Ch$ - Chilean pesos
ThCh$ - Thousands of Chilean pesos US$ - United States dollars
ThUS$ - Thousands of United States dollars MUS$ - Millions of United States dollars UF - Unidad de Fomento -
Official index - linked units ThUF - Thousands of Unidades de Fomento
- European Union monetary unit CPI - Consumer Price Index
CONSOLIDATED BALANCE SHEET 114
CONSOLIDATED STATEMENT OF INCOME 116
CONSOLIDATED STATEMENT OF CASH FLOWS 117
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 119
114
115
C O N S O L I D A T E D B A L A N C E S H E E T
A S S E T
2001
CURRENT ASSETS
Cash and banks
11,466,280
33,172,232
Time deposits
44,779,073
36,848,192
Marketable securities (net)
413,611,699
147,021,574
Trade accounts receivable (net)
202,694,441
182,971,274
Notes receivable (net)
44,040,742
46,311,983
Sundry debtors (net)
22,113,027
259,198,356
Notes and accounts receivable from related companies
10,662,536
5,240,454
Inventories (net)
305,334,430
322,310,643
Recoverable income taxes
28,557,865
11,448,570
Prepaid expenses
17,410,620
16,108,203
Deferred income taxes
5,673,641
6,933,445
Other current assets
65,586,168
75,640,074
Total current assets
1,171,930,522
1,143,205,000
FIXED ASSETS
Land
304,098,429
291,009,624
Buildings and infrastructure
1,107,118,118
1,239,316,010
Machinery and equipment
1,054,121,528
966,591,624
Other fixed assets
1,536,442,763
1,483,163,455
Incremental value following technical appraisal
46,700,443
47,326,298
Accumulated depreciation
(1,249,920,467)
(1,182,037,083)
Total fixed assets
2,798,560,814
2,845,369,928
OTHER ASSETS
Investments in related companies
176,893,138
184,535,807
Investments in other companies
148,644
288,344
Goodwill
23,264,508
24,085,889
Negative goodwill
(30,898,370)
(60,644,011)
Long-term debtors
11,736,572
13,030,462
Notes and accounts receivable from related companies
3,048,812
9,604,330
Intangible assets
2,449,645
1,711,241
Amortization
(342,538)
(563,094)
Other
55,060,268
51,153,668
Total Other Assets
241,360,679
223,202,636
Total Activos
4,211,852,015
4,211,777,564
At December 31,
2001
2000
ThCh$
ThCh$
L I A B I L I T I E S
CURRENT LIABILITIES
Due to banks and financial institutions - short term
39,598,747
103,925,329
Current portion of long-term bank borrowings
27,371,080
162,622,976
Bonds payable
21,079,536
16,085,433
Current portion of long-term obligations
1,093,779
1,329,728
Dividends payable
3,580,087
1,539,528
Accounts payable
128,568,547
175,232,538
Notes payable
71,551
1,416,860
Sundry creditors
8,811,694
13,768,973
Notes and accounts payable to related companies
1,572,931
1,715,140
Provisions
21,914,131
27,112,390
Withholdings
4,943,109
4,767,332
Income taxes
-
11,510,017
Unearned income
1,593,263
1,533,476
Other current liabilities
200,652
2,224,167
Total current liabilities
260,399,107
524,783,887
LONG-TERM LIABILITIES
Bank borrowings
396,963,065
239,278,906
Bonds payable
840,071,034
602,844,788
Notes payable
783
17,405
Sundry creditors
7,900,163
24,933,773
Notes and accounts payable to related companies
86,157
122,675
Provisions
10,409,641
11,324,476
Deferred income taxes
56,320,281
58,347,164
Other long-term liabilities
22,988,679
27,135,367
Total long-term liabilities
1,334,739,803
964,004,554
Minority Interest
42,147,227
35,634,271
SHAREHOLDERS' EQUITY
Paid-in capital
266,540,460
266,540,460
Share premium account
14,898,437
14,898,437
Other reserves
1,050,173,076
997,353,379
Accumulated development period deficit
(1,353,337)
(740,721)
Reserve for future dividends
9,615,776
9,160,828
Retained earnings
955,265,928
1,193,022,144
Net income for the year
368,611,110
257,152,120
Interim dividends
(89,185,572)
(50,031,795)
Total shareholders' equity
2,574,565,878
2,687,354,852
Total liabilities, minority interest, and shareholders' equity
4,211,852,015
4,211,777,564
At December 31,
2001
2000
116
117
C O N S O L I D A T E D S T A T E M E N T O F I N C O M E
2001
OPERATING RESULTS
Sales
2,342,057,040 2,135,536,168
Cost of sales
(1,805,747,962)
(1,571,873,556)
Gross margin
536,309,078 563,662,612
Administrative and selling expenses
(258,396,497)
(215,381,906)
Operating income
277,912,581 348,280,706
NON-OPERATING RESULTS
Financial income
20,855,856 12,970,919
Income from investments in related companies
10,359,870
11,319,251
Other non-operating income
256,046,602
68,283,821
Loss on investments in related companies
(2,349,184)
(3,361,511)
Amortization of goodwill
(3,235,728)
(4,830,439)
Financial expenses
(84,612,634)
(78,918,657)
Other non-operating expenses
(16,122,907)
(57,360,587)
Price-level restatements
13,691,931
24,522,156
Foreign exchange differences
(108,869,170)
(48,066,871)
Non-operating results
85,764,636 (75,441,918)
Income before income taxes
363,677,217
272,838,788
Less: Income tax
(21,558,853)
(39,716,107)
Income Before Minority Interest
342,118,364
233,122,681
Minority interest
(3,660,644)
(3,116,601)
Net Income Before Negative Goodwill Amortization
338,457,720
230,006,080
Amortization of negative goodwill
30,153,390
27,146,040
Net Income For The Year
368,611,110
257,152,120
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
For the years ended
December 31,
2001
2000
CASH FLOW FROM OPERATING ACTIVITIES
Collection of trade accounts receivable
2,513,979,208
2,303,502,891
Financial income
39,327,121
15,432,117
Dividends and other distributions received
2,467,522
9,158,151
Other income
64,516,223
75,061,594
Payments to suppliers and personnel (less)
(2,144,854,807)
(1,870,821,660)
Interest paid
(89,855,016)
(73,559,878)
Income tax paid
(49,199,954)
(32,498,404)
Other expenses paid (less)
(15,073,915)
(21,282,544)
Value Added Tax and other similar payments
(44,059,834)
(44,568,191)
Cash flow from operating activities
277,246,548
360,424,076
CASH FLOW FROM FINANCING ACTIVITIES
Share placement
-
255,085
Loans drawn
270,042,165
246,886,814
Bonds issued
268,497,889
173,635,306
Other funding sources
5,371,346
26,894,332
Dividends paid
(531,476,575)
(84,573,920)
Loans repaid
(318,938,559)
(243,037,827)
Bonds repaid
(84,435,712)
(4,326,685)
Loans repaid to related companies
(59,919)
(24,417)
Bond issue and placement expenses
(11,122,066)
(3,310,667)
Other financing disbursements
(6,224,545)
(30,845,684)
Cash flow (used in) from financing activities
(408,345,976)
81,552,337
CASH FLOW FROM INVESTMENT ACTIVITIES
Sales of fixed assets
6,236,623
3,573,146
Sales of permanent investments
435,472,688
152,654
Sales of other investments
241,382,268
76,567,181
Collection of loans to related companies
-
581,484
Collection of other loans to related companies
3,392,075
-Other investment receipts
57,009,718
48,266,698
Fixed asset purchases (less)
(170,567,090)
(189,611,496)
Permanent investments (less)
(4,142,951)
(195,274,453)
Investments in securities (less)
(34,039,107)
(74,808,095)
Documented loans to related companies (less)
(2,106,836)
(584,070)
Other loans to related companies (less)
-
(26,725)
Other investment disbursements (less)
(40,444,840)
(62,024,108)
Cash flow from (used in) investment activities
492,192,548
(393,187,784)
Net cash flow for the year
361,093,120
48,788,629
Effect of Inflation on Cash and Cash Equivalents
(9,497,007)
(4,830,650)
Net Change In Cash And Cash Equivalents
351,596,113
43,957,979
Beginning Balance Of Cash And Cash Equivalents
158,161,813
114,203,834
Ending Balance Of Cash And Cash Equivalents
509,757,926
158,161,813
For the years ended
December 31,
2001
2000
118
119
C O N S O L I D A T E D S T A T E M E N T O F C A S H F L O W S
2001
Net Income For The Year
368,611,110
257,152,120
Results on sale of assets
(Gain) loss on sale of fixed assets
(1,132,025)
614,938
Gain on sale of investments
(234,353,810)
(49,811,137)
Loss on sale of investments
-
33,758,546
Gain on sale of other assets
(9,642)
(104,614)
CHARGES (CREDITS) TO INCOME NOT REPRESENTING CASH FLOW:
Depreciation for the year
112,942,392
91,938,563
Amortization of intangible assets
911,428
934,379
Write-offs and provisions
8,424,340
8,655,349
Accrued income from investments in related companies
(10,359,870)
(11,319,251)
Accrued loss on investments in related companies
2,349,184
3,361,511
Amortization of goodwill
3,235,728
4,830,439
Amortization of negative goodwill
(30,153,390)
(27,146,040)
Net price-level restatements
(13,691,931)
(24,522,156)
Net foreign exchange losses
108,869,170
48,066,871
Other credits to income not representing cash flow
(37,433,256)
(38,640,819)
Other charges to income not representing cash flow
62,849,225
59,620,351
CHANGES IN ASSETS AFFECTING CASH FLOW
Increase in trade accounts receivable
(58,897,669)
(38,894,517)
Decrease (increase) in inventories
48,578,634
(50,619,174)
Decrease (increase) in other assets
30,520,039
(68,459,099)
CHANGES IN LIABILITIES AFFECTING CASH FLOW
(Decrease) increase in accounts payable related to operating activities
(73,080,062)
121,066,710
Increase in interest payable
6,120,473
15,380,353
(Decrease) increase in income tax payables
(21,017,625)
10,069,030
Increase in other accounts payable related to non-operating activities
10,609,125
1,810,663
(Decrease) increase in Value Added Tax and similar payables
(10,305,664)
9,564,459
Minority interest profit
3,660,644
3,116,601
Cash flow from operating activities
277,246,548
360,424,076
For the years ended
December 31,
2001
2000
ThCh$
ThCh$
The accompanying Notes 1 to 35 are an integral part of these consolidated financial statements.
RECONCILIATION OF NET CASH FLOW FROM
N o t e 1
Company Registration
As at december 31, 2001 and 2000 (A free translation from the original in Spanish for use in Chile)
The Parent Company and its subsidiaries Pesquera Iquique Guanaye S.A. and Forestal Cholguán S.A. are quoted stock corporations, registered
under Nos. 0028, 0044 and 0030, respectively, in the Securities Register and regulated by the Chilean Superintendency of Securities and Insurance
Companies. The subsidiaries Celulosa Arauco y Constitución S.A. (No. 0042), Forestal Arauco S.A. (No. 0703), Bosques Arauco S.A. (No. 0701) and
Forestal Celco S.A. (No. 0705) are closely-held corporations also registered in the Securities Register.
N o t e 2
Summary of Significant Accounting Policies
a) Accounting period
These consolidated financial statements cover the twelve-month period from January 1 to December 31, 2001 and are shown compared with
the same period of 2000.
b) Bases of preparation
These consolidated financial statements have been prepared in accordance with accounting principles generally accepted in Chile, issued by
the Chilean Institute of Accountants, and the accounting standards of the Chilean Superintendency of Securities and Insurance Companies.
Where there are differences between the two, the latter prevail.
c) Bases of presentation
The consolidated financial statements for the year ended December 31, 2000 and the related figures appearing in the Notes have been
reclassified according to criteria defined for this year and restated off the books by 3.1%, for comparison purposes, to show them at December
31, 2001 peso values.
d) Bases of consolidation
In the consolidated financial statements, the asset, liability, income accounts and cash flows of the Parent Company have been combined with
those of its subsidiaries, eliminating investments, current accounts and significant transactions between consolidating companies and
unrealized results arising from operations between such companies.
In addition, in order to correctly arrive at net income before negative goodwill amortization, that part of this amortization related to the minority
interest has been eliminated from the Minority interest and Amortization of negative goodwill accounts in the consolidated statement of income
(Note 21).
The financial statements of the subsidiaries Compañía Latinoamericana Petrolera S.A. and Sociedad Contractual Minera Vilacollo are not
included in the consolidation since they are currently in a development period.
120
121
e) Price-level restatements
The consolidated financial statements have been monetarily restated in accordance with generally accepted accounting principles in order to
reflect changes in the purchasing power of the currency during the periods (Note 24). These restatements have been calculated based on
variations in the official Consumer Price Index (CPI) measured one month in arrears, which during the period from January 1 to December 31,
2001 amounted to 3.1% (4.7% in the same period of 2000).
f) Foreign currency
Assets and liabilities in foreign currency (Note 31) correspond mainly to US dollar balances and have been translated into Chilean pesos at each
year-end exchange rate published by the Central Bank of Chile. These were Ch$ 654.79 per US$ 1 at December 31, 2001 (Ch$ 573.65 per
US$ 1 at December 31, 2000).
Assets and liabilities in Unidades de Fomento (UF) have been converted at their equivalent in pesos at the date of closing the financial
statements, of Ch$ 16,262.66 per UF 1 at December 31, 2001 (Ch$ 15,769.92 per UF at December 31, 2000).
g) Marketable securities (Note 4)
Investments in mutual funds are shown at their redemption value. Bonds are shown at the lower of their present value, calculated at the
discount rate used in determining their cost, and their market value. Securities pledged in guarantee are shown in Other current assets.
Quoted shares issued by companies where the investor has no significant influence are shown at the lower of restated cost and market value,
calculated separately considering each investor’s total financial investment in shares.
h) Inventories
Forests and plantations included under this category, which correspond to those intended to be exploited during the following twelve months,
have been valued at standard commercial values.
Forestry products have been valued at each year’s average unit cost of production which includes manufacturing expenses and fixed asset
depreciation, or at cost in the case of wood bought from third parties.
Fuels are shown at replacement cost. The daily replacement cost is used to determine the cost of sales.
Manufacturing supplies and raw materials are valued at their latest or restated cost.
Household appliances are valued at restated cost.
Lubricants are shown at restated production cost. The weighted average cost of production is used to determine the cost of sales.
Materials, supplies and spare parts are shown at restated cost and are classified based on their rotation under Other current assets (Note 9), or
under Other fixed assets for those that will ultimately be incorporated under that heading, or under Other in Other assets (Note 14) in other cases.
Fishmeal and fish-oil inventories are valued at the weighted average restated cost of production, which includes the depreciation of operating
assets
Other inventories are shown at restated cost.
The resultant inventory amounts do not exceed their corresponding net realizable values, having adjusted to market value those products where
this value is lower (Note 7).
Other, in Other assets.
i) Allowance for doubtful accounts
Allowances have been set up to cover the risk of non-collection of accounts receivable, determined on the basis of accounts receivable subject
to judicial collection and/or overdue. The allowance covers 100% of debts in judicial collection and 50% of receivables overdue for more than
120 days, excluding fiscal debts or those with collateral. The subsidiaries maintain allowances determined on the basis of the age of accounts
receivable, the economic background and the history of write-offs, criteria applied separately by each company.
j) Fixed assets
Forests ready to be exploited but which will not be harvested during the next twelve months are shown under Other fixed assets, valued at
standard commercial values (Note 11). The incremental commercial value compared with the accumulated restated cost represents forest
reserves, which are reversed as a credit to cost of sales when the respective forests are sold. Forests and plantations not yet ready to be
exploited are also shown under Other fixed assets, valued at growing cost.
The fixed assets of the Parent Company acquired prior to 1974 are valued based on a technical appraisal made during that year, as authorized
under Decree Law Nº 110, plus price-level restatements.
Fixed assets acquired by Saesa up to 1977 and by Frontel up to 1974 (subsidiaries sold in August 2001) are shown at values determined by
appraisals carried out in 1980 and 1975, respectively, in accordance with Decree Law No. 4 of 1959, and authorized by the Chilean
Superintendency of Electricity and Fuels, plus corresponding price-level restatements. Investments by these subsidiaries using third-party
contributions have no net effect on the level of fixed assets nor on net income through depreciation.
Part of the fixed assets of the subsidiary Alto Paraná S.A. acquired prior to December 31, 1997 are shown on the basis of appraisals made by
independent experts in 1991 and 1997 (Note 11).
The remaining fixed assets are shown at restated cost. The incremental values resulting from the technical appraisals made in 1979 and 1980
by the main subsidiaries of the forestry sector and by Pesquera Iquique-Guanaye S.A. and Abastible S.A., are shown under a separate heading.
Some spare parts classified under Fixed assets have a provision for obsolescence (Note 11).
k) Depreciation of fixed assets
Depreciation for each year has been calculated on the straight-line basis considering the estimated useful life of each asset and based on the
restated and reappraised values of the assets. As exceptions, imported machinery and equipment of Bosques Arauco S.A. is depreciated based
on actual use, and trucks purchased as from 1994 by Transportes de Combustibles Chile Ltda. are depreciated using the declining balance
method so that when they are sold (generally after 4 years), they do not generate any significant loss and, moreover, so that the total charge
for depreciation and maintenance costs are spread evenly over their useful lives. The Parent Company has charged directly to Other reserves
that part of depreciation which is attributable to the appraisals made in 1974 under Decree Law 110 (Note 22).
l) Leased assets
The subsidiaries have fixed assets acquired under financial leases and show these at the present value of the lease contract in accordance with
Technical Bulletin No.22 of the Chilean Institute of Accountants. These assets do not belong to the subsidiaries until they exercise their
corresponding purchase options (Note 11).
122
123
m)Intangible assets
These mainly correspond to disbursements made for connection rights to third-party plants, rights of way, rental premiums, water rights, mining
concessions and other similar rights, which represent a service potential for the Parent Company and those subsidiaries making such payments.
They are being amortized on the straight-line method based on the term set out in the contracts, the reserves identified for mining concessions
or a maximum of 20 years.
n) Investments in related companies
Investments in related companies are adjusted to the proportional year-end equity values of the related companies after eliminating unrealized
gains.
Investments in companies with business abroad are shown by applying the proportional equity value method to their financial statements after
making the adjustments and translations required under Technical Bulletin No.64 of the Chilean Institute of Accountants.
The corresponding share in income from these investments is included in the Consolidated income statement under Income or Loss on
investments in related companies, as the case may be.
The share in the deficit or surplus of companies in a start-up or development period is shown by charge or credit to Retained earnings under
Shareholders’ equity in the case of subsidiaries (Note 22), or by charge or credit to income in the case of associate companies.
The share in the Accumulated adjustment for translation differences arising from the application of the technical standards relating to
investments in companies having activities abroad has been shown as a charge or credit to Other reserves under Shareholders’ equity
(Note 22).
The proportional effect of other variations in equity not arising from income has been recorded in Other reserves (Note 22), except variations
arising from new share issues whose effects are reflected in income.
Subsidiaries with investments in Argentina have recorded the effects of the application of an exchange rate of 1.7 Argentine pesos per US$ 1
in the translation of the financial statements at December 31, 2001 of the companies in which they have invested, as required by Technical
Bulletin No.64 of the Chilean Institute of Accountants and Circulars Nos.79 and 81 of the Superintendency of Securities and Insurance
Companies (Note 12a).
o) Goodwill/Negative goodwill
Differences between the proportional equity value and the cost of investments in related companies, calculated at the date of the respective
purchases, are amortized by charge or credit to income over the term of the expected return on the investment, in accordance with current
regulations (Note 13).
Amortization in each case has been calculated considering the estimated period of return of the investment, in accordance with the expected
rates of return in each economic sector and market in which the respective investment is made.
The share of Accumulated adjustment for translation differences arising from the application of the criteria for goodwill/negative goodwill on
investments abroad is shown as a charge or credit to Other reserves under equity (Note 22).
p) Transactions under repurchase and resale agreements (Note 9)
Securities sold under repurchase agreements are shown at their investment value plus accrued interest to the end of the year, in Other current
assets. The purchase commitment obligations are shown in Other current liabilities.
shown in Other current assets under Receivables under resale agreements.
q) Bonds payable
These obligations refer to bonds issued by the subsidiaries Celulosa Arauco y Constitución S.A. and Sociedad Austral de Electricidad S.A.
(subsidiary sold in August 2001), and are shown under liabilities at their par value. The difference between par value and the proceeds of the
placement of the bonds represents deferred interest which is amortized over the life of the instruments. The unamortized balance is included
under Other in Other assets.
r) Income taxes and deferred taxes (Note 8)
The Parent Company and its subsidiaries have made provisions for income taxes against income in accordance with Chilean tax legislation
and/or that of the countries in which income is generated.
They have also recorded the effect on income for the year of timing differences arising from those items that temporarily have a different
treatment for accounting and tax purposes, according to instructions of the Chilean Institute of Accountants, complemented by instructions of
the Superintendency of Securities and Insurance Companies.
s) Staff severance indemnities
The Parent Company has made provisions for this concept calculated as the present value of the accrued benefit’s cost, by applying estimates
of payments due under current collective agreements and discounted at a real rate of 6% per annum over a capitalization period equivalent to
the estimated average term remaining before the expiry of these obligations. Those subsidiaries that also make a provision of this kind mostly
calculate this at the present value of the accrued cost of the benefit. The forestry subsidiaries apply a discount rate of 8% per annum and a
capitalization period of 7 years, while electrical sector companies (sold on August 31, 2001) used a discount rate of 5% per annum and used a
future permanence based on maximum years of service of 36 years (Note 19).
t) Sales
Sales of the consolidated businesses are shown on an accrued basis, recognized at the time that goods are delivered or services provided.
The electrical sector also considered an estimate of electricity supply and tariff income pending billing at the year end (August 31 for the
present year).
u) Derivative contracts
The Parent Company has forward contracts to cover exchange risks between the US dollar and the Unidad de Fomento.
These hedge instruments are shown at their market value at the year end and unrealized differences are charged to income if losses result. On
the other hand, any resultant gains are shown as a credit to short- or long-term Other liabilities, as appropriate.
v) Computer software
The Parent Company and those subsidiaries which make disbursements for developing computer systems internally charge these directly to
income for the year in which they are incurred. Disbursements made in the acquisition or external development of specialized computer
systems, and not intended for sale, are shown as fixed assets and are amortized over a term of four years from their start-up (Note11).
w)Research and development costs
Disbursements by the Parent Company and subsidiaries in the research and development of new projects are charged directly to income for the
year in which they are incurred, except those for the acquisition of fixed assets used in research and development which are included in fixed
assets.
124
125
x) Consolidated statement of cash flows
For purposes of the Consolidated statement of cash flows, cash equivalents are considered to be all those short-term financial investments
made as part of normal cash surplus management, in accordance with Technical Bulletin No. 50 of the Chilean Institute of Accountants. These
include securities acquired under resale agreements, Central Bank of Chile notes, mutual fund (non-equity) units, etc., provided they represent
investments intended to be redeemed or liquidated within 90 days of the closing date of the respective financial statements. They also include
bank time deposits of any term provided the term is no longer than 90 days from the closing date of the respective financial statements or when
it is intended to redeem them within that term.
Cash flow from operating activities includes all those flows related to the normal consolidated businesses, including interest paid, financial
income, dividends and other distributions received and in general all cash flows not defined as being from financing or investment activities.
The operating concept used in this statement has a broader meaning than that used in the consolidated statement of income.
y) Bond issue costs
The issue costs of bonds are capitalized and shown in Other current assets and Other long-term assets, and are amortized on the straight-line
method over the term of the bonds. The charge for amortization is shown in Financial expenses in the Consolidated statement of income.
Equity holding Equity holding
Tax registration Companies at December 31, 2001 at December 31, 2000
No. Direct Indirect Total Total
91,806,000-6 Abastecedora de Combustibles S.A. 98,7638 - 98,7638 98,6548
81,151,500-0 ABC Comercial Ltda. 3,4000 95,8951 99,2951 99,2294
77,165,170-4 ABC Gestión Ltda. - 99,2948 99,2948 99,2291
79,589,100-5 ABC Inversiones Ltda, - 99,2685 99,2685 99,2007
79,927,130-3 Adm. Central de Estaciones de Servicios Ltda. - 100,0000 100,0000 100,0000
77,126,990-7 Adm. de Establecimientos de Hostelería Ltda. - 70,0000 70,0000 70,0000
79,689,550-0 Adm. de Estaciones de Servicios Serco Ltda. - 100,0000 100,0000 100,0000
77,215,640-5 Adm. de Ventas al Detalle Ltda. - 70,0000 70,0000 70,0000
77,614,700-1 Administradora de Servicios de Retail Ltda. - 100,0000 100,0000
-79,927,140-0 Administradora de Servicios Generales Ltda. - 100,0000 100,0000 100,0000
96,547,510-9 Arauco Generación S.A. - 99,9779 99,9779 99,9779
96,565,750-9 Aserraderos Arauco S.A. - 99,9779 99,9779 99,9779
82,152,700-7 Bosques Arauco S.A. - 99,9779 99,9779 99,9779
93,458,000-1 Celulosa Arauco y Constitución S.A. 99,9779 - 99,9779 99,9779
79,874,200-0 Compañía de Inversiones Mobiliarias Ltda. 10,0000 90,0000 100,0000 100,0000
85,840,100-3 Compañía de Turismo de Chile Ltda. 98,0000 2,0000 100,0000 100,0000
96,531,500-4 Compañía Eléctrica de Osorno S.A. - - - 93,8782
96,656,810-0 Cía. Latinoamericana Petrolera Número Dos S.A. 60,0000 - 60,0000 60,0000
96,623,630-2 Compañía Minera Can-Can S.A. 51,0000 - 51,0000 51,0000
96,657,900-5 Controladora de Plagas Forestales S.A. - 50,9262 50,9262 50,9746
96,765,270-9 Distribuidora Centromaderas S.A. - 99,9779 99,9779 99,9779
88,272,600-2 Empresa Eléctrica de Aisén S.A. - - 0,0000 86,0568
91,715,000-1 Empresa Eléctrica de La Frontera S.A. - - 0,0000 91,5672
96,573,310-8 Forestal Arauco S.A. 0,0752 99,9027 99,9779 99,9779
85,805,200-9 Forestal Celco S.A. - 99,9779 99,9779 99,9779
93,838,000-7 Forestal Cholguán S.A. - 97,3290 97,3290 98,2283
96,567,940-5 Forestal Valdivia S.A. - 99,9779 99,9779 99,9779
96,563,550-5 Inversiones Cholguán S.A. - 97,3652 97,3652 95,4289
96,569,490-0 Inversiones Década S.A. 99,2703 - 99,2703 99,2023
79,990,550-7 Investigaciones Forestales Bioforest S.A. - 99,9779 99,9779 99,9779
96,768,760-K Paneles Arauco S.A. - 99,9779 99,9779 99,9779
91,123,000-3 Pesquera Iquique-Guanaye S.A. 50,2177 31,7149 81,9326 81,9326
96,932,590-K Pesquera Ligure S.A. - - - 81,9244
88,840,700-6 Servicios de Combustibles Ltda. 99,9803 0,0197 100,0000 100,0000
96,637,330-K Servicios Logísticos Arauco S.A. - 99.9779 99.9779 99,9779
78,953,900-6 Servicios y Transportes Setracom Ltda. 1,0000 97,7762 98,7762 98,6683
96,701,470-2 Sistema de Transmisión Del Sur S.A. - - - 93.8783
90,021,000-0 Sociedad Austral de Electricidad S.A. - - - 93.8806
96,929,960-7 Southpacific Korp. S.A. - 61,4495 61,4495 61,4495
79,904,920-1 Transportes de Combustibles Chile Ltda. 99,0000 1,0000 100,0000 100,0000
0-E Alto Paraná S.A. - 99,9479 99,9479 99,9606
0-E Arauco Denmark Aps. - 99,9779 99,9779 99,9779
0-E Arauco Ecuador S.A. - 99,9779 99,9779
-0-E Arauco Forest Products B.V. - 99,9779 99,9779 99,9779
0-E Arauco Honduras S.R.L. de C.V. - 99,9779 99,9779 99,9779
0-E Arauco Perú S.A. - 99,9779 99,9779 99,9779
0-E Arauco Wood Products Inc. - 99,9779 99,9779 99,9779
0-E Araucomex S.A. de C.V. - 99,9779 99,9779 99,9779
0-E Copec Canal Inc. 100,0000 - 100,0000 100,0000
0-E Copec International Inc. 100,0000 - 100,0000 100,0000
0-E Forestal Arauco Guatemala S.A. - 99,9779 99,9779 99,9779
0-E Forestal Cono Sur S.A. - 97,3913 97,3913 98,2458
0-E Forestal Misiones S.A. - 99,9776 99,9776 99,9777
0-E Igemar Overseas S.A. - 81,9326 81,9326 81,9326
0-E Industrias Forestales S.A. (Argentina) - 99,9779 99,9779 99,9779
0-E Patagonian Pride S.A.I. y C. - 81,9317 81,9317 81,9318
0-E Trupán Argentina S.A. - 99,9485 99,9485 99,9610
126
127
N o t e 3
Changes in Accounting Principles
There were no changes made in the application of accounting principles or estimates during the present year as compared with the previous year.
N o t a 4
Marketable Securities
On January 10, 2001, the subsidiary Cia. de Inversiones Mobiliarias Ltda. sold its entire shareholding (23,887,716 shares) in Compañía
Cervecerías Unidas S.A. This generated a consolidated gain of ThCh$ 51,426,449 which is shown in Other non-operating income (Note 23).
2001
Breakdown of balance:
Book value Instrument 2001 2000 ThCh$ ThCh$ Shares 319,368 40,612,351 Bonds 320,281 13,133,471Mutual fund units 47,952,432 82,371,048
Foreign mutual funds 365,019,618 10,904,704
Total marketable securities 413,611,699 147,021,574
Shares
Number of Percentage Market value Market value Restated
Tax No. Company shares holding per share of investment cost
90,635,000-9 Compañía de Telecomunicaciones de Chile S.A. 44,479 0.0046 2,198 97,760 87,955 88,221,200-9 Empresa Eléctrica de Magallanes S.A. 26,674 0.2039 3,700 98,694 73,977 94,271,000-3 Enersis S.A. 472,520 0.0057 179 84,501 69,508 96,524,320-8 Chilectra S.A. 13,593 0.0037 2,170 29,497 23,642 90,227,000-0 Viña Concha y Toro S.A. 17,241 0.0024 477 8,226 7,820 96,805,890-8 Sociedad Matriz del Banco de Chile S.A. 154,928 0.0012 36 5,509 6,621 94,627,000-8 Parque Arauco S.A. 26,086 0.0057 190 4,951 6,304 84,671,700-5 Santa Isabel S.A. 24,800 0.0042 185 4,588 6,039 94,270,000-8 Almendral S.A. 77,790 0.0070 48 3,714 4,067 81,201,000-K Empresas Almacenes Paris S.A. 6,730 0.0011 445 2,991 3,683 90,749,000-9 Falabella S.A.C.I. 6,603 0.0003 542 3,576 3,649 90,707,000-K Empresas Pizarreño S.A. 20,000 0.0133 408 8,160 3,064 91,297,000-0 Compañía de Aceros del Pacífico S.A. 2,976 0.0020 644 1,916 2,606 96,541,920-9 Empresa Eléctrica de Antofagasta S.A. 13,324 0.0074 250 3,331 2,514 92,580,000-7 Entel Chile S.A. 404 0.0002 3,945 1,594 2,083 96,541,870-9 Empresas Eléctrica de Iquique S.A. 13,324 0.0073 180 2,398 1,511 97,006,000-6 Banco Crédito Inversiones S.A. 390 0.0004 4,768 1,859 1,429 96,542,120-3 Empresa Eléctrica de Arica S.A. 13,324 0.0072 100 1,332 1,017 91,081,000-6 Empresa Nacional de Electricidad S.A. 4,320 0.0001 226 976 568 96,555,360-6 Pacífico V Región S.A. 3,992 0.0028 217 867 552 88,006,900-4 Empresa Eléctrica del Norte Grande S.A. 13,324 0.0029 22 286 481
94,478,000-9 Indiver S.A. 2,262 0.0008 190 430 481
96,708,490-5 Forestal Terranova S.A. 1,200 0.0002 285 342 231
92,165,000-0 Infodema S.A. 12,500 0.0044 3 31 58
0-E Papelera Inversora S.A. 8,907 0.0000 2 10,572 10,572
Value of investment portfolio 378,101 320,432
Adjustment provision (1,064)
Fixed-income securities:
Instrument Purchase Expiry Par Book value Market
Date Date Value Amount Rate value Provision
Banco Santiago Bonds 11/11/1997 10/15/2011 345,785 320,281 7.3 341,607
-Detail of foreign mutual funds:
2001 2000
Fund Investor company ThCh$ ThCh$
Citifund USA Celulosa Arauco y Constitución S.A. and subsidiaries 235,381,212 10,904,704
JPM Short Duration US Fixed Income Parent Company 75,558,010 -
JPM Institutional Money Market Fund, Ltd. Parent Company 42,190,238 -
Short Term US Gover Income Fund Parent Company 9,803,035 -
Citifund Instit. Liquid Reser. Ltd. Parent Company 2,087,123 -
Total 365,019,618 10,904,704
N o t e 5
Short-and Long-Term Debtors
Current Long term
Caption Up to 90 days 90 days up to 1 year Total current (net)
2001 2000 2001 2000 Sub-total 2001 2000 2001 2000
ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$ ThCh$
Trade accounts receivable 197,611,031 183,332,333 9,548,287 3,937,047 207,159,318 202,694,441 182,971,274 1,109,291 2,117,656 Allowance for doubtful accounts - - - - 4,464,877 - - - -Notes receivable 34,000,569 35,853,135 13,882,719 13,986,989 47,883,288 44,040,742 46,311,983 3,896,235 4,243,168 Allowance for doubtful accounts - - - - 3,842,546 - - - -Sundry debtors 20,994,418 244,914,524 2,288,369 14,971,675 23,282,787 22,113,027 259,198,356 6,731,046 6,669,638 Allowance for doubtful accounts - - - - 1,169,760 - - -
-Total long-term debtors 11,736,572 13,030,462
128
129
2001
At December 31, 2000, Sundry debtors – short term includes receivables arising from the sale of shares, as follows:
Sundry debtors -short termThCh$
Debtors from sale of shares in Gener S.A. 138,335,855 Debtors from sale of shares in Compañía General de Electricidad S.A. - CGE 83,964,377 Account receivable from Chilquinta Energía S.A. 10,381,514
Total debtors from sale of shares 232,681,746
The amount shown as Debtors from sale of shares in Gener S.A. refers to the whole sale price for those shares which were sold by the subsidiary
Servicios de Combustibles Ltda. and the Parent Company through a public share offering made in Chile by The AES Corporation on
December 28, 2000.
The amount shown as Debtors from sale of shares in Compañía General de Electricidad S.A. refers to the whole sale price for those shares which
were sold by the subsidiaries Compañía de Inversiones Mobiliarias Ltda., Saesa, Frontel, Servicios de Combustibles Ltda. and Abastible S.A. in
November 2000.
The account receivable from Chilquinta Energía S.A. refers to the sale in 1998 of the complete shareholding of the subsidiary Abastecedora de
Combustibles S.A. in Energas S.A.
Short-and long-term debtors - Additional information:
Current Long term
2001 2000 2001 2002
ThCh$ % ThCh$ % ThCh$ % ThCh$ %
TRADE ACCOUNTS RECEIVABLE
Fuels 62,577,456 30.9% 77,203,860 42.2% - 0,0% - 0,0%
Forestry 133,321,194 65.7% 87,409,187 47.8% 1,109,291 100,0% 2.117.656 100,0%
Electrical - 0.0% 14,098,707 7.7% - 0,0% - 0,0%
Fishing 4,999,631 2.5% 2,898,576 1.6% - 0,0% - 0,0%
Services & others 1,796,160 0.9% 1,360,944 0.7% - 0,0% - 0,0%
Total 202,694,441 100.0% 182,971,274 100.0% 1,109,291 100,0% 2.117.656 100,0% NOTES RECEIVABLE Fuels 18,261,114 41.5% 16,463,847 35.5% 32,060 0.8% - 0.0% Forestry 3,936,478 8.9% 5,514,831 11.9% 14,165 0.4% - 0.0% Electrical - 0.0% 1,269,749 2.7% - 0.0% - 0.0% Fishing 92,057 0.2% 51,085 0.1% - 0.0% - 0.0%
Services & others 21,751,093 49.4% 23,012,471 49.8% 3,850,010 98.8% 4,243,168 100.0%
Total 44,040,742 100.0% 46,311,983 100.0% 3,896,235 100.0% 4,243,168 100.0% SUNDRY DEBTORS Fuels 2,561,298 11.6% 14,421,974 5.6% 2,463,295 36.6% 2,564,300 38.4% Forestry 12,489,558 56.4% 15,980,279 6.1% 2,944,559 43.7% 2,112,636 31.7% Electrical - 0.0% 28,956,641 11.2% - 0.0% 1,992,702 29.9% Fishing 6,937,693 31.4% 1,490,140 0.6% 1,323,192 19.7% - 0.0% Services & others 124,478 0.6% 198,349,322 76.5% - 0.0% - 0.0%
Total 22,113,027 100.0% 259,198,356 100.0% 6,731,046 100.0% 6,669,638 100.0%
N o t e 6
Balances and Transactions with Related Parties
The relationship "Parent Company director control" shown in the following charts relates the Parent Company to those companies in which a Parent
Company director is able to name at least one director in the other company.
In addition to the transactions with related entities detailed in this Note, the subsidiary Forestal Arauco S.A. in 2000 acquired 359,030,386 shares
in Forestal Cholguan S.A., a company related to the same controlling group.
Notes and accounts receivable:
Tax No. Company Short- term Long- term
2001 2000 2001 2000
ThCh$ ThCh$ ThCh$ ThCh$
96,893,820-7 Corpesca S.A. 3,792,324 1,698,921 192,746 7,627,715
96,942,120-8 Air Bp Copec S.A.. 1,770,631 - 2,160,806 -
96,668,110-1 Cía. Latinoamericana Petrolera S.A. 2,360,422 - - -
96,532,330-9 CMPC Celulosa S.A. 882,031 890,536 - -
96,641,810-9 Gas Natural Producción S.A. - - 695,260 695,260
99,285,000-0 Compañía de Seguros Generales Cruz del Sur S.A. 631,304 429,421 - -
90,160,000-7 Compañía Sudamericana de Vapores S.A. 360,456 1,156,074 - -
85,759,000-7 Compañía de Lubricantes de Chile Ltda. 288,814 458,409 - 1,281,355
96,731,890-6 Cartulinas CMPC S.A. 196,832 - - -
92,048,000-4 Sudamericanas Agencias Aéreas y Marítimas S.A. 140,395 408,550 - -
91,656,000-1 Industrias Forestales S.A. 115,531 - - -
77,090,440-4 Socieadad Contractual Minera Vilacollo 42,200 - - -
95,304,000-K C.M.P.C. Maderas S.A. 25,002 18,566 - -
96,853,150-6 Papeles Cordillera S.A. 22,321 - - -
82,777,100-7 Puerto de Lirquén S.A. 8,095 4,393 - -
91,440,000-7 Foresatal Mininco S.A. 7,094 14,601 - -
96,635,700-2 Empresa Eléctrica Guacolda S.A. 6,122 30,990 - -
96,529,310-8 CMPC Tissue S.A. 5,074 14,911 - -
94,052,000-2 Maestranza Iquique S.A. 3,766 2,392 - -
89,201,400-0 Envases Impresos S.A. 1,812 661 - -
95,503,000-1 Logística Integral S.A. 1,105 2,574 - -
79,943,600-0 Propa S.A. 701 - - -
87,635,000-9 Sociedad Edificio Don Crescente Ltda. 386 - - -
81,095,400-0 Sociedad Nacional de Oleoductos S.A. 118 4,423 - -
71,625,000-8 Fundación Educacional Arauco - 43,735 - -
0-E Edersa - 31,420 - -
96,657,800-9 Compañía Minera Tierra del Fuego S.A. - 10,018 - -
96,722,460-K Metrogas S.A. - 7,902 - -
86,370,800-1 Sigma Servicios Informáticos S.A. - 4,723 - -
91,643,000-0 Empresa Pesquera Eperva S.A. - 4,343 - -
92,545,000-6 Servicios y Refinerías del Norte S.A. - 2,427 - -
79,895,330-3 Compañía Puerto de Coronel S.A. - 464 - -
130
131
2001
Notes and accounts payable:
Tax No. Company Short -term Largo Plazo
2001 2000 31/12/2001 31/12/2000
ThCh$ ThCh$ ThCh$ ThCh$
77,090,440-4 Sociedad Contractual Minera Vilacollo 654,790 - - - 85,759,000-7 Compañía de Lubricantes de Chile Ltda. 192,965 324,720 86,157 122,675 81,095,400-0 Sociedad Nacional de Oleoductos S.A. 209,132 44,924 - - 82,777,100-7 Puerto de Lirquén S.A. 153,973 123,088 - - 79,895,330-3 Compañía Puerto de Coronel S.A. 107,545 72,616 - - 86,370,800-1 Sigma Servicios Informáticos S.A. 73,848 116,545 - - 71,625,000-8 Fundación Educacional Arauco 58,054 - - - 82,040,600-1 Sociedad de Inversiones de Aviación Ltda. 37,226 28,531 - -
96,722,460-K Metrogas S.A. 24,529 2,292 - -
96,925,430-1 Servicios Corporativos Sercor S.A. 16,737 5,465 - -
96,529,310-8 CMPC Tissue S.A. 14,196 9,955 - -
94,052,000-2 Maestranza Iquique S.A. 7,779 8,020 - -
96,715,160-2 Exapesca S.A. 7,258 47,318 - -
99,285,000-0 Compañía de Seguros Generales Cruz del Sur S.A. 5,215 8,752 - - 90,160,000-7 Compañía Sudamericana de Vapores S.A. 3,986 8,534 - - 91,643,000-0 Empresa Pesquera Eperva S.A. 3,490 6,939 - -
96,942,120-8 Air BP Copec S.A. 2,123 - - -
92,545,000-6 Servicios y Refinerías del Norte S.A. 85 80 - -
94,238,000-3 Astilleros Arica S.A. - 853,586 - -
96,893,820-7 Corpesca S.A. - 53,574 - -
95,503,000-1 Logística Integral S.A. - 201 - -
Total 1,572,931 1,715,140 86,157 122,675
Transactions:
2001 2000
Effect on Effect on
Company Tax No. Relation Transaction income income
Amount (charge/credit) Amount (charge/credit)
ThCh$ ThCh$ ThCh$ ThCh$
Compañía de Lubricantes de Chile Ltda. 85,759,000-7 Associate Rental paid 3,450,642 (3,450,642) 3,074,963 (3,074,963) Compañía de Lubricantes de Chile Ltda. 85,759,000-7 Associate Expense reimbursement 894,537 - 942,029 - Compañía de Lubricantes de Chile Ltda. 85,759,000-7 Associate Other purchases 34,432 (17,288) 4,274 (4,274) Compañía Sudamericana de Vapores S.A. 90,160,000-7 Parent Company Fuel sales 3,839,610 3,839,610 4,841,039 4,841,039
director control
Compañía Sudamericana de Vapores S.A. 90,160,000-7 Parent Company Lubricant sales 172,111 172,111 72,786 72,786 director control
Compañía Sudamericana de Vapores S.A. 90,160,000-7 Parent Company Lubricants transportation 46,716 (42.224) 47,513 (47,513) director control
Sudamericana Agencias Aéreas 92,048,000-4 Parent Company Fuel sales 2,984,220 2,984,220 1,219,025 1,219,025 y Marítimas S.A. director control
Sudamericana Agencias Aéreas 92,048,000-4 Parent Company Lubricant sales 100,674 100,674 150,937 150,937 y Marítimas S.A. director control
Sociedad Nacional de Oleoductos S.A. 81,095,400-0 Associate Rental paid 1,484,315 (1,484,315) 1,024,395 (1,024,395) Sociedad Nacional de Oleoductos S.A. 81,095,400-0 Associate Lubricant sales 28,394 28,394 80,570 80,570 Sociedad Nacional de Oleoductos S.A. 81,095,400-0 Associate Fuel sales 59,291 59,291 55,984 55,984 Sociedad Nacional de Oleoductos S.A. 81,095,400-0 Associate Expense reimbursement 27 - 10,248 - Sociedad Nacional de Oleoductos S.A. 81,095,400-0 Associate Commissions paid 140,108 (140,108) 2,760 (2,760) Cía. Puerto de Coronel S.A. 79,895,330-3 Parent Company Stock-piling services 1,413,698 (1,413,698) 845,689 (845,689)
director control
Puerto de Lirquén S.A. 82,777,100-7 Associate Port services 1,023,411 1,023,411 1,060,701 (1,060,701) Puerto de Lirquén S.A. 82,777,100-7 Associate Fuel sales 153,069 153,069 49,127 49,127 Puerto de Lirquén S.A. 82,777,100-7 Associate Lubricant sales 17,064 17,064 10,106 10,106 Industrias Forestales S.A. 91,656,000-1 Parent Company Fuel sales 538,260 538,260 - -
Transactions:
(Continued)2001 2000
Effect on Effect on
Company Tax No. Relation Transaction income income
Amount (charge/credit) Amount (charge/credit)
ThCh$ ThCh$ ThCh$ ThCh$
Industrias Forestales S.A. 91,656,000-1 Parent Company Lubricant sales 24,812 24,812 - -director control
Sigma Servicios Informáticos S.A. 86,370,800-1 Parent Company Service and advice 196,357 (180,489) 177,565 (177,565) director control
Sigma Servicios Informáticos S.A. 86,370,800-1 Parent Company Computer services 166,197 (87,169) 177,561 (68,306) director control
Sociedad de Inversiones de Aviación Ltda. 82,040,600-1 Associate Warehousing 336,893 336,893) 198,692 (198,692) Sociedad de Inversiones de Aviación Ltda. 82,040,600-1 Associate Other sales 194 194 - - Empresa Pesquera Eperva S.A. 91,643,000-0 Parent Company Office rental 39,607 (39,607) - -
director control
Empresa Pesquera Eperva S.A. 91,643,000-0 Parent Company Fishing quota rights 113,745 (113,745) - - director control
Astilleros Arica S.A. 94,283,000-9 Parent Company Fleet maintenance and repairs 123,634 (123,634) 113,372 (113,372) director control
Inversiones Siemel S.A. 94,082,000-6 Parent Company Other purchases 18,698 - 155,542 - director control
Inversiones Siemel S.A. 94,082,000-6 Parent Company Fuel sales 1,763 1,763 1,309 1,309 director control
Fundación Educacional Arauco 71,625,000-8 Parent Company Other sales 307 - 278 - director control
Fundación Habitacional Arauco 71,681,100-K Parent Company Other sales 140 - 34,595 - director control
Chilena de Moldeados S.A. 93,658,000-9 Parent Company Fuel sales - - 534,490 534,490 director control
Servicios y Refinerías del Norte S.A. 92,545,000-6 Parent Company Fish-oil sales - - 175,528 175,528 director control
CMPC Tissue S.A. 96,529,310-8 Parent Company Fuel sales 28,421 28,421 488,831 488,831 director control
CMPC Tissue S.A. 96,529,310-8 Parent Company Lubricant sales 7,012 7,012 19.336 19,336 director control
CMPC Tissue S.A. 96,529,310-8 Parent Company Other purchases 92,963 (92,963) 74,305 (74,305) director control
CMPC Celulosa S.A. 96,532,330-9 Parent Company Fuel sales 7,072,303 7,072,303 8,137,521 8,137,521 director control
Exapesca S.A. 96,715,160-2 Associate Sales commissions 23,075 (23,075) 28,032 (28,032) Exapesca S.A. 96,715,160-2 Associate Expenses recovered 527 (527) - - Exapesca S.A. 96,715,160-2 Associate Fish-oil purchase - - 35,200 (32,500) Cartulinas CMPC S.A. 96,731,890-6 Parent Company Fuel sales 798,758 798,758 - -
director control
Cartulinas CMPC S.A. 96,731,890-6 Parent Company Lubricant sales 15,380 15,380 - - director control
Corpesca S.A. 96,893,820-7 Associate Fuel sales 8,551,075 8,551,075 9,585,569 9,585,569 Corpesca S.A. 96,893,820-7 Associate Lubricant sales 467,596 467,596 358,412 358,412 Corpesca S.A. 96,893,820-7 Associate Administrative expenses 13,655 (13,655) - - Corpesca S.A. 96,893,820-7 Associate Production service and others - - 1,584,802 (1,584,802) Servicios Corporativos Sercor S.A. 96,925,430-1 Associate Administrative advice 61,847 (61,847) 19,929 (19,929) Air Bp Copec S.A. 96,942,120-8 Associate Fuel sales 18,023,505 18,023,505 - - Air Bp Copec S.A. 96,942,120-8 Associate Other sales 81,580 30,901 - - Air Bp Copec S.A. 96,942,120-8 Associate Lubricant sales 145 145 - - Air Bp Copec S.A. 96,942,120-8 Associate Other purchases 15,213 (15,213) - - Compañía de Seguros Generales 99,285,000-0 Parent Company Insurance 5,939,487 (5,829,042) 2,923,359 (2,923,359)
Cruz del Sur S.A. director control
Compañía de Seguros Generales 99,285,000-0 Parent Company Refund of insurance premiums 71,539 (76,394) - - Cruz del Sur S.A. director control
Maestranza Iquique S.A. 94,052,000-2 Parent Company Expenses recovered - - 352 352 director control
132
133
2001
Additional information on balances and transactions with Related Parties
Additional information:
In general, balances receivable and payable at the year end arise from consolidated business commercial transactions under normal market
conditions. However, the following is a detail of the balances which did not arise from normal commercial transactions.
Notes and accounts receivable:
Company Classification 2001 2000 Comments
ThCh$ ThCh$
Corpesca S.A. Short-term 3,175,518 - Trading current account Long-term 192,746 7,627,715 Trading current account Air Bp Copec S.A. Short-term 60,457 - Line of credit (1)
Long-term 2,160,806 - Line of credit (1)
Short-term 12,452 - Accrued interest Gas Natural Producción S.A. Long-term 695,260 695,260 Future capital increases Compañía de Lubricantes de Chile Ltda. Short-term 288,814 458,409 Sale of assets & others Long-term - 1,281,355 Sale of assets & others Empresa Eléctrica Guacolda S.A. Short-term - 13,793 Coal sales Sociedad Nacional de Oleoductos S.A. Short-term 118 4,423 Expense reimbursements Cía. de Seguros Generales Cruz del Sur S.A. Short-term - 76,504 Balance in current account Fudación Educacional Arauco Short-term - 43,735 Advances in current account
Notes and accounts payable
Empresa Classification 2001 2000 Comments
ThCh$ ThCh$
Compañía de Lubricantes de Chile Ltda. Short-term 49,221 49,210 Loan for investments (2) Long-term 86,157 122,675 Loan for investments (2)
Notas:
(1) This line of credit is denominated in US dollars and carries an interest rate of Libor + 1% with annual principal and interest repayments.
Inventories:
The principal components of inventories are:
Inventories: 2001 2000
ThCh$ ThCh$
Forests & plantations in the process of exploitation 128,323,231 99,837,930
Forestry products 101,225,711 109,255,749 Fuels 27,901,673 69,920,994 Raw materials 20,850,360 18,974,589 Household appliances 9,804,580 8,904,294 Lubricants 7,481,660 6,149,053 Manufacturing materials 3,182,740 2,334,809
Fishmeal and oil & other fish products 2,570,912 4,417,345
Other 4,586,596 2,946,972
Subtotal 305,927,463 322,741,735
Less: Provision for obsolescence (493,849) (387,904)
Adjustment to realizable value (99,184) (43,188)
Total 305,334,430 322,310,643
N o t e 8
Income Tax and Deferred Taxes
Deferred taxes
Concept 2001 2000
Deferred tax asset Deferred tax liability Deferred tax asset Deferred tax liability Short- term Long- term Short- term Long- term Short- term Long- term Short- term Long- term
TIMING DIFFERENCES
Allowance for doubtful accounts 2,502,065 181,016 - - 1,904,624 1,017,876 - - Unearned income 252,493 23,116 - - 357,250 - 259,108 - Provision for personnel vacations 995,660 - - - 767,642 - - 23,145 Amortization of intangible assets - - 24,522 - - - - - Leased assets 50,611 6,209 46,266 69,457 3,240 72,241 - 144,346 Manufacturing expenses - - 4,131,880 28,290 229 - 4,890,452 3,177 Fixed asset depreciation - - 29,250 67,676,410 - 3,594,341 - 63,590,925 Severance indemnities 701,221 885,170 - - 665,669 673,747 84 111,569 Other events 1,304,118 1,054,229 221,849 2,335,258 1,061,658 518,335 29,581 228,384 Results of investments abroad - - - 1,943,135 - - - 1,397,843 Provision for reduced value of inventories 277,743 - - - 184 373,448 301,148 - Provision for reduced value of assets for sale 14,954 - - - -
Plantation valuation - - - 251,674 - -
Deferred expenses - - 498,464 1,458,939 - - 239,929 210,034 Provision for programmed maintenance 442,636 - - - 408,961 - - - Provision for obsolescence 375,437 - - - 408,756 - - 9,440 Debt issue and project expenses - - - 3,517,945 - - - 3,799,987 Unrealized gain on sale of assets - - - 487,829 6,194,346 - - 631,034 Fixed asset valuation - 60,691,523 - 22,098,732 - 53,716,033 - 19,669,887 Tax loss 2,408,460 23,447,820 - - 1,566,027 25,429,847 - - Devaluation of Argentine peso 1,693,538 6,774,151 - - - -
OTHER
Complementary accounts net of amortization 22,985 47,490,007 44,321 29,332,152 609,557 40,411,591 222 23,748,541 Provision for valuation 414,400 31,609,665 - - 75,504 37,511,885 - -
134
135
2001
Item 31/12/2001 31/12/2000
ThCh$ ThCh$
Current tax expense (tax provision) (25,498,586) (47,305,077)
Tax charge adjustment (prior year) (97,439) (80,099)
Deferred tax asset or liability during the year 2,180,641 3,731,553
Tax benefit from tax losses 7,628,723 8,611,254
Effect of amortization of complementary deferred asset and liability accounts 97,413 (2,932,008)
Deferred tax assets or liabilities from changes in the valuation provision (5,416,304) (1,659,418)
Other charges or credits (453,301) (82,312)
Total (21,558,853) (39,716,107)
Income Tax and Deferred Taxes - Additional information
a) Tax losses
The balance of tax losses at the year-end amounts to ThCh$ 150,720,009 (ThCh$ 142,428,028 in 2000), arising mainly from the subsidiaries
Pesquera Iquique-Guanaye S.A., Servicios de Combustibles Ltda., Forestal Valdivia S.A. and Alto Paraná S.A.
b) Retained taxed and non-taxed earnings
The Parent Company’s retained taxed earnings at the year end will have the following tax effect for its shareholders, once the earnings are
distributed:
Item 2001 2000
ThCh$ ThCh$
TAXED EARNINGS
Income with no tax credit - 46,324,272
Income with 15% credit 83,654,472 299,591,641
Income with 10% credit - 7,936,049
Total retained taxable profits 83,654,472 353,851,962
NON-TAXED EARNINGS
Income not treated as income for tax purposes 15,527,445 122,001,637
Exempt income - 14,274
Total retained non-taxed earnings 15,527,445 122,015,911
DIVIDENDS AND PARTICIPATIONS RECEIVED DURING THE YEAR
Dividends and participations received during the year, pending certification 57,165,909 81,722,610
Total dividends and participations received during the year 57,165,909 81,722,610
c) Deferred Taxes
Law 19.753 introduces some modifications to the Income Tax Law, one of these being to increase company income tax rates from 15% to 16%
during 2002, to 16.5% during 2003 and to 17% as from 2004, The effect on deferred taxes of this change in rates generated a charge to income
for 2001 of ThCh$ 7,926,425.
Other Current Assets
The principal components are:
Components 2001 2000
ThCh$ ThCh$
Rights under resale agreements 40,747,232 24,024,893
Materials, supplies and spares 23,199,585 25,549,502
Bond placement costs 1,866,342 1,203,395
Deferred expenses 591,878 743,142
Rights under derivative contracts 294,960 1,587,739
Assets for sale 273,767 236,561
Insurance claims 49,080 504,391
Deposits and notes issued in guarantee 1,300 24,519,345
Other 653,478 304,746
Subtotal 67,677,622 78,673,714
LESS:
Provisions for obsolescence of materials and supplies (1,997,989) (2,935,763)
Adjustment to market values of assets for sale (93,465) (97,877)
Total 65,586,168 75,640,074
Rights under resale agreements relate to securities subject to resale agreements expiring within one year at the year end. Resale values do not
differ significantly from their market value (Note 10).
Rights under derivative contracts relate to forward contracts used as an exchange hedge against US dollar obligations (Note 28).
The deposits and notes in guarantee at the year end include ThCh$ 24,486,294 (ThUS$ 41,402) granted by the subsidiary Copec Canal Inc. to
Salomon Smith Barney to cover the exchange of Gener S.A. shares for Gener S.A. ADRs in the US market, a transaction within the process of
exchanging Gener S.A. ADRs for The AES Corporation ADS.
136
137
2001
N o t e 1 0
Information on resale transactions
Purchases under resale agreements (CRV)
Code Investment Expiry Counterparty Currency Subscription Rate Final Instrument Market
date date value value value
ThCh$ % ThCh$
Resale agreement 12/19/2001 12/02/2002 Banco de Chile Ch$ 280,000 0.0052 280,631 PRBC 277,381 Resale agreement 12/20/2001 12/14/2002 Scotiabank Sud Americano Ch$ 450,000 0.0053 450,954 PRBC 452,881 Resale agreement 12/21/2001 12/04/2002 Scotiabank Sud Americano Ch$ 2,250,000 0.0055 2,254,538 PRBC 2,268,912 Resale agreement 12/26/2001 12/03/2002 Santander Ch$ 300,000 0.0054 300,324 PRBC 296,689 Resale agreement 12/27/2001 12/14/2002 Scotiabank Sud Americano Ch$ 250,000 0.0053 250,220 PRBC 252,943 Resale agreement 12/26/2001 12/03/2002 BBVA CB BHIF Ch$ 890 0.0056 891 PDBC 891 Resale agreement 12/26/2001 12/03/2002 BBVA CB BHIF Ch$ 2,016,110 0.0056 2,019,121 PRC 2,017,992 Resale agreement 12/21/2001 12/04/2002 Banchile Ch$ 6,500,000 0.0173 6,517,290 PDBC 6,512,350 Resale agreement 12/18/2001 12/02/2002 BBVA Banco Bhif Ch$ 1,000,000 0.0055 1,002,750 PDBC 1,002,383 Resale agreement 12/19/2001 12/02/2002 BBVA Banco Bhif Ch$ 1,000,000 0.0056 1,002,613 PDBC 1,002,240 Resale agreement 12/26/2001 12/08/2002 BBVA Banco Bhif Ch$ 476,000 0.0054 477,114 PDBC 476,428 Resale agreement 12/27/2001 12/14/2002 BBVA Banco BhifF Ch$ 3,000,000 0.0054 3,009,720 PDBC 3,002,160 Resale agreement 12/18/2001 12/11/2002 Banco BICE Ch$ 1,500,000 0.0048 1,503,360 PCD 1,500,720 Resale agreement 12/17/2001 12/02/2002 Banco Crédito Inversiones Ch$ 1,632,959 0.0054 1,637,662 CERO 1,637,074 Resale agreement 12/17/2001 12/02/2002 Banco Crédito Inversiones Ch$ 183,041 0.0054 183,568 PRC 183,503 Resale agreement 12/16/2001 12/07/2002 Banco Crédito Inversiones Ch$ 1,000,000 0.0054 1,002,160 PRD 1,000,900 Resale agreement 12/17/2001 12/10/2002 Banco Crédito Inversiones Ch$ 3,000,000 0.0054 3,007,560 PRD 3,002,160 Resale agreement 12/17/2001 12/02/2002 Banco Edwards Ch$ 500,000 0.0055 501,467 CERO 501,283 Resale agreement 12/18/2001 12/02/2002 Banco Edwards Ch$ 737,000 0.0055 739,027 CERO 738,757 Resale agreement 12/27/2001 12/08/2002 Banco Edwards Ch$ 1,500,000 0.0055 1,503,300 CERO 1,501,100 Resale agreement 12/27/2001 12/08/2002 Banco de Chile Ch$ 1,000,000 0.0053 1,002,120 PRD 1,000,707 Resale agreement 12/27/2001 12/09/2002 Banco de Chile Ch$ 649,000 0.0053 650,491 PRD 649,459 Resale agreement 12/28/2001 12/11/2002 Banco de Chile Ch$ 363,000 0.0046 363,779 PRD 363,167 Resale agreement 12/24/2001 12/04/2002 Banco Santiago Ch$ 78,984 0.0058 79,152 PCD 79,091 Resale agreement 12/24/2001 12/04/2002 Banco Santiago Ch$ 1,492,016 0.0058 1,495,189 PDBC 1,494,035 Resale agreement 12/27/2001 12/09/2002 Banco Santiago Ch$ 309,777 0.0053 310,489 PCD 309,996 Resale agreement 12/27/2001 12/09/2002 Banco Santiago Ch$ 2,690,223 0.0053 2,696,401 PDBC 2,692,124 Resale agreement 12/20/2001 12/07/2002 Banco Security Ch$ 310,000 0.0054 311,004 PRD 310,614 Resale agreement 12/26/2001 12/07/2002 Banco Security Ch$ 1,000,000 0.0054 1,002,160 PRD 1,000,900 Resale agreement 12/27/2001 12/08/2002 Banco Security Ch$ 500,000 0.0054 501,080 PRD 500,360 Resale agreement 12/27/2001 12/09/2002 Banco Security Ch$ 500,000 0.0054 501,170 PRD 500,360 Resale agreement 12/17/2001 12/02/2002 Scotiabank Sud Americano Ch$ 500,000 0.0054 501,440 PDBC 501,260 Resale agreement 12/27/2001 12/10/2002 Scotiabank Sud Americano Ch$ 1,000,000 0.0053 1,002,473 PDBC 1,000,706 Resale agreement 12/20/2001 12/03/2002 Banco Sudameris Ch$ 800,000 0.0054 802,016 PDBC 801,584 Resale agreement 12/20/2001 12/07/2002 Banco Sudameris Ch$ 747,317 0.0054 749,738 PDBC 748,796 Resale agreement 12/20/2001 12/07/2002 Banco Sudameris Ch$ 2,683 0.0054 2,692 PRC 2,689 Resale agreement 12/27/2001 12/08/2002 Banco Sudameris Ch$ 500,000 0.0054 501,080 PDBC 500,360 Resale agreement 12/24/2001 12/08/2002 Banco Crédito Inversiones Ch$ 291,241 0.0054 291,923 PRD 291,728 Resale agreement 12/20/2001 12/02/2002 Banco Crédito Inversiones Ch$ 50,000 0.0053 50,115 PDBC 50,097 Resale agreement 12/26/2001 12/10/2002 Banco de Chile Ch$ 93,000 0.0038 93,153 PDBC 93,035 Resale agreement 12/28/2001 12/14/2002 Banco de Chile Ch$ 138,000 0.0041 138,321 PRD 138,057 Resale agreement 12/28/2001 12/14/2002 Banchile US$ 101,492 0.0080 105,922 PRD 101,499
Fixed Assets
This heading mainly comprises forests and forest plantations, industrial plants for producing wood-pulp, fishmeal and wood, fuel storage facilities,
electricity distribution networks, fuel and lubricant service stations, land and industrial machinery and equipment of the consolidated businesses.
Accumulated depreciation of: 2001 2000
ThCh$ ThCh$
Buildings and infrastructure (607,655,706) (622,012,536)
Machinery and equipment (484,772,828) (418,690,940)
Other fixed assets (115,418,502) (99,138,181)
Incremental value after technical reappraisal of fixed assets (42,073,431) (42,195,426)
Total (1,249,920,467) (1,182,037,083)
Depreciation for the year 2001 2000
ThCh$ ThCh$
CHARGE TO INCOME:
Operating expenses 105,238,031 85,069,080
Administrative and selling expenses 5,183,176 5,423,876
Non-operating results 2,521,185 1,445,607
Subtotal - charge to income 112,942,392 91,938,563
OTHER CHARGES
Inventories (production cost) 699,327 655,542
Investment in forests and plantations 451,462 639,059
Shareholders' equity - Other revaluation reserves (D.L. No. 110) 434,333 435,908
Subtotal - Other charges 1,585,122 1,730,509
Total depreciation for the year 114,527,514 93,669,072
The principal items comprising other fixed assets are: 2001 2000
ThCh$ ThCh$
Forests and plantations 1,266,639,284 1,234,226,301
Leased assets 5,004,773 4,669,794
Household gas cylinders, tanks and meters 69,962,977 67,790,772
Work in progress 86,649,420 74,151,053
Fixed asset spares 19,677,017 18,225,627
Acquisition and development of computer systems 12,097,781 12,474,998
Goods on consignment 13,118,679 12,608,414
Other fixed assets 63,292,832 59,016,496
138
139
2001
Balance of "Incremental value from technical reappraisals" are the following:
Gross assets Accumulated depreciation
2001 2000 2001 2000
ThCh$ ThCh$ ThCh$ ThCh$
Land 648,400 648.400 - -
Buildings and infrastructure 21,222,995 21,252,249 (18,816,850) (18,654,628)
Machinery and equipment 23,283,364 23,874,935 (21,712,226) (21,992,376)
Other fixed assets 1,545,684 1,550,714 (1,544,355) (1,548,422)
Total 46,700,443 47,326,298 (42,073,431) (42,195,426)
Installment
2001
Date
Installments
amount
Leased assets
ThCh$
Start / End
pending
ThCh$
Crane trucks 110,124 04-98 / 05-02 5 2,022
Jeep Vitara Rugby 14,460 09-01 / 09-03 21 717
1 TIMCO harvester, Mod T45 80,171 07-98 / 04-02 4 2,551
1 TIMCO harvester, Mod T45 118,862 01-98 / 07-02 7 2,647
Offices at 215 Aníbal Pinto St. of 810, Concepción 67,819 03-92 / 02-02 - -
Sugimat Thermal-oil vertical boiler 122,723 03-99 / 09-02 9 3,538
Offices at Nueva Lyon, 5th and 6th floors 1,789,584 10-94 / 10-04 34 1,313
Offices at Nueva Lyon, 5th and 6 th floors 1,142,809 12-00 / 12-20 182 364
Los Andes building 597,469 03-97 / 03-17 227 297
Los Andes building 667,826 12-01 / 12-21 240 185
Atlas Copco 5 compressor 49,789 06-00 / 02-02 2 3,395
Scoop 10 87,208 06-00 / 02-02 2 5,898
Fiat Allis loader 90,560 01-01 / 10-02 10 7,005
Atlas Copco compressors 65,369 11-01 / 12-02 12 5,028
Gross value 5,004,773
Accumulated depreciation (644,245)
Net value 4,360,528
