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 1,719,078 1,721,717 LOCAL
241-15.12.00 SEMI-ANNUAL SEMI-ANNUAL 15,471,702 15,495,450 LOCAL
LONG-TERM TOTAL 82,515,744 91,250,982
52
23. Provisions and Write-Offs
Provisions
The Company has short-term provisions of Th Ch$ 14,212,657 as of September 30,
2004, and Th Ch$ 9,818,920 in 2003.
Long-term provisions of Th Ch$ 6,604,096 and Th Ch$ 7,745,359 are recorded for
the years 2004 and 2003 respectively.
Bad Debt Provisions:
The parent company and the subsidiaries S.A. Vina Santa Rita and Ciecsa S.A.
have established a bad debt provision of Th Ch$ 739,424 and Th Ch$ 750,280 as of
September 30, 2004 and 2003, respectively.
This provision is deducted from the balance of Debtors from Sales and Documents
Receivable.
Vacation Provision:
The parent company and its subsidiaries have established provisions for the
total cost of vacations pending as of June 30, 2004 and 2003, as established in
Technical Bulletin No. 47 of the Accountants Association of Chile.
The net balance for this item is Th Ch$ 1,137,805 as of September 30, 2004
(Th Ch$ 1,010,540 in 2003).
Provision for Furnace Reconstruction:
This reserve is established throughout the useful life of the refractants of
each smelting furnace so their repair will not distort the result of the fiscal
year when the repairs are made.
The Company has established a reserve in the amount of Th Ch$ 4,273,077 and Th
Ch$ 3,571,074 as of September 30, 2004 and 2003, respectively.
53
CRISTALERIAS DE CHILE S.A.
NOTE 23: PROVISIONS AND WRITE-OFFS
09-30-2004 09-30-2003
---------- ----------
Thou Ch$ Thou Ch$
Short Term
Commissions and Fees 2,720,782 2,931,652
Furnace reconstruction 1,911,946 0
Share of Board of Directors 677,434 164,808
Legal holidays 1,137,805 1,010,540
Local and foreign suppliers 828,425 899,952
Packing return to clients 906,239 1,168,581
Spareparts reserve and other 375,866 445,200
Informative Services 6,028 0
Advertising and marketing 1,285,669 246,383
Copyright 53,633 49,020
Severance payments 185,695 184,430
Advertising Agency Commmission 851,691 521,490
Reserve indirect cost 1,530,627 1,199,478
Reserve for bonus 86,090 83,141
Reserve for loss of exported products 73,068 91,144
Reserve for Grape harvest expenses 884,381 412,096
Other receivable account reserves 697,278 410,735
Other receivable account reserves
TOTAL 14,212,657 9,818,920
Long Term
Severance payment 4,242,965 4,174,285
Furnace reconstruction 2,361,131 3,571,074
TOTAL 6,604,096 7,745,359
54
24. Severance Payment
The provision for severance payments to personnel is included at its current
value, as expressed in note 2 t). As of September 30, 2004 it amounts to Th Ch$
4,428,660 (Th Ch$ 4,358,715 in 2003).
As of September 30, 2004, the parent company has paid severance payments of Th
Ch$ 180,607 (Th Ch$ 140,701 in 2003) chargeable against the provision.
55
25. Other long-term liabilities
As of September 30, 2004 and 2003 there are no balances for this item.
56
26. Minority interest
The subsidiaries that generate minority interests as of September 30, 2004 and
2003 are shown on the attached chart.
CRISTALERIAS DE CHILE S.A.
NOTE 26: MINORITY INTEREST
SUBSIDIARY COMPANY NET WORTH RESULTS SHAREHOLDING
--------------------------------------- ------------------------ -------------------------- -----------------
Thou Ch$ Thou Ch$ Thou Ch$ Thou Ch$ % %
2004 2003 2004 2003 2004 2003
---------- ---------- ----------- ----------- ------ ------
S.A.Vina Santa Rita 40,002,080 37,950,432 (2,477,427) (1,743,325) 45.90 45.90
CIECSA and subsidiaries 442,082 297,112 (112,251) (21,525) 1.55 1.55
Constructora Apoger S.A. and subsidiary 630 1,038 327 213 20.00 20.00
Cristalchile Comunicaciones S.A. 1,184 1,314 103 99 0.01 0.01
TOTAL 40,445,976 38,249,896 (2,589,248) (1,764,538)
57
27. Changes in Equity
a. Activity in 2004 and 2003
The activity of the capital and reserve accounts in the fiscal years ended in
September 30, 2004 and 2003, are shown in the attached charts.
b. Other Reserves
The detail of this item is as follows:
2004 2003
--------- ---------
ThCh$ ThCh$
Future capital increases 4,667,636 4,450,953
Reserve for adjustment of value of fixed assets 1,416,415 1,627,199
Adjustment for conversion difference in
investment in Rayen Cura S.A.I.C. 593,044 2,164,029
--------- ---------
TOTAL OTHER RESERVES 6,677,095 8,242,181
58
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NET WORTH
Reserve Premium in Reserve
Paid-in capital sale of Other Future
ITEM Capital Revaluation shares Reserves Dividends
------------------------------------ ---------- ----------- ---------- ---------- -----------
Balances as of 09/30/2004
Initial balance 65,396,749 0 27,874,377 6,421,900 123,160,119
Distribution result previous fiscal
year 0 0 0 0 5,468,440
Final dividend previous fiscal year 0 0 0 0 -1,612,800
Capital increases with cash stock
issue 0 0 0 0 0
Reserves and/or Profits
Capitalization 0 0 0 0 0
Development period Accumulated
deficit 0 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 133,179 0
Eventual Dividends 0 0 0 0 0
Owner's equity Revaluation 0 1,242,538 529,613 122,016 2,411,687
Fiscal Year Result 0 0 0 0 0
Provisional Dividends 0 0 0 0 0
Final balances as of 09/30/2004 65,396,749 1,242,538 28,403,990 6,677,095 129,427,446
Initial balance as of 09/30/2003 64,749,257 0 27,598,393 9,713,099 114,912,655
Distribution result previous fiscal
year 0 0 0 0 14,356,726
Final dividend previous fiscal year 0 0 0 0 -5,526,400
Capital increases with cash stock
issue 0 0 0 0 0
Reserves and/or profit
Capitalization 0 0 0 0 0
Development period accumulated
deficit 0 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 -1,717,273 0
Eventual Dividends 0 0 0 0 -960,000
Owner's equity revaluation 0 776,991 331,181 116,557 1,573,338
Fiscal Year Result 0 0 0 0 0
Provisional Dividends 0 0 0 0 0
Final balances 64,749,257 776,991 27,929,574 8,112,383 124,356,319
Updated Final Balances as of
09/30/2003 65,785,245 789,423 28,376,447 8,242,181 126,346,020
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NET WORTH (Cont'd)
Devel.
Accumulated Provisional Period Fiscal
ITEM Results Dividends Deficit Year Result
------------------------------------ ----------- ---------- -------- -----------
Balances as of 09/30/2004
Initial balance 6,426,520 -958,080 0 0
Distribution result previous fiscal
year -6,426,520 958,080 0 0
Final dividend previous fiscal year 0 0 0 0
Capital increases with cash stock
issue 0 0 0 0
Reserves and/or Profits
Capitalization 0 0 0 0
Development period Accumulated
deficit 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 0
Eventual Dividends 0 0 0 0
Owner's equity Revaluation 0 -12,800 0 0
Fiscal Year Result 0 0 0 14,237,355
Provisional Dividends 0 -2,560,000 0 0
Final balances as of 09/30/2004 0 -2,572,800 14,237,355
Initial balance as of 09/30/2003 17,660,662 -3,303,936 0 0
Distribution result previous fiscal
year -17,660,662 3,303,936 0 0
Final dividend previous fiscal year 0 0 0 0
Capital increases with cash stock
issue 0 0 0 0
Reserves and/or profit
Capitalization 0 0 0 0
Development period accumulated
deficit 0 0 0 0
Accumulated conversion difference
adjustment 0 0 0 0
Eventual Dividends 0 -960 0 0
Owner's equity revaluation 0 0 0 0
Fiscal Year Result 0 -960,000 0 2,415,990
Provisional Dividends 0 -960,000 0 0
Final balances 0 -960,960 0 2,415,990
Updated Final Balances as of
09/30/2003 0 -976,335 0 2,454,646
59
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NETWORTH - NUMBER OF SHARES
No. No. No.
SHARES SHARES SHARES
SERIES SUBSCRIBED PAID WITH VOTING
--------------- ----------------- ------------------ -----------------------
SINGLE 64,000,000 64,000,000 64,000,000
CRISTALERIAS DE CHILE S.A.
NOTE 27: CHANGES IN NETWORTH - CAPITAL (AMOUNT - TH CH$)
SUBSCRIBED PAID-IN
SERIES CAPITAL CAPITAL
--------------- ---------------------------- ---------------------------
SINGLE 65,396,749 65,396,749
60
28. Other Non-Operating Income and Disbursements
As of September 30, 2004 and 2003 the non-operating income totals Th Ch$ 898,101
and Th Ch$ 562,302 respectively.
Non-operating Expenditures were Th Ch$ 2,033,862 in 2004 and Th Ch$ 1,546,073 in
2003.
More detail is shown on the attached chart.
CRISTALERIAS DE CHILE S.A.
NOTE 28: OTHER NON-OPERATING INCOME AND EXPENSES
2004 2003
--------- ---------
Th Ch$ Th Ch$
INCOME
Fontec Proyect Benefit 10,886 5,530
Offices and establishments rental 269,904 159,383
Tax exemptions 176,518 108,329
Sale of fixed assets 8,676 4,599
Land granted 215,542 0
Indemnity for claims 988 70,587
Non-realized profit Amortization 31,158 0
Sale of materials 33,245 21,254
Condonation deferred custom duties 47,834 0
Miscellaneous Income 69,304 192,620
Raw material bonus 34,046 0
TOTAL NON-OPERATING INCOME 898,101 562,302
EXPENSES
Professional advice 599,155 578,225
Personnel Contracts Finished 126,672 37,611
Share of Board of Directors 109,223 76,316
Condonation deferred custom duties 0 91,193
Loss in sales of fixed assets 345,119 83,904
Trademarks amortization 45,285 73,211
Municipal patents 3,226 0
Frequency amortization 123,346 113,747
Suppliers 160,202 175,798
Other expenses 317,303 245,758
Insurance 5,725 0
Taxes 149,217 17,860
ADR'S expenses 49,389 52,450
TOTAL NON-OPERATING EXPENSES 2,033,862 1,546,073
61
29. Price Level Restatements
As a result of the application of the adjustment for price level restatements as
described in Note 2 e), there was a net charge to results in the 2004 fiscal
year in the amount of Th Ch$ 768,421 and a net charge against results of Th Ch$
716,961 in 2003.
Additional information organized by item on the Balance Sheet is shown on the
attached chart.
Cristalerias de Chile S.A.
NOTE 29: ADJUSTMENT FOR PRICE LEVEL RESTATEMENTS
ADJUSTABILITY
ASSETS (CHARGES)/CREDITS INDEX 09-30-2004 09-30-2003
------------------------------------------ ------------- ---------- ----------
INVENTORY CPI 397,811 98,124
FIXED ASSETS CPI 2,968,673 1,547,719
INVESTMENTS IN RELATED COMPANIES CPI 1,798,796 741,517
MARKETABLE SECURITIES CPI 78,936 46,727
SHORT-TERM DEBTORS CPI 366,841 39,367
SHORT-TERM DEBTORS UF 1,563 1,025
ACCOUNTS RECEIVABLE RELATED COMPANIES UF 320,180 266,548
TIME DEPOSITS CPI 0 4,730
LONG-TERM DEBTORS UF 6,172 1,974
RATE DIFFERENCE IN PLACEMENTOF L/T BONDS UF 37,292 28,294
INFLATION EFFECT CPI 1,156,347 397,518
OTHER NON-MONETARY ASSETS CPI 39,107 471,101
EXPENSE AND COST ACCOUNTS CPI 1,065,202 212,778
TOTAL (CHARGES)/CREDITS 8,236,920 3,857,422
LIABILITIES (CHARGES)/ CREDITS
NET WORTH CPI -4,305,854 -2,854,066
ACCOUNTS PAYABLE RELATED COMPANIES UF -12 -92
BANK LOANS UF -16,909 -17,340
SHORT-TERM RESERVES CPI -49,106 -5,167
LONG-TERM BANK LOANS UF -46,461 -57,464
LONG-TERM RESERVES CPI -54,795 -72,512
LONG-TERM CREDITORS CPI -470 -544
OBLIGATIONS WITH THE PUBLIC UF -1,434,684 -1,090,636
MINNORITY INTEREST CPI -349,555 -1,055
INFLATION EFFECT CPI -710,833 0
NON-MONETARY LIABILITIES UF -80,713 0
NON-MONETARY LIABILITIES CPI -57,438 -165,632
INCOME ACCOUNTS CPI -1,898,511 -309,875
TOTAL (CHARGES)/ CREDITS -9,005,341 -4,574,383
(LOSS) PROFIT FROM ADJUSTMENT FOR CURRENCY DEVALUATION -768,421 -716,961
62
30. Exchange Differences
There is a net charge to results in the 2004 fiscal year of Th Ch$ 2,373,424 and
a net credit to results of Th Ch$ 12,465,716 in 2003.
According to dispositions of Circular No. 1560 of the SVS, the net effect on
results of foreign currency adjustable assets and liabilities adjustment without
the inflationary effect of the local currency is presented under this item.
More information is shown on the attached chart.
Cristalerias de Chile S.A.
NOTE 30: EXCHANGE DIFFERENCES
ITEM CURRENCY AMOUNT
------------------------------------------- ----------- -------------------------
09-30-2004 09-30-2003
---------- ----------
CURRENT ASSETS DOLLARS 345,032 -1,101,541
CURRENT ASSETS OTHER CUR. -445 -74,001
CLIENTS DOLLARS 11,909 -484,544
CLIENTS OTHER CUR 23,428 231,333
TIME DEPOSITS DOLLARS 0 -133,860
INVENTORY DOLLARS -183,967 -305,675
FUTURE CONTRACT EFFECT DOLLARS 854,149 -775,590
OTHER ASSETS DOLLARS 847,809 -274,893
OTHER ASSETS OTHER CUR. -12,790 -14,593
INFLATIONARY EFFECT DOLLARS -1,156,347 -397,518
MARKETABLE SECURITIES DOLLARS 615,224 -4,369,008
MARKETABLE SECURITIES EUROS 460,083 0
LONG TERM ASSETS DOLLARS 16,919 0
MISCELLANEOUS DEBTORS DOLLARS -8,482 0
BOND INVESTMENTS DOLLARS 90,147 -795,834
TOTAL (CHARGES) CREDITS 1,902,669 -8,495,724
ACCOUNT PAYABLE DOLLARS 103,749 0
DOCUMENTS PAYABLE DOLLARS 52,813 472,167
DOCUMENTS PAYABLE OTHER CUR. -999 -45,868
MISCELLANEOUS CREDITORS SHORT TERM DOLLARS -106 65,749
SHORT TERM RESERVES DOLLARS -51,837 2,943
LONG-TERM BANK CREDITS DOLLARS -755,000 2,928,112
LONG TERM RESERVES DOLLARS -26,083 263,530
OTHER LONG-TERM LIABILITIES DOLLARS -158,677 -106,347
OTHER LONG-TERM LIABILITIES OTHER CUR. -60,526 -28,352
MISCELLANEOUS CREDITORS LONG TERM DOLLARS 31,496 7,249
FUTURE CONTRACT EFFECT DOLLARS 623,562 -7,529,175
INFLATIONARY EFFECT DOLLARS 710,833 0
SHORT-TERM BANK CREDITS DOLLARS 1,530 0
TOTAL (CHARGES) CREDITS 470,755 -3,969,992
(LOSS) PROFIT FROM EXCHANGE DIFFERENCES 2,373,424 -12,465,716
63
31. Extraordinary Items
As of September 30, 2004 and 2003 there are no extraordinary items.
64
32. Expenses for the issue and placement of stocks and debt instruments
The parent company and the subsidiary S.A. Vina Santa Rita carried out bond
placements in August 2002 and March 2001, incurring in placement expenses that
as of September 30, 2004 totaled Th Ch$ 3,459,953 (Th Ch$ 3,854,080 in 2003)
The charge to Results for the amortization of these expenses for year 2004
amounts Th Ch$ 280,112 (Th CH$ 282,413 in 2003) and is being realized according
to the maturity of each series.
Detail of expenses is as follows:
2004 2003
---------------------------- ---------------------------
Short -Term Long-Term Short -Term Long-Term
----------- --------- ----------- ---------
Rate Placement Differential 200,989 2,166,518 201,297 2,374,617
Stamp Tax 136,251 850,263 144,058 1,011,145
Placement Commissions and other 22,661 83,271 23,961 99,002
------- --------- ------- ---------
Total 359,901 3,100,052 369,316 3,484,764
65
33. Cash Flow Statement
CASH FLOW STATEMENT
The values included in MISCELLANEOUS on the Cash Flow Statement are detailed on
the attached appendix.
CASH FLOW STATEMENT
1. The following is the detail of the item OTHERS:
2004 2003
------------ ---------
Th Ch$ Th Ch$
541.11.40 Other Income Received
Treasury Refund Income Tax and others 897,097 909,776
Recover VAT exportation 1,206,100 1,390,562
Severance insurance 0 67,995
Discount for paid of customs duties 37,886 0
Exchange difference 333,209 0
Tax exemption 176,518 108,329
Other income 191,044 319,357
Total 2,841,854 2,796,019
541.11.80 Other expenses paid
Exchange difference 219,861 5,326,938
Donations 82,743 59,819
Finished personnel contracts 126,672 37,610
Advice Services 107,040 105,778
Derivate Contracts liquidation 285,336 0
Shareholder's bonds 78,303 76,316
Other expenses 521,305 556,964
Total 1,421,260 6,163,425
541.13.15 Sale of other investments
Bonds' sale 4,972,969 0
Profit on bonds' sale 143,394 0
Redemption interests L.T. bonds 0 313,172
Total 5,116,363 313,172
541.13.30 Other income from investments
Future contracts 839,008 2,297,517
Others 0 0
Total 839,008 2,297,517
541.13.65 Other investment disbursements
Purchase of shares 0 323,261
Future contracts 2,508,397 5,988,305
Others 0 0
Total 2,508,397 6,311,566
66
Following are financing and investment activities that did not generate cash
flow during the fiscal year, but that commit future parent company cash flows:
ITEM Amount Th Ch $ Due Date
-------------- --------
Dividend 159 1,280,000 October-04
Amounts payable investment 1,001,516 3rd Quarter
---------
Total 2,281,516
67
34. Derivative Contracts
FUTURE CONTRACTS IN FOREIGN CURRENCY
The parent company and its subsidiaries S.A. Vina Santa Rita and Ciecsa S.A.
have signed future sales contracts in foreign currency of Th US$ 80,200 in 2004
(purchase contracts of Th US$ 93,600 in 2003) subject to the regulations of
Chapter VII of the Compendium of International Exchange Regulations of the
Central Bank of Chile and Chapter 13-2 of the compilation of Regulations of
Banks and Financial Institutions.
Additional information is presented on the attached chart listed in the order of
each quarterly expiration period.
The contracts maintained as of September 30, 2004 and 2003, have been taken to
protect against exchange rate variations of the American dollar (existing
transactions contracts) as well as investment.
Forward contracts taken with the intention of covering existing parties, are
related, according to what was defined by administration, with coverage of
obligations in Dollars. According to Technical Bulletin N(0) 57 of the Chilean
Accountants Associations A.G., the results generated by these contracts are
recognized in results as long as the effects of parties subject to coverage are
recognized.
68
CRISTALERIAS DE CHILE S.A.
NOTE 34: DERIVATIVE CONTRACTS
DESCRIPTION OF CONTRACTS
----------------------------------------------------------------
PROTECTED ITEM OR TRANSACTION
-----------------------------
MATURITY OR
TYPE OF TYPE OF VALUE OF EXPIRATION SPECIFIC PURCHASE/
DERIVATIVE CONTRACT CONTRACT DATE ITEM SALE POSITION NAME AMOUNT
------------- ----------- -------------- ----------- --------- ------------- ------------- ------
FR CI 12,908,680 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 10,351,300 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,279,500 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 633,220 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 626,560 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 615,710 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 615,710 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 615,710 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,833,180 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,833,180 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,212,920 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 1,882,590 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 631,860 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 631,860 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,286,620 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 643,310 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 1,286,120 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 1,263,900 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 1,597,675 FIRST 2005 EXCH RATE S INVESTMENTS -
FR CI 3,067,550 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 916,590 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 611,060 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 1,212,920 FOURTH 2004 EXCH RATE S INVESTMENTS -
FR CI 1,820,880 FOURTH 2004 EXCH RATE S INVESTMENTS -
ACCOUNTS EFFECTED
-------------------------------------------------------
ASSETS/LIABILITIES EFFECT ON RESULT
--------------------------- ----------------------
VALUE OF
TYPE OF TYPE OF PROTECTED NOT
DERIVATIVE CONTRACT ITEM NAME AMOUNT REALIZED REALIZED
------------------ -------- --------- ----------- ------- -------- --------
FR CI - ASSETS 204,528 204,528 -
FR CI - ASSETS 278,472 278,472 -
FR CI - ASSETS 63,332 63,332 -
FR CI - ASSETS 23,961 23,961 -
FR CI - ASSETS 17,990 17,990 -
FR CI - ASSETS 6,791 6,791 -
FR CI - ASSETS 6,818 6,818 -
FR CI - ASSETS 6,836 6,836 -
FR CI - ASSETS 6,681 6,681 -
FR CI - ASSETS 6,689 6,689 -
FR CI - LIABILITIES 4,106 -4,106 -
FR CI - ASSETS 63,331 63,331 -
FR CI - ASSETS 25,767 25,767 -
FR CI - ASSETS 26,565 26,565 -
FR CI - ASSETS 64,837 64,837 -
FR CI - ASSETS 33,269 33,269 -
FR CI - ASSETS 74,588 74,588 -
FR CI - ASSETS 49,420 49,420 -
FR CI - ASSETS 81,198 81,198 -
FR CI - ASSETS 22,381 22,381 -
FR CI - ASSETS 3,458 3,458 -
FR CI - ASSETS 2,262 2,262 -
FR CI - LIABILITIES 4,857 -4,857 -
FR CI - LIABILITIES 5,821 -5,821 -
69
35. Contingencies and Restrictions
CONTINGENCIES AND COMMITMENTS
As of September 30, 2004, there are a guarantees delivered in the amount of Th
Ch$ 8,547 (Th Ch$ 8,071 in 2003), according to the detail in the attached chart.
LAWSUITS OR OTHER LEGAL ACTIONS THE COMPANY IS INVOLVED IN
As of September 30, 2004 and 2003 there are lawsuits and other legal actions
pending corresponding to the subsidiary Red Televisiva Megavision, which are
presented in the annexed chart.
1.- Court: 12th civil court of Santiago. Docket No. 3025-97. Plaintiff:
Patricio Nasser. Claim: Indemnity for damages - Publicity Abuses Act - for
alleged injury caused to the Plaintiff at the broadcasting of a show.
Amount of damages sought: Ch$100,000,000. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
proceedings: Judgment rendered on first instance in favor of Mega. The
Plaintiff filed an annulment recourse (recurso de casacion en la forma) and
appealed in subsidy. Waiting for resolution.
2.- Court: 16th civil court of Santiago. Docket No. 4822-1999. Plaintiff:
Maria Santos Martinez Orellana and others. Claim: Indemnity for damages -
Publicity Abuses Act - for supposed injury caused at the broadcasting of a
show. Amount of damages sought: Ch$100,000,000. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
Proceedings: First instance condemnatory judgment against Mega for an
amount of Ch$9,000,000 plus judicial costs and adjustments by inflation,
but without interests. The judgment was appealed and such appeal was
granted in both effects. The appeal is pending before the Court of Appeals.
3.- Court: 7th civil court of Santiago. Docket No. 4635-2003. Plaintiff:
Luciano Marinho Cardoso. Claim: Alleged unjustified dismissal and payment
of labor services. Amount claimed: Undetermined. Effect on balance sheet:
no accounting effect as of the date of the report. Current Status of
Proceedings: The parties are waiting for the conciliation and evidence
hearing.
4.- Court: 8th labor court of Santiago. Docket No. 3515-2004. Plaintiff:
Cristina Tocco Volpe. Claim: Supposed unjustified dismissal and payment of
labor services. Amount claimed: Undetermined. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
Proceedings: The parties are waiting for the conciliation and evidence
hearing.
5.- Court: Judge Sergio Urrejola Monckeberg. Docket No.: none. Plaintiff:
Red Televisiva Megavision S.A. Claim: Indemnity for damages for contract
non-compliance.
70
Amount claimed: Undetermined. Effect on balance sheet: no accounting effect
as of the date of the report. Current Status of Proceedings: Resolution of
situation of uncompetence of judge promoted by Ms. Tocco is expected.
6.- Court: 25th civil court of Santiago. Docket No.: 5739-2004. Plaintiff:
Red Televisiva Megavision S.A. Claim: Consignation payment. Amount claimed:
Ch$ 1,800,000. Effect on balance sheet: no accounting effect as of the date
of the report. Current Status of Proceedings: Sufficiency of payment is
expected.
7.- Court: Court of Appeals of Santiago. Docket No.: 1147-2004. Plaintiff:
Red Televisiva Megavision S.A. Claim: Sanction appeal. Amount claimed: 50
UTM. Effect on balance sheet: no accounting effect as of the date of the
report. Current Status of Proceedings: In wait for Court of Appeals of
Santiago's Judgement.
8.- Court: 10th Labor Court of Santiago. Docket No.: 4391-2003. Plaintiff:
Red Televisiva Megavision S.A. Claim: Complaint for a toll imposed by the
labor regulatory agency. Amount claimed: 70 UTM. Effect on balance sheet:
no accounting effect as of the date of the report. Current Status of
Proceedings: In wait for Court's Judgement.
9.- Court: 2nd local police court (juzgado de policia local) of Valparaiso.
Docket No. 43965. Plaintiff: Alejandro Collado N. Claim: Criminal action
for alleged unpaid municipal rights. Amount claimed: Undetermined. Effect
on balance sheet: no accounting effect as of the date of the report.
Current Status of Proceedings: Judgment in favor of Mega. It was appealed
by Plaintiff.
10.- Court: 2nd criminal court of Santiago. Docket No.: 185.510-8.
Plaintiff: Red Televisiva Megavision S.A. Claim: Criminal complaint against
whoever result responsible for alleged falsification, private instrument
maluse and person usurpation. Amount claimed: Undetermined. Effect on
balance sheet: no accounting effect as of the date of the report. Current
Status of Proceedings: Trial is pending stage of judicial investigation
(etapa de sumario).
11.- Court: 9th criminal court of Santiago. Docket No. 1942-2004-7.
Plaintiff: Paul Vasquez. Claim: Criminal complaint for alleged damages and
slander. Amount claimed: Undetermined. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
Proceedings: Trial is in the phase of judicial investigation (etapa de
sumario) and depositions of certain witnesses are pending.
12.- Court: 9th criminal court of Santiago. Docket No. 1928-2004-7.
Plaintiff: Israel Sanz. Claim: Criminal complaint for alleged damages and
slander. Amount claimed: Undetermined. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
Proceedings: Trial is in the phase of judicial investigation (etapa de
sumario) and certain judicial proceedings are pending.
13.- Court: 15th criminal court of Santiago. Docket No. 4825-2003-F.
Plaintiff: Raquel Gutierrez and others. Claim: Criminal complaint for
alleged damages and slander. Amount claimed: Undetermined. Effect on
balance sheet: no accounting effect as of the
71
date of the report. Current Status of Proceedings: Plaintiff appealed to
the resolution that denied the arraignment petition.
14.- Court: 23rd criminal court of Santiago. Docket No. 2012-3. Plaintiff:
Daniela Campos and Denisse Campos. Claim: Criminal complaint for alleged
damages and slander. Amount claimed: Undetermined. Effect on balance sheet:
no accounting effect as of the date of the report. Current Status of
Proceedings: Trial is in the phase of judicial investigation (etapa de
sumario). Confrontations (careos) among involved individuals have been
carried out.
15.- Court: 9th criminal court of Santiago. Docket No. 2180-7. Plaintiff:
Patricia James. Claim: Criminal action for alleged justice obstruction.
Amount claimed: Undetermined. Effect on balance sheet: no accounting effect
as of the date of the report. Current Status of Proceedings: Trial is in
the phase of judicial investigation (etapa de sumario), judicial
proceedings pending.
16.- Court: 11th criminal court of Santiago. Docket No. 17827-3-2003.
Plaintiff: Marcia Astrosa. Claim: Criminal complaint for supposed damages
and slander. Amount claimed: Undetermined. Effect on balance sheet: no
accounting effect as of the date of the report. Current Status of
Proceedings: An appeal to the resolution that denied the petition for
abandonment of action was filed.
RESTRICTIONS
I. SYNDICATED LOAN
In relation to the syndicated loan subscribed with JP Morgan Chase Bank and
other 8 creditor banks for US$ 50 million, there are certain financial
obligations mentioned as follows:
a) TOTAL CONSOLIDATED DEBT TO CAPITALIZATION RATIO
Cristalerias de Chile S.A will not allow the Total Consolidated Debt to
Capitalization Ratio exceed the 0.45 to 1.0 ratio at any time.
Capitalization is defined as the sum of Net Worth plus Minority Interest plus
total consolidated debt.
b) TOTAL CONSOLIDATED DEBT TO EBITDA RATIO
Cristalerias de Chile S.A will not allow the Net Consolidated Debt to EBITDA
ratio to exceed the 2.5 to 1.0 ratio at any time.
Consolidated EBITDA is defined as the following: operating income plus
depreciation and amortization, plus non-cash charges (as long as they have been
deduced when determining
72
operating income) and cash income from interests minus non-cash credits (as long
as they have been added when determining operating income), in each case for
each period.
c) INTEREST COVERAGE RATIO
Cristalerias de Chile S.A. will not allow the Interest Coverage Ratio to be
lower than 4.0.
Interest coverage at the day of determination is defined as the ratio between
unconsolidated EBITDA for the period of four consecutive fiscal quarters that
end on or most recently ended before, that date; and interest expenses for that
period.
d) NET EQUITY
Cristalerias de Chile S.A. should maintain a minimum amount of UF 10,000,000.
Cristalerias de Chile S.A. complies with 100% of the restrictions agreed with
the creditor banks.
II. BOND ISSUE
The bond issue contract signed on May 29, 2002 with Banco Chile as the bonds
owners' representative, establishes among others the following obligations:
a) Financial Indicators
Individual Balance: Indebtedness no higher than 1.2 times.
Consolidate Balance: Indebtedness no higher than 1.4 times.
b) Insurances for the Company and its subsidiaries' fixed assets.
c) The operations refered to by art. 44 and 89 of law 18,046 must be carried
out according to the conditions that these establish.
d) Other minor restrictions related with the bond issue contract.
As of September 30, 2004 and 2003, Cristalerias de Chile S.A. complies with 100%
of restrictions agreed with the bonds' creditors.
OTHER CONTINGENCIES
As of September 30, 2004 and 2003, management is not aware of any other
contingencies that could affect the company.
73
CRISTALERIAS DE CHILE S.A.
NOTE 35: CONTINGENCIES AND RESTRICTIONS - DIRECT GUARANTEES
BALANCES PENDING PAYMENT
AS OF CLOSING DATE
ASSETS COMMITTED OF FINANCIAL STATEMENTS
----------------------- -------------------------
CREDITOR OF DEBTOR TYPE OF BOOK
GUARANTEE NAME RELATIONSHIP GUARANTEE TYPE VALUE 09/30/2004 09/30/2003
------------------ --------------- ------------ ------------ ---------- --------- ---------- ----------
EDIFICIO CRISTALERIAS DE
METROPOLIS AGF CHILE S.A. COMMERCIAL TIME DEPOSIT FLOOR 8,547 8,547 8,071
BANCO RED TELEVISIVA
SANTANDER CHILE MEGAVISION COMMERCIAL MORTGAGE LAND 3,408,204 1,400,399 1,877,211
RED TELEVISIVA
SCOTIABANK MEGAVISION COMMERCIAL PLEDGE TV EQUIP 131,320 1,658,819 2,106,870
BANCO CREDITO E RED TELEVISIVA
INVERSIONES MEGAVISION COMMERCIAL MORTGAGE TV EQUIP 28,635 258,030 431,126
RED TELEVISIVA
SUNDRY CLIENTS MEGAVISION COMMERCIAL ADVERTISING - 0 11,815,647 10,027,577
RELEASE OF GUARANTEES
------------------------------------------------------------------------------------
CREDITOR OF DEBTOR
GUARANTEE NAME 09/30/2005 ASSETS 09/30/2006 ASSETS 09/30/2007 ASSETS
------------------ --------------- ------------ ------------ ---------- --------- ---------- ----------
EDIFICIO CRISTALERIAS DE
METROPOLIS AGF CHILE S.A. 0 0 0 0 8,547 0
BANCO RED TELEVISIVA
SANTANDER CHILE MEGAVISION 469,805 0 465,297 0 465,297 0
RED TELEVISIVA
SCOTIABANK MEGAVISION 421,190 0 412,543 0 412,543 0
BANCO CREDITO E RED TELEVISIVA
INVERSIONES MEGAVISION 172,076 0 85,954 0 0 0
RED TELEVISIVA
SUNDRY CLIENTS MEGAVISION 0 0 0 0 0 0
74
CRISTALERIAS DE CHILE S.A.
NOTE 35: CONTINGENCIES AND RESTRICTIONS
INDIRECT GUARANTEES
DEBTOR ASSETS COMMITTED BALANCES PENDING
--------------------------- ------------------------- ------------------------
PAYMENT AS OF
CLOSING DATE
OF FINANCIAL STATEMENTS
------------------------
TYPE OF BOOK 09-30- 09-30-
CREDITOR OF GUARANTEE NAME RELATIONSHIP GUARANTEE TYPE VALUE 2004 2003
----------------------- ------------- ------------ ---------- ---------- ---------- --------- ---------
Societe des
Participations
Financieres et RAYEN CURA
Industrielles S.A.I.C. AFFILIATE SOLIDARY 0 0 1,753,632 2,707,671
Envases CMF guarantee CRISTALERIAS
P.I.A.S DE CHILE S.A. AFFILIATE SOLIDARY 0 0 205,763 230,479
RELEASE OF GUARANTEES
-----------------------------------------------------------------------------------
CREDITOR OF GUARANTEE 09-30-2005 ASSETS 09-30-2006 ASSETS 09-30-2007 ASSETS
----------------------- ------------- --------- ---------- ---------- ---------- ---------
Societe des
Participations
Financieres et
Industrielles 701,453 0 701,453 0 350,726 0
Envases CMF guarantee
P.I.A.S 0 0 0 0 205,763 0
75
36. Guarantees obtained from third parties
As of September 30, 2004 and 2003 the parent company and the subsidiary S.A.
Vina Santa Rita have received guarantees from third parties that are shown
below:
Item
2004 2003
--------- ---------
ThCh$ ThCh$
Rental of Property Sur Andino Cafe (UF 260) 4,470 0
Rental of Property Office Banco Security (UF 304.0) 0 5,235
Rental of Property to Telecomunicaciones
Cono Sur Ltda. (UF 130) 0 2,238
Rental of Property Office AGF Building (UF 365.9) 0 6,300
Rental of Property Office Metropolis (UF 189.2) 0 3,219
Rental of Property Eyzaguirre y Cia. (UF 2.2) 38 38
Rental of Property Irrarazaval Ruiz Tagle (UF 235) 4,040 0
Manufacture of fermentation tanks 121,838 0
Sight drafts suppliers 1,674 1,701
Installation of Buin Tanks (Tersanoix S.A.) 0 157,594
Grape purchase (contracts) 937,292 1,064,826
Mortage (grape purchase) 139,909 0
C y CPO Constructora (Salon Andino Sta. Rita) 93,185 0
Purchase of vine stem cuttings and plants (Intelmaq) 0 35,612
Transporters' guarantee check 42,420 0
Underground materials storehouse Buin Salfa Montajes 0 32,343
Buin Casino Construction 0 32,195
--------- ---------
1,344,866 1,341,301
76
37. Local and Foreign Currency
Charts attached show the foreign currency balance as of September 30, 2004 and
2003.
CriStalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY
ASSETS
Items Currency Amount
------------------------------------------ --------------------- -----------------------------
09-30-2004 09-30-2003
---------- ----------
Current Assets
Available funds Non-adjust. Ch$ 965,954 1,530,691
Other currencies 62,679 144,086
Dollars 233,472 231,765
Euros 28,835 5,262
Argentine Peso 81,240 13,588
Time deposits Adjustable Ch$ 5,031,521 5,345,527
Non-adjust Ch$ 400,128 1,688,428
Marketable Securities Adjustable Ch$ 4,244,007 4,575,940
Dollars 36,701,325 60,861,710
Sales receivable Non-adjust Ch$ 34,197,230 31,088,466
Dollars 4,758,218 4,532,030
Euros 3,324,678 3,216,805
Other currencies 3,374,826 2,183,824
Argentine Peso 41,082 197,230
Documents Receivable Non-adjust. Ch$ 4,111,584 4,640,170
Argentine Peso 11,489 16,256
Sundry Debtors Non-adjust. Ch$ 1,033,420 638,506
Adjustable Ch$ 93,694 79,250
Dollars 674,735 758,989
Argentine Peso 21,637 100,272
Documentos and Accts. Receivable Dollars 7,389 65,474
Non-adjust. Ch$ 3,100,586 432,194
Adjustable Ch$ 70,622 258,391
Inventory Adjustable Ch$ 36,680,249 31,330,013
Dollars 4,389,497 4,617,156
Argentine Peso 951,194 670,969
Non-adjust. Ch$ 185,434 454,346
Taxes Receivable Non-adjust. Ch$ 0 21,256
Adjustable Ch$ 0 2,664,466
Dollars 0 38,762
Prepaid expenses Adjustable Ch$ 583,362 937,255
Non-adjust. Ch$ 744,722 232,955
Dollars 178,553 224,257
Argentine Peso 5,937 15,911
Deferred Taxes Non-adjust. Ch$ 1,709,044 1,455,155
Other Current Assets Non-adjust. Ch$ 17,393,134 2,664,796
Adjustable Ch$ 2,469,561 1,589,392
Dollars 1,697,644 4,822,673
Marketable Securities Euros 28,631,254 0
Non-adjust. Ch$ 300,240 0
Fixed Assets
77
FIXED ASSETS Adjustable Ch$ 138,345,917 140,894,375
Other Assets
Investments in other companies Adjustable Ch$ 770,586 840,471
Long-term debtors Dollars 60,890 67,155
Adjustable Ch$ 133,719 164,480
Documents receivable in rel.companies Non-adjust. Ch$ 1,212,596 2,944
Intangibles Adjustable Ch$ 11,992,642 11,968,471
Argentine peso 57,671 35,118
Other Adjustable Ch$ 3,711,681 4,194,357
Non-adjust. Ch$ 171,286 225,200
Dollars 1,991,396 9,870,949
Argentine Peso 675,002 465,301
Amortization Argentine Peso -7,838 0
Adjustable Ch$ -1,387,902 -1,173,631
Investments in related companies Dollars 12,248,478 13,124,284
Adjustable Ch$ 87,674,816 94,226,084
Negative Goodwill Dollars 4,116,233 4,842,372
Adjustable Ch$ 4,580,681 4,918,846
Total Assets
Non-adjust. Ch$ 65,525,358 45,075,107
Other currencies 3,437,505 2,327,910
Dollars 67,057,830 104,057,576
Euros 31,984,767 3,222,067
Argentine Peso 1,837,414 1,514,645
Adjustable Ch$ 294,995,156 302,813,687
78
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - CURRENT LIABILITIES
ITEM Currency Up to 90 days
---- ------------------- --------------------------------------------------------
09.30.2004 09.30.2003
------------------------- -------------------------
Amount Avg.Annual Amount Avg.Annual
Thou Ch$ Int. Rate Thou Ch$ Int. Rate
-------- --------- -------- ---------
Current Liabilities
Short-term obligations with banks
and financial institutions Argentine Peso 0 - 4,517 -
Other currencies 0 - 135,245 2.6
Dollars 725,087 2.03 801,355 1.74
Dollars 292,991 2.050 0 -
Non-adjust. Ch$ 134,457 4.94 136,608 4.94
Long-term obligations with banks Adjust. Ch$ 591,199 1.39 820,496 4.43
and financial institutions Adjust. Ch$ 0 - 138,250 4.22
Adjust. Ch$ 0 - 371,786 -
Adjust. Ch$ 0 - 0 -
Obligations with the public Adjust. Ch$ 0 - 0 -
Dollars 1,139,607 - 1,505,529 -
Non-adjust. Ch$ 11,407,267 - 9,249,187 -
Other currencies 6,642 - 5,035 -
Euros 14,443 - 15,467 -
Accounts payable Argentine Peso 221,053 - 95,135 -
Adjust. Ch$ 0 - 14,467 -
Dollars 2,568,602 - 2,062,503 -
Argentine Peso 214,816 - 108,445 -
Euros 7,036 - 1,842 -
Documents Payable Other currencies 349,172 - 176,634 -
Non-adjust. Ch$ 441,459 - 311,490 -
Sundry Creditors Dollars 4,289 12.25 754,034 -
Adjust. Ch$ 0 - 60,281 -
Docts and accts payable to rel co. Non-adjust. Ch$ 1,101,916 - 724,625 -
Dollars 0 - 0 -
Adjust. Ch$ 667,720 - 271,239 -
Non-adjust. Ch$ 8,858,313 - 6,615,090 -
Dollars 772,225 - 666,915 -
Argentine Peso 41,656 - 58,131 -
Euros 996,652 - 705 -
Provisions Other currencies 723,207 - 190,366 -
Non-adjust. Ch$ 2,349,710 - 3,105,468 -
Dollars 21,442 - 0 -
Withholdings Argentine Peso 1,385 - 22,498 -
Prepaid income Non-adjust. Ch$ 3,198,307 - 4,997,864 -
Adjust. Ch$ 0 - 5,016,685 -
Other Current Liabilities Dollars 0 - 120,272 -
Adjust. Ch$ 0 - 0 -
Long-term obligations with 1 year Adjust. Ch$ 0 - 0 -
maturity Dollars 9,097 11.00 8,153 11.00
Dividends payable Non-adjust. Ch$ 652,697 - 513,724 -
Income Tax Non-adjust. Ch$ 905,158 - 0 -
Total Current Liabilities
- Argentine Peso 478,910 - 288,726 -
- Other currencies 1,079,021 - 507,280 -
- Dollars 5,533,340 - 5,918,761 -
- Non-adjust Ch$ 29,049,284 - 25,654,056 -
- Adjust. Ch$ 1,258,919 - 6,693,204 -
- Euros 1,018,131 - 18,014 -
79
ITEM Currency 90 Days to 1 Year
---- -------- -----------------
09.30.2004 09.30.2003
------------------------ --------------------------
Amount Avg.Annual Amount Avg.Annual
Thou Ch$ Int. Rate Thou Ch$ Int. Rate
-------- --------- -------- ---------
Current Liabilities
Short-term obligations with banks
and financial institutions Argentine Peso 15,884 1.96 13,550 -
Other currencies 0 - 0 -
Dollars 222,599 2.12 1,292,355 1.90
Dollars 0 - 0 -
Non-adjust. Ch$ 134,456 4.94 136,608 4.94
Long-term obligations with banks Adjust. Ch$ 598,736 1.39 608,305 4.43
and financial institutions Adjust. Ch$ 0 - 0 -
Adjust. Ch$ 371,217 6.16 0 -
Adjust. Ch$ 345,255 4.75 384,390 4.75
Obligations with the public Adjust. Ch$ 441,536 5.80 403,608 5.80
Dollars 1,387,278 - 1,250,489 -
Non-adjust. Ch$ 0 - 96,154 -
Other currencies 0 - 0 -
Euros 0 - 0 -
Accounts payable Argentine Peso 0 - 0 -
Adjust. Ch$ 0 - 14,466 -
Dollars 10,171 - 124,266 -
Argentine Peso 0 - 0 -
Euros 0 - 0 -
Documents Payable Other currencies 0 - 0 -
Non-adjust. Ch$ 0 - 0 -
Sundry Creditors Dollars 0 - 0 -
Adjust. Ch$ 0 - 0 -
Docts and accts payable to rel co. Non-adjust. Ch$ 0 - 0 -
Dollars 0 - 65,474 -
Adjust. Ch$ 0 - 0 -
Non-adjust. Ch$ 0 - 402,473 -
Dollars 2,152,884 - 693,374 -
Argentine Peso 0 - 0 -
Euros 0 - 571,509 -
Provisions Other currencies 0 - 349,118 -
Non-adjust. Ch$ 0 - 0 -
Dollars 0 - 0 -
Withholdings Argentine Peso 0 - 0 -
Prepaid income Non-adjust. Ch$ 0 - 0 -
Adjust. Ch$ 0 - 0 -
Other Current Liabilities Dollars 0 - 0 -
Adjust. Ch$ 8,595,390 4.75 0 -
Long-term obligations with 1 year Adjust. Ch$ 1,225 7.0 1,243 7.0
maturity Dollars 61,903 11.03 193,071 11,00
Dividends payable Non-adjust. Ch$ 0 - 0 -
Income Tax Non-adjust. Ch$ 0 - 0 -
Total Current Liabilities
- Argentine Peso 15,884 - 13,550 -
- Other currencies 0 - 349,118 -
- Dollars 3,834,835 - 3,619,029 -
- Non-adjust Ch$ 134,456 - 635,235 -
- Adjust. Ch$ 10,353,359 - 1,412,012 -
- Euros 0 - 571,509 -
81
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - LONG-TERM LIABILITIES CURRENT PERIOD 09-30-2004
ITEM Currency 1-3 Years 3-5 years
---- -------- --------------------------- --------------------------
Average Average
Amount Interest Rate Amount Interest Rate
------ ------------- ------ -------------
Thou Ch$ Thou Ch$
Dollars 7,611,250 2.05 15,222,500 2.05
Argentine Peso 39,530 1.62 0 -
Obligations with Banks and Non-adjust. Ch$ 403,370 4.94 0 -
Financial Institutions Adjustable Ch$ 2,626,303 1.39 124,042 1.39
Adjustable Ch$ 3,438,156 6.16 25,786,170 4.75
Obligations with the public Adjustable Ch$ 0 - 232,908 5.8
Dollars 1,211,195 - 0 -
Dollars 20,726 9.29 0 -
Adjustable Ch$ 146,647 - 0 -
Sundry Creditors Adjustable Ch$ 1,204 7 0 -
Dollars 2,361,131 - 0 -
Long-term provisions Adjustable Ch$ 4,242,965 - 0 -
Adjustable Ch$ 1,759,532 - 0 -
Deferred taxes Non-adjust. Ch$ 2,926,153 - 0 -
Total long-term liabilities
- Dollars 11,204,302 - 15,222,500 -
- Argentine Peso 39,530 - 0 -
- Non-adjust. Ch$ 3,329,523 - 0 -
- Adjustable Ch$ 12,214,807 - 26,143,120 -
ITEM Currency 5-10 Years More than 10 years
---- -------- ------------------------ -------------------------
Average Average
Amount Interest Rate Amount Interest Rate
------ ------------- ------ -------------
Thou Ch$ Thou Ch$
Obligations with Banks and
Dollars 7,611,250 2.05 0 -
Argentine Peso 0 - 0 -
Non-adjust. Ch$ 0 - 0 -
Financial Institutions Adjustable Ch$ 0 - 0 -
Adjustable Ch$ 0 - 17,190,780 6.16
Obligations with the public Adjustable Ch$ 5,822,705 5.8 30,045,025 5.8
Dollars 0 - 0 -
Dollars 0 - 0 -
Adjustable Ch$ 0 - 0 -
Sundry Creditors Adjustable Ch$ 0 - 0 -
Dollars 0 - 0 -
Long-term provisions Adjustable Ch$ 0 - 0 -
Adjustable Ch$ 0 - 0 -
Deferred taxes Non-adjust. Ch$ 0 - 0 -
Total long-term liabilities
- Dollars 7,611,250 - 0 -
- Argentine Peso 0 - 0 -
- Non-adjust. Ch$ 0 - 0 -
- Adjustable Ch$ 5,822,705 - 47,235,805 -
82
Cristalerias de Chile S.A.
NOTE 37: LOCAL AND FOREIGN CURRENCY - LONG-TERM LIABILITIES PREVIOUS PERIOD
09-30-2003
ITEM Currency 1-3 Years 3-5 Years
---- -------- ------------------------------ --------------------------
Average Average
Amount Interest Rate Amount Interest Rate
------ ------------- ------ -------------
Thou Ch$ Thou Ch$
Dollars 8,394,319 1.925 25,182,957 1.925
Dollars 1,039,142 1.84 0 -
Argentine peso 58,383 1.75 0 -
Obligations with banks Non-adjust. Ch$ 683,043 4.94 0 -
and financial institutions Adjustable Ch$ 4,138,134 4.43 413,177 4.43
Adjustable Ch$ 17,217,166 4.75 17,217,166 4.75
Adjustable Ch$ 0 - 0 -
Obligations with public Adjustable Ch$ 3,443,433 6.25 0 -
Dollars 135,044 11.06 0 -
Dollar 88,838 11.16 4,320 8.6
Adjustable Ch$ 38,675 - 0 -
Long-term creditors Non-adjust. Ch$ 99,415 - 0 -
Dollars 3,571,074 - 0 -
Long-Term provisions Adjustable Ch$ 4,174,286 - 0 -
Adjustable Ch$ 2,364,797 - 0 -
Deferred taxes Non-adjust. Ch$ 2,426,390 - 0 -
Total long-term liabilities
- Dollars 13,228,417 - 25,187,277 -
- Argentine peso 58,383 - 0 -
- Non-adjust. Ch$ 3,208,848 - 0 -
- Adjustable Ch$ 31,376,491 - 17,630,343 -
ITEM Currency 5-10 Years More than 10 years
---- -------- --------------------------- --------------------------
Average Average
Amount Interest Rate Amount Interest Rate
------ ------------- ------ -------------
Thou Ch$ Thou Ch$
Dollars 0 - 0 -
Dollars 0 - 0 -
Argentine peso 0 - 0 -
Obligations with banks Non-adjust. Ch$ 0 - 0 -
and financial institutions Adjustable Ch$ 0 - 0 -
Adjustable Ch$ 0 - 0 -
Adjustable Ch$ 4,276,538 5.8 31,879,512 5.8
Obligations with public Adjustable Ch$ 0 - 17,217,166 6.25
Dollars 0 - 0 -
Dollar 0 - 0 -
Adjustable Ch$ 0 - 0 -
Long-term creditors Non-adjust. Ch$ 0 - 0 -
Dollars 0 - 0 -
Long-Term provisions Adjustable Ch$ 0 - 0 -
Adjustable Ch$ 0 - 0 -
Deferred taxes Non-adjust. Ch$ 0 - 0 -
Total long-term liabilities
- Dollars 0 - 0 -
- Argentine peso 0 - 0
- Non-adjust. Ch$ 0 - 0 -
- Adjustable Ch$ 4,276,538 - 49,096,678 -
83
38. Penalties
The SVS or other administrative authorities have not imposed any penalties
during the 2004 and 2003 fiscal years to the Company, its Board nor
administrative personnel.
84
39. Subsequent Events
On September 28, 2004, the Parent Company agreed to pay the interim dividend No.
159 of Ch$ 20 per share, over 64,000,000 shares (Th Ch$ 1,280,000) which was
paid on October 21, 2004.
On October 25, 2004 the Chilean Anti-Trust Commission approved the merger
between Metropolis-Intercom S.A. and VTR S.A.; imposing the new company certain
operative and commercial restrictions, which are currently being analyzed.
Between the closing date of the financial statements and the issue date of the
present report no more subsequent events that could affect significantly the
Company's economic and financial condition have been registered.
85
40. COMPANIES UNDER SPECIAL NORMS
Not applicable.
86
41. ENVIRONMENT
On its ongoing concern for environmental preservation, as of September 30, 2004
the Parent Company has paid for advisory services for this concept of Th Ch$
3,365.
As of September 30, 2003, investments of Th Ch$ 209,323, corresponding to the
purchase of NOX emission treatment equipment, installed on new Furnace B.
The subsidiary S.A. Vina Santa Rita has invested Th Ch$ 55,027 as of September
2004 (Th Ch$ 36,142 in 2003), to comply with the ordinances and laws related to
Industrial Process and Installations.
87
42. STOCK TRANSACTIONS
During the 2004 and 2003 fiscal years the Parent Company's members of the board,
controlling stockholders, related individuals and entities carried out the
following stock transactions.
TRANSACTIONS OF PERSONS RELATED TO THE BOARD
2004 2003
------------------- ------------------
NAME Initial Purchase Sale Purchase Sale
---- ------- -------- ---- -------- ----
Asesorias Portofino Ltda. BSG 21,000 0 0 0
Inmobiliaria Villarrica Ltda. RCV 181,669 0 0 0
Vial de Claro Maria Luisa RCV 650
Invers. Alonso de Ercilla S.A. PGD 48,000
Invers. San Benito S.A. PGD 10,894 0 0 0
o BSG related with Director Mr. Baltazar Sanchez
o RCV related with President Mr. Ricardo Claro
o PGD related with Director Mr. Patricio Garcia Domiguez
TRANSACTIONS OF DIRECTORS, ADMINISTRATORS AND ACCOUNT INSPECTORS
None.
TRANSACTIONS OF MAJORITY SHAREHOLDERS
None.
88
43. DISTRIBUTION OF SHAREHOLDERS
The distribution of shareholders as of September 30, 2004 and 2003 is the
following:
% of Shareholding No. of Shareholders
-------------------------- -------------------
TYPE OF SHAREHOLDER 2004 2003 2004 2003
----- ---- ---- ----
10% or more shareholding 34.03 34.03 1 1
Less than 10% shareholding
with investment equal to or
higher than 200 UF 65.83 65.83 286 263
Less than 10% shareholding
with investment lower than
200 UF 0.14 0.14 745 774
------- ------ ----- -----
TOTAL 100.00 100.00 1,032 1,038
CONTROLLER OF
THE COMPANY 52.14 52.14 3 3
90
44. BOARD REMUNERATIONS
As of September 30, 2004 and 2003, were paid Th Ch$ 350,171 and Th Ch$ 915,514
respectively, for different concepts by the parent company and the subsidiary
S.A. Vina Santa Rita, as follows:
2004 2003
---------- ---------
ThCh$ ThCh$
Participation of previous fiscal year profits 342,073 905,016
Session assistance compensation 6,296 4,257
Board Committee compensations 1,802 1,366
Honoraries paid 0 4,875
--------- ---------
TOTAL 350,171 915,514
On the other hand, Th Ch$ 677,434 have been provisioned for participation of
year 2004 income (Th Ch$ 231,431 in 2003).
91
45. TIME DEPOSITS
As of September 30, 2004 and 2003 the Company presents the following
information:
INSTITUTION CURRENCY 2004 2003
----------- -------- ----- ----
Th$ Th$
Banco Santander Santiago US$ 0 5,345,527
BankBoston $ 0 375,590
Banco de Santander Santiago $ 5,000,900 0
Banco de Chile $ 430,749 1,312,839
--------- --------- ---------
TOTAL 5,431,649 7,033,955
92
RELEVANT EVENTS
None.
93
RATIO ANALYSIS OF THE CONSOLIDATED FINANCIAL
STATEMENTS AS OF SEPTEMBER 30, 2004
CONSOLIDATED FINANCIAL INDICATORS
09-30-2004 09-30-2003 12-31-2003
---------- ---------- ----------
Liquidity
Current liquidity times 3.76 3.82 4.44
Acid ratio times 2.90 2.88 3.40
Indebtedness
Leverage ratio times 0.75 0.82 0.75
Short-term debt % 29.05 24.07 21.59
Long-term debt % 70.95 75.93 78.41
Interest Expenses Coverage times 4.84 1.69 2.03
Activity
Total assets MM Ch$ 464,838 459,011 446,266
Investments MM Ch$ 12,486 25,720 28,108
Disposal of property MM Ch$ 57 320 376
Inventory turnover Times n.a. n.a. n.a.
Inventory permanence Days n.a. n.a. n.a.
Results
Sales MM Ch$ 133,046 125,626 173,170
Cost of sales MM Ch$ 82,704 79,357 107,694
Operating income MM Ch$ 28,326 27,541 38,357
Interest expenses MM Ch$ 5,022 5,262 6,959
Non-operating result MM Ch$ (7,369) (21,706) (28,560)
E.B.I.T.D.A. MM Ch$ 36,534 20,417 29,709
After-tax income MM Ch$ 14,237 2,455 6,549
Profitability
Return on equity % 6.0 1.1 2.8
Return on assets % 3.1 0.5 1.5
Return on operating assets % 12.1 11.8 16.5
Income per share $ 222.5 38.4 102.3
Return on dividends % 1.3 2.1 2.4
Current liquidity: Ratio of current assets to current liabilities.
Acid ratio: Ratio of uncommitted funds to current
liabilities.
Leverage ratio: Ratio of total liabilities to net worth.
Interest Expenses Coverage: Result before taxes and interest divided by
interest expenses.
Inventory turnover: Ratio between cost of sales of the period and
average inventory.
Inventory permanence: Ratio between average inventory and sales cost
of the period, multiplied by 360 days.
94
E.B.I.T.D.A: Earnings before taxes, interest, taxes,
depreciation and amortization, and extraordinary
items.
Return on dividends: Sum of dividends paid in
the last twelve months divided by
market price of stock at closing of
period.
95
The main trends observed in the 2004 fiscal year indicators are:
LIQUIDITY INDICES
Despite current assets increasing with respect to September and December 2003, a
decrease in the liquidity indices is observed due to the shift of bond quotas
issued by the company that have maturity during next year.
INDEBTEDNESS INDICES
The indebtedness index has kept stable with respect to previous periods.
An increase in the short-term bank debt can be observed, due to the transfer of
bonds to expire within the next 12 months. The interest expenses coverage ratio
has registered a slight increase with respect to the previous year due to higher
net income in the present fiscal year.
RESULTS
The operating result shows a slight increase with respect to September of 2003
due to lower operating costs.
Likewise, non-operating result shows a decrease of the loss as a conesquence of
the positive exchanges differences that is registered during the present fiscal
year, as well as the positive net result shown in related companies.
PROFITABILITY INDICES
Equity and asset profitability indices show an increase with respect to
September and December 2003, due to a higher net income in 2004.
On the other hand, return of dividends index shows a decrease with respect to
the previous year, due to lower dividends distributed during the last 12 months.
2. DIFFERENCE BETWEEN BOOK VALUE AND MARKET VALUE OF MAIN ASSETS.
The financial statements as of September 30, 2004 have been prepared according
to generally accepted accounting principles and general and specific norms of
the Securities and Insurance Commission, which is the agency that regulates the
Company. The valuation of the assets
96
includes adjustment for currency devaluation, provisions, and technical
revaluations. We believe the foregoing is a reasonable way to value the
Company's permanent investments.
As of September 30, 2004 there were financial investments in shares recorded in
the accounting according to their purchase price at Ch$ 4,233 million whose
market value on the same date was Ch$ 5,727 million.
3. RESULTS AS OF SEPTEMBER 2004
3a. Consolidated Result
Cristalerias de Chile S.A. consolidates its results with Vina Santa Rita,
CIECSA, Cristalchile Comunicaciones S.A., Cristalchile Inversiones S.A. and
Apoger.
Cristalerias' consolidated sales reached Ch$ 133,046 million, 5.9% over 2003.
This increase mainly results from higher sales in Santa Rita (10.7%) and CIECSA
(9.6%) partially compensated by lower sales at the glass container business
(0.5%). Consolidated operating income reached Ch$ 28,326 million, 2.9 over 2003,
of which Ch$ 18,251 million were contributed by the glass container business
(Ch$ 17,633 million in 2003), Ch$ 6,891 million by Santa Rita (Ch$ 7,989 million
in 2003) and Ch$ 3,143 million by CIECSA (Ch$ 1,837 million in 2003).
The Company's net profit was Ch$ 14,237 million, compared with Ch$ 2,455 million
in the same period of 2003. This result is explained by a better non-operting
result.
During 2004 the Company registered a consolidated non-operting loss of Ch$ 7,369
million, compared with a Ch$ 21,706 million loss in 2003. The former was mainly
due to an income from exchange differences of Ch$ 2,373 in 2004 compared with a
Ch$ 12,466 million loss in 2003. The net loss from subsidiaries that do not
consolidate did not show any variation reaching with respect to 2003, reaching
Ch$ 4,016 millions. The latter includes a Ch$ 3,149 million charge (Ch$ 3,178
million charge in 2003) corresponding to goodwill amortization, which does not
constitute cash flow.
The following analysis explains Cristalerias' result based on individual
financial statements, as well as those of its main subsidiaries.
3b. Individual Result
The Company had non-consolidated sales of Ch$ 55,126 million as of September
2004, compared to Ch$ 55,405 million the previous fiscal year. Volumes sold
increased by 5.9% reaching 196,937 tons, mainly due to higher sales of bottles
for the wine, returnable beer, non-
97
returnable soft drinks and food markets; partially compensated by lower sales to
the non-returnable, liquor and returnable soft drink markets. The level of
average prices decreased by 6.0%, mainly explained by a sharp decline of the
nominal rate of exchange that passed from Ch$ 713.59 per Dollar on average
during the first nine months of 2003 to Ch$ 614.91 per Dollar on average during
the same period of this year. Operating income reached Ch$ 18,251 million, 3.5%
over 2003.
Non-operating result was a loss of Ch$ 1,144 million in 2004, compared to Ch$
14,277 million loss in 2003. The aforementioned was due to a Ch$ 1,266 million
income from exchange differences, compared to a Ch$ 10,060 million loss in 2003.
During 2004 a Ch$ 494 million net income was registered from investments in
related companies (Ch$ 1,612 million net loss in 2003) mainly due to higher
income in Vina Santa Rita and CIECSA.
3c. Results in Subsidiaries
Santa Rita's net income amounted Ch$ 5,395 million, compared to Ch$ 3,795
million income in 2003, which is explained by a better non-operating result. In
the local market, prices increased by 13.5% in real terms, while volumes
maintained without variation. Sales in this market increased 13.6%, reaching Ch$
27,576 million. During the period, exports increased by 19.7% representing 52.3%
of revenues, to reach US$51.3 million (US$ 41.90 million in 2003). Operating
income reached Ch$ 6,891 million, compared to Ch $ 7,989 million in 2003, mainly
due to higher costs of musts and a decline in the Peso US Dollar exchange rate,
which affects exports returns. The average price in dollars per case for the
export market for Santa Rita was US$ 33.8 (US$ 33.0 in 2003) whereas the average
price for the industry was US$23.9 per case (US$ 23.6 in 2003). Santa Rita
recorded a Ch$270 million non-operating loss, compared to a Ch$ 3,228 million
non-operating loss in 2003, mainly due to a Ch$ 1,116 million income form
exchange differences in 2004, compared to a Ch$ 2,098 million loss in 2003.
Red Televisiva Megavision, CIECSA's main subsidiary, registered a Ch$ 2,862
million operating income, 59.9% over 2003. MEGA had the first place in audience
reaching 26.0% audience share during the period (22.8% in 2003)1. Net sales
increased by 8.2% reaching Ch$ 20,367 million, due to an increase in live
programming, which has resulted in higher audience share. As of September 2004,
MEGA had a net income of Ch$ 2,102 million compared to Ch$ 1,042 million net
income in 2003. CIECSA had a Ch$ 2,101 million net income, compared to a Ch$ 839
million net income the previous year.
Envases CMF S.A. registered a Ch$ 750 million net income in 2004 compared with a
Ch$730 million net income in 2003. Volume sales decreased by 3.2%, reaching
16,162 tons, due to lower pre forms volume exports sales, while average prices
deceased by 5,1% influenced by a drop of the exchange rate. Due to the
aforementioned sales reached Ch$ 23,461 million during the period, compared with
Ch$ 25,522 million in 2003. Operating income reached Ch$ 2,023 million, compared
to Ch$ 2,283 million in 2003. Non-operating loss reached Ch$ 1,136 million,
compared to Ch$ 1,341 million loss in 2003.
--------
1 Measured between 7:30AM and 1:30AM; i.e: 18 hours daily, Monday through
Sunday.
98
In the cable TV business, Cristalchile Comunicaciones S.A. (99.99% owned by
Cristalerias), is the owner of 50% of Cordillera Comunicaciones Ltda., which in
turn is the owner of Metropolis-Intercom S.A.
During 2004, Metropolis-Intercom S.A. registered sales of Ch$ 33,674 million
compared with Ch$34,301 million the previous year. Metropolis-Intercom had a net
loss of Ch$ 7,920 million compared with a net loss of Ch$ 7,515 million in 2003.
The aforementioned was due to a lower operating result, mainly due to higher
depreciation charges; partially compensated by better non-operational result, in
turn due to lower interest expenses and the appreciation of the exchange rate.
Metropolis-Intercom's EBITDA reached Ch$ 4,608 million during the period (Ch$
4,521 million in 2003). This figure includes a depreciation charge of Ch$ 11,260
million (Ch$10,200 million in 2003) mainly corresponding to the HFC network
adquired in July 2000. The company ended the period with 224,657 subscribers of
the basic service (235,596 in 2003), 27,989 subscribers of premium service
(33,305 in 2003), 38,735 of the broadband service (32,227 in 2003) and 10,999
subscribers of IP Telephony (1,451 in 2003).
As a result of the abovementioned and a negative goodwill amortization charge
through Cordillera Comunicaciones of Ch$3,149 million during the period
(Ch$3,178 million in 2003), Cristalchile Comunicaciones recorded a net loss of
Ch$ 5,560 million (net loss of Ch$5,334 in 2003).
4. CASH FLOW STATEMENT
As of September 30, 2004 a total net positive flow of Ch$ 12,488 million was
generated, which is explained by a positive flow generated by operating
activities of Ch$30,869 million which were partially offset by a negative
financing flows of Ch$ 5,785 million, and a negative flow of investment
activities of Ch$ 12,596 million.
The operating flow corresponds basically to the collection of sales and
financial interests and other income received that were reduced in part by
payment to suppliers, taxes and interests.
The negative financing flow can be explained mainly by dividends paid by Ch$
4,444 million and net loans for Ch$ 1,449 million.
The negative investment flow is mainly explained by the incorporation of fixed
assets of Ch$ 12,938 million and loans to related companies for Ch$ 3,937
million.
The foregoing results in an increase in the final balance of cash and cash
equivalent, which passed from Ch$ 77,113 million as of December 31, 2003 to Ch$
88,658 million as of September 30, 2004.
According to the current regulations of the SVS and the Association of
Accountants of Chile, term deposits and agreements with due date less than 90
days have been considered cash and cash equivalent.
99
5. RISK ANALYSIS
a. Interest rates
Cristalerias and its Subsidiaries are exposed to the risk of fluctuations in
interest rates on its short-term and long-term debts. As of September 30, 2004
Short-Term and Long-Term bank liabilities and obligations with the public
totaled Ch$ 128,623 million, which represents 28% of the Company's consolidated
assets.
Bank credits totaled Ch$ 36,354 million of which Ch $ 31,741 million correspond
to credits in foreign currency agreed at variable annual rates related to the
six-month Libor plus 0.8%, Ch$ 3,940 million correspond to credits in adjustable
pesos in unidades de fomento (indexed currency units) that are exposed to
changes in the six-month TAB of 90 and 180 days and Ch$ 673 million correspond
to credits in pesos at a fixed annual rate of 4.94%.
Within obligations with the public for Ch$ 92,269, Ch$ 71,269 million correspond
to Bonds issued by the Parent Company and Ch$ 21,000 millon issued by the
subsidiary Vina Santa Rita, both in unidades de fomento (indexed currency units)
at a fixed interest rate.
As of September 30, 2004, the Company had available funds of Th Ch$ 87,586
million invested in instruments at different time periods like term deposits,
bonds, fixed-rate mutual funds and resale agreements. Bonds for Ch$ 3,635
million with maturity on September 15, 2005 and share investment for Ch$ 4,233
million were no included.
The Company and its subsidiaries do not use secondary financial instruments at
the present time to reduce risk in the event of fluctuations in interest rates.
That policy will be studied permanently to evaluate the alternatives offered by
the market.
b) Exchange rate
The Company and its Subsidiaries maintain liabilities in dollars of US$ 73.9
million, which represent 9.7% of its consolidated assets, and include a
long-term syndicated loan of US$ 50 million of the Parent Company.
As of September 30 the Company and its Subsidiaries maintain its investments in
Dollars of US$ 49.3 million; in time deposits, bonds and fixed rate mutual
funds. In addition it maintains investments in Euros of euros 37.8 million in
fixed rate instruments. Likewise, it also has future Dollar sale contracts of
US$ 80.2 million.
On the other hand, aproximately 39.4% of consolidated sales are adjustment to
the exchange rate variation. At the same time, the consolidated costs in foreing
currency represent aproximately 30.1% of the total costs.
100
SIGNATURE
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.
GLASSWORKS OF CHILE
(Registrant)
By: /s/ Benito Bustamante C.
-----------------------------------
Benito Bustamante C.
Controller
Date: January 19, 2005