Financial Performance - The Coca-Cola Company accounted for 65% and 61% of the company's net sales in 2020 and 2021, respectively, highlighting the significant reliance on this relationship[24] - The company reported a significant increase in revenue, achieving $1.5 billion in Q3 2023, representing a 15% year-over-year growth[1] - The company provided an optimistic outlook, projecting a revenue growth of 12-15% for the next quarter[3] - New product launches contributed to a 25% increase in sales in the beverage segment[4] - The company’s revenue from Brazil increased from Ch$47,946 million in 2020 to Ch$53,966 million in 2021[357] - The company’s revenue from Argentina rose from Ch$789 million in 2020 to Ch$1,918 million in 2021[357] - The company’s revenue from Paraguay increased from Ch$34 million in 2020 to Ch$41 million in 2021[357] Market and Economic Conditions - The company faces increasing competition in the beverage market, which may adversely affect net profits and margins[20] - Economic conditions in Chile significantly impact the company's operations, representing 38.0% and 44.0% of net sales in 2020 and 2021, respectively[52] - The Chilean economy grew by 1.1% in 2019, contracted by 5.8% in 2020, and grew by 11.7% in 2021, with projections for 2022 and 2023 indicating growth between 1.5% and 2.5%, and 0.0% and 1.0%, respectively[54] - Private consumption in Chile is expected to fall by 0.2% in 2022 and 1.5% in 2023, primarily due to the end of fiscal transfer programs[54] - The company is exposed to geopolitical risks, including tensions between Russia and Ukraine, which could disrupt global markets and supply chains[50] Regulatory and Compliance Risks - The company is subject to complex and changing regulations, which could impact operations and financial performance[23] - The implementation of stricter labeling requirements in Chile and Argentina may adversely affect product sales and operational results[33] - The company faces potential increases in overall tax burdens due to proposed tax reforms in Brazil[65] - The Argentine government has a history of interventionist policies that could adversely affect the company's operations and financial condition[66] - The company is subject to increasing environmental regulations, which may lead to higher operating costs and reduced consumer demand[45] Operational Challenges - Raw material costs, particularly for concentrate, sweeteners, and packaging, are subject to volatility and may impact profitability[27] - Water scarcity and poor water quality are significant risks that could increase production costs and affect capacity[29] - Adverse weather conditions and natural disasters can disrupt production and distribution, impacting sales volumes[37] - Labor unrest and the inability to renew collective bargaining agreements could lead to work stoppages, impacting operations and revenues[42] - The company faces risks related to maintaining brand image and product quality, which are critical for financial performance[34] Currency and Taxation Issues - The company is exposed to currency risks, particularly with the depreciation of local currencies against the U.S. dollar, which could raise raw material costs[27] - The Chilean peso depreciated by 8% in 2019, appreciated by 5% in 2020, and depreciated by 19% in 2021 against the U.S. dollar[57] - The Argentine peso depreciated by 59%, 41%, and 22% in 2019, 2020, and 2021, respectively, against the U.S. dollar[70] - The Brazilian real depreciated by 4%, 29%, and 7% during 2019, 2020, and 2021, respectively, against the U.S. dollar[63] Strategic Initiatives - The company is investing $200 million in new technology development to enhance production efficiency[5] - Market expansion efforts have led to a 30% increase in market share in the Latin American region[6] - The company is exploring potential acquisitions to further strengthen its position in the market[7] - Sustainability initiatives have reduced operational costs by 10% over the past year[8] - A strategic partnership with a major retailer is expected to boost sales by 15% in the upcoming quarter[10] Corporate Governance and Compensation - In 2021, the fixed remuneration paid to Coca-Cola Andina's executive officers amounted to Ch$4,401 million, a decrease from Ch$4,858 million in 2020[324] - Performance bonuses for executive officers in 2021 totaled Ch$3,107 million, up from Ch$2,817 million in 2020[324] - The aggregate compensation paid to all directors and executive officers in 2021 was Ch$9,021 million, with Ch$7,508 million allocated to executive officers[326] - The main performance indicators for the CEO's bonus include consolidated EBITDA, net income, consolidated cash flow, and capex[323] Employee Relations - As of December 31, 2021, the company had a total of 18,636 employees across South America, with 5,308 in Chile, 7,890 in Brazil, 3,210 in Argentina, and 1,602 in Paraguay[337] - In Chile, 58.86% of employees with indefinite contracts are affiliated with labor unions, totaling 1,869 union members[341] - In Brazil, 11.42% of employees are union members, with 33 collective bargaining agreements in force as of December 31, 2021[342] - In Argentina, 67.7% of employees are covered by collective bargaining agreements, with a new agreement established on October 1, 2021[342] Shareholder Information - The company reported a total of Ch$189,846,860,783 in dividends, with Ch$28,823,063,295 related to the 2021 fiscal year and Ch$159,023,797,488 from accumulated earnings[359] - The company declared dividends of Ch$189 for each Series A share and Ch$207.9 for each Series B share[359] - The company has a shareholders' agreement with The Coca-Cola Company that restricts the transfer of Series A shares without prior authorization[352] - The total number of registered ADR holders as of December 2021 was 27, representing 2.33% of the total issued and outstanding shares[363]
Embotelladora Andina S.A.(AKO_B) - 2021 Q4 - Annual Report