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Embotelladora Andina S.A.(AKO_A) - 2022 Q4 - Annual Report
AKO_AEmbotelladora Andina S.A.(AKO_A)2023-04-25 16:00

Company Overview - Coca-Cola Andina was incorporated in 1946 and is the principal manufacturer of Coca-Cola products in Chile since then[90]. - In 2012, Coca-Cola Andina merged with Embotelladoras Coca-Cola Polar S.A., granting former Polar shareholders a 19.68% ownership interest in the merged entity[93]. - In 2018, Coca-Cola Andina completed the acquisition of 100% of Comercializadora Novaverde S.A., a company focused on juices and ice cream production[93]. - The company is the largest bottler of Coca-Cola trademark beverages in Chile and Argentina, and the third largest in Brazil[108]. Financial Performance - In 2022, the company achieved consolidated net sales of Ch2,656,878millionandatotalsalesvolumeof873.6millionunitcasesofbeverages[108].−Netsalesincreasedby19.92,656,878 million and a total sales volume of 873.6 million unit cases of beverages[108]. - Net sales increased by 19.9% to Ch2,656,878 million in 2022, compared to Ch2,216,733millionin2021[204].−Grossprofitmarginimprovedto38.72,216,733 million in 2021[204]. - Gross profit margin improved to 38.7% in 2022 from 38.0% in 2021, with gross profit rising to Ch1,028,177 million[204]. - Net income decreased by 18.2% to Ch128,459millionin2022,downfromCh128,459 million in 2022, down from Ch157,032 million in 2021, resulting in a net income margin of 4.8%[204]. Sales and Market Share - The soft drinks segment accounted for 64% of the company's consolidated net sales in 2022[108]. - In Chile, the company accounted for 36.6% of total volume and 42.3% of consolidated net sales in 2022[117]. - The average soft drink market share of the company within its franchise territories was 64.4% in 2022[137]. - The Argentine soft drink operations generated net sales of Ch523,908millionin2022,withthecompanysellingproductstoapproximately68,000clientsinArgentina[127].CapitalExpendituresandInvestments−CapitalexpendituresincreasedfromCh523,908 million in 2022, with the company selling products to approximately 68,000 clients in Argentina[127]. Capital Expenditures and Investments - Capital expenditures increased from Ch141,952 million in 2021 to Ch173,675millionin2022,primarilyduetonewprojects[101].−ThecompanyplanstoallocateUS173,675 million in 2022, primarily due to new projects[101]. - The company plans to allocate US250 million for capital expenditures in 2023, focusing on machinery and infrastructure improvements across various plants[105]. - The company is investing 200millioninnewtechnologydevelopmenttoenhanceproductionefficiency[5].ProductDistributionandPartnerships−In2021,Coca−ColaAndinasignedadistributionagreementforwineproductswithVin~aSantaRita,coveringbrandslikeDon~aPaulaandSantaRita[95].−InAugust2020,Coca−ColaAndinasignedanagreementwithCervecerıˊaChileS.A.forthedistributionofABInBevbrandsinChile[93].−ThecompanydistributesawiderangeofalcoholicbeveragesinArgentina,Brazil,andChile,includingbeers,wines,andspirits[115].EnvironmentalandSustainabilityInitiatives−ThecompanyhasbudgetedforimprovementsinwateruseefficiencyandcompliancewithindustrialwatertreatmentregulationsinChileandArgentina[105].−Anewsustainabilityinitiativeaimstoreducecarbonemissionsby30200 million in new technology development to enhance production efficiency[5]. Product Distribution and Partnerships - In 2021, Coca-Cola Andina signed a distribution agreement for wine products with Viña Santa Rita, covering brands like Doña Paula and Santa Rita[95]. - In August 2020, Coca-Cola Andina signed an agreement with Cervecería Chile S.A. for the distribution of AB InBev brands in Chile[93]. - The company distributes a wide range of alcoholic beverages in Argentina, Brazil, and Chile, including beers, wines, and spirits[115]. Environmental and Sustainability Initiatives - The company has budgeted for improvements in water use efficiency and compliance with industrial water treatment regulations in Chile and Argentina[105]. - A new sustainability initiative aims to reduce carbon emissions by 30% over the next five years[8]. - The company maintains compliance with environmental standards across its operations in Brazil and Chile[176]. Executive Compensation - In 2022, fixed remuneration for Coca-Cola Andina's executive officers amounted to Ch5,406 million, an increase from Ch4,401millionin2021[287].−Performancebonusesforexecutiveofficersin2022totaledCh4,401 million in 2021[287]. - Performance bonuses for executive officers in 2022 totaled Ch3,400 million, up from Ch3,107millionin2021[287].−Theaggregatecompensationforalldirectorsandexecutiveofficersin2022wasCh3,107 million in 2021[287]. - The aggregate compensation for all directors and executive officers in 2022 was Ch10,366 million, with Ch$8,806 million allocated to executive officers[287]. Challenges and Competition - The company faced intense competition in its franchise territories, particularly from other soft drink brands, which may impact net profits and margins[137]. - Increased competition from low-price brands may limit the company's growth potential and negatively affect results[255]. Future Outlook - The company provided an optimistic outlook, projecting a revenue growth of 10-12% for the next fiscal year[3]. - The company aims to enhance its business by developing existing markets and penetrating new beverage markets, including alcoholic beverages[115].