ANNUAL REPORT 2018 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 Index
Welcome 2 Who are we? 6
Letter from the Chairman of the Board Falabella Letter from the CEO Our values Our Formats Regional Footprint Financial Indicators How do we do it? 28 History Exceed customer expectations Differentiate the value proposition Scale up logistics capability Payment solutions Corporate Governance 84 Data analysis and business intelligence Development of a flexible Board of Directors technological platform Director's Committee Develop Our Employess Integrally Management Generate Social Impact Ownership and Control Governance Manage Our Supply Chain Manage Our Environmenta Impact Investment Plan Summarized Consolidated 160 Financial Statements Corporate 108 Reasoned Analysis Information Statements of Financial Position Company Information Statements of Comprehensive Income by Function Insurance Statements of Comprehensive Income Brands and Patents Statement of Changes in Equity Regulatory Framework Statement of Cash Flows (Direct Method) Risks Awards and Acknowledgements Summary of Significant Events for Sustainability Guidelines the Year 170 Shareholders' Comments and Proposals Definition of Materiality Stock Information GRI Index Stores by Format and Country Non-financial Audit Letter Summarized Corporate Structure Information about Subsidiaries Subsidiaries with Participation
Falabella Consolidated Financial 182 investors.falabella.com 180 Statements Rut: 90.749.000-9 Declaration of Responsibility Address: Manuel Rodriguez Norte 730, Santiago, Chile. Phone: +56 (2) 2380-2000 E-mail: [email protected] Note: All figures in US dollars are calculated based on the observed exchange rate as of January 2, 2019: 694.77 $/US$. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 The digitalization of the company in all of long-term. the in sustainability and diversification us gives which base, shareholder our to investorsnew incorporated we addition, In Americancommerce. the currentLatin within position privileged a in us setting our balance sheet, giving us flexibilityand million capitalincreasethatstrengthens celerate this plan we undertook a US$ 581 leadership in the region. To develop and ac commercial our maintain way this in and company to generate a digital ecosystem, to automate, digitalize and scale-up our at consolidating the necessary capabilities bella. We made relevant progress aimed Fala for important especially was 2018 is thenorthofouractions. This suppliers. and shareholders as well interact with our company, employees as ent and watching over all the people that with the communities in which we are pres operating with responsibility, cooperating purchase,waystheyto the which wish in experiences. Our goal is to serve them in all transformingof ourclients shopping their respond to our passion, simplify the lives 2018 was a year in which we continued to Dear Shareholders distribution center locatedinSantiagode ginning ofoperations oftheomnichannel be the with investments, other among materialized, logistics in progresses Our us toleadthedigitalmarket. position in the physical world, and will allow competitive invigorateour will vantages we are present. We believe that these ad the strength to lead in the markets in which tions with us, differentiate us and deliver customers fromtheirvisitsandtransac centers, added to our knowledge about our Linio, our network of stores and shopping undertaking in logistics, the acquisition of are we that investments the formats, its Chairman oftheBoard Letter fromthe ------that best supplies its stores and customers. and stores its supplies best that company the be to order in operate, we which in countries the all in capabilities logistics our improving continue will we term, short the In digital. the in as well as physical the in formats, all in answers consumer that requires quick and precise a satisfy to seeks region, the in modern center,most the automated This Chile. operate, covering mainly areas in which we ganic expansion in the markets in which we omnichannel proposal we consider an or & Collect mode in allour formats. In our Click expandthe marketplace,and Linio rity,theconsolidate logistics, strengthen cybersecu and intelligence artificial ing vancing in information technology - includ ad- considers programinvestment Our omnichannel world. this of behavior new the to organization est way. We are working hard to adapt our serve clients in the most efficient and fast- to aim efforts Our Factories. Digital our phones and developing with more strength development ofapplicationsformobile presence. We will continue privileging the virtual the through as well as branches, stores, shoppingcentersandfinancial in presence physical through both nels, We seek to respond to clients in all chan- are moving intherightdirection. although we still have many challenges, we that, show indicators these All products. satisfaction of our clients with our digital financial services web sites, reflecting the es and more than 155 million visits to our had over 874 million visits to our web pag growth with a better customer service. We 70%, and we were able to accompany this year electronic transactions increased over to scale up our company sustainably. This Moreover, we are developing the capability - - - internal meritocracy. promoting gender equality together with and diversity respecting talent, local of lenges was the attraction and development behavior. Anotherofourconstantchal cybersecurity challenges and transparent tainable operation, with special concern in corporate governance having and sus a improvement permanent onthe sis ofour As well, in 2018 we maintained the empha focus ofallourdecisions. for the benefit of our clients which are the processes and systems, to become efficient Falabellla. We will continue reviewing our tion process,CMRintegrated intoBanco making even more. Within this simplifica continue simplifying to streamline decision ganization that we have simplifiedand will transparency to all these challenges. An or and agility with reacts that organization All theseinvestments aresustainedinan bella Sorianacreditcardinthatcountry. Fala the expansionof the with together opening of new Sodimac stores in Mexico of Ikea in Chile, Peru and Colombia and the addition we will focus on the establishment to make the most of our valuable assets. In centers shopping and ofourstores eling are currently not present, and the remod in the region. leadership commercial our maintain way this in and company, our scale-up and digitalize automate, to capabilities necessary the consolidating at aimed 2018especiallywas importantFalabella.for relevantmadeWe progress ------Chairman oftheBoard Carlo SolariDonaggio Thank you, ican commerce. Amer Latin the in ourleadership increase tous allow will that trip this of part be to want and us trust who shareholders the Finally,commitment. thank and support their for team management the as well as subsidiaries its and Falabella of tors Direc of Board the thank to want also I clients. our satisfy to us allow dedication and work hard with who employees, our I can’t finishthis letter withoutthanking all - -
WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 Annual Report | 1. Welcome 3 CEO Letter fromthe the previous year, which is explained mainly income was US$689 million, 6.1% less than EBITDA totaled US$1,733 million; and net US$13,294 million, 3.4% more than in 2017; reached revenues consolidated Total the dynamismofthischannel. showing operates,company the which in of theretailsegment,inallcountries represented an8.0% online sales In total, million. US$861 totaling 2017, to pared and supermarkets) increased 26.4% com- (department stores, home improvement businesses ourretail from sales internet growth throughout all the period. In 2018, sustained a showed which channel, line on the mainly focuses, development our of performance the in improvements by markedwere results 2018 Region, the in In ascenarioofconsumptiondeceleration they want. servewheneverclients our whereverand and thus of ourbusinessunits capabilities transversalthe boost to us enables which services,integrated of ecosystem an ing do that, during 2018 we focused on build action and decision at Falabella. In order to every guides that mission the is America Latin in clients our of Tolives the simplify tion, we optimized our store portfolio. We In ordertodifferentiateourvalue proposi of theCompany. growth future the sustain will that efforts the today undertaking are We platform. preferred their being and continue region which will allow us to serve our clients in the definedas a physicaland digital ecosystem, took important steps to build what we have we as Falabella, of history the in point ing There is no doubt that 2018 marked a turn investments madeduringtheperiod. by a higher operating expense related to the - - - - the space available space the Pla Mall in forlease Tottusincreased we Also, Peru.Vecino in Dicico in Brazil and the opening of the first Sodimac to Dicico 16 of conversion the out standing services, expandedour and remodeled we well, As Colombia. in one ping centers,oneinChileandtheother shop new two and Mexico, in three first year,the this including stores 20 opened Sodimac and Tottus,and common Sodimac a becoming Linio will boost the sales of Falabella Retail, solidate itsleadershipintheregion. Inturn, by Falabella, and thus strengthen and con Linio, leveraging on the capabilities offered America. Our goal is to boost and develop the most important Marketplaces in Latin of one Linio, acquired we offer,August in tomers, and seeking to deepen our product cus our of needs new the of Conscious channel forthethreecountries. together with the development of the online years, next10 the over stores nine least agreement contemplatestheopeningofat franchise to Chile, Colombia and Peru. The Sodimac, we will bring the first stores of this Through Ikea. globally: brands successful and renowned most the of one with ment In this same line, in May we signed an agree oriented toownbrands. augurated a food production center, mainly it in Chile. Meanwhile, in Tottus Peru we in of Crate &BarrelinPeru andalsolaunched developingcontinued ourrepresentation Americanino; and Sybilla for stores dent context, during 2018, we opened indepen this Within usapart. sets that er element incorporation of exclusive brands is anoth the and brands own of development The Mall PlazaLos Ángeles. Los Plaza Mall andremodeled Dominicos of space the consolidated Vespucioclinic, the expansionof Vespuciothe za through ------consolidate our leadership in the financial to view a with and hand, other the On our Marketplace. managed to triple purchases with CMR on we which with Linio, on promotions and on Falabella.com; and the new CMR offers use also credit cardsandtheirimmediate of sale digital 100% the Falabella.com; on CMR creditlinesprevious topurchases of increase online the clients; CMR from Colombia, to finance large ticket purchases gle Pay; the Sales Finance pilot in Sodimac bile phone, through the alliance with Goo launch of face-to-face payments with a mo- Among the main initiatives highlights the shopping processofourcustomers. payment and financing options during the better and more available made we that, achieve Inorderto America. Latin in tion digitaliza financial the leading of goal our view to strengthen this ecosystem and fulfill a with capabilities strategic our veloping In the financial business, we continued de Tottus orMallplaza. and picking them up at Falabella, Sodimac, allows conducting purchases on any format we launched crossed Click & Collect, which addition, In purchases. their tracking and deliveriesexperience,programming their have to clients enable that over control As well, we implemented new functionalities to processorders,reducingresponsetimes. up, we optimized our capability and speed technological sophistication.Withitsstart- milestone due to its installed capacity and a represents which Chile, de Santiago in Center Distribution Retail Falabella new capability, in November we inaugurated the With thegoalofscaling-upourlogistics their owndigitalsaleschannels. nies, which will also continue strengthening showcase for the products of these compa - - - - and needs. demands their to responding customers, form on a daily basis the experiences of our Taking advantage of it enables us to trans- competitiveour main is digital advantage. This synergy between the physical and the up, but also to exchange or return products. bution network, as we allow people to pick are also becoming an extension of our distri experience source and a purchasing point, an been havetraditionally which centers, physical channels. Our stores and shopping means to increase the assortment of our relevant a also but channel, distribution ers. The Marketplace in itself is an important posal, which enables us to attract custom differentiating factor within our online pro- brandsown fundamental our a ample, are Forex digital. the and network physical our between synergies the of advantage takeand capture to able been haveWe our businessunits. ofall service the at solutions technological us toaccelerateenables that up scale and step important an is country that in ation oper our of launch The India. Bangalore, in center development technological new openeda and thebusinesses inall teams which we established digital development ble and scalable technological platform, for All of the abovementioned requires a flexi means ofpayment. can now earn and redeem points using any linked our CMR accounts. Tottus customers our loyalty program which was traditionally of process opening the started lakesand data our integrate to capabilities essary As well, we continued investing in the nec Falabella Chile. Banco to CMR integrated we 2018 ber inDecem Chile, in proposition our value business intheretailsegmentandboost ------CEO Falabella Gaston Bottazzini transforming theirshoppingexperiences. clients, our of lives the simplify to mission growth path over time, always guided by the to putus in apositiveaim andsustainable efforts These require. theywherever and variety of products and services, whenever larger a better,them them offering know to exceedingexpectations,seeking client on focus keepthe will we 2019, During lead by himduringthelastyears. achieved in 2018 are fruit of the initiatives milestones the of many as Solari, Sandro thank operate.to we want which I in Also, livesthe communities the and ofourclients achieves togeneratea positive on impact values, our living which, team Falabella I want to thank and congratulate all of the leading platforminLatinAmerica. offline and online an as itself position to reveals the trust in the plan of the Company volatility in the financial markets, the result 59% of the total issue. In a context of high international fundsjoinedsubscribinga important which to base, shareholder our diversify and Company the of float free the increase to addition, in decided, we process this Through increase. capital a make to flexibility, decided financial we strategic development and maintainour With thegoalofadvancingfasterin
WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 Annual Report | 1. Welcome 5 7
Falabella
We are one of the largest retail platforms Our regional footprint covers 7 countries: in Latin America. The drive and focus of our Chile, Colombia, Peru, Argentina, Brazil, business is the passion for our customers. Uruguay and Mexico, with offices in China We want to simplify their lives transform- and India. We operate department stores, ing their shopping experiences. We seek home improvement stores, supermarkets, to know and serve them in all their con- financial services and real estate assets sumption needs, which leads us to reinvent through a network of 504 stores and 43 ourselves and innovate to deliver the best shopping centers. shopping experience, through a strategy of differentiated formats and channels, with We are transforming ourselves into a digital
strongly positioned brands in our markets. ecosystem leveraged on our robust physical Annual Report | 2. Who are we? capabilities
LOGISTICS LOYALTY ç Ŵ
Who are we? PAYMENT DATA SOLUTIONS ¤ ANALYTICS A �
Falabella Regional presence of our subsidiaries
Our values Financial indicators FINANCIAL MARKET Our formats History SOLUTIONS ч ü PLACE WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 9
OUR VALUES
We work every day to simplify the lives of people in Latin America, transforming their shopping experiences, motivated by 2. WE EXCEED CLIENT 4. WE GROW BY OUR our values, drivers of our actions: EXPECTATIONS ACHIEVEMENTS
We work as a team and invest our skills The client is the center of our decisions, to attract and train the best talent. We that´s why we anticipate to their needs, recognize their achievements, encourage delivering an offer with a service quality them to self-manage their development that adds value. and growth, and reward internal mobility between businesses and countries as a competitive advantage. Annual Report | 2. Who are we?
5. WE MAKE THINGS 1. WE ARE HAPPEN
3. WE ACT WITH ONE TEAM We take charge of our actions, we take risks and A PURPOSE build opportunities to make things happen, with the same entrepreneurial spirit of our origin. We are driven by doing the right thing so we guide our actions We are ONE diverse team, transparently to generate value. committed and passionate for our customers, that collaborates, communicates and reaches its goals in a direct, honest and constructive manner. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 11
Our formats
Department stores Market share
Falabella Retail is the leading platform in fashion, decoration and electronics in Latin This business unit has several competi- America. Through a network of 114 stores and strong online presence, operates in Chile, tors in the countries in which it operates, Peru, Colombia and Argentina. among which four different subsectors can be distinguished: department stores, multi-stores, online players and specialty stores, which center their product offer 47 11 on a brand, lifestyle or concept. Stores Stores According to our estimates, the market Annual Report | 2. Who are we? share of our department stores in the Chile Argentina retail industry within the categories in 333,698 58,978 which we participate is approximately 23% in Chile, 18% in Peru, 7% in Co- Sales area (m2) Sales area (m2) lombia and 2% in Argentina.
29 27 Stores Stores Chile Argentina Peru Colombia 23% 2% 177,298 182,678 Sales area (m2) Sales area (m2)
Peru Colombia 18% 7% Market position
Chile # 1 Peru Colombia √ 114 757,652 Sales Argentina Stores area (m2)
Note: Sales area and number of stores does not include stores specialized in fashion and footwear for exclusive and second generation brands; Peru and Colombia include Crate & Barrel stores. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 13
Home improvement
Present in Chile, Peru, Argentina, Colombia, Uruguay, Brazil and Mexico, our home improvement division offers a wide range of solutions for the construction, decoration and maintenance of homes.
90 53 Annual Report | 2. Who are we? Stores Stores
Chile Brasil 254 771,648 162,933 Stores Sales area Sales area (m2) (m2)
56 3 Stores Stores √ 1,845,878 Sales Peru 2 371,714 Uruguay 24,849 area (m ) Sales area Sales area (m2) (m2)
9 3 40 Stores Stores Stores
Argentina México Colombia 94,073 34,705 385,956 Sales area Sales area Sales area m2) (m2) (m2) WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 15
Market share
In the home improvement sector, the Com- to Nacional de Estadísticas, the Encuesta pany has multiple and diverse competitors in Nacional de Presupuestos Familiares, and the different countries in which it operates. the Cámara Chilena de la Construcción de There are large construction materials and Chile, the Instituto Nacional de Estadística home improvement stores, as well as hard- e Informática de Perú, the Departamento ware stores, many of which are grouped in Administrativo Nacional de Estadísticas chains. In addition, there are other compet- de Colombia, the Instituto Nacional de Es- itors in home improvement products within tadística y Censos de Argentina, the Instituto which hypermarkets, department stores Brasileiro de Geografía y Estadística and the and specialty stores stand out, and finally Instituto Nacional de Estadísticas de Uru- suppliers that sell directly to construction guay (INE), among other sources, the market companies. share1 in this segment is approximately 25% in Chile, 14% in Peru, 10% in Colombia, 1%
According to the market analysis done inter- in Argentina, 4% in Uruguay and less than Annual Report | 2. Who are we? nally based on information from the Institu- 1% in Brazil and Mexico.
Chile Peru Colombia Uruguay Argentina Brazil Mexico 25% 14% 10% 3% 1% <1% <1%
Market position
Chile # 1 Peru Colombia
# 2 Argentina
1. Market share calculations for home improve- ment are not comparable with those published # 4 Brazil in our 2016 Annual Report due to changes in the methodology. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 17
Supermarkets
Tottus operates hypermarkets, supermar- kets and convenient price formats (Hiper- Market position bodega Precio Uno). With 136 stores and online presence, operates in Chile and Peru.
The supermarket segment has several # 3 Peru competitors, among them hypermarkets, 136 supermarkets, self-service stores and small Stores neighborhood stores. # 4 Chile According to the market analysis done internally based on information from the Instituto Nacional de Estadísticas de Chile, Euromonitor and the Instituto Nacional de
Estadística e Informática de Peru, among √ Annual Report | 2. Who are we? 447,812 others, Falabella’s market share in the su- permarket industry is around 4% in Chile Sales Area (m2) and 5% in Peru.
67 Stores
Chile 204,545 Sales area (m2)
69 Stores
Peru 243,267 Sales area (m2)
Market share
Chile Peru 4% 5% WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 19
Financial Services
Falabella Financiero offers a wide variety of integrated financial services combining the traditional financial business model with the proximity of the retail business. This division includes CMR Falabella (credit cards), Banco Falabella (bank), Seguros Falabella (insur- ance brokerage), Viajes Falabella (travel agency) and CF Seguros (insurance company). It operates in Chile, Peru, Colombia, Argentina and Mexico.
Chile Argentina Annual Report | 2. Who are we?
2,649,711 102 441,843
# CMR accounts Bank # CMR accounts with balance branches with balance In the financial services area competitors Market position in # include retail banks as well as other retailers that issue and operate credit cards. In addi- of accounts from CMR tion, insurance companies and travel agencies with balance Peru Colombia are also competitors.
According to the market analysis done inter- nally based on information from the CMF (Comisión para el Mercado Financiero) and Chile 1,007,503 69 1,058,544 90 www.cajaschile.cl, Falabella’s market share # 1 in terms of total consumer loans is 10.1%2 Peru in Chile, considering loans from CMR and Bank # CMR accounts # CMR accounts Bank Banco Falabella. In Peru, based on information with balance branches branches with balance from the Superintendencia de Banca, Seguros y AFP from that country, Banco Falabella’s market share in consumer loans as of Decem- # 4 Colombia ber 2018 reaches 4.5%3. In Colombia, based Mexico on information from the Superintendencia Financiera from that country, Banco Falabel- la´s market share in consumer loans reaches 4.8%4. According to the Banco Central de la 167,986 República Argentina, the market share of CMR in that country based on credit card and 2. Total Loans as of December 2018. personal loans is 0.7%5. Finally, market share 3. Total Loans as of December 2018. in Mexico is 0.2%6 according to information 4. Total Loans as of October 2018. # CMR accounts from the Comisión Nacional Bancaria y de 5. Total Loans as of June 2018. with balance Valores de Mercado. 6. Total Loans as of November 2018. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 21
Real Estate Business
Present in Chile, Peru and Colombia, the With presence in Chile and Peru, Falabella Market position In addition, the Company owns approxi- In Chile, through the Nuevos Desarrollos real estate arm of Falabella develops and Inmobiliario operates smaller-sized shop- mately 1,030,000 m2 of leasable area at free S.A. subsidiary, it has a plot in the V Region, operates shopping centers, where Falabel- ping centers using as anchors the formats standing locations from Falabella, Sodimac, while in Colombia, through its subsidiaries la’s retail formats and the mixed usage of operated by the Company (Falabella, Sod- Tottus, Maestro and others . in that country, owns a plot for development the property stand out. imac and Tottus), complementing them in Lima. Through the subsidiary Sociedad with an attractive offer of Minor stores # 1 Chile According to studies made in households de Rentas Falabella, projects Megacenter, Mallplaza is a regional company dedicated and entertainment7. and in the different shopping centers, the Calera and Fontova are currently under to the development of shopping centers in main actors that compete in the real estate construction in Chile. Also, the latter has
Chile, Peru and Colombia. Its value prop- business are shopping centers in their dif- land available in the III, IV, V, XIV and Met- Annual Report | 2. Who are we? osition integrates retail, entertainment, # 2 Peru ferent formats such as, malls, power cen- ropolitan Regions for the development of gastronomy, health, culture and other uses, ters, strip centers and traditional retailers future projects. under a sustainable growth strategy that located at the areas where the Company’s seeks to add value to all its stakeholders, shopping centers are located. Based on data from the Instituto Nacional promoting local development, access to de Estadísticas, Mallplaza’s estimated mar- culture and care for the environment. The Company has land for the develop- ket share in the retail business reaches 6.7% ment of projects in Chile and Colombia. in Chile, 3.0% in Peru and 0.2% in Colombia.
Chile Peru Colombia
17 1,355,000 3 205,000 2 66,000
# Mallplaza GLA # Mallplaza GLA # Mallplaza GLA Shopping Shopping Shopping Centers Centers Centers
10 230,000 11 317,000
# Open GLA # Open GLA Shopping Shopping Centers Centers
7. Excludes specialized stores in fashion and footwear for exclusive and second generation brands. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 23
Regional Footprint Financial Indicators
MM annual % growth ч 4.1% 3.4% 3,051,342 m2 2.5% Sales area
61.6% 24.6% 6.6% 5.6% -1.0%
Revenues Chile Revenues Peru Revenues Colombia Annual Report | 2. Who are we? : 3.4%
3,203,000 m2 Leasable area 1,151,481 1,216,361 1,204,322 8,588,381 8,936,419 9,236,259
2016 2017 2018 2016 2017 2018
Employees Employees Employees Revenues EBITDA Chile 54,472 Peru 31,046 Colombia 16,640 ç
2 1,298,500 m 26.4% Fulfillment centers 7.3% Shopping Centers 3.5% 8.8% 4.8% and Stores 2.0% <1.0% <1.0% 36.2% Revenues Revenues Revenues Revenues Argentina Brasil Uruguay México 504 Stores
Employees Employees Employees Employees Argentina Brazil Uruguay Mexico Shopping Centers 4,520,781 4.677.611 5,018,641 5,610 3,545 438 1,533 43 347,547 473,189 598,320 2016 2017 2018 2016 2017 2018
Total Loans Online Sales
Note: headcount excludes China and India; Colombia includes headcount but excludes revenues from Sodimac. Revenues for Chile include Plaza S.A. in Colombia. Sales area and number of stores exclude stores specialized in fashion and footwear for exclusive and second generation brands. Peru and Colombia include Crate & Barrel stores. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 25
History 1962 ù
Falabella acquires Falabella goes public and its + San Francisco √ Falabella enters shares start to trade on the supermarket chain Argentina and Santiago Stock Exchange. in Chile. Sodimac enters Banco Falabella is The first store out Colombia. created through of Santiago is ope- the acquisition of 2004 ned in Concepción. м ING Bank Chile’s ¿ 1993 license. " ù Alberto Solari 1998 joins the Company, Falabella launches 1996 transforming it into CMR, its own credit Falabella opens the first Annual Report | 2. Who are we? an important fashion card and the first of Tottus supermarket in store. its kind in Chile. Lima, Peru. 1937 1980 2002
1990 1999 2003 Mallplaza opens its first Ý shopping center in Chile, Falabella.com Falabella merges 1889 Mallplaza Vespucio, in launched starting with Sodimac, La Florida. Viajes Falabella internet sales in launching the first and Seguros Chile. regional home impro- ∑ vement chain in LAtin Falabella are created. America. Household products ß are introduced, laying 1995 ș the foundations for Salvatore Falabella the first department Falabella enters Peru with 1997 X opens the first large store in Chile and the acquisition of Saga. tailor shop in Chile Ahumada Street starts Falabella partners with at Ahumada Street. to be known as “the Home Depot in Chile, Falabella Street”. acquiring its operations four years later. 1958 ∑ WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 27
First issuance of the Fala- Móvil Falabella Sodimac acquires bella-Soriana credit card is launched in a 60% stake of in Mexico, and acquisition Chile. Chilean home of a 50% stake of Servicios improvement Financieros Soriana S.A.P.I. Falabella and Soriana sign chain Imperial. de C.V. Hiperbodega the final contracts for Precio Uno is the joint development of ń launched in Peru. the Home Improvement 2007 (Sodimac) and Financial ü Services (CMR) businesses in Mexico. 2017 2013 2014 Homy is launched ß in Chile. ¤ Falabella Retail enters Colombia with its first Mallplaza opens its department store in 2009 first shopping center Falabella made a capital Annual Report | 2. Who are we? Bogota. in Colombia. Falabella issued a US$ Sodimac enters increase, raising US$ 400 million corporate 581 million. bond. Uruguay opening its first two stores. 2006 2012
Banco Falabella issued a US$ Falabella is 2008-09 2016 400 million corporate launched in Falabella issued a US$ ∑ bond. Peru. CMR partners with 500 million corporate Split-off of Visa in Peru and Chile. bond. Aventura Plaza Afterwards, in 2011 2011 Sodimac acquires S.A. in Peru. CMR partners with Maestro home MasterCard in Argentina Banco Falabella improvement + and Colombia. starts operating chain in Peru. 2018 in Colombia. � Falabella anounces the acquisition of Linio " 2015 Falabella enters and the signature of the Dow Jones a Memorandum of Aventura Plaza is Falabella opens its Sustainability Understanding for launced in Peru. first two Sodimac World Index. the development and stores in Brazil. operation of IKEA.
Falabella enters Brazil _ through the acquisition of a 50.1% stake of Dicico home improvement chain. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 29
How do we do it?
At Falabella we work to simplify the lives governance (ESG) issues that will ensure of Latin Americans by transforming their our sustainable growth. We maintain open shopping experiences. Our approach starts communication channels that allow us to by engaging with our stakeholders, exter- understand the needs of our stakeholders nal and internal, which helps us determine and promote corporate guidelines, funda- which are the environmental, social and mental to build Falabella.
OUR COMMITMENT COMMUNICATION CHANNELS
Clients The Company aspires to simplify the lives of its clients. We seek to transform shopping experiences, trying to Social networks, physical and online stores, custom-
ensure the quality and safety of products offered to er support teams, satisfaction surveys (e.g. NPS), Annual Report | 3. How do we do it? the public, of services provided and of the Company’s among others. Ä facilities.
Employees We recognize the fundamental importance of our collaborators on their development and growth, so Ethical channel, internal climate surveys, corporate we maintain a commitment with their professional communications channel, volunteering programs, development and integral wellbeing. We actively internal mobility programs, Falanet (Intranet), meet- ж seek to attract and retain the best team in each ings with unions, quality life teams, among others. of our businesses, valuing inclusion and diversity.
Suppliers We seek constructive and long-term relationships Digital B2B platform, meetings between buyers and How do we do it? with our suppliers. We believe that collaboration suppliers, supplier training, support programs to and trust allow us, our suppliers and enterpirses, improve service standards, and support programs ç to grow. for smaller sized suppliers, among others.
Community Civil Society We promote the generation of links with the community and contribution to their development and quality of Social action programs, corporate volunteering, Exceed customer expectations Manage our supply chain life. We seek to collaborate in the social, economic and members of Green Building Council, and Chambers cultural development of communities in Latin America, of Commerce, among others. X for which we implement social programs with a mea- Develop our employees integrally Manage our environmental impact sureable and significant impact for the community.
Generate social value Investment plan Shareholders We are committed to generate profitability in a sus- Investor relations team, Ordinary Shareholders' Meet- tainable manner and maintain transparent commu- ing, financial reports (Press Releases, quarterly Finan- Governance $ nication channels with our shareholders. cial Statements and Annual Report), investor web site. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 31
During 2018, we did a materiality study at a corporate level for the first time. We worked together with an independent specialized consultant in social, environmental and gov- Exceed customer ernance management.
The topics identified were ranked under two criteria: influence on our business and rele- expectations vance for our external groups of interest. The detail of the materiality matrix is available on page 172 of this Annual Report.
Our purpose is to simplify the lives of peo- Differentiate the ple in Latin America. Exceeding customer Exceed customer Develop our expectations is part of our DNA. We seek value proposition 1. expectations 2. employees integrally 3. Generate social value to constantly increase our knowledge
about clients and have enough flexibility Annual Report | 3. How do we do it? • Putting our customers first, getting • We know that today changes are more • We focus on strengthening our commit- to react and adapt to their needs, trans- We want to offer our consumers a unique • Offer a convenient proposal to know them and transforming their disruptive, profound and fast, so we un- ment and giving transcendent meaning form their shopping experience in all chan- commercial proposal, where they can find shopping experience is what drives our derstand that to face the current market to our work. We are aware of the re- nels, and watch over the protection and a wide range of products and a valuable With a high quality/price relationship, growth. Ensuring the privacy and security reality we have to be one sole team, com- sponsibility we have with society, the privacy of their information. For the latter shopping experience. allowing us to compete, for example, with of their information helps us continue to mitted and passionate about our clients. communities that surround us, and the we have defined five strategic priorities. fast-fashion brands in apparel, and lead- be chosen. environment. Having an exclusive and deep assortment is ing brands in supermarkets and home • Our emphasis on inclusion helps us differentiating. We continue focusing on the improvement. • We have defined five strategic priorities: understand and serve an increasingly • We are moved by doing the right thing, development of own and exclusive brands differentiate the value proposition; scale- diverse group of customers and commu- and that is why we guide our actions in a that allow us to strengthen our positioning. • Increase the profitability of up logistics capability; payments; data nities. Surrounding ourselves with talent- transparent manner to deliver the best DIFFERENTIATE THE VALUE our business analysis and business intelligence; and ed people from different backgrounds is of us to our stakeholders. PROPOSITION The development of our brands allows us to: development of a flexible technological how we maintain our ability to prepare With better margins compared to those platform. for future opportunities and challenges. • Differentiate from other retailers and obtained through third-party brands. online players SCALE-UP LOGISTICS CAPABILITY An exclusive offer with a robust position- ing. We develop a proposal that adjusts to specific groups of clients, who we know and understand and which has enabled Manage our Manage our us to position several of our own brands Own brands sales 4. Governance 5. supply chain 6. environmental impact MEANS OF PAYMENT as leaders in their segments and with a recognition that is independent from as of the close • We believe that acting ethically and • We seek constructive and long-term re- • We understand the importance of ad- the business. Through our own brands of 2018 reached responsibly is not only about doing the lationships with our suppliers. Mutual dressing environmental sustainability and we anticipate innovative proposals in US$2.8 billion8. right thing, but also the right way to collaboration and trust allow suppliers we have undertaken several initiatives the local market. DATA ANALYSIS AND do business. We seek to contribute in and companies to grow. of environmental protection and sus- different ways to a sustainable future, tainability mainly oriented to reduce our BUSINESS INTELLIGENCE conducting our businesses in a transpa- • We are committed with developing alli- energy consumption and for our physical rent manner and promoting ethical and ances with suppliers that share our dedi- network to be ecofriendly. responsible operations. cation to carry out their activity in a legal, DEVELOPMENT OF A ethical and socially responsible manner. FLEXIBLE TECHNOLOGICAL • We promote values that reflect the 8. Private label sales include department stores, home improvement and supermarkets, and exclude market place. commitment with a transparent and PLATFORM loyal actuation towards people, their freedoms and rights. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 33
In 2018, we continued to advance on our value proposition:
Home Department improvement stores Supermarkets
As a franchise, Falabella will bring to Chile, Through our own brand Sybilla, we seek 30% more assortment than our average In Chile, Tottus grew close to three times try and ready meals. Also, we closed the Peru and Colombia the complete IKEA to offer our customers a differentiated Sybilla corners, and are a focus for gener- in own brands compared to the market, year with 13 Hiperbodega Precio Uno experience, one of the most renowned proposal of female youth clothing in all ating new customers as they are located according to information prepared by supermarkets, a convenient commercial and successful brands worldwide, com- countries where Falabella Retail operates. in low cannibalization areas with our Fal- Nielsen, reaching a market share that is proposal with a format that offers low
plementing the product and service offer During 2018 we opened two Sybilla stores abella stores. Product development is the higher than what own brands represent at prices and an assortment focused on own Annual Report | 3. How do we do it? of its different formats, and thus help im- and in total we have five stand-alone stores strength of the brand, and through this a national level. In Peru, in January 2018, brand products. prove the quality of life and make a reality in Chile, ranging between 250 and 1,000 differentiaed proposal we have managed we opened a food production center in the dreams and projects of clients, offering m2, and soon we will open more within the to position Sybilla as a recognized brand Huachipa, Lima, focused on bakery, pas- an exclusive brand. region. These stores have approximately within the youth segment. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 35
Deepen the assortment
In the different units, we take advantage of the opportunities opened by the digital world to substantially increase At Falabella we are in constant innovation, several corners in different countries, • In our commitment to deliver a shop- product assortment and personalize offers according to the preferences of each of our customers. seeking that our stores deliver an increas- such as: Urban Decay and Aldo in Ar- ping experience that meets the highest ingly better shopping experience to our gentina, Bearcliff and beauty in Peru, standards, we are constantly looking to clients and being selective in the locations and Crate&Barrel in Chile. develop new projects and technologies in which we believe there is a market. This in our stores. To offer a more efficient way during the last years, we have carried • During 2018, in Brazil, we transformed 16 and agile service, we are implementing Total SKUs out an optimization plan through which we Dicico stores into Sodimac Dicico, a format new systems that allow us to eliminate (Millions) have undertaken an assessment of the asset that seeks to deliver better product quality unnecessary waiting during the shopping portfolio of our businesses, which includes and services to our clients, oriented to- process, as is the case of self-check-out investments in projects, remodeling, expan- wards remodeling and home maintenance cashiers, especially thought for moments 2018 sions and the sale of some assets. needs, with new product categories that of greater affluence in the stores. Number of online SKUs 6.1 have a higher purchasing frequency. Number of physical SKUs 3.1 • In the case of Falabella Retail, we have • With this same goal, CMR launched in gone through a strong remodeling pro- • In the context of our active management 2018 an agreement with Google Play
cess of our stores in Chile, and now we of our real estate portfolio, Falabella In- that will allow Android users to conduct Annual Report | 3. How do we do it? continue with Peru and Colombia. We mobiliario agreed with a subsidiary of purchases in Chile and abroad through are allocating a large part of the spaces Parque Arauco, the sale of Open Plaza their mobile phones. Currently, 75% of to fashion and own brands. In 2018, we El Bosque, a shopping center of approx- CMR Visa clients use Android technology. remodeled 14 stores and renovated imately 30,000 m2.
Acquisition of Linio
In August, the company acquired Linio, one of the main regional marketplaces. Part of the product catalogue of the Falabella, Sodimac and Tottus offer is now available through the platform. At the same time, progress is being made in leveraging Li- nio on the Falabella ecosystem not only to automatically have the catalogues of these retailers, but also to make use of the group's logistical capabilities and integra- tion with CMR for payment processing, fraud management and loyalty, thus pro- viding customers with the same benefits when buying in Linio as they have in the other formats. In this way, we seek to stren- gthen the business, allocating capital for its growth and better satisfying the needs of our customers and sellers. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 37
We maintain contact channels with cus- • Our retail businesses measure service In order to consolidate the retail NPS, tomers and with feedback mechanisms quality, among others, through the Net department stores, home improvement that allow us to receive client concerns Promoter Score (NPS) satisfaction sur- and supermarkets were considered in the In the logistics area at Sodimac Brazil, a In Peru, work is being carried out on the regarding products and/or services of- vey, which aims to measure client loy- countries in which they have operations, new transport flow was developed for distribution center for appliances, which fered, seeking to deliver a fast and accu- alty based on recommendations (pro- weighting the score by the contribution imported products on the way from the will deliver logistics and fulfillment services rate response. moter, passive, detractor). In addition, in retail sales. In order to consolidate the port to the distribution center, using the to all of our retailer´s formats. Falabella.com has established perma- financial NPS, the operation of CMR and railway network. This way dependence on • Social networks have contributed to nent feedback means from clients that Banco Falabella in the countries in which road transport was reduced and storage The Click & Collect service continued to generate greater closeness and facil- visit the webpage and from clients that they operate were considered, weight- flexibility increased. grow strongly on a regional basis, explaining itate communication with our clients, carry out a purchase to the end, with ed by their participation in the financial more than half of the online transactions in and thus deliver a better service. Fal- the goal of improving its processes and business revenues. To consolidate the Regarding Tottus in Chile, the capacity of some markets. abella has over 35 million followers in delivering a better experience. Global Visit Satisfaction of the Real Estate the Dry Products Distribution Center was social networks (Twitter, Facebook and business, Mallplaza in Chile and Falabella increased by 7,500 m2 totaling 64,800 m2, others), considering our businesses and • Mallplaza and Falabella Inmobiliario Inmobiliario in Chile and Peru were con- in order to be prepared for the increase in countries in which we are present. The measure customer satisfaction through sidered, weighted by their participation imports and higher sales volumes. latter represents a 30% increase with a survey called Global Visitor Satis- in the sales of the real estate business. respect to 2017, with growth standing faction. We work everyday in order to
out due to the acquisition of Linio. improve customer experience, which Annual Report | 3. How do we do it? is reflected in the continuous improve- ment of their perceptions.
%∆ 2016/2017 %∆ 2017/2018
Retail NPS 2,6% 5,2% Financial NPS 10,6% 13,4% Chile Argentina Peru Colombia Real Estate Global Visit Satisfaction 2,4% 3,1% Distribution centers Distribution centers Distribution centers Distribution centers 14 3 6 3
Scale-up logistics Square meters* Square meters* Square meters* Square meters* capability 766,000 64,000 239,000 139,000
We are developing an omnichannel logistics With this new system, we increase product Sodimac continued with the automation of with distribution centers specialized by availability in stores and in the e-commerce logistics facilities in the different countries, product type, that serve our stores as well channel, given the omnichannel logistic moving them to world-class equivalent levels. as our e-commerce. integration and design. In Chile, the Company concentrated a large Our goal is to continue strengthening and With the inauguration of Falabella Retail's number of initiatives to standardize and Brazil Uruguay Mexico standardizing our logistics processes to new distribution center, with world-class automate processes, achieving efficien- better fulfill our promise of service to our technology and more than 40,000 m2, we cy improvements in the supply chain and Distribution centers Distribution centers Distribution centers clients and make our capabilities available are able to offer more than 50,000 products inventory levels. In turn, this translated 2 1 1 to third parties by offering logistics services in less than 24 hours. into an increase in store availability index- to our sellers. es above 95%. As well, regarding channel As well, Falabella Retail launched a integration, the implementation of HUB and Square meters* Square meters* Square meters* Together with launching Falabella’s new dis- self-service portal, where customers can cross-docking at regional warehouses has tribution center, this year we implemented learn about the delivery status of their reduced client delivery times to 24 hours 63,000 9,500 18,000 a world-class system for the management of orders or request product returns, among and 48 hours in extreme zones in Chile. our logistics flows at Falabella and Sodimac. other functionalities.
* Includes distribution centers, transfer centers and external warehouses. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 39
Digital Factory Means of payment
During 2018, we made available more Created in January 2017 with a 65 member starting with a hypothesis and always and better payment and financing options 2018 Indicators team (3 cells and 2 programs), its goal is to putting the client at the center of our de- during the shopping process of our custom- accelerate the pace of digital transforma- cisions. Our teams, each between 5 and 9 ers, which translated into a 61% increase in tion and deliver innovations permanently members, are cross-functional (we boost the online sale of financial products. to our clients, focusing on: client migration knowledge and cross-expertise within towards digital channels and improvement teams), self-organizing, product oriented,
During the year, we launched payments +2.6 million of user experience and; achieve a differen- stable, co-located and dedicated. Annual Report | 3. How do we do it? with cell phones, through the alliance with tiated digital experience and boost the sale Google Pay; the increase in the quota of digital clients of financial products. During 2018, we launched the Giftcard CMR online prior to a purchase in Falabel- exchange in the App, the 100% online la.com; the 100% digital card opening; the Today 208 people work in the factory orga- credit card sale for the first purchase at Sales Finance pilot in Sodimac Colombia, nized in 22 work cells, each one composed Falabellla.com, make transfers in few to finance purchases of high tickets to 2x by multicultural teams (10 nationalities). steps, and the Banco Falabella App in CMR customers; and new CMR offers We work through teams applying the Agile Chile was acknowledged as the most val- and promotions in Linio, with which we active clients in the App methodology, which allows us to work ued App by banking clients according to managed to triple the purchases with on an iterative and incremental manner, an IPSOS survey. CMR in our Marketplace.
To be increasingly agile, we decided to inte- grate CMR to Banco Falabella in Chile, and thus deliver better financing and payment +20 million options to our customers. On December digital payments 1, 2018, the integration became effective and by the end of the year, both companies were operating jointly. This allowed the Bank to double its distribution network in Chile reaching 201 branches and a gross +40% loan portfolio of MM$3,625,620. Sale penetration of financial products in digital channels in Chile WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 41
Data analysis and business intelligence
The Business Intelligence area developed • With big data and neuronal network tools, a strategy that crosses the entire Compa- we seek to facilitate the purchasing pro- ny, with an emphasis on achieving a deep cess of complex projects, which require a understanding of our customers, boost diversity of products and services. sales and generate tools that increase ef- ficiency and gather the best knowledge • Mallplaza made an important progress on of the Company to be put at the service the way to digital transformation. During of clients, always protecting the privacy 2018 the Innovation and Digital Strategy of their personal data. Department was created, defining the goals and processes of the Digital Transformation • We expanded the teams specialized in at Mallplaza. The latter was complemented business intelligence. with the enabling of the first digital office,
the first agile cells and the conformation of Annual Report | 3. How do we do it? • We started the implementation of a cen- the first Analytics team. As well, the new De- tralized data lake, allowing us to take partment actively participated in the groups advantage of the enormous amount of digital strategy, working together with Cor- data generated on a daily basis in all porate BI centered on Marketing campaigns, operations, and use it to make better and defined the Analytics Ecosystem aligned decisions for the benefit of our clients. with the Corporate Architecture.
+1,000 +408 Artificial intelligence at million visits to our million annual visits to our the service of clients web pages shopping centers
The digital transformation has allowed provide the correct answer. At Falabella us to rethink the way to serve clients Financiero, we have our virtual assistant +35 +396 at the time of interaction. At Sodimac called Lia, which is available at all the million followers in million customer services Chile and Sodimac Colombia advanc- countries where we are present. Lia can social networks in the financial retail es were made in the implementation solve doubts, refer to an executive, give of virtual assistants based on artificial information on CMR Puntos, and give intelligence, project started in 2017. information on fees and tariffs, among This enables making queries regard- other functionalities. In Falabella Retail ing products or services avoiding tens in Chile, we have implemented a virtu- +344 70 % of thousands of calls to the call center al assistant called Amanda, which has million annual transactions growth of online orders on peak demand periods, as is the case helped us to reduce by half the calls in in our stores with Cyber events. The assistants (Pe- Cyber periods, even if the orders keep dro in Chile and Ana in Colombia) are growing. This has been made possible by available 24x7 and capture over 90% of the seven Artificial Intellligence teams intentions behind client´s questions, and that work in Chile.
Note: Visits to our web pages include e-commerce platforms, financial services, Viajes Falabella and Seguros Falabella. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 43
Development of a flexible technological platform Cybersecurity
We laid the foundations to migrate our way and strengthening our networks, but our Protection and care of data are fundamental infrastructure to the cloud under a robust, greatest advances relate to the construction parts of the capabilities of a digital eco- 0.1 0.2 secure and scalable architecture. of different solutions: payments, analytics, system, so the privacy of our clients is an fraud prevention, and order traceability, essential part of our strategy. Cyber Defense Center (CDC) Cybersecurity training – SSI 2018 took We have invested heavily in technological among others, which are important to offer place with over 35 thousand employees infrastructure and development of basic a superior service standard and differentiate During the last years, we have implement- A world-class cybersecurity monitoring cen- in 8 countries capabilities, as working in the cloud in an agile ourselves towards the customer. ed corporate governance whose goal is to ter, with the capability to prevent, protect establish the cybersecurity strategy and and respond to an incident. The latter has In September took place the third version of policies to protect the information of our been designed with an external world-class the Information Security Week (Semana de la customers in terms of confidentiality, in- supplier and implemented internally by a Seguridad de la Información – SSI), event that tegrity and availability in all the businesses highly specialized team. included digital and face-to-face activities in we operate. Falabella’s companies. The goal of the event
Solutions was centered in creating awareness with Annual Report | 3. How do we do it? Modernize and standardize our systems respect to threats, risks and best practices with an emphasis on security, together with on cybersecurity within Falabella. the development of a data protection cul- ture among our employees, were part of Enablers our efforts during 2018.
BUSINESS CAPABILITIES
Analytics, Loyalty, IT CAPABILITIES Seller center, B2C, Order, Fraud, API, Devops, Customer & Ciam CORE Test environment management INFRAESTRUCTURE & Continuos integration
Cloud, Big data, Storage & Network
Supported by a cybersecurity framework that strives to meet the highest global standars WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 45
Develop our Development office employees integrally in India
On November 7, we inaugurated the new development offices in India, in the city of Changes today are more disruptive, profound opportunities between men and women, Bangalore. This relevant event sets us at the forefront in information technologies and fast, so we understand that the way to lowering barriers to female promotion and 0.3 within the retail industry. Our operation in India has over 100 employees, integrating face the current market reality is being one increasing the presence of women in high talents from the world to Falabella’s talents. sole team, committed and passionate about positions. This way, in order to increase Networking our clients. and strengthen female leadership within Falabella and boost participation, visibility During 2018, the “Connected Women” pro- We recognize the fundamental importance and internal networking between managers gram was implemented, with the aim of cre- of our collaborators, so we maintain a com- and female executives, during 2018 we ating quick, accessible and efficient contact mitment with their professional growth and carried out the first version of the Men- networks with other women within Falabella.
development, as well as attracting the best toring Women Program, comprised of the Annual Report | 3. How do we do it? talent. We recognize their achievements, following activities: encourage them to self-manage their de- velopment and growth, and reward internal We formally asked all our hunting companies mobility between businesses and countries. 0.1 in the region that the long lists of candidates to be presented to us must contain at least Promote diversity and inclusion, with a Mentor-Up Academy 30% of women. special focus on women Seeks to train our female leaders in or- Regarding headcount: Our emphasis on inclusion helps us under- der for them to become mentors of other stand and serve an increasingly diverse generations of women within Falabellla. • Falabella ended 2018 with 113,526 group of customers and communities. Sur- After the first two sessions, all mentors employees. At the close of the year, rounding ourselves by talented people from receive their diplomas and are certified as 51.3% of them were women (compared different origins is how we maintain our mentors. During 2018, 25 women received to 51.6% as of the close of 2017). ability to prepare for future opportunities such a diploma. and challenges. • We have 52,001 (45.8%)Chilean em- ployees, 31,521 (27.8%) Peruvians, In 2018, a Diversity and Inclusion Policy was 16.904 (14.9%) Colombians, 5,528 approved, with the goal of establishing the (4.9%) Argentineans and 7,572 (6.7%) basic principles by which Falabella and its 0.2 employees from other nationalities. employees must be governed, in order to promote an organizational culture and work Internal Mentoring • 44% (46% in 2017) of employees are less environment that is diverse and inclusive. than 30 years old. As well, the Inclusion of People with Dis- We carried out the communicational cam- abilities Procedure was approved, aiming to paign directed to women in the headquar- • 48% (45% in 2017) of employees have standardize the way to fulfill the obligations ters office and zonal managers, with vol- worked at Falabella for more than 3 years. established in Law 21,105, in accordance untary inscriptions. 70 women registered with its capabilities and social goal. to be guided and 40 to be mentors in the program. After applications 25 pairs were We stimulate diversity and gender equality, selected, which had two encounters of 1 promoting the visibility and development hour approximately. of our female employees, as well as equal WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 47
Some of the acknowledgements for our efforts regarding inclusion and gender equality are:
Sodimac and Falabella Retail in Peru The proportion represented by the average The Board of Directors of Falabella is composed of 22% of women, compared to 33% in were acknowledged in the second base salary of our female collaborators with 2016, given that at the 2017 Shareholders' Meeting one female director was replaced by and fifth place, respectively, in the respect to the average base salary of male a man. In addition, the larger part of the Board is composed of people over 50 years old. Gender Equality in Organization employees is: ! (PAR) ranking, developed by Aequales, the Chamber of Commerce of Spain • For Managers and Deputy Managers: in Peru and Organización Peru 2021. 76% (78% in 2017), representing 3% of total employees. Board of Directors
Board of Directors, Falabella 2016 2017 2018 • For Professionals and Technicians: 89% (90% in 2017), representing 22% of Less than 30 years old 0 0 0 Falabella Retail in Chile stood out total employees. Between 30 and 50 years old 2 2 1 in second place in the Women in More than 50 years old 7 7 8 High Direction ranking, prepared by • Other positions: 94% (97% in 2017), rep- Total 9 9 9 Comunidad Mujer, which measures resenting 75% of total employees.
female participation in the corporate Annual Report | 3. How do we do it? governments of the large companies Board of Directors, Falabella 2016 2017 2018 trading in the Santiago Stock Exchange. Men 6 7 7 Â In addition, Falabella Retail was Women 3 2 2 acknowledged by Comunidad Mujer Total 9 9 9 and the Gender Parity Index (IPG) Chile for the efforts undertaken to improve gender equality and promote practices to foster female leaderships.
Tottus in Peru obtained place 18 in the Gender Equality in Organizations ý ranking, from Aequales consultant.
CMR in Chile was presented with the Female Talent Award from Pulso Newspaper, due to the promotion of female labor through high levels of Å female employment and by the number of women in its Board of Directors. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 49
Falabella Total Employees9
Other Employees Professionals and Technicians Managers and Executives TOTAL S.A.C.I. (Holding) 25 163 40 228 Subsidiaries 84,818 24,945 3,535 113,186 TOTAL 84,843 25,108 3,575 Chile 41,491 11,472 1,509 54,472 Peru 22,488 7,681 877 31,046 Argentina 3,969 1,400 241 5,610 Colombia 12,583 3,621 436 16,640 Uruguay 385 40 13 438 Brazil 3,110 175 260 3,545 China 28 101 28 1,533 India 2 75 8 157 Mexico 787 543 203 85 TOTAL 84,843 25,108 3,575 113,526
Classification by nationality Female Male TOTAL Annual Report | 3. How do we do it? Chile 28,348 23,653 52,001 Peru 15,412 16,109 31,521 Colombia 8,221 8,683 16,904 Argentina 3,157 2,371 5,528 Brazil 1,405 2,175 3,580 Uruguay 193 249 442 Others 1,492 2,058 3,550 TOTAL 58,228 55,298 113,526
Classification by age range (years) Female Male TOTAL Less than 30 24,433 25,384 49,817 Between 30 and 40 19,606 17,528 37,134 Between 41 and 50 9,530 7,621 17,151 Between 51 and 60 3,950 3,570 7,520 Between 61 and 70 662 1,050 1,712 More than 70 47 145 192 TOTAL 58,228 55,298 113,526
Classification by seniority at Empresas Falabella Female Male TOTAL Less than 3 years 29,550 29,955 59,505 Between 3 and 6 years 12,060 10,119 22,179 Between 6 and 9 years 7,540 6,289 13,829 Between 9 and 12 years 4,052 3,591 7,643 More than 12 years 5,026 5,344 10,370 TOTAL 58,228 55,298 113,526
9. Considers S.A.C.I Falabella and its subsidiaries, including those which do not consolidate. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 51 Annual Report | 3. How do we do it?
Paola, Enrique, Hernán, Ricardo and Moscovia at Falabella Ahumada. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 53
We seek to attract, retain and develop talent
Our efforts are inspired by attracting the and technical courses are made available to Regarding talent retention, one of our ini- (i) attract, identify and select young talent to best talent, retaining them and giving them employees on a regular basis so as for them tiatives is the Talentum program, consisting face the new challenges of the business; (ii) unique opportunities in their professional to be more informed and empowered to in an internship between businesses, where position Falabella at the top of mind among development, so we cultivate employee successfully achieve their professional goals professionals from an area go to work for the best companies to work in Chile, and development and growth within the Company. and those of the business. During 2018, a two months in a project of another business. to be recognized as an integral referent in total of 4,162,803 hours of training took In addition, each year we finance MBA and the labor market and; (iii) transmit our labor When our collaborators enter to Falabella place, representing an average of 37 hours Masters programs abroad, with the goal of value proposition and business challenges. for the first time, we carry out an induction per employee during the year. The following promoting and facilitating improvement and process as well as e-learning courses, table depicts the average of yearly training development of employees with good per- We constantly monitor the attrition rate11 internships and/or training. As well, specific hours, separated by men and women: formance reviews and high potential. During of our collaborators, which during 2018 2018, six people applied to the Corporate reached 41.6 % (compared to 41.0% in Managers Committee and everyone approved 2017). As well, our fill rate12 for 2018 was the process to secure financing. 43.2% (compared to 43.8% in 2017). Average yearly training hours by employee Annual Report | 3. How do we do it? Falabella Challenge is born to attract talent Men Women in an innovative way. The initiative seeks to: 2016 2017 2018 2016 2017 2018 43 42 41 36 35 33
Falabella has a solid group of leaders and In addition, this initiative enables the • During 2018, 73% of our collaborators professionals focused in building teams and identification and development of tal- were evaluated with some assessment developing collaborators to give sustain- ent in order to plan for future needs. In method, compared to 67% in 2017. ability to the business. The development of 2018, 2,500 executives were evaluated in talent in our employees is one of our main Chile, Peru, Colombia, Argentina, Brazil, The following table shows the percentage of concerns and we have several performance Uruguay, Mexico and Asia. total collaborators between men and women reviews and feedback sessiones. that have received a periodic performance • Besides the 360° Assessment, several review and professional development during • One of the main initiatives within internal performance reviews are carried out the last three years. talent management is the 360° Assess- every year10 at all levels within the or- ment, carried out annually to 100% of the ganization, totaling 79.606 employee main executives of Falabella. The goal is performance reviews. to generate individual development plans that allow each evaluated employee to improve his results and boost potential.
Percentage of total collaborators that have received a periodic performance review and professional development
Men Women Year 2016 2017 2018 2016 2017 2018 Evaluated 71% 71% 81% 66% 63% 67%
11. Attrition rate measured as the number of employees that leave the organization voluntarily or dismissed, retired or died, over total employees over the informed period. 12. Fill rate measured as the number of new hires over total employees over the informed period. 10. 180° Assessment, 90° Assessment, and EDD 45°, among others. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 55
Attraction of technological and digital profiles We promote a collaborative environment, a healthy equilibrium and the construction of a good place to work
The digital transformation of our retail In addition, we participate with speakers One of the main goals of Falabella is to be a As part of the commitment with talent business model has made the attraction, and recruit at EVIC (Computer Engineering good place to work, promoting a collaborative development and retention, as well as em- selection and incorporation of technological Summer School), focusing on artificial intel- environment and healthy balance between ployee quality of life, we have implemented and digital profiles a key element. Thus, ligence. Finally, during 2018 we financed the personal and work. In order to do that it´s labor flexibility plans with flexible entry and during 2018 we continued incorporating five masters on these areas. essential to develop a series of programs and exit schedules, the possibility of remote professionals with a STEM profile (Science, benefits that seek to improve the quality of life works during certain days, and leaves of Technology, Engineer and Mathematics) in As well, we actively participate in recruiting of collaborators and their families. In addition, absence without pay, among others. several areas of our activity. In order to do activities, such as Laboratoria, the first and employee wellbeing is periodically reviewed so we maintain strong relations with the largest women hackathon in Chile, with through internal climate measurements. In order to know and fulfill the needs of our most prestigious universities in this areas close to 100 participants, seeking to recruit collaborators it is necessary to maintain a
and finance training for our collaborators. the best technological talent. We participate in the Great Place to Work fluid internal communication, at a particular Annual Report | 3. How do we do it? survey, with which we measure ourselves or collective level. Falabella fosters dialogue and set goals as part of our commitment and transparency, recognizing freedom of with collaborators. This year the results of association and labor rights. As of December our Retail and Real Estate businesses were: 2018, 36% (34% in 2017) of employees at Falabella were unionized (covered by collec- • Department Stores: The department tive bargaining agreements). The unioniza- stores business in Colombia placed 13th tion rate in Chile reached 64%. in the ranking, while Peru reached 8th place, Argentina 7th, and, finally, Chile the 20th place.
• In Peru, we obtained the 11th place, while in Argentina the 5th place and in Uruguay the 6th place.
• Mallplaza Chile improved 10 positions compared to the last year, getting to the 24th position. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 57
The health and security of our employees Hazard identification, risk assessment and accident investigation is a priority for Falabella
2018 Indicators 2016 2017 Men Women Total The protection of the health and security Together with the aforementioned, courses, During 2018, 3,995 work accidents were Accident frequency rate (AFR) 4.1% 3.7% 3.9% 3.1% 3.5% of our employees is as important as the campaigns and inspections are carried out registered, 4% less compared to the previous 13 commitment with a good labor climate, so through these committees with the goal of year. The accident rate reached 3.5%, below Occupational Disease incidence 0.09 0.10 0.10 0.12 0.11 we have policies that seek to prevent labor minimizing and managing risks. Thanks to the 3.7% registered in2017. During 2018, no rate (ODIR) risks and promote a healthy environment. these initiatives, we have been able to reduce fatal accidents occurred within the facilities Lost days rate (LDR) 41.0 39.7 39.0 36.5 37.8 continuously our accident rate, which each of of all the business units of Falabella. We urge our teams to comply with applicable our businesses constantly monitors. Deaths by work accident or 0 0 0 0 0 laws, as well as regulations and corporate In relation to health issues, the occupational occupational disease policies on health and security. The latter Some practices within our businesses: disease ratio (ODR), the lost days ratio (LDR)
are based on applicable regulations in the and the absenteeism hours ratio (AR) are Annual Report | 3. How do we do it? countries in which we operate and guide us in • We keep track of accident indicators and monitored, reaching values of 0.11, 37.8 Note: ODIR has been rectified for 2017. the task of managing a safe and healthy work carry out a periodic evaluation of them. and 8,120, respectively, which represent a environment. Coverage in health and security +13.5%, -4.8% and -29.7% change compared issues extends to all our collaborators as well • The management system has a training to the previous year 14 15. as our contractors and sub-contractors. program, led by the risk prevention teams, that includes a mandatory induction Joint committees are composed and main- and several trainings programmed on tained by collaborators and management. a monthly and weekly basis, as well as Their main function is to detect the risks evacuation drills. of injury and professional illness, and are in charge of watching over the health and • We apply hazard identification matrices wellbeing of their teammates within their (HIM) to assess risk and control measures respective facilities, representing 100% at different levels. of employees. Our stores as well as our distribution centers count with experts in • Our policy is to cover 100% of our col- risk prevention, and hygiene and safety joint laborators by an occupational health and committees. Each of our businesses reports safety management system. the detail of the health and security policies.
13. Work accidents / direct employees. 14. ODR: number of occupational diseases per 100 employees during an annual work schedule. LDR: number of lost days per 100 employees during an annual work schedule. AR: number of absenteeism hours per 100 employees during an annual work schedule. Occupational Disease: motivated by a work related activity or derived from a work accident. Lost Day: no work done due to an occupational disease or work accident. Absenteeism: absence from work due to any type of inability, not only because of an occupational disease or work accident. Authorized absences are not considered absenteeism, for example, vacations, studies, maternity or paternity leave and permits for humanitarian reasons. 15. Does not consider Sodimac Brazil. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 59
Generate social value Social integration and regeneration
Within our teams, we focus in strengthen- operate, which require our support during We promote the generation of links with • Infrastructure: we seek to contribute besides the academic through music, ing commitment and giving a transcendent specific circumstances. Every donation is the community and the contribution to to an adequate physical environment sports and games. Some of the programs meaning to work. We are aware of our re- backed by our Donation Protocol, which their development and quality of life. The for learning and teaching of students are “From School to the Theater”, “Knowl- sponsibility to the society, the communities indicates that our donations must be aligned Company seeks to collaborate with the and teachers. This way, the Company edge Olympics” and “Dreamers that Cre- that surround us, and the environment. with our values and must contribute to the social, economic and cultural development supports the repair and rehabilitation of ate” about technological education from We are moved by doing the right thing corporate social responsibility goals we of the communities that receive it, putting in school spaces in order to achieve an inclu- Adessa. On average 87% of academic and that is why we guide our actions in a have determined. During 2018, donations practice social programs with a measurable sive and quality education. During 2018, managers at surveyed educational es- transparent manner to deliver the best of represented 24% of our social investment. and significant impact for the community. four establishments received support tablishments agree that “Knowledge us to our stakeholders. in their infrastructure with the repair of Olympics” helps children improve their Our commercial initiatives, defined as the All our businesses have local community libraries, painting, bathrooms and others. soft abilities such as teamwork, sense Community investment activities carried out between Falabella participation programs. Among the most The latter adds to the support given to of belonging among peers and sense of and the community to support the success important are19: eight schools in 2017. responsibility, among others. This posi- 16
Our community investment seeks to of the Company and its corporate identity tive perception increased six percentage Annual Report | 3. How do we do it? collaborate with the social, economic and had a cost that represented 5% of our social • Academic: the efforts centered more points with respect to 2017 (81%). cultural development of the communities that investment in 2018. Making School strongly in fostering early reading in receive it, for which each of our businesses Program (PHE) students. This way we seek to incorpo- • Corporate volunteering: we promote carry out social programs based on dialogue Corporate volunteering constitutes one of the rate parents in the process. The “First the involvement of our employees and responsible management of their impacts. main working guidelines in the relationship I Read” program was implemented to- fostering their participation in community During 2018, community investment with communities, generating positive impact The Making Shool Program (Programa Haci- gether with Fundación Crecer, seeking development activities and becoming represented 71% of our social investment. for both our employees and the surrounding endo Escuela – PHE) is one of the character- to install an innovative methodology to active volunteers in the development of environment. During 2018, Falabella’s istic seals of Falabella’s Social Responsibility. teach the language through the delivery communities. In 2018, 3,195 volunteers In addition, each of our businesses donate17 collaborators carried out 89,902 hours of Created 50 years ago its goal is to build a of materials, student accompaniment and participated, increasing participation by to foundations and/or non-for-profit or- volunteering, 4.2% more than in 2017, with better future for the children of today and teacher training. As well, together with 21%, which translated into 12,724 hours, ganizations in the countries in which we a total cost18 of $369 million. the families of tomorrow. This initiative has Fundación Barnechea we supported the 10% more than in 2017. been adapted to the educational conditions management of schools and together of each country, based on the integral sup- with Fundación APTUS we developed port of volunteers in each store, together programs in mathematics and language with municipalities and parent councils from to increase the academic abilities of stu- the communities to which they belong. The dents. In the case of academic programs, 2017 2018 program is present in Chile, Argentina, Peru 97% of the beneficiaries (children and Community investment 5,034 7,039 and Colombia, supporting over 100 educa- teachers) improved their skills and 85% Donations 1,526 1,682 tional establishments and contributing to developed a skill by participating in PHE's improve the education of more than 80,000 academic programs. In addition, 90% of Commercial initiatives 404 1,221 children in the region. the children reported positive change Total Social Investment 6,963 9,942 of attitude towards football and reading In order to maximize the impact and allow for with their parents, after participating in MM CLP 2017 2018 the measurement of the program, in 2017 the sports programmes "Escuela Activa", Money contributions 3,314 5,607 its activities were conceptually redefined, "Escuela de Fútbol", "Copa de Fútbol" and focusing on the following goals: (i) infrastruc- in the reading encouragement program Contributions in kind 2,686 3,650 ture for schools; (ii) academic; (iii) expand "Mis Padres, mis Cuentos". Volunteering cost 964 686 horizons and; (iv) corporate volunteering. Administration costs 354 525 During 2018, the impact of the program • Expand horizons: is a programmatic line was measured for the second time, using the that seeks to develop abilities in students LBG20 methodology. The positive impacts of these measures were:
16. Social investment includes donations under the tax benefit accounting criteria, as they are related to the sustainability strategy. 17. Donations understood as a one time or occasional support of the necessities of charities and communities, or in response to external events as emergency situations. 19. A detail of the initiatives and programs of each business unit can be found in the respective Sustainability Reports. These may differ from the accounting principle, as they may be considered as contributions without tax benefits. 20. LBG is a worldwide-acknowledged framework for measuring the impact of corporate investment in communities. It is used by more than 300 companies and is suggested 18. To calculate the volunteering cost, the total hours of volunteering of our businesses was multiplied by an average hourly base salary for all the group. for reporting social investment in DSJI. http://ww.lbg-online.net. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 61
Building Dreams Healthy Nutrition Financial Education Entrepreneurship and Local Employment of Home Education Program Program Promotion Program
Launched in 2017, with the program “Build- Through our program on Healthy Nutrition Our Financial Education program aims We work on a daily basis to create meeting ing Dreams of Homes” Sodimac deepens Education we promote healthy nutrition to train clients, employees, schools and spaces that contribute to the inclusion of the efforts in social investment and in col- habits in children, teachers and parents communities about personal finance. One people in the social and economic areas. laborative and participative community from vulnerable schools close to Falabel- of the main intervention strategies in this We are committed with the promotion of relationship, that the Company develops la’s supermarkets, as well as our employees matter is the program “Eddu”, which has entrepreneurship to maximize local devel- since a decade ago to improve people's and clients. The program “It´s good to grow as a protagonist an animated character opment and the creation of shared value. quality of life. healthy with Tottus” started in 2014 with that, with a didactic language and through The Entrepreneurship Support Program 200 students and two schools in Melipil- recommendations, videos and several enables us to fulfill our goal of facilitating Through competitive funds, the initiative la. As of today it has been implemented in tools, seeks to teach people how to use the access of entrepreneurs to the large supports improvement, repair or remodeling 21 schools in the Metropolitan Region and their financial products in a responsible number of clients that visit our shopping
projects of infrastructure in public spaces regions V, VI and VII, benefiting over 4,500 manner. The program is present in Chile, centers, through fairs and permanent spac- Annual Report | 3. How do we do it? presented by neighborhood or community students that participated in our classroom Peru, Colombia and Argentina, and during es in our shopping malls. In addition, we organizations. In addition, special funds are sessions, over2,600 teachers and parents 2018, we continued strengthening its support our entrepreneurs with training contemplated for the development of proj- that joined the healthy nutrition workshops regional presence launching it in Mexico programs and mentorships carried out by ects that improve the houses of collaborators and over 3,500 employees who attended the and reaching millions of people. executives from Falabella. During 2018, of the Company. Once approved, Sodimac courses taught by our team of nutritionists. we staged over 400 fairs, involving close sets aside the necessary funds and corporate For the sixth consecutive year, we did our to 900 small entrepreneurs that received volunteer groups coordinate to carry out As a fundamental part of this process, we “Learn with Eddu” Tournament, reaching tools to better manage their businesses and the work on-site. carry out an annual anthropometric assess- over 2,400 students from the Making thus become more sustainable over time. ment of the children at the beginning and School Program (PHE) school network. This way we influenced positively more than The program has an Advisory Council in at the end of the year, and focus groups Together with the latter, we launched 1,000 families and 4,000 people indirectly, which directors of the Company and leaders with teachers, parents and collaborators. our digital game “Edducity” in Chile, and as well as boosting the innovation and dy- of the civil society take part. Its goal is to In 2018, we completed the audit process for the first time, did financial education namism of the local commerce. perform a global evaluation and watch over conducted by FOCUS, a company that will workshops in schools measuring their im- its correct application, providing advice and present to us at the beginning of 2019 a pact21, achieving excellent results: 74% of At the end of 2018, we evaluated the im- points of view over the main issues that proposal to improve gaps, new indicators students understand what responsible pact of the emblematic programs with the involve the civil society and its relationship and learning improvements. indebtedness is. In Peru, we also developed community, whose results will be available with Sodimac. an e-learning course for our employees at the beginning of 2019. and several talks for students, teachers In 2018, 110 projects were undertaken and parents, benefiting over 4,900 partici- throughout Chile, with the participation pants. In a complementary way, during the Culture within the reach of 1,116 volunteers and benefiting 24,607 year we conducted talks about Financial of everyone people. Internally, 120 employees were Education to clients at the branches of supported to improve their homes. Banco Falabella in Chile, and taught four e-learning courses in which over 1,800 Promotion of culture has transformed into people participated. a strategic and differentiating focus in our shopping centers. We want to contribute to the society bringing people closer to different free cultural proposals. Hence, we have transformed our urban centers into living cultural spaces. In Chile, over 200,000 people enjoyed the nine performances of the musical Pirates of the Caribbean, face- to-face and through streaming. In addition, our Living Libraries surpassed one million visits in Chile. We went over it again.
21. Impact evaluation was conducted by Fundación Barnechea. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 63
Governance
Our integral and ethical behavior Our top governance bodies and their continuous management of the risks is a central part of who we are relevant to our businesses in economic, social and environmental matters
Our success lies in the trust that thousands • We guide ourselves by a series of norms During 2018, all members of our top gov- The highest governance body of Falabella functioning of the risk management pro- of clients, suppliers and employees place in and codes of conduct, which clearly ernance bodies learned about anti-corrup- is the Board of Directors, composed of cess. The CEO of the business unit and us. For us, acting ethically and responsibly establish the ethical behavior base of tion policies and procedures. In addition, nine members who hold office for a three- the Corporate Internal Audit Manager is not only correct, but is the right way to our culture. and in line with the guidelines of the Gen- year term since their election, and may be also participate in these meetings, in do business. eral Norm N°385 from the SVS, the Board re-elected indefinitely. Under the Board which Directors learn about the overall It is a priority in our practices for both of S.A.C.I. Falabella agreed in December is the Corporate CEO of Falabella, who performance of the risk management As leaders in the markets and industries managers and directors, on whom the 2015, to hold an annual training work- in turn leads the Corporate Managers of process. In this way, Directors detect, where we operate, Falabella has devel- responsibility of governance lies, to act shop as a permanent training mechanism each business unit. categorize and monitor risks periodically. oped and implemented a robust com- with diligence, ethics and transparency in for the Board. During 2018, two of such pliance system, which includes policies, the exercise of their duties, accounting for workshops took place with the presence For the management and decision making of In addition, each of our businesses22 has
procedures and training, to ensure that their activity and ensuring balance, respect of external and internal speakers, in which economic, social and environmental issues a Sustainability Committee, consisting of Annual Report | 3. How do we do it? our businesses and collaborators comply and equality of all shareholders, especially the following issues were discussed: (i) we conduct a permanent management of a member of the Board of the subsidiary, with ethical and regulatory standards. minority shareholders. This way, directors “My Client: Consumer Rights Defense the relevant risks, in line with our Risk Con- the CEO, the managers of each area related count with a procedure for continuous Program”; (ii) “Governance, Ethics and trol and Management Policy, with results to the business strategy and the managers • Key aspects such as privacy, security and improvement, which adds to the annual Compliance: Where are we?”; (iii) “Human presented to the Board at least once a year. in charge of the sustainability projects. Its information management, or transparen- assessment that is entrusted to a specialist Centered Design”; (iv) “Consumer Trends goal is to provide with guidelines issued cy towards our clients and stakeholders, third party. In addition, there is a formal in Latin America”; (v) “Panorama and Regu- • The Board meets twice a year with the by the Board, approve the strategy and are vital to have the trust of our consum- induction procedure for each new director, latory Trends in Data and Cybersecurity”; corporate unit to analyze the adequate monitor advances. ers and are an essential part of ethical through which the director learns about (vi) “Cybersecurity: What is going on, what behavior guidelines and norms. the Company, its businesses, policies and are we doing and where are we going?” procedures, among others. and; (vii) “Use of Data and Data Analytics”.
We are committed with providing sustainable profitability to our shareholders
We seek to assign resources and efforts • We have an Investor Relations team that During 2018, Voice of the Market, a study efficiently to create sustainable value over ensures the delivery of objective infor- conducted by EY Chile and the Santiago time. We ensure that stakeholders have mation to the investment community Stock Exchange, recognized Falabella regular access to relevant, sufficient and with which they can value the fair price among the top three Chilean companies reliable information, both in relation to the of stock, bonds and other financial instru- to show advances in the development of As leaders in the markets and industries where we operate, Falabella rules and exercise of governance as well as ments issued by the Company, and limit their corporate governments. The study has developed and implemented a robust compliance system, which over achieved results. unnecessary volatility through an oppor- also acknowledged Falabella among those tune and proactive reach. In addition, the that obtained the highest grades in the five includes policies, procedures and training, to ensure that our busines- • Financial-economic results are informed team seeks to deliver a strategic view pillars considered in the study: business ses and collaborators comply with ethical and regulatory standards. periodically, in line with current regula- of the leadership of the Company from strategy, control environment, transpar- tion, as well as any other fact considered the investor's perspective, competition ency, fair and equalitarian trait and sus- as relevant or of interest to the Company. dynamics and macroeconomic trends. tainability management.
• We comply with applicable norms and regulations in each country where sub- sidiaries of the Company are present.
22. For more information regarding the sustainability committees, please refer to the Sustainability Reports of each of our businesses. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 65 Annual Report | 3. How do we do it?
Cristopher, Jéssica , María Angélica and Leandro at Tottus Piedra Roja. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 67
We have different tools that allow us to guide the ethical actions of our collaborators and all of those who make up Falabella Gift Policy
During 2017, the Gift Policy was approved, Ethics Program aiming to establish the general principles and criteria that guide the behavior of all The following list depicts some of the norms that regulate the During 2016, the Corporate Legal Affairs To maintain and protect the highest integri- ents, suppliers and third parties can file employees at Falabella regarding gifts behavior of Falabella: and Governance Division created the ty standards, we make available to workers, complaints in the web page of the Company which, given their role as employees, they Ethics Department, which since 2017 is executives, directors, clients, suppliers and through the Integrity Channel link https:// can either extend or receive. This way, by implementing the Ethics Program, whose shareholders our Integrity Channel. This canaldeintegridad.ines.cl/falabella/. the end of 2017 the campaign “A million • Risk Control and Management • Policy on Operations with Third first two tasks were the updating of the platform enables them to conduct queries thanks, but no” was carried out, to raise Policy Parties Ethics Code of the Company, today de- regarding ethic issues, as well as informing In 2018, 19 discrimination cases were filed in awareness about the importance of not
nominated “Integrity Code”, and the new about infractions or non-compliances re- all the subsidiaries of the Company and, after accepting gifts that my compromise the • Conflicts of Interest Policy • Information Management and Annual Report | 3. How do we do it? Integrity Channel that replaced the old garding any applicable law or regulation, or completing the respective investigations, impartiality of collaborators. This campaign Responsible Marketing, Labeling whistleblower channel. Approved in 2017, the principles established in the Integrity only six cases were confirmed, with all of was rerun in October 2018. • Sustainability Policy Manual the code is in force and operative in all the Code. them being subject to corrective measures. businesses of Falabella and applies to all • Marketing Material Elaboration • Crime Prevention Control employees, directors, temporary personnel, We guarantee that all information received During 2018, broadcasting activities were Environment Policy Instructive contractors and subcontractors. Its goal through the Integrity Channel will be treat- carried out to make the Code and the In- is to deliver clarity regarding the ethical ed as fully confidential and anonymous. Our tegrity Channel known in Brazil, Argentina, During 2018, important advances were • Crime Prevention Model • Linio Information Exchange behavior that Falabella expects from its employees can file complaints through the Colombia and Peru. The Integrity Chan- made in the elaboration of an Environmen- Instructive collaborators, and ensure that Falabella’s Intranet of the Company, a toll-free phone nel received 2,024 contacts from all of the tal Policy for Falabella. The Environmental • Donee Control Protocol values are shared and lived by all employees, line (800 number), email or personally with countries in which Falabella operates. Roundtable, a group that brings together in order to strengthen a culture of integrity. the Ethics Department. Shareholders, cli- managers and those responsible for the envi- ronment at Falabella Retail, Sodimac, Tottus and Mallplaza, held seven working sessions, advancing towards the commitment of im- plementing a new Environmental Policy and During 2018, we advanced in the following norms: develop and execute a plan to implement Law 20,920 of Extended Producer Responsibility. • Customer safety procedure • Crime Prevention Policy 1 2 3 4 As part of the training effort of employ- ees, and in order to permeate this culture • Instruction on Protection • Anti-Bribery policy and program of integrity among our collaborators, we of Commercially Sensitive QUERIES AND COMPLAINTS MULTIPLE MEDIA AND CENTRALIZED RESEARCH & carried out communication campaigns and Information • Free Competition Policy and FROM COLLABORATORS AND CONTACT POINTS MANAGEMENT IMPLEMENTATION trained our employees, teaching them how Program THIRD PARTIES to address the main conflicts of interest • Policy and Program on Protection they may have to face, covering topics such of Client Rights • Instructive for Participation in as crime prevention, anti-bribery and free Trade Associations competition, among others. During 2018, • Procedure for Processing • Website Reception and resolu- over 50,000 employees were trained in and Responding to Customer • Instructive for the Negotiation • Intranet tion by ethics and gover- anti-corruption, covering 44% of our work- Complaints with Suppliers for Free • E-mail nance management force. Our commitment for 2019 is to con- Competition • 800 number duct communication campaigns regarding • Personally with the our integrity management oriented to our Ethics Department suppliers of own brands. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 69
We value and respect human rights and are committed to treat people with justice and dignity
At Falabella we have a firm commitment on We offer equal opportunities and treat- the compliance of the regulation of each ment to all our collaborators in all areas country in which we operate. As well, Fal- and subsidiaries of our Company, without abella supports the principles consecrated and arbitrary distinction, as those based in the United Nations Universal Declaration on nationality, raze, gender, ethnicity, sex, of Human Rights and the Convention on sexual orientation, gender identity, disability the Rights of the Child. Falabella, through or civil state. its subsidiaries, has been incorporating progressively the United Nations Global We reject all violations to the human rights
Compact, ensuring to communicate and of our employees or third parties that relate Annual Report | 3. How do we do it? comply with its ten fundamental principles with us, which our internal regulation duly that consider human rights, labor regu- sanctions. lation, environment and anti-corruption. We are committed with the development of The respect for the dignity of each of our alliances with suppliers that share our ded- collaborators constitutes a fundamental ication to conduct their activities in a legal, pillar of our corporate integrity, which we ethical and socially responsible manner. commit to protect always. We promote diversity among our teams and thus expect relations between employees to be based on respect and inclusion.
Due Dilligence on Human Rights Ẁ м Process Sodimac Chile
UNFAIR POLITICAL COMPETITION CONTRIBUTIONS During 2018, Sodimac in Chile carried out of Sodimac, with 63 interviews and the During 2018, there were no legal actions In line with our internal norms and policies, a Due Dilligence Process on Human Rights, review of 217 documents. The issues and related to unfair competition, monopolistic we do not contribute to political campaigns in line with the United Nations Guiding risks raised in this process were integrated behavior or anticompetitive practices. or lobbying organizations. Principles on Business and Human Rights. to the Risk Management of the Company, This initiative counts with the participation adding a new view regarding the impact on of the Executive Committee, suppliers, people to the whole prevention and miti- employees, contractors and union leaders gation process conducted by the Company. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 71
Manage our supply chain Participation in organizations and associations We seek constructive and long-term relationships with Falabella participates in different asso- The contribution made to Chambers and our suppliers ciations and organizations, national and Associations of Shopping Centers is a stra- international, seeking to develop strate- tegic decision, given that we align and share gic alliances with common interests and good practices for the benefit of shopping Mutual collaboration and trust enable suppliers 10% of the total purchases made during the goals that reinforce sustainability. The total centers, in addition to discussing issues that and companies to grow. We maintain an open period for the supply of goods and services amount contributed during 2018 reached affect the guild. The amount contributed in communication with our suppliers, providing of the segment. $1,077 million. 2018 corresponds to $178 million. them with adequate communication channels and fostering in them the development of in- The integration of long-term sustainability The top three contributions made during Finally, the contribution made to Universities novative solutions oriented to the necessities across the value chain is reinforced by our 2018 totaled $489 million. These were is explained by our interest in training and of clients. bet on innovation and a responsible man- made to Chambers of Commerce, Cham- developing our collaborators, through schol- agement of the supply chain that prioritizes
bers and Associations of Shopping Centers arships and training. The contribution made • At the close of 2018, our retail businesses traceability and transparency as a starting Annual Report | 3. How do we do it? and Universities. during 2018 corresponds to $88 million. reached a total of 27,855 active suppliers23, point to develop our social, environmental, 11 % less than in 2017. health and security policies for products.
• No business unit of the Company has sup- pliers that individually represent more than
We are committed with developing alliances with suppliers that share our dedication to conduct their activities in a legal, ethical and socially responsible manner
During 2018, our Compliance and Gov- • Our retail businesses work with Sedex, • While 30% of our total suppliers with a ernance Department, together with the the largest platform worldwide in issues contract have an environmental clause, Governance Department started to work related to Social Responsibility in the in the case of home improvement this on an Instructive for Negotiating with Sup- Supply Chain, that helps companies to figure increases to 55% of its suppliers. pliers for Free Competition, with the goal to reach ethical, labor, environmental, and provide specific guidelines of conduct that health and security responsibility stan- • In 2018, over 700 suppliers of our re- help our collaborators in their relations and dards. Suppliers must commit to comply tail businesses were audited on CSR25 negotiations with suppliers. with the norms of ethical commerce for practices. Sedex members (SMETA). This way we are committed to develop al- liances with suppliers that share our dedi- • 68% of retail suppliers and 78% of real cation to conduct their activities in a legal, estate suppliers with a contract have ethical and socially responsible manner. It is Social Responsibility clauses24 whose a requisite for our suppliers to comply with goal is to specify ethical and human labor legislation and operate in accordance rights conditions in which products with the universal human rights. must be elaborated.
23. Suppliers that had movements/transactions during the year. 24. Vendor Compliance or other. 25. Sedex or any other audit of CSR practices. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 73
Manage our impact Our focus in own brands challenges us to develop an increasingly solid strategy for supplier management on the environment
The world of own brands has transformed labels continued to increase their share into a strategic pillar that provides an ex- over total sales in the group consistently, We see environmental care as a responsibil- treal Protocol 2018, where the work Extended Producer Responsibility clusive portfolio at competitive prices, reaching 26.3% of total retail sales in 2018, ity to manage our impact and an opportunity carried out at Tottus Vitacura Alderete Law (EPR) enabling us to differentiate and deliver a which challenges us to reinforce our com- to contribute beyond our business to some and Kennedy highlighted due to its eco- higher value-added to our clients in our mitment with a responsible supply chain. of the greatest global challenges. Our goal logical refrigeration system based on In Chile, one of our focuses in 2018 was different retail units. That is how private is to promote environmental care, for which CO2 that takes care of the ozone layer the integration of the future EPR Law23 in we procure to identify, evaluate and manage and prevents global warming. our daily work. We are one of the five com- the environmental effects of our operation, panies in Chile that leads and participates aspiring to minimize them. We want to be • Falabella Chile: in 2018, we signed the in all roundtables and dialogue instances We believe that sustainable development is only possible if all actors a regional referent, which is possible only Clean Production Agreement (CPA), a related to the EPR Law, in order to face the collaborate and advance towards that goal with the collaboration and involvement of public-private alliance through which challenges derived from its implementation. our employees, whom we seek to make a we committed – together with 29 other part of this vision. companies – to reduce to cero the waste We actively participate in the EPR Law
The Company and its subsidiaries are con- Working hand in hand with our suppliers disposal of our Los Dominicos store, both roundtable together with associations Annual Report | 3. How do we do it? cerned about timely payment to suppliers, allows us to strengthen our business model During 2018, our businesses received the from our production as well as from our as the Chilean Chamber of Commerce, especially SMEs. In 2018, our retail business- and our value chain. For this, it is essential to following acknowledgements and awards: services facilities. Sofofa24 and AMCHAM25. es in Chile worked with 6,258 SMEs, which advance in the total traceability of the chain, represent close to 58% of total suppliers to identify potential impacts on human rights • Acknowledgement from the United Na- • Due to the installation of 3,150 solar pan- in Chile and a 113% increase with respect in the supply chain, to align with the main tions Global Compact to Imperial, in the els on the terrace of Mallplaza El Castillo, 23. Framework Law for Waste Disposal, Extended Pro- to 2017. 30-day payments were made to global standards and best practices, and to Environment category, for the “Disposal of CELSIA acknowledged Mallplaza as an ally ducer Responsibility and Recycling Promotion. 4,458 of these SMEs, equivalent to 71.2% permanently dialogue with our stakeholders. sawdust waste for biomass”, which stands in the development of good practices in 24. Sociedad de Fomento Fabril. of the total. out among the best practices in sustainabil- environmental management and energy 25. Chilean North American Chamber of Commerce. ity and commitment with the 2030 Agenda, efficiency, in order to contribute to the Globally, 12,706 suppliers were SMEs in in relation to the Sustainable Development sustainable development of Colombia. 2018 in our retail businesses (excluding Ar- Goals (SDG). gentina, where these category is not pres- • Acknowledgement from the Food Bank of ent), representing 46% of the total. • The United Nations Development Pro- Peru, for being one of the five companies gramme (UNDP) presented Tottus Chile that more food donates to the institution. with the Ozone Award from the Mon-
Some of our advances in 2018: CIRCULAR ECONOMY – PROJECT • Our Good Agricultural Practices Program • Starting on September 2018, our real • During 2018 we implemented a sanitary FROM FALABELLA RETAIL (GAP) in Tottus Peru acquires the most estate business is carrying out a sus- and environmental evaluation to our important relevance after training our tainability assessment as part of the food operators in the food courtyards To be at the forefront, promoting inno- discarded or treated as waste, and whose suppliers and distributors in issues that selection process of suppliers that take in Open Chile, and an audit plan was vation in the search for systems that go destination was the landfill: recycling and include product harmlessness, environ- part in any bidding process. In so far, 104 developed which by the end of the year hand-in-hand with the worldwide trend recuperation of clothes hangers, and recu- mental protection and security of people suppliers have been evaluated and to achieved 70% compliance. A monthly related to the Circular Economy. This is peration of plastic bags from operations that work during the sowing, fertilization, date no commercial relation has been environmental assessment is made. how we did it in Chile during 2018, with (in Chile). Both projects will be maintained fumigation, harvest and selection stages. ended due to these assessments. the creation of two new projects oriented during 2019, adding two more in order to to improve our waste management. With continue giving consistency to our work in these projects, we were able to give a this line and deepen the mitigation of our new life to materials that were previously impacts on environment. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 75
Environmentally friendly facilities Falabella Retail Distribution Center
The new Omnichannel Distribution Center is currently in the process of obtaining the LEED26 Gold certification delivered by the U.S. Green Building Council, a non-profit organization of which we are members.
SUSTAINABLE REDUCTION OF OTHER CONSTRUCTION ENVIRONMENTAL ASPECTS
Green Point Annual Report | 3. How do we do it? 65% 29% 134 m2 124 of materials used in the of used materials construction were from a are recycled within the distribution center for recy- bicycle racks and 9 local origin cling of cardboard, plastics and wood approach buses
89% ' Щ Þ of on-site generated Air renovation system re- Replacement of cardboard boxes Over 3,000 m2 of green areas, on waste was recycled news 100% of the interior with reusable plastic boxes made a land where a clandestine landfill air every four hours from recycled material used to be
ENERGY WATER SAVINGS SAVINGS
29% Ū LED 100% 33.53% energy savings thanks Skylight27 system that illumination, with auto- of the water used is ex- savings thanks to the to the use of 30 solar takes advantage of mated control system tracted from a groundwa- low-consumption faucet panels natural light for energy savings ter and treated at a water system treatment facility
26. LEED: Leadership in Energy & Environmental Design. Sustainable buildings certification system. 27. A skylight is a window located on the rooftop used to admit light. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 77
Constructions increasingly friendly with the environment and the local community We seek to promote the efficient use of resources, mainly energy
Our businesses have led several initiatives while two shopping centers have LEED efficient use of water; usage of construction • In 2017, Falabella signed an alliance with strip centers, renewable energy con- oriented to generate an operational eco- Silver certification, Mallplaza Arequipa materials from renewable, recyclable and Acciona Energía for the implementation sumption represents close to 40% of efficiency and minimize the environmental and Mallplaza Manizales. Mallplaza Los non-toxic resources and; improve the qual- of non-conventional renewable electric total energy consumption, increasing effects of our operations. Dominicos and Mallplaza Arica are un- ity of life of people and the communities. energy usage in all the facilities of Empre- 14% with respect to the previous year. dergoing the LEED certification process sas Falabella during the following years. We promote a sustainable real estate de- and are close to obtaining it. In addition, before building our stores we • In line with our commitment on energy velopment with the construction of stores make controls and monitor the externali- »» The latter has allowed during 2018 to consumption, during 2018 our retail for- and buildings with LEED certification or • In addition, we have another 23 shopping ties that we commit to comply, in line with increase consumption of renewable mats reduced consumption per m2 built eco-friendly28 systems, which in turn gener- centers with eco-friendly characteristics the ranges demanded by regulation and energy in our retail businesses by by 12% reaching a total consumption of ates efficiencies and production increases. in the region. pertinent authorities, and take care to en- 11% with respect to the previous 164KWh per m2 built. sure that the activity of the store does not year, representing in 2018 30% of We believe that energy efficiency goes • As of the end of the year, 32 of our retail alter the life of the community during the total energy consumption. • On the other hand, our shopping centers
hand-in-hand with sustainable construc- stores have LEED certification and 71 have construction stage and later operation. reported an energy consumption of 70 Annual Report | 3. How do we do it? tions, for which we obtain external certifica- eco-friendly characteristics. This type of »» In our real estate businesses, renewable KWh per m2 built, which represents a 2% tions to demonstrate our commitment and construction permits the reduction of en- We present Relevance or Environmental energy consumption already represents reduction with respect to the previous year. progress, and we work to ensure that our ergy consumption, on average, by 15% Impact studies in line with regulation. As 67% of total energy consumption. practices are in line with the best practices to 20%. part of the process, all observations from in our markets. the Environmental Evaluation Service and »» Adding retail and our shopping and • S.A.C.I. Falabella is a member of the World other audit entities involved in each of these • Six of our shopping centers have been Green Building Council, a non-profit orga- processes are taken into account. On the built under sustainable construction nization that aims to promote and foster: other hand, acoustic studies are conduct- parameters under the LEED methodol- sustainable construction and development; ed to count with more demanding levels ogy. As of December 2018, two shopping technological innovation and sustainable than those considered by the applicable centers have LEED Gold certification, building certification; efficient use of -en regulation, which are then checked once Mallplaza Egaña and Mallplaza Copiapó, ergy and the usage of renewable energy; the store is operating.
28. Eco-friendly facilities are those that count with LEED criteria, but: (a) not enough in order to be certified or; (b) have not been subject to the certification process. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 79
We are committed to take charge of the waste we produce
As a Company, we are committed to take and create value to the community. BAP network had 17 recycling points distrib- charge of the waste we generate, fostering recovers from our main stores and dis- uted throughout Santiago and regions. In recycling initiatives and recycling points. tribution center products that have lost addition, Sodimac signed an alliance with commercial value in order to distribute a communications company in order to • In 2018, Tottus Chile entered the “Zero them to charities, thus feeding over 170 incorporate an electronic recycling space Waste Clean Production Agreement”, thousand people in a vulnerable situation. to the network, enabling the recycling of which seeks to reduce the waste disposed On the other hand, Bioconvertin trans- cell phones, tablets and cables. in landfills. During the year, pilots were forms our products that are no longer conducted at two stores in Chile. At the edible into bird and fishmeal. In turn, • In our strip and power centers, regarding same time, we actively involved ourselves Biolis recycles the non-edible cooking the determination of waste in order to in two roundtables. The first one, at a oil as airplane bio-fuel. have special warehouses for hazardous
guild level in the Chilean Supermarkets and non-hazardous waste, in 2018 start- Annual Report | 3. How do we do it? Association, as part of the Packaging • At Falabella Retail, catalogs, tickets and ed the separation of recoverable waste Technical Committee. The second one, product boxes from Falabella.com were destined to sanitary landfills, and for the through the Chamber of Commerce of elaborated with PEFC and FSC certified year 2019 hard work is being done to Santiago, integrating the Electric and raw materials, so they come from renew- implement RESPEL and SUSPEL ware- Electronic Appliance Waste roundtable, able forests. In addition, we ensure to houses, and quantify and declare haz- which has a public-private character, and provide our clients with reusable bags. ardous waste. for whose participation we were invited to Spain in representation of our guild in • In April 2018, Sodimac eliminated in Chile We maintain our commitment on expanding the order to learn and share best practices. the use of plastic bags for purchases, measurement of our Carbon Footprint which is equivalent to 46 million bags, • Sorepa S.A. certified that during 2018 it or 471 tons. This decision adds to sev- received 7,661,003 kilograms of card- eral other measures like carbon neutral We maintain our commitment on expanding • During the year, at Falabella Retail, • At Falabella Inmobiliario and Open Peru, board recuperated by Hipermercados delivery during Cyber Monday. the measurement of our Carbon Footprint through the Carbon Footprint program there is a real commitment with climate Tottus S.A. in order to control and ensure the reduction from the Ministry of Environment, the change. From this perspective, during the • The National Network of Recycling of direct and indirect emissions. We contin- quantification of the carbon footprint of last years the carbon footprint has been • Tottus Peru has alliances with three Points at Sodimac stores in Chile recy- ue working in the process of standardizing 25 stores was carried out for Scopes 1 measured in the operations of the Chilean strategic partners: Food Bank of Peru cled over 3.1 tons of waste, surpassing procedures to capture and control informa- and 2, increasing from 12 stores in 2017. shopping centers. In order to quantify (BAP), Bioconvertin and Biolis, special- 680 thousand visits from clients and the tion for Scopes 1 and 2. direct emissions, the latter considered ized in waste management, with the aim community. At the close of the year, this • In 2019, the quantification of the carbon CO2 emissions from the use of fossil of reducing the impact of our operations • Sodimac Chile and Colombia once more footprint of Tottus in the year 2018 will fuel (diesel) in the backup power gener- measured their carbon footprint, which be completed, which will imply measuring ator and the firefighting motor system. has fostered initiatives to increase the use Scopes 1, 2 and residuals in 3. The quantification of indirect emissions of non-conventional renewable energy considered the use of electricity (Kw/h) (NCRE). Sodimac will have solar panels • In Peru, Open is the first shopping cen- and waste disposal in landfills. In Peru, in 58 facilities in Chile (80% of total fa- ter chain to invest in the preservation the carbon footprint is not measured. cilities) between 2017 and 2019 seeking of natural areas through the purchase Work is being done since 2018 with an to supply 34% of energy consumption of Carbon Credits. Open Plaza Pucall- environmental expert advisor who is ana- from renewable energy. Said panels are pa, located in the Peruvian Jungle, is the lyzing measurements in order to prepare expected to reduce 20 thousand tons of first carbon-free construction, as 8,000 a reduction plan. CO2 emissions to the atmosphere. Carbon Credits were purchased at the end of its construction, neutralizing its carbon footprint. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 81
Investment plan 37%
Falabella is constantly looking for invest- 34% ment opportunities that contribute to the Store and shopping center openings plan 29% wellbeing of its customers, generate syner- gies in existing operations or are attractive for the Company from a strategic stand- point. Each investment is researched and 26 ¤ 5 evaluated based on cash flow projections Shopping √ and strategic value. Financing policies are 23 23 23 US$ 4.2 bn centers established for each particular case, always 95 Investment Stores following guidelines approved by the Board plan of Directors. √ Stores 2019 2020 2021 2022
In January 2019, the Company announced Remodelling and expansión of existing a new US$ 4,200 million organic investment Stores and Shopping Malls
plan for the 2019-2022 period. The use of Annual Report | 3. How do we do it? these resources is focused mainly in the New Stores and Shopping Malls development of information technology (IT) 2 2 and logistics, to continue advancing in the 1 IT, Logistics and Others development of a digital services ecosystem. ü Shopping Specifically, this plan considers approxi- malls 2019 2020 2021 2022 mately 37% of resources for these goals, allowing the Company to achieve efficien- cies in operations, deepen client knowledge and supply customers both in store sales as well as through the internet. In turn, 34% Investment plan (US$ millions) of resources will be oriented to new store and shopping center openings, focusing mainly in regions where the Company has a 1,084 small presence or none at all. Finally, the re- 1,115 1,072 maining 29% will be invested in expansions 929 and remodeling, boosting the existing store network and aiming to offer a better service ¤ 2019 2020 2021 2022 level. All these investments are designed to solve the lives of customers and offer a consistent shopping experience across all channels. Note: the investment plan includes 100% of the investments of Falabella and its subsidiaries, including Sodimac Colombia, Sodimac Mexico and CMR Mexico, which do not consolidate.
“Falabella is undertaking today the investments that will support the future growth of the Company. We are building an ecosystem of integrated services, which enables us to serve our clients in the region whenever they want and in the format they choose.” Gaston Bottazzini, CEO Falabella WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 83 Annual Report | 3. How do we do it?
Karen, Alejandro, Paola and Ricardo at Tottus Piedra Roja. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 85
Board of Directors
The Board of Directors of Falabella is The current members of the Board were composed of nine members that sit on elected in the April 25, 2017, Ordinary the Board for three-year terms since the Shareholders' Meeting for the statutory date of election. They can be re-elected period of three years. indefinitely. The Board does not contem- plate alternate directors. As of December 31, 2018, the Board of Directors of Falabella was comprised of the following members: Directorio
RUT Name Position Occupation Director since 2018 attendance 9.585.749-3 Carlo Solari Donaggio Chairman Civil Engineer 2011 20 7.017.522-3 Juan Carlos Cortés Solari Vice Chairman Business Administrator 2002 20 5.718.666-6 Hernán Büchi Buc Director (Independent) Civil Engineer 1996 19 5.082.229-K Sergio Cardone Solari Director Business Administrator 1986 18 5.898.685-2 Juan Pablo del Río Goudie Director Architect 2017 19 4.773.832-6 José Luis del Río Goudie Director Civil Engineer 2003 16 Annual Report | 4. Corporate Governance 8.717.000-4 Carlos Heller Solari Director Agricultural Engineer 2002 13 7.005.097-8 María Cecilia Karlezi Solari Director Entrepreneur 2003 17 8.506.868-7 Paola Cúneo Queirolo Director Business Administrator 2014 19
Notes: Carlo Solari Donaggio is Chairman of the Board since 2014. Juan Carlos Cortés is Vice Chairman of the Board since 2014.
During 2018 the Board met 20 times. Regard- The following tables set forth the number ing the composition of the Board of Directors, of Board members by age range and years seven members are men and two women, all served as Director. Corporate Governance Chilean nationals.
Age (years) Directors Under 30 0 Between 30 and 40 0 Between 41 and 50 2 Between 51 and 60 3 Between 61 and 70 2 Over 70 2
Service years Directors Board of Directors Management Less than 3 years 1 Director's Committee Ownership and Control Between 3 and 6 years 1 Between 6 and 9 years 1 Between 9 and 12 years 0 More than 12 years 6 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 87
Directorio
1. 4. 7. Carlo Solari Donaggio Sergio Cardone Solari Carlos Heller Solari Chairman Director Director
2. 5. 8. Juan Carlos Cortés Solari Juan Pablo del Río Goudie María Cecilia Karlezi Solari Vice-Chariman Director Director
3. 6. 9.
Hernán Büchi Buc José Luis del Río Goudie Paola Cúneo Queirolo Annual Report | 4. Corporate Governance Director Independiente Director Director
Comité de Directores
Hernán Büchi Buc Sergio Cardone José Luis del Río Presidente del Comité Solari Goudie WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 89
Falabella Board Compensation – 2018 (M$) Falabella Director Compensation in subsidiaries - 2018 (M$):
R.U.T. Director Fixed compensation Variable compensation Total 2018 R.U.T. Director Dinalsa Malls Sodimac FIF Retail Total 2018 9.585.749-3 Carlo Solari Donaggio 222,884 356,715 579,599 9.585.749-3 Carlo Solari Donaggio 18,108 32,634 9,068 18,115 18,121 96,045 7.017.522-3 Juan Carlos Cortés Solari 18,121 178,358 196,478 7.017.522-3 Juan Carlos Cortés Solari 54,360 - - - - 54,360 5.718.666-6 Hernan Buchi Buc 17,939 178,358 196,297 5.082.229-K Sergio Cardone Solari - 65,267 - 18,115 18,121 101,503 5.082.229-K Sergio Cardone Solari 18,121 178,358 196,478 4.773.832-6 Jose Luis del Río Goudie - - 18,271 - - 18,271 5.898.685-2 Juan Pablo del Río Goudie 18,121 178,358 196,478 8.717.000-4 Carlos Heller Solari - - - - 72,485 72,485 4.773.832-6 Jose Luis del Río Goudie 18,121 178,358 196,478 7.005.097-8 María Cecilia Karlezi Solari 7,488 - 18,271 - 7,485 33,244 Annual Report | 4. Corporate Governance 8.717.000-4 Carlos Heller Solari 18,121 178,358 196,478 8.506.868-7 Paola Cuneo Queirolo - - 18,271 - - 18,271 7.005.097-8 María Cecilia Karlezi Solari 18,121 178,358 196,478 5.898.685-2 Juan Pablo del Río Goudie - - 108,974 - - 108,974 8.506.868-7 Paola Cuneo Queirolo 18,121 178,358 196,478 Total 79,956 97,901 172,855 36,230 116,213 503,154 Total 367,667 1,783,577 2,151,245
Falabella Board Compensation – 2017 (M$) Falabella Director Compensation in subsidiaries - 2017 (M$):
R.U.T. Director Fixed compensation Variable compensation Total 2017 R.U.T. Director Dinalsa Malls Sodimac FIF Retail Total 2017 9.585.749-3 Carlo Solari Donaggio 218,021 345,601 563,622 9.585.749-3 Carlo Solari Donaggio 17,725 31,906 17,867 17,719 17,723 102,940 5.082.229-K Sergio Cardone Solari 17,725 172,801 190,526 7.017.522-3 Juan Carlos Cortés Solari 53,176 - 17,867 - 0 71,043 5.718.666-6 Hernan Buchi Buc 17,548 172,801 190,349 5.082.229-K Sergio Cardone Solari - 95,719 - 17,719 17,723 131,160 8.717.000-4 Carlos Heller Solari 17,725 172,801 190,526 6.888.500-0 Carolina del Río Goudie - - - - 0 0 7.017.522-3 Juan Carlos Cortés Solari 17,725 172,801 190,526 4.773.832-6 José Luis del Río Goudie - - 17,867 - 0 17,867 4.773.832-6 Jose Luis del Río Goudie 17,725 172,801 190,526 8.717.000-4 Carlos Heller Solari - - - - 70,883 70,883 6,888,500-0 Carolina del Río Goudie 5,874 172,801 178,675 7.005.097-8 María Cecilia Karlezi Solari 17,725 - 17,867 - 17,723 53,316 7.005.097-8 María Cecilia Karlezi Solari 17,725 172,801 190,526 8.506.868-7 Paola Cúneo Queirolo - - 17,867 - - 17,867 6,066,460-9 Paola Cuneo Queirolo 17,725 172,801 190,526 7.005.097-8 Juan Pablo del Río Goudie - - 106,564 - - 106,564 5.898.685-2 Juan Pablo del Rio Goudie 11,851 - 11,851 Total 88,627 127,625 195,899 35,437 124,053 571,641 Total 359,647 1,728,005 2,087,652
The Board did not contract any advisors during 2018. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 91
Board Committees
Directors’ Committee
At the Ordinary Shareholders’ Meeting The Committee was also empowered to shareholders’ meeting dated August 20, • The economic proposal for the audit dated April 25, 2017, all the Board was re- contract professional advisory for the de- 2018, presented, in accordance with the services; and, newed, for the statutory three-year period. velopment of its functions. law, a report with respect to the operation At said meeting, Mr. Hernán Büchi Buc was with a related party called “Collaboration • The recent incorporation of new coun- elected independent Director (henceforth, During the 2018 exercise, there were no ex- Agreement”, between the Company and tries and businesses that need a correct the “Independent Director”). At the Ordinary penses charged against the advisory budget Inversiones Los Olivos S.A., copy of which settlement in the audit process. meeting of the Board of the same date, and in of the Committee. was sent to the Board. Said operation was accordance with what is established in article finally approved by the shareholders in the During the same aforementioned session, 50 bis of the Stock Corporations Law, the Meetings aforementioned meeting; the Committee approved to propose to the Independent Director appointed Mr. Sergio Board the following designation of risk rating Cardone Solari and Mr. José Luis del Río During 2018, the Committee met eight Learned about the progress of the audit plan agencies for the publicly traded securities Goudie as members of the Audit Commit- times, on February 26, May 14, June 26, and audit processes of the Company and its issued by the Company: tee. This way, and as of the aforementioned July 3, August 28, November 27 and De- subsidiaries, as well as the internal control date, the Committee is comprised by the cember 17. report presented by the external auditors To maintain Fitch Chile Clasificadora de Ries- abovementioned Directors and is chaired of the Company; go Limitada and Feller-Rate Clasificadora Annual Report | 4. Corporate Governance by the Independent Director. Matters addressed de Riesgo Limitada as risk rating agencies Reviewed and learned about the reports for the stock, bonds and commercial paper The expense budget for the Committee and At the sessions held during 2018, the Com- presented by the Internal Audit Department issued by the Company in Chile; and, the compensation of each of its members for mittee devoted itself to learn about the of the Company, and, approved the internal the period comprised between the ordinary matters of its competence. Among other audit plan for the Company for 2019. Maintain as well risk rating agencies Stan- shareholders’ meetings of the years 2018 things indicated on article 50 of the Stock dard & Poor’s and Fitch Ratings for the rating and 2019 were determined by the share- Corporations Law and that were entrusted During the session dated February 26, 2018, of securities issued abroad. holders of the Company at their ordinary by the Board to the Committee, it: the Committee evaluated the service pro- session dated April 24, 2018, as follows: posals received from external audit com- Examined the balance sheet and the rest panies for the 2018 exercise and proposed The expense budget was set as an amount of the quarterly and annual financial state- the Board, which in its turn proposed to the equivalent to the sum of the annual compen- ments of the Company, including the reports shareholders, a pair from which to choose sation of the members of the Committee; presented by senior management of the the external auditors from the following Company as well as by the external auditors, companies, in the order in which they are The compensation of each member of the ruling on them prior to their presentation named: i) first, Ernst & Young Servicios Pro- Committee was set as: i) a fixed amount to the Board and, when applicable, to the fesionales de Auditoría y Asesorías Limitada equivalent in pesos to one third of the shareholders, for approval; (henceforth “EY”), and, ii) in second place, Members and meeting attendance: monthly compensation of a Director, for Deloitte Auditores y Consultores Limitada. each session of the Committee attended Proposed to the Board names for the se- Director Attendance 2018 Attendance 2017 by the respective member, and in the case lection of the external auditors and private Regarding the proposal from EY, the Com- Hernán Büchi Buc (Chairman)* 8 6 of the chairman of the Committee, plus a risk rating agencies, which were, in turn, mittee left record of considering it as a first Sergio Cardone Solari 7 6 monthly fixed compensation equivalent in proposed to the shareholders’ meeting; priority based on the following professional José Luis del Río Goudie 7 5 pesos to 100 gross UF (unidades de fomento aspects and of the service proposal from EY: – inflation indexed currency) for each month Informed the Board with respect to the con- or its fraction during the time served at the venience of hiring the external auditors of • The quality of the professional team in Compensation of the Directors’ Committee (M$) position since its election; plus, ii) in addition the Company for the provision of non-audit charge of the Company’s audit; to the fixed compensation described in the services, in terms contemplated in number R.U.T. Director Fixed portion Variable Total 2018 Total 2017 previous point, an annual variable compen- six of subsection eight of article 50 bis of the • The Company’s past working experience portion sation for the amount in pesos equivalent to Stock Corporations Law; with EY; 5.082.229-K Sergio Cardone Solari 3,057 59,453 62,510 60,572 one third of the annual variable compensa- 5.718.666-6 Hernán Büchi Buc 36,115 59,453 95,567 92,433 tion of a Director; considering that all of the Examined the information related to the • The international presence of EY in the 4.773.832-6 Jose Luis del Río Goudie 3,550 59,453 63,003 60,073 above amounts are in addition to those to operations referred to in Title XVI of the countries in which the Company and its Total 221,080 213,078 which the members of the Committee are Stock Corporations Law, and in the con- subsidiaries operate; entitled given their position as Directors in text of the Company’s capital increase the Board; and, process agreed upon at the extraordinary *Independent board member WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 93 Annual Report | 4. Corporate Governance
Christian, Natalia, Pedro and Sandra at Sodimac Ñuñoa. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 95
Management Alejandro González Dale Michael Fox Senior Executives Corporate Chief Financial Officer Corporate Chief Information Officer Strategy Committee 10.054.917-4 26.142.968-3 Business Administration Bachelor in Business Administration The Strategy Committee aims to evaluate Together with the latter, the role of the 12 years in Falabella 1 year in Falabella Date appointed in the position: Date appointed in the position: March 2018 and make proposals to the Board regarding Committee is to assess investments and November 2006 industry trends and their implications for divestments, and make proposals regard- Falabella, as well as the strategic oppor- ing the Company’s investment and risk Jordi Gaju Nicolau María Francisca Prieto Arroyo tunities presented by the business with a management policies. Moreover, the Com- Corporate Chief Strategy Officer Corporate Chief People Officer 13.660.520-8 11.833.668-2 mid to long-term focus. mittee is responsible for leading the anal- Business Administration Business Administration ysis and the development of proposals in 9 years in Falabella 7 years in Falabella As well, the Strategy Committee deep- critical issues at the request of the Board. Date appointed in the position: Date appointed in the position: September 2018 September 2018 ens on the guidelines of the corporate strategic plan and those of the business The Strategy Committee met three times Gonzalo Smith Ferrer units. In this line, the Committee proposes during 2018. Corporate Legal Affairs and improvements to strategic plan proposals Governance Manager 9.959.968-5 presented by the CEO. Lawyer 3 years in Falabella Members and attendance: Date appointed in the position: December 2015 Gaston Bottazzini Pablo Ardanaz Director Attendance 2018 Attendance 2017 Corporate Chief Executive Officer Country Manager Argentina Carlo Solari Donaggio (Chairman) 3 3 22.923.569-9 0-E (Foreign) Economist Industrial Engineer Juan Carlos Cortés Solari 2 2 Annual Report | 4. Corporate Governance 10 years in Falabella 12 years in Falabella Sergio Cardone Solari 2 3 Date appointed in the position: Date appointed in the position: June 2018 August 2016 José Luis del Río Goudie 2 3 Rodrigo Fajardo Zilleruelo Paola Cúneo Queirolo 3 2 Country Manager Colombia Juan Pablo del Río Goudie 3 2 7.649.739-7 Cecilia Karlezi Solari 2 - Business Administration 24 years in Falabella Date appointed in the position:
DIRECTORIO Jorge Joannon Errázuriz February 2010 Compensation and Talent Committee Corporate Internal Audit Manager 7.003.348-8 Juan Fernando Correa Malachowsk Civil Engineer Country Manager Peru 4 years in Falabella The Committee analyzes compensation, In addition to the latter, the Committee 0-E (Foreign) Date appointed in the position: Industrial Engineer evaluation and talent management policies, reports periodically about the key issues August 2014 15 years in Falabella and when appropriate reviews nominations in talent management and nominations Date appointed in the position: January of Board members for the subsidiaries. within the organization. 2017
Regarding compensation, the Committee The Committee proposes guidelines rela- Gonzalo Somoza García Juan Manuel Matheu analyzes and proposes compensation policies tive to succession plans for the CEO and Corporate Department Stores Chief Falabella Financiero Chief for Directors of the Company and its rele- senior executives, and monitors the per- Executive Officer Executive Officer 22.051.269-K 21.658.334-5 vant subsidiaries, evaluating the long-term formance of key executives. Civil Engineer Bachelor in Business Administration incentives to be delivered during the year. 19 years in Falabella 9 years in Falabella The Compensation and Talent Committee Date appointed in the position: Date appointed in the position: June 2018 April 2014 In relation to evaluations, the Committee met twice during 2018. ensures the correct implementation of the Enrique Gundermann Wylie Fernando de Peña Iver Corporate Home Improvement Chief Chief Executive Office Mall Plaza performance review of the senior execu- Executive Officer 7.556.207-1 tives in the Company. 9.900.567-K Civil Engineer Civil Engineer 29 years in Falabella Members and attendance: 17 years in Falabella Date appointed in the position: Date appointed in the position: January 1990 October 2012 Directors Attendance 2018 Attendance 2017 Johann Ramberg Arnillas Ricardo Hepp de Los Ríos Juan Carlos Cortés Solari (Chairman) 2 1 Corporate Supermarkets Chief Chief Executive Officer Falabella Carlo Solari Donaggio 2 3 Executive Officer Inmobiliario Note: The Corporate Chief Information Officer Michael Juan Pablo del Río Goudie 2 2 0-E (Foreign) 7.617.431-8 Fox served in that position until January 31, 2019. In Economist Business Administration Carolina del Río Goudie - 1 15 years in Falabella 24 years in Falabella February 1, 2019 Helder Mao de Ferro was appointed Date appointed in the position: Date appointed in the position: Sergio Cardone Solari - 1 to that position. September 2018 April 2009 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 97
Management
As of December 31, 2018, no senior ex- Senior executives by age range ecutive or Director (who is not part of the controlling pact, disclosed further on) owns Age (years) Senior executives more than 0.5% of the Company on an Under 30 0 individual basis. As a group the combined Between 30 and 40 0 stake does not exceed 0.5% of the property. Between 41 and 50 12 Annual Report | 4. Corporate Governance Regarding the composition of the senior Between 51 and 60 2 executive team, nine are Chilean and seven Between 61 and 70 2 are foreigners, while fifteen are men and Over 70 0 one is a woman.
The following tables set forth the number Senior executives by service years of senior executives according to their age and years in the Company. Service years Senior executives Less than 3 years 1 Incentive plans Between 3 and 6 years 2 Between 6 and 9 years 2 The Company gives its employees certain Between 9 and 12 years 3 incentives as performance bonuses in ad- More than 12 years 8 dition to their salary. These incentives are calculated based on results obtained and goals set at the beginning of each period. Also, compensation plans for executives based on stock options from the Parent Company have been implemented. For more information about stock options, please see Note 21 d) of the Company’s Consolidated Financial Statements as of December 2018. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 99
Ownership and Control CORSO GROUP RUT N° Shares % Juan Carlos Cortes Solari 7.017.522-3 2,081,442 0.08% Teresa Matilde Solari Falabella 4.661.725-8 2,229,487 0.09% Controlling Group Maria Francisca Cortes Solari 7.017.523-1 2,082,186 0.08% The Company is controlled by the shareholder groups mentioned further on. As of December 31, 2018, the controlling group owns Inversiones Mapter Dos S.A. 76.839.460-1 6,180,193 0.25% 70.98% of the stock. The aforementioned controllers have a joint action agreement as per the Shareholders' Pact subscribed on This Company is controlled by the natural persons mentioned below: September 24, 2013. Said pact contains limitations to the free disposal of shares. • Teresa Matilde Solari Falabella 4.661.725-8 • Juan Carlos Cortes Solari 7.017.522-3 • Maria Francisca Cortes Solari 7.017.523-1
Inversiones Quitafal Limitada 76.038.402-K 18,300,200 0.73% AUGURI GROUP RUT N° Shares % This Company is controlled by the natural persons mentioned below: María Cecilia Karlezi Solari 7.005.097-8 14,000,000 0.56% • Teresa Matilde Solari Falabella 4.661.725-8 Inversiones Auguri Limitada 78.907.330-9 37,533,331 1.50% • Juan Carlos Cortes Solari 7.017.522-3 This Company is controlled by the natural persons mentioned below: • Maria Francisca Cortes Solari 7.017.523-1 • Maria Cecilia Karlezi Solari 7.005.097-8 • Sebastian Arispe Karlezi 15.636.728-1 Inversiones Don Alberto Cuatro SpA 99.552.470-8 151,079,494 6.02% Lucec Tres S.A. 99.556.440-8 267,803,642 10.67% This Company is controlled by the natural persons mentioned below: This Company is controlled by the natural persons mentioned below: • Teresa Matilde Solari Falabella 4.661.725-8 • Maria Cecilia Karlezi Solari 7.005.097-8 • Juan Carlos Cortes Solari 7.017.522-3
• Sebastian Arispe Karlezi 15.636.728-1 • Maria Francisca Cortes Solari 7.017.523-1 Annual Report | 4. Corporate Governance
BETHIA Mapcor Cuatro S.A. 99.556.480-7 108,247,346 4.31% Bethia S.A. 78.591.370-1 235,408,055 9.38% This Company is controlled by the natural persons mentioned below: This Company is controlled by the natural persons mentioned below: • Teresa Matilde Solari Falabella 4.661.725-8 • Liliana Solari Falabella 4.284.210-9 • Juan Carlos Cortes Solari 7.017.522-3 • Carlos Alberto Heller Solari 8.717.000-4 • Maria Francisca Cortes Solari 7.017.523-1 • Andrea Heller Solari 8.717.078-0 • Pedro Heller Ancarola 17.082.751-1 SAN VITTO GROUP • Alberto Heller Ancarola 18.637.628-5 Inversiones San Vitto Limitada 77.945.970-5 243,698,146 9.71% • Paola Barrera Heller 15.960.799-2 This Company is controlled by the natural persons mentioned below: • Felipe Rossi Heller 18.637.490-8 • Piero Solari Donaggio 9.585.725-6 • Sandro Solari Donaggio 9.585.729-9 Inbet S.A. 85.487.000-9 2,678,697 0.11% • Carlo Solari Donaggio 9.585.749-3 This Company is controlled by the natural persons mentioned below: • Liliana Solari Falabella 4.284.210-9 Asesorías e Inversiones Brunello Limitada 78.907.380-5 8,852,268 0.35% • Carlos Alberto Heller Solari 8.717.000-4 This Company is controlled by the natural persons mentioned below: • Andrea Heller Solari 8.717.078-0 • Piero Solari Donaggio 9.585.725-6 • Pedro Heller Ancarola 17.082.751-1 • Sandro Solari Donaggio 9.585.729-9 • Alberto Heller Ancarola 18.637.628-5 • Carlo Solari Donaggio 9.585.749-3 • Paola Barrera Heller 15.960.799-2 • Felipe Rossi Heller 18.637.490-8 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 101
SAN VITTO GROUP RUT N° Acciones % AMALFI GROUP RUT N° Shares % Asesorias e Inversiones Barolo Limitada 78.907.350-3 8,852,288 0.35% Inversiones Vietri S.A. 76.182.636-0 11,217,037 0.45% This Company is controlled by the natural persons mentioned below: This Company is controlled by the natural persons mentioned below: • Piero Solari Donaggio 9.585.725-6 • Sergio Cardone Solari 5.082.229-K • Sandro Solari Donaggio 9.585.729-9 • Ines Fantuzzi 6.066.811-6 • Carlo Solari Donaggio 9.585.749-3 • Macarena Cardone 10.091.903-6 • Matias Cardone 10.091.901-K Asesorias e Inversiones Sangiovese Limitada 78.907.390-2 8,852,248 0.35% • Valentina Cardone 15.642.572-9 This Company is controlled by the natural persons mentioned below: • Josefina Cardone 17.406.681-7 • Piero Solari Donaggio 9.585.725-6 • Francisco de Pablo 12.265.592-K • Sandro Solari Donaggio 9.585.729-9 • Cristian de Pablo 12.585.617-9 • Carlo Solari Donaggio 9.585.749-3 • Nicolas de Pablo 13.550.768-7
Banco Santander Chile SSS 97.036.000-K 360,000 0.01% DERSA GROUP This Company is controlled by the natural persons mentioned below: Dersa S.A. 95.999.000-K 138,024,501 5.50% • Sandro Solari Donaggio 9.585.729-9 This Company is controlled by the natural persons mentioned below: • Jose Luis del Rio Goudie 4.773.832-6 LIGURIA GROUP • Barbara del Rio Goudie 4.778.798-K • Juan Pablo del Rio Goudie 5.898.685-2 Inversiones Los Olivos S.A. 76.360.576-0 224,246,270 8.94%
• Felipe del Rio Goudie 5.851.869-7 Annual Report | 4. Corporate Governance This Company is controlled by the natural persons mentioned below: • Ignacio del Rio Goudie 6.921.717-6 • Juan Cuneo Solari 3.066.418-3 • Sebastian del Rio Goudie 6.921.716-8 • Paola Cuneo Queirolo 8.506.868-7 • Carolina del Rio Goudie 6.888.500-0 • Giorgianna Cuneo Queirolo 9.667.948-3
DT Carrera S.A. 76.338.127-7 34,660,829 1.38% AMALFI GROUP This Company is controlled by the natural persons mentioned below: • Felipe del Rio Goudie 5.851.869-7 Importadora y Comercializadora Amalfi SpA 87.743.700-0 45,224,102 1.80% • Mariana de Jesus Arteaga Vial 6.695.852-3 This Company is controlled by the natural persons mentioned below: • Luis Felipe del Rio Arteaga 13.234.925-8 • Sergio Cardone Solari 5.082.229-K • Andres Antonio del Rio Arteaga 14.118.360-5 • Ines Fantuzzi 6.066.811-6 • Martin del Rio Arteaga 15.642.668-7 • Macarena Cardone 10.091.903-6 • Javier del Rio Arteaga 16.605.546-6 • Matias Cardone 10.091.901-K • Jose Pablo del Rio Arteaga 17.703.172-0 • Valentina Cardone 15.642.572-9 • Mariana Teresita Carmen del Rio Arteaga 18.641.820-4 • Josefina Cardone 17.406.681-7 • Francisco de Pablo 12.265.592-K Quilicura S.A. 76.338.077-7 22,185,599 0.88% • Cristian de Pablo 12.585.617-9 This Company is controlled by the natural persons mentioned below: • Nicolas de Pablo 13.550.768-7 • Jose Luis del Rio Goudie 4.773.832-6 • Barbara del Rio Goudie 4.778.798-K • Juan Pablo del Rio Goudie 5.898.685-2 • Felipe del Rio Goudie 5.851.869-7 • Ignacio del Rio Goudie 6.921.717-6 • Sebastian del Rio Goudie 6.921.716-8 • Carolina del Rio Goudie 6.888.500-0 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 103
DERSA GROUP RUT N° Shares % DERSA GROUP RUT N° Shares % El Roquerio S.A. 76.338.125-0 22,185,599 0.88% Inversiones Vitacura S.A. 88.494.700-6 5,376,695 0.21% This Company is controlled by the natural persons mentioned below: Esta sociedad es controlada por las personas naturales que se indican a continuación: • Jose Luis del Rio Goudie 4.773.832-6 • Jose Luis del Rio Goudie 4.773.832-6 • Barbara del Rio Goudie 4.778.798-K • Barbara del Rio Goudie 4.778.798-K • Juan Pablo del Rio Goudie 5.898.685-2 • Juan Pablo del Rio Goudie 5.898.685-2 • Felipe del Rio Goudie 5.851.869-7 • Felipe del Rio Goudie 5.851.869-7 • Ignacio del Rio Goudie 6.921.717-6 • Ignacio del Rio Goudie 6.921.717-6 • Sebastian del Rio Goudie 6.921.716-8 • Sebastian del Rio Goudie 6.921.716-8 • Carolina del Rio Goudie 6.888.500-0 • Carolina del Rio Goudie 6.888.500-0
DT D y D S.A. 76.338.126-9 32,450,434 1.29% Inversiones Austral Limitada 94.309.000-9 14,255,119 0.57% This Company is controlled by the natural persons mentioned below: Esta sociedad es controlada por las personas naturales que se indican a • Juan Pablo del Rio Goudie 5.898.685-2 continuación: • Patricia Edwards Braun 5.711.271-9 • Jose Luis del Rio Goudie 4.773.832-6 • Elisa del Rio Edwards 12.628.617-1 • Barbara del Rio Goudie 4.778.798-K • Diego del Rio Edwards 13.234.004-8 • Juan Pablo del Rio Goudie 5.898.685-2 • Ana del Rio Edwards 13.435.488-7 • Felipe del Rio Goudie 5.851.869-7 • Pedro del Rio Edwards 15.382.612-9 • Ignacio del Rio Goudie 6.921.717-6 • Sara del Rio Edwards 15.641.769-6 • Sebastian del Rio Goudie 6.921.716-8 • Paula del Rio Edwards 16.371.405-1 Annual Report | 4. Corporate Governance • Carolina del Rio Goudie 6.888.500-0
BFD S.A. 76.338.129-3 22,185,599 0.88% Inpesca S.A. 79.933.960-9 49,343,681 1.97% This Company is controlled by the natural persons mentioned below: Esta sociedad es controlada por las personas naturales que se indican a • Jose Luis del Rio Goudie 4.773.832-6 continuación: • Barbara del Rio Goudie 4.778.798-K • Jose Luis del Rio Goudie 4.773.832-6 • Juan Pablo del Rio Goudie 5.898.685-2 • Barbara del Rio Goudie 4.778.798-K • Felipe del Rio Goudie 5.851.869-7 • Juan Pablo del Rio Goudie 5.898.685-2 • Ignacio del Rio Goudie 6.921.717-6 • Felipe del Rio Goudie 5.851.869-7 • Sebastian del Rio Goudie 6.921.716-8 • Ignacio del Rio Goudie 6.921.717-6 • Carolina del Rio Goudie 6.888.500-0 • Sebastian del Rio Goudie 6.921.716-8 • Carolina del Rio Goudie 6.888.500-0 DT Peñuelas S.A. 76.338.177-3 32,448,233 1.29% This Company is controlled by the natural persons mentioned below: Inversiones D y D Cuatro SpA 76.156.657-1 1,425,333 0.06% • Carolina del Rio Goudie 6.888.500-0 Esta sociedad es controlada por las personas naturales que se indican a continuación: • Victor Pucci Labatut 6.474.224-8 • Juan Pablo del Rio Goudie 5.898.685-2 • Victor Pucci del Rio 15.643.671-2 • Patricia Edwards Braun 5.711.271-9 • Pablo Pucci del Rio 15.637.474-1 • Elisa del Rio Edwards 12.628.617-1 • Rodrigo Pucci del Rio 16.371.133-8 • Diego del Rio Edwards 13.234.004-8 • Felipe Pucci del Rio 18.392.648-9 • Ana del Rio Edwards 13.435.488-7 • Pedro del Rio Edwards 15.382.612-9 Las Mariposas S.A. 76.338.144-7 5,144,938 0.21% • Sara del Rio Edwards 15.641.769-6 This Company is controlled by the natural persons mentioned below: • Paula del Rio Edwards 16.371.405-1 • Ignacio del Rio Goudie 6.921.717-6 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 105
DERSA GROUP RUT N° Shares % Inversiones Alcohuaz SpA 76.156.962-7 962,651 0.04% This Company is controlled by the natural persons mentioned below: • Felipe del Rio Goudie 5.851.869-7 • Mariana de Jesus Arteaga Vial 6.695.852-3 • Luis Felipe del Rio Arteaga 13.234.925-8 Ownership changes Dividend Policy • Andres Antonio del Rio Arteaga 14.118.360-5 • Martin del Rio Arteaga 15.642.668-7 In January 2018, Bethia Group sold distribution: i) Amalfi Group subscribed The Ordinary Shareholders' Meeting has • Javier del Rio Arteaga 16.605.546-6 1,790,000 shares equivalent to 0.074% of 385,779 new shares through Inver- determined as a divided policy to pay on an the stock. The sale was done through Bethia siones Vietri S.A., RUT 76.182.636-0; annual basis at least 30% of the Company’s • Jose Pablo del Rio Arteaga 17.703.172-0 S.A., RUT 78.591.370-1. ii) Auguri Group subscribed 2,182,698 net income of each exercise, paying at least • Mariana Teresita Carmen del Rio Arteaga 18.641.820-4 new shares through Lucec Tres S.A., RUT one interim dividend, if the business per- In March 2018, Dersa Group acquired 99.556.440-8 and Inversiones Auguri formance allows for it. Inversiones Gueimen SpA 76.156.978-3 1,105,574 0.04% 554,793 shares of S.A.C.I. Falabella, Ltda, RUT 78.907.330-9, while María This Company is controlled by the natural persons mentioned below: equivalent to 0.023% of the stock. The Cecilia Karlezi Solari, RUT 7.005.097-8 Given the latter, dividends paid during the purchase was done through DT Carrera subscribed directly. Each one subscribed years 2015, 2016, 2017 and 2018 are set • Carolina del Rio Goudie 6.888.500-0 S.A., RUT 76.338.127-7, DT DyD S.A., RUT 1,404,051, 578,647 and 200,000 new forth in the following table: • Victor Pucci Labatut 6.474.224-8 76.338.126-9 and DT Peñuelas S.A., RUT shares, respectively; iii) Bethia Group sub- • Victor Pucci del Rio 15.643.671-2 76.338.177-3. Each company acquired scribed 1,627,345 new shares through • Pablo Pucci del Rio 15.637.474-1 184,931 shares, respectively. Bethia S.A., RUT 78.951.370-1; iv) Corso • Rodrigo Pucci del Rio 16.371.133-8 Group subscribed 1,983,544 new shares $/share In March 2018, Dersa Group sold through Inversiones Mapter Dos S.A., RUT • Felipe Pucci del Rio 18.392.648-9 20,000,000 shares of S.A.C.I. Falabella, 76.839.460-1; v) Dersa Group subscribed Annual Report | 4. Corporate Governance equivalent to 0.822% of the stock. The 2,609,378 new shares through DT Car- Final dividend N° 36 Felipe del Rio Goudie 5.851.869-7 7,941 0.00% companies that sold the shares were El rera S.A., RUT 76.338.127-7, Quilicura Paid in May 2015 47 Roquerío S.A., RUT 76.338.125-0 and BFD S.A., RUT 76.338.077-7, El Roquerío Total Controllers 1,780,689,158 70.98% S.A., RUT 76.338.129-3. Each company sold S.A., RUT 76.338.125-0, DT DyD S.A., RUT Interim dividend N° 37 10,000,000 shares, respectively. 76.338.126-9, BFD S.A. , RUT 76.338.129-3, DT Peñuelas S.A., RUT 76.338.177-3, and Paid in October 2015 26 In October 2018, a public auction of Las Mariposas S.A., RUT 76.338.144-7. Each
70,669,211 shares of S.A.C.I. Falabella was company subscribed 463,858, 357,806, Final dividend N° 38 held on the Santiago Stock Exchange. Of 357,806, 437,710, 357,806, 435,509 and Equity those shares: i) 49,669,211 were new shares 198,883 new shares, respectively; vi) Liguria Paid in May 2016 54 issued by S.A.C.I. Falabella; ii) 21,000,000 Group subscribed 1,676,282 new shares As of December 31, 2018, the Company’s equity was divided into 2,508,844,629 ordinary shares correspond to the secondary sale through Inversiones Los Olivos S.A., RUT Interim dividend N° 39 shares of only one class, without par value, owned by 1,399 registered shareholders. of shares owned by the controlling group 76.360.576-0; vii) San Vitto Group sub- Paid in November 2016 26 Liguria through their company Inversiones scribed 1,849,676 new shares through Los Olivos, RUT 76.360.576-0. As a result of Asesorías e Inversiones Brunello Limitada, 12 Largest Shareholders the auction the total paid-in capital of S.A.C.I. RUT 78.907.380-5, Asesorías e Inversiones Final dividend N° 40
Falabella reached 2,484,134,314 shares. Barolo Limitada, RUT 78.907.350-3 and Paid in May 2017 54 Shareholder name or Business name R.U.T. N° Shares % ownership Asesorías e Inversiones Sangiovese Limitada,
Lucec Tres S.A. 99.556.440-8 267,803,642 10.67% In October 2018, after the auction, a RUT 78.907.390-2. The first two companies Interim dividend N° 41 Inversiones San Vitto Limitada 77.945.970-5 243,698,146 9.71% preemptive rights option period started subscribed 616,559 new shares while the which lasted until mid-November 2018. third subscribed 616.558 new shares. Af- Bethia S.A. 78.591.370-1 235,408,055 9.38% Paid in November 2017 26 During this period 27,710,315 new ter the preemptive rights period, the total
Inversiones Los Olivos S.A. 76.360.576-0 224,246,270 8.94% shares were paid-in, where the control- amount of paid-in shares of the Company Inversiones Don Alberto Cuatro SpA 99.552.470-8 151,079,494 6.02% lers subscribed a total of 12,314,702 reached 2,508,844,629 shares. Final dividend N° 42 Dersa S.A. 95.999.000-K 138,024,501 5.50% new shares according to the following Paid in May 2018 54
Banco Santander on behalf of foreign investors 97.036.000-K 136,077,768 5.42%
Banco De Chile on behalf of non-resident third parties 97.004.000-5 113,359,384 4.52% Interim dividend N° 43
Banco Itau Corpbanca on behalf of foreign investors 97.023.000-9 112,811,448 4.50% Paid in January 2019 26 Mapcor Cuatro S.A. 99.556.480-7 108,247,346 4.31% Inpesca S.A. 79.933.960-9 49,343,681 1.97% Importadora y Comercializadora Amalfi SpA 87.743.700-0 45,224,102 1.80% WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 107 Annual Report | 4. Corporate Governance
María José, Florentino, Patricia and Isidro at Sodimac Ñuñoa. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 109
Company Identification
S.A.C.I. Falabella is a public Company, reg- Notary Office of Santiago Francisco Leiva istered on the Registro de Valores de la Carvajal, senior notary public of the Second Comisión para el Mercado Financiero under Notary Office of Santiago. An excerpt of said N° 582. Its tax ID number (Rol Unico Tribu- deed was published in the Official Gazette tario - RUT) is 90.749.000-9. The principal N° 42,139 dated August 23, 2018 and was executive offices are located at: Manuel registered in page 63,697 number 32,572 of Rodríguez Norte 730, Santiago, Chile; phone the 2018 Commercial Register of Santiago’s
number +562 2380 2000; fax +562 2380 Real Estate Registry. Annual Report | 5. Corporate Information 2077; PO BOX 1737; website investors. falabella.com; email address inversionistas@ The Company’s purpose is: 1) to install and falabella.cl. operate, directly or through third parties, in the country or abroad, all sorts of commer- The Company was incorporated as “Socie- cial establishments, stores and supermar- dad Anónima Comercial Industrial Falabella kets, intended for retail trade of all types of SACIF” by public deed dated March 19, products and services, among them: cloth- 1937, granted at the Notary Office of Jorge ing, including raw materials, fabrics, ready- Gaete Rojas and received its permission to made and tailored clothing, ornaments and Company Information incorporate and declared legally installed accessories, all kinds of hardware goods, by Decreto Supremo N° 1,424 dated April household goods and equipment, electric Corporate Insurance 14, 1937. The Company’s bylaws and the or electronic equipment such as radios, aforementioned Decreto Supremo were receivers, televisions, computers, cookers, Brands and Patents registered in pages 1,181 and 1,200 under washing machines and others of a similar numbers 400 and 401 of the 1937 Com- nature, and in general, all kinds of products Information Regulatory Framework mercial Register of Santiago´s Real Estate and services susceptible to be retailed in Registry. As well, the bylaws and the afore- large stores, shops and supermarkets; 2) to Risks mentioned decree were published in the install and operate, directly or through third Awards and Acknowledgements Official Gazette on April 27, 1937 and in parties, in the country or abroad, workshops the Diario La Nación de Santiago newspaper or factories to prepare or manufacture items Summary of Significant Events for the Year on April 27, 29 and 30 and May 3, 1937. subject to be sold on a retail basis; 3) the sale, import, export and commercialization in Shareholders' Comments and Proposals During the years after its incorporation, the general of said products; 4) the organization, bylaws have been subject to several amend- start-up, development and management, in Stock Information ments, including the change of the name the country or abroad, directly or through Stores by Format and Country to “S.A.C.I. Falabella” by public deed dated its subsidiaries, of systems for marketing, December 23, 1970. The last amendment granting loans and financing retail sales, Summarized Corporate Structure was agreed upon at the Extraordinary Share- of all articles, merchandise, products and holders’ Meeting dated August 20, 2018, in services to be retailed; 5) undertake, directly Information about Subsidiaries which the shareholders decided to increase or through third parties, in the country or the Company’s capital. The minutes were abroad, all kinds of real estate businesses. Subsidiaries with Participation reduced to public deed the same day in the WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 111
Insurance University Club, Coniglio, Denimlab, Yamp, The main business units of Falabella have Operational risks: Falabella and its subsidiaries maintain busi- Doo, Eleven, Robert Allen, Bearcliff, Home risk committees whose purpose is to ana- ness property insurance contracts with first Collection, Bauker, Kolor, Mr. Beef, Recco, lyze the potential threats to their respec- • Risk of damage to people or physical class insurance companies that adequately Ubermann, Wurden, Ozom, Click & Collect tive businesses. These committees meet assets cover the loss or deterioration risks to which and Fratta, among others. regularly and are comprised by the senior its assets are exposed. These insurances executives of each business, including the Through the course of business we op- cover, among others, buildings, inventories, respective CEO, and in some cases Board erate several physical facilities such as vehicles, machinery, and warehousing and Regulatory members. The Directors of Falabella and stores, shopping centers, distribution
transport of products for sale. Among the those of the main business units also analyze centers, call centers and offices, among Annual Report | 5. Corporate Information insured risks the Company has specifically Framework the potential risks to the Company in Board others. These facilities and assets may included fire and natural disasters such as meetings, the Directors’ Committee and experience a series of events that may earthquakes. The property insurance covers S.A.C.I. Falabella is a publicly traded company the Audit Committee meetings in the case reduce or impair their productivity or loss of profit through an additional coverage and as such is subject to Law 18,046 of Stock of some subsidiaries. operation, such as fires, flooding, earth- for business interruption or suspension. Corporations, Law 18,045 on the Securities quakes, natural disasters and other The Company also has insurance policies Market and the regulations from the Financial Falabella and its main subsidiaries count adverse events. Some of these events, that adequately cover other operational Market Commission, among others. with internal audit teams that report directly and their effects, may be controlled or risks, such as civil liability due to damages to the Board of each company. These teams contained to a certain extent. The oc- to third parties and others related to the On the other hand, the subsidiaries of S.A.C.I. perform internal audit based on the audit currence of these events in our facilities banking sector. Falabella, depending on the activities they plans previously approved directly by the may also hurt or damage the people that undertake, are subject to the Consumer Pro- Board of each company. The results of these attend on a daily basis, such as custom- tection Act, the General Banking Act, and audits are reported to the audited units and ers, employees, suppliers, contractors or Brands and regulation from the Financial Market Com- the respective Board and are reviewed in others. Personal damage that may occur mission and the Superintendency of Banks the Audit Committee or in the Directors’ within our facilities could imply legal, Patents and Financial Institutions, among others. Committee. economic and reputational impacts for the Company or its subsidiaries. As well, The Company has registered a large number Finally, the activities of subsidiaries abroad are Following is a list of the most important risks damage to our facilities may impair them of brands for products that it sells in the subject to the regulation of their respective faced by Falabella, based on the analysis temporarily or permanently, resulting in country as well as abroad. To safeguard its jurisdictions. done by the Company with the available economic losses or negatively affecting brands, the Company relies on the advisory information to date. Should any of these revenues and profitability, depending on of the law firm Silva & Cia. In addition, the risks actually occur, they could materially the extent of the damage and insurance Plaza S.A. subsidiary relies on the advisory of Risks and adversely affect Falabella or its sub- coverage. the law firm Porzio, Rios, García y Asociados. sidiaries, including economic losses and Falabella and its subsidiaries are exposed negative reputational effects. The risks faced • We may face increasing and disruptive Falabella’s main own brands registered and to certain risks that may adversely affect by Falabella and its subsidiaries do not limit competition in the markets in which currently in force are: its business, operations, assets, results and to those described herein. There might be we operate investments. Therefore, the Company has other risks, but given our accumulated ex- Falabella, Sodimac, Homecenter, Homecen- developed a series of measures and policies perience and current available information, Competition may increase in the future ter Sodimac, Sodimac Constructor, Imperial, to identify, manage and reduce the risks we believe these are the most relevant. from current competitors or due to new Maestro, Homy, Tottus, Precio Uno, CMR, faced by its businesses. entrants. An eventual inability to effec- Banco Falabella, Viajes Falabella, Seguros tively compete against current or new Falabella, Mallplaza, Open Plaza, Linio, Sybil- The Company has a Risk Management and la, Basement, Blue, Florencia, Harris & Frank, Control Policy and an Internal Audit Policy. Holley, Mica, Qfeel, Scoop, Stefano Cocci, Both policies apply to S.A.C.I. Falabella and Textil Viña, Americanino, Newport, Apology, all its subsidiaries. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 113
competitors may result in the loss of mar- • We face permanent inventory risk pliers violate applicable laws, regulations, tion about the Company, our clients or • Our business may be negatively affect- ket share, lower revenues and margins, or our codes, or implement unethical, unsafe suppliers. Such a breach could severely ed by strikes may render our business model or value We must maintain sufficient inventory or dangerous practices for the environ- damage the reputation of the Company proposition obsolete in an extreme case. levels to operate our businesses suc- ment, they could adversely affect our or its subsidiaries and negatively impact If one of our businesses does not reach
cessfully, avoiding stock-outs and excess reputation, limit our growth or negatively future revenues. We have developed sys- an agreement on a collective bargaining Annual Report | 5. Corporate Information • We are exposed to different risks due inventory. Generally suppliers need long affect our operating results. tems and processes designed to protect process, our operations and financial re- to our international operations lead times to comply with product orders. our clients’ information and avoid data sults may be adversely affected due to This implies putting purchase orders long • Our business is increasingly dependent losses and other security breaches, includ- stoppages or strikes. Our operational results and financial po- before these products are offered for on the growth of e-commerce in the ing the systems and processes designed sition depend to a large extent on current sale. Thus, precise demand anticipation region to reduce the impact of a security breach Financial risks: economic conditions in the countries in and lead time estimates are necessary to on an external supplier. However, such which we operate. These conditions may ensure adequate inventory levels. In ad- The online trade market is fully under measures may not provide total security. • We face exchange rate risk be affected by a variety of events be- dition, weather and seasonality affect the development in Latin America. Our future yond our control, including economic and results of several business units. When revenues depend to a certain extent on Human capital risks: The local currencies in which we operate other policies imposed by governments, preparing for peak-demand seasons, the acceptance and widespread usage of are subject to fluctuations with respect to inflation rates and mechanisms used to inventory must be increased above av- the Internet by Latin American custom- • The loss of human capital may adverse- the US dollar and other currencies. Some control it, exchange rate fluctuations, and erage levels. Any unforeseen reductions ers, as well as the necessary telecommu- ly affect our business of the products offered for sale in our world and regional economic conditions, in demand, errors in demand forecast or nications infrastructure in each market stores are acquired in foreign countries. among others. Adverse changes in these supplier delays may adversely affect our to carry out electronic trade. We depend on the experience and knowl- Hence, during the time that these imports variables may negatively impact us, our results, and we may be forced to apply edge of our executives, employees and are unpaid, we are exposed to exchange clients and suppliers. commercial strategies to compensate or Technology and information Directors for the daily operation and rate fluctuations. A sharp depreciation mitigate these situations. security risks: execution of our investment plans. An of one or more of these currencies may • The retail sector is sensitive to the eventual inability to attract and retain result in higher costs and lower mar- economic cycle • Our relation with suppliers leads us • We might suffer operational continuity talent may adversely impact our abili- gins for the respective business unit. to face several risks disruptions due to damages to our tech- ty to compete effectively and continue As well, exchange rate fluctuations in Our revenues are subject to fluctuations nological network, loss or alteration of growing in our different markets. the currencies in which Falabella main- in the retail sector and hence, to economic We work with important suppliers which information or security breaches tains investments relative to the Chilean activity cycles. Consumer behavior is af- are key to our provision. If our current • Our business may be negatively affect- peso, could adversely affect the value of fected by many factors, including but not suppliers stopped selling or licensing We use information technology systems in ed by the loss of senior management those investments abroad. These cur- limited to, perception about the general products, content, components or ser- different operational processes in all our rency fluctuations may also affect the performance of the economy as seen in in- vices to us on acceptable terms, or if we businesses. An extended failure in one of We depend on senior management and contribution from subsidiaries abroad flation, growth, and interest rates, among face delays in delivery as a result of their these systems may interrupt some of these other key executives for the operation to other accounts in the Consollidated others. The latter may negatively affect bankruptcy due to negative economic processes, adversely affecting operations of our different business units. The loss Financial Statements of the Company the purchasing behavior of our clients and conditions, natural disasters or other (accounting, sales and inventory manage- of any of these executives may adversely that are expressed in Chilean pesos, in- their willingness or ability to pay the loans causes, we may not be able to obtain al- ment, among others) or other aspects. As impact our business. cluding consolidated revenues. contracted with us. These may negatively ternative products from other suppliers well, third parties may try to breach our affect our revenues and profitability. in a timely and efficient manner and on systems to access confidential informa- acceptable terms. Moreover, if our sup- WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 115
• Fluctuations in interest rates may ad- credit for the acquisition of consumer versely affect our business goods and services, mortgages for the acquisition of residential real estate and A large percentage of client purchases in our loans for the purchase of cars; as well as
stores are financed with loans from CMR legal persons who obtain credit lines for Annual Report | 5. Corporate Information or Banco Falabella. An important increase their purchases made through the Sales in interest rates could adversely affect our to Companies areas of our businesses. revenues and our financing business, as consumer consumption levels decrease Default ratios can be affected by exog- under these scenarios. enous variables (macroeconomics, geo- political risks) that go beyond strategic Interest rate changes could also adversely decisions and business risk management affect our financial expenses related to the practices; therefore, we cannot ensure financial debt maintained by us. The latter that our default rates will not increase, would affect primarily our short-term debt requiring more provisions and adversely and our long-term debt with variable interest affecting the financial business results. rates, as well as at the time of refinancing existing debt or issuing new long-term fixed rate debt. Compliance risk:
Credit risk: • We might face changes to regulation
• Our financial business may be ad- We operate in different legal and regu- versely affected by deterioration in latory contexts in several countries, all the quality of our loan portfolio, due to of which have an impact and determine an increase in past-due and charge-off to a certain extent the way in which we levels, resulting in increased provision develop our business. These legal regimes expenses and negatively affecting our and regulations may change in the future results and adversely impact, limit or restrict the business models we have developed, Credit risk refers to the possibility of incur- thus increasing their costs in ways or ring a loss associated with the event that amounts that make them less profitable the counterparty fails to meet its contrac- or unviable. tual obligations (default risk). Our business focuses on natural persons who obtain WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 117
Awards and Acknowledgements
• Falabella Chile received the Consumer Loyalty Award 2018 in the department stores category, presented by Alco Con- Home Improvement: sultants together with the ESE Business School from Universidad de los Andes. • Second place Ranking ICreo 2018 by • Sodimac Chile reached 11th place (first • Sodimac Chile was among the 50 Most Almabrands (which evaluates five dimen- retailer) in the Corporate Sustainability Innovative Companies in Chile, according • Falabella Retail in Chile reached the 20th sions: honesty and transparency, respon- Index – prepared by ActionAbility Insti- to the Best Place to Innovate ranking. place in the Great Place to Work Chile sibility, empathy, support and closeness). tute and Revista Capital. 2018 ranking. Sodimac is the second most trusted brand • Sodimac Peru ranked 11th in the Best by Chileans after firefighters. • Sodimac Chile ranked 9th (1st home Place to Work for Women and Millen- • Falabella was chosen as one of the 50 improvement retailer) in the Merco nials ranking. most innovative companies in Chile by • Sodimac Chile ranked 7th in the Merco Companies Chile ranking. Best Place to Innovate. Most Responsible Companies and with • Sodimac Peru reached 2nd place in the best Corporate Governance in Chile • Corporate Reputation Ranking Chile: PAR Ranking, which highlights companies • Falabella in Chile was recognized by the ranking. Sodimac Chile reached 4th place (first that promote and defend gender equality. Gender Equality Index by PROhumana home improvement retailer), in the rank- 2018. • 2nd place in the Most Valuable Compa- ing prepared by Hill&Knowlton Strate- • The Ministry of Labor and Employment nies in Chile brand reputation ranking, gies and GfK Adimark – Pulso. Promotion in Peru presented Sodimac • Fundacion Forge acknowledged Falabella prepared by BrandZ/Millward Brown. Peru with two acknowledgements for for youth labor insertion in Chile. • Corporate Reputation Ranking Chile: its new Integrity System and the Trust
• The United Nations Global Compact Sodimac Chile reached 8th place (first Program, which delivers psychological Annual Report | 5. Corporate Information • 8th place in the Great Place to Work Peru 2018 acknowledged Imperial in the En- home improvement retailer), in the rank- and legal advisory 24 hours a day and ranking, and 12th place in the Millenials vironment category for the “Sawdust ing prepared by RepTrack Chile (Repu- 365 days a year. Great Place to Work ranking. Waste Disposal for Biomass”, which tation Institute). Falabella: Department Stores: highlights among the best practices in • Sodimac Peru obtained for the fifth con- • 5th place in the PAR Gender Equality terms of sustainability and commitment • Sodimac Argentina was distinguished secutive year the Socially Responsible • Fallabella was selected for third time in • Fallabella was awarded as Best Retail 2018 ranking for Saga Falabella. with the 2030 Agenda, in relation to the by AmCham (United States Chamber Company acknowledgment, presented by a row to enter the Dow Jones Sustain- Ecommerce Platform by eCommerce Sustainable Development Goals (SDG). of Commerce) with the Corporate Citi- Peru 2021 organization and the Mexican ability World Index (DJSI World), which Awards Chile 2018 from the Latin Amer- • Alex Zimmermann, CEO of Saga Falabel- zenship Award 2018. The company was Center for Philanthropy (CEMEFI), in evaluates the largest companies in the ican eCommerce Institute. la, reached 62nd place in Merco Business • Great Place to Work Ranking (GPTW): acknowledged in the Internal Collabora- recognition to the programs it has been world in relation to economic, social and Leaders with the Highest Reputation 5th place for Sodimac Argentina, 6th in tors category. carrying out and promoting. environmental factors. In this edition, • Aknowledged as the most valuable retail Ranking. Uruguay, 11th in Peru (Sodimac and Mae- they studied 2,500 companies from 48 brand in Chile and Latin America, accord- stro), 12th in Colombia and 33nd in Chile. • The Great Builder Training Fair was rec- • INDECOPI distinguished Sodimac Peru countries, selecting only the top 10% in ing to the BrandZ 2018 ranking. • First place in the retail category of Talent ognized in the Ibero-American Festival with a third place in Responsible Con- terms of sustainable management within Attraction and Management, according • In 2018 Sodimac Constructor entered of Promotions and FIP Events within the sumption for its Ecotienda campaign. their respective industries. • Falabella Chile reached the first place in to Merco Talent 2018 for Saga Falabella. the Marketing Hall of Fame Chile, join- Gold Category as best social initiative. the retail category for Talent Attraction ing the most outstanding brands in the • Sodimac Brazil was awarded with the 1st • Falabella was selected for third time in a and Management, according to Merco • Falabella Colombia ranked 13th in Great country. • Sodimac Colombia was awarded with place among the 100 Best Companies in row to enter the Dow Jones Sustainability Talent 2018. Place to Work ranking. a Bronze Effie Latam for the campaign Customer Satisfaction, under the cate- Emerging Markets Index (DJSI EM) and • Sodimac Chile was presented with Goo- “Furniture has an expiration date”. gory Construction Retailer, according to the Dow Jones Sustainability Chile Index • Falabella Chile was presented with the • Falabella Argentina was chosen once gle’s Gold Button for exceeding one mil- a survey by the MESC Institute. (DJSI Chile). In addition, Falabella is part Sustainable Pension Management Ac- more as one of the best companies to lion subscribers on YouTube. • Sodimac Colombia was acknowledged by of the Dow Jones Sustainability MILA knowledgment from AFP Capital, under work in Argentina, being recognized Revista Dinero as the retailer that most • Sodimac Brazil was distinguished with the Index, which follows the performance of the category “Pension Education and by the Great Place to Work Institute • Sodimac Chile reached 20th place (1st impact has on Facebook and ranked 14th Expo Revestit and Anamaco Magazine companies in relation to sustainability in Awareness”. (GPTW) in 7th place. As well, the com- home improvement retailer) in the Cit- in the Brands with Best Performance in 2018 Award as one of the “Best Resellers Chile, Colombia, Mexico and Peru. pany received a special distinction from izen Brands 2018 ranking, prepared by Social Networks ranking. of Ceramic Coatings” in Sao Paulo. • First place for Falabella Chile in Merco GPTW for its Social Inclusion program, Cadem. Companies with Best Corporate Repu- as an acknowledgement for our alliances • Sodimac Colombia ranked 4th among tation and fifth place in Merco Corporate with Fundación Discar, Fundación Forge • Sodimac Chile ranked 10th (1st retailer) the Most Innovative Companies in Co- Governance Responsibility 2018, both in and Fundación Reciduca. in the Most Valued Brands by Chileans lombia, acknowledgment presented by the retail category. ranking, prepared by Brand Asset Valu- Portafolio. • Falabella Argentina was distinguished ator (BAV) / El Mercurio. • First place in the National Client Satisfac- for the third consecutive year with the tion ProCalidad 2018 Award in Chile, in “Drivers of Social Impact” Award for the the department stores category. continuous commitment together with Red Activos (Social Company of La Usina NGO). WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 119
Supermarkets:
• Reptrack Chile 2018 awarded Tottus Chile entity’s different initiatives. customer satisfaction with the service • Viajes Falabella Argentina won the Top with the first place in the retail-supermarkets received from the different banks in the Producers LATAM Airlines Award, pre- category for Best Corporate Reputation. • 17th place in the Best Place to Work industry. sented to the top 10 producers of LATAM 2018 Peru ranking, within the over 1,000 Airlines Group. • The United Nations Development Pro- employees category. • Effie Awards is the sole professional eval- gramme (UNDP) presented Tottus Chile uation instance in our media, centering • Viajes Falabella Argentina ranked 3rd in
with the Ozone Awards from the Mon- • 34th place in the Merco Empresas 2018 its focus in the effectiveness of marketing Cruise Sales – season 2017-2018, in the Annual Report | 5. Corporate Information treal Protocol 2018, where the work un- ranking, Peru. communications. Banco Falabella Colom- Costa Cruceros Top Producers Award, dertaken in Tottus Vitacura Alderete and bia was a finalist for its campaign “From presented by Costa Cruceros. Kennedy was highlighted for its ecological • 30th place in the Merco Talent 2018 hiding my credit card to saying: I pay”. refrigeration system based on CO2 that ranking, Peru. • CMR Argentina was awarded with the takes care of the ozone layer and prevents • Viajes Falabella Colombia was presented Social Impact Promoters Award, present- global warming. • Tottus Peru ranked 16th in the Gender with the Allied Agency 2018 Award from ed by RedActivos. This award is given to Equality in Organizations ranking, pre- Air Europa Líneas Aéreas S.A.U. companies that make inclusive purchases • BrandZ recognized Tottus Chile in 7th pared by Aequales consultant. in conjunction with RedActivos (a social place among the most valued brands in • Viajes Falabella Colombia was presented company from Asociación Civil La Usina). the country. Financial Services: with two ratifications from Aerovías del Continente Americano S.A., being ratified • Viajes Falabella Argentina ranked 13th • SOREPA S.A. certified that during 2018 it • CMR Chile was awarded with the Cus- as Diamond Agency 2018 and Honors in the Best Companies to Work ranking received 7,661,003 kilos of cardboard re- tomer Loyalty Award, in the Retail Credit Club Agency 2018. by Great Place to Work Institute. cuperated from Hipermercados Tottus S.A. Cards sector, presented by ALCO Con- sultores. • Viajes Falabella Chile obtained the • Viajes Falabella Argentina placed among • Tottus Peru was awarded with a Bronze eCommerce Award for its leadership the Top 10 Producers from Argentina Effie under the Low Budget – Services • CMR Chile obtained the National Cus- in the tourism industry. eCommerce in the 2017-2018 Season in the MSC category for the relaunch of our Premium tomer Satisfaction Award in the Retail Awards were created to distinguish Awards, presented by MSC Cruises. Peruvian meat “Tottus Black”. Credit Cards sector, in the ProCalidad companies and entrepreneurships that 2018 Awards. given its role in the electronic commerce • Acknowledgement from Food Bank Peru and Internet businesses sector, have for being one of the five companies that • DuocUC awarded CMR Chile with the contributed with their innovation and more food donates to the organization. Employability Promotion Award. development to boost market networks and the Digital Economy. • Tottus Peru was acknowledged by Claro • CMR Chile was presented with the Fe- for being one of the companies commit- male Talent Award by Pulso Newspaper, • Viajes Falabella Chile attended Aeromex- ted with the environment, in its program for promoting female labor through large ico’s Top Worldwide Agencies Award, “I Recicle, I am Claro”. female fill rates and for the amount of distinguished among the 10 top ranked women in its Boards. agencies. • Tottus Peru was presented with the Solidarity Award from the Stella Maris • Banco Falabella Chile ranked 1st in a • Viajes Falabella Chile was presented Association for its responsibility, social survey conducted by IPSOS to clients with the Diamond Agency Award from commitment and participation in the with checking accounts in the Traditional Avianca, as one of the best agencies in Banking segment. The survey measures the country for being a top seller. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 121
Summary of Material Events of the Period
Material Event N°1 Material Event N°2 March 27, 2018 April 24, 2018
At the Company’s Board meeting, held • The determination of the newspaper in At the Ordinary Shareholders’ Meeting Annual Report | 5. Corporate Information in March 28, 2018, the following was which company publications ordered by held today, the following agreements were agreed upon: law will be made; adopted:
Real Estate Business: 1. To call an Ordinary Shareholders’ Meet- • The report on operations with related • Approval of the annual report, general ing for April 24, 2018, at 15.00 hrs., in the parties performed during the 2017 ex- audited consolidated financial state- • Gold Award for Mallplaza Los Dominicos • Mallplaza Arequipa was presented with • Tottus was awarded with the Best Tech- Alamo BC Room at the Courtyard Hotel, ercise, and those referred to by Title XVI ments and the opinion of the external in Chile, under the New Development the "Because the world needs us now" nological Innovation Award, for the located on Av. Kennedy 5601, 7th floor, of Law N°18,046 of Stock Corporations; auditors, all corresponding to the period 2018 category, Recon Latin America & Award in the category “Example of sus- implementation of projects with CO2 Las Condes, Santiago; to submit to con- and, ended December 31, 2017. Caribbean, ICSC. tainability and environmental commit- cooling gas in transcritical phase in its sideration, pronouncement and decision ment” by Ecobrands, ecological initiative supermarkets and development in SIF. thereof of those matters that are proper • The report on the activities of the Direc- • Approval of the payment of a final div- • Mallplaza in Chile was acknowledged created with the goal of promoting sus- of its competence in accordance to the tor's Committee during the 2017 exer- idend of $54 per share against 2017 as 2018 Financial Operation by Diario tainable development projects. • Open Plaza La Calera was acknowledged law, including the following: cise, the determination of its expense profits. The aforementioned dividend Financiero newspaper for its initial public by the Municipal Office of Labor Infor- budget and the determination of com- will be paid on May 8, 2018, to share- offering. • Mallplaza ranked 24th in the Best Place mation of La Calera, Chile, for its support • The approval of: i) the annual report and pensation for the Directors members holders of the sole series registered in to Work ranking in Chile 2018, advancing of local development. the audited consolidated financial state- of the committee. the Shareholders' Registry as of May 2, • Mallplaza Copiapó in Chile obtained the 10 places in relation to the previous year. ments of the Company; and, ii) the opinion 2018. To that effect hereto is attached LEED Gold Certification and Mallpla- • Open Plaza Peru gave the Regional of the external auditors of the Company; 2. Propose to shareholders that, out of net Form N°1 from Circular 660 of that za Manizales in Colombia obtained the • Mallplaza Peru ranked 17th in the Best Government of Piura, US$5,000 which all correspondent to the period ended on distributable earnings from fiscal year Commission; LEED Silver Certification. Place to Work ranking in Peru 2018, received from the “Latin American Com- December 31, 2017; 2017, a definitive final dividend of $54 among companies with between 25 and munity Support” Award, presented by per share be paid, which added to the in- • Approval of the dividend policy consist- • SENA (National Learning Service) ac- 250 employees. the International Council of Shopping • The distribution of net profits from the terim dividend of $26 per share approved ing in the annual payment of, at least, knowledged Mallplaza in Colombia for Centers Foundation for helping families 2017 exercise; by the Board on November 14, 2017, and 30% of distributable liquid profits of being a strategic ally in employment • Mallplaza Chile obtained the first place in affected by the El Niño Coastal Phenom- paid on November 28, 2017, yields a total each exercise; generation in Manizales. Corporate Reputation in the Construc- enon through its “Piura Unida #UnSolo- • The dividend policy of the Company; $80 per share distribution against 2017 tion, Real Estate and Retail sector, ac- Corazón” campaign. profits; and that the proposed dividend • Appointment of Ernst & Young Servicios • Thanks to the implementation of 3,150 cording to MERCO (Monitor Empresarial • To determine Board compensation; be paid on May 8, 2018, to shareholders Profesionales de Auditoría y Asesorías solar panels on the terrace of Mallplaza de Reputación Corporativa). registered on the Shareholders' Registry Limitada as external auditors of the El Castillo in Colombia, CELSIA acknowl- • The appointment of external auditors for as of May 2 of this year, at Huerfanos 770, Company for the 2018 period; edged Mallplaza as an ally in the develop- • Open Plaza Piura was acknowledged for the 2018 exercise; 22nd floor, Santiago, as well as through ment of good environmental and energy its contribution in the promotion and the customary payment modalities, in- • Finally, other matters proper of this type efficiency practices to contribute with the development of the Artisanal Sector in • The appointment of rating agencies for cluding: bank deposits, certified deliveries of meetings were discussed. sustainable development of Colombia. the Piura Region by the Regional Gov- the 2018 exercise; and direct withdrawals at any branch ernment of Piura and the Foreign Trade office of Banco de Crédito e Inversiones, and Tourism Direction – Piura. BCI. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 123
Material Event N°3 April 24, 2018
During the Board meeting held today, brand and Internet address Linio (www.linio. crease in the Securities Registry of the by the Meeting and upon fulfilling certain self-regulated entity, domestic or foreign, of America, without proceeding with the April 24, 2018, the CEO Mr. Sandro So- com), in the countries of Argentina, Chile, FMC (Financial Market Commission) requirements, authorization be granted to as may arise in connection with the cap- registration of such shares in said country, lari Donaggio presented his resignation Colombia, Ecuador, Mexico, Panama, Peru and the Santiago Stock Exchange, and shareholders to conduct, together with the ital increase and the amendment of the pursuant to Rule “144A” and Regulation “S” effective on June 1, 2018. During the same and Venezuela, countries in which, on an proceed with the share issuance process issue of new shares, a simultaneous and syn- bylaws of the Company. of the 1933 Securities Act of the United meeting, the Board appointed Mr. Gaston aggregate basis, reached net merchandise as approved by the Shareholders; chronized secondary sale of shares of their States of America. The Board was autho- Botazzini as CEO of the Company effective value sales of US$ 137 million in 2017. To ownership, on the stock market. The capital increase proposed by the Board rized on comprehensive terms to conduct June 1, 2018, whom to date acts, and will date, it is not possible to estimate the finan- • Agree that, together with, and in addition is intended to finance the acquisition of Linio all necessary acts to materialize the capital continue to do so until May 31, 2018, as cial effects of the acquisition of Linio. to, the offer of new shares conducted in Regarding the Collaboration Agreement and the contributions to leverage its market- increase and the placement of the new Corporate CEO of Falabella Financiero. Chile under the Chilean Law, a private between the Company and Inversiones Los place, accelerate investments in logistics and shares. The acquisition of Linio was done at a total offering thereof be made to qualified Olivos S.A., shareholder member of the Com- technology, develop the operations of IKEA Material Event N°4 company value of $138 million dollars of investors in the United States of America, pany’s controlling group, it is informed that in Chile, Peru and Colombia, and increase 3. Authorize the Board to issue the new April 26, 2018 the United States of America, notwithstand- without registering the shares in that by virtue of said agreement it will be admitted the stake in Construdecor. shares and establish the final place- ing the establishment of common methods country, pursuant to Rule “144A” and that Inversiones Los Olivos S.A. sell on the ment price thereof, provided that the Section 3.02 of Form N°1 of Circular 660 in these types of transactions for partial Regulation “S” of the 1993 Securities Act stock market up to 21.000.000 outstanding The holders of shares registered in the sale starts within 180 days following of that Commission, which was attached to retentions (escrow) and eventual price ad- of the United States of America. Falabella shares of its property, together with Shareholders’ Registry Book of the Company the date of the Shareholders’ Meeting. Significant Event 02/18, dated April 24 of justment mechanisms due to liabilities or the new shares from the proposed capital at midnight of the fifth business day prior to the present year is rectified in the following unknown contingencies. Linio, among whose 2. Delegation of Authority to the Board increase through a simultaneous and syn- the day scheduled for holding the Meeting 4. Authorize shareholder Inversiones terms: where it says “02/05/17”, it should founders is Rocket Internet, was until today of Directors to Establish the Final Price chronized secondary offer. shall be eligible to participate therein. Los Olivos S.A. to, upon fulfilling all re- say “02/05/18”. 100% property of New Tin Linio II GmbH, a of the New Shares: as a second matter, quirements established by the Board, limited responsibility company also incorpo- authorize that the Board of Directors be With respect to the General Authority of the sell up to 21,000,000 currently out-
Material Event N°5 rated under the laws of the German Federal delegated the authority to establish the Board of Directors, it will be proposed to the Material Event N°8 standing shares of its ownership, in a Annual Report | 5. Corporate Information May 17, 2018 Republic, whose property was distributed final placement price of the new shares, shareholders to grant wide-ranging authority August 20, 2018 simultaneous and synchronized sale among a group of shareholders, investors provided that the placement be done to the Board of the Company in order to: process together with the sale of the As of today, Falabella has subscribed a and investment funds. within 180 days following the date of the The Extraordinary Shareholders' Meeting of new 84,330,000 shares issued in con- Memorandum of Understanding (hence- Extraordinary Shareholders’ Meeting in • Proceed to issue the new shares all at the Company held today agreed the following: nection with the capital increase. To forth the "MOU") with Inter Ikea Systems Material Event N°7 which the capital increase is approved. once and for the total amount, or else this end, as of this date, the Company B.V., owner of IKEA® Concept and exclusive August 1, 2018 on a partial basis, as per the decision of 1. Increase the paid-in capital in the and Inversiones Los Olivos S.A. entered worldwide franchiser of IKEA®, intending 3. Authorization of a Simultaneous and the Board; sum of $505,188,141,300 by issuing into a collaboration agreement for said for Falabella to acquire franchiser rights to During the Board meeting held today, on Synchronized Secondary Offering: as a 84,330,000 new shares, nominative, secondary offering, simultaneous and develop and operate IKEA® commercializa- August 1, 2018, the following was agreed third matter, approve that, upon fulfilling • Register the new shares in the Securities without par value, all of the same and sole synchronized on the terms described tion stores and web sites in Chile, Colombia upon: certain requirements, and concurrent Registry of the FMC; existing series, which shall be subscribed in the collaboration agreement model and Peru. The MOU establishes the agree- with the placement of the new shares, and paid in Chilean pesos, legal Chilean that was made available for review by ments that the parts have already reached To call an Extraordinary Shareholders’ the sale of shares currently outstand- • Grant a preemptive subscription right to currency, within a maximum of three shareholders on the webpage of the for the aforementioned goals. Falabella and Meeting to be held on August 20, 2018, ing be admitted in a simultaneous and the shareholders; years as from the date of the Meeting. As Company as from the date of publication Inter Ikea Systems B.V. foresee that the at 15.00 hrs, in the Alamo AB Room at the synchronized process with the afore- a result of the aforementioned increase, of the first Notice of the Meeting. preparation of the final agreements should Courtyard Hotel, located on Av. Presidente mentioned issue. • Place among shareholders or third par- the paid-in capital of the Company is the be concluded no later than November 30, Kennedy 5601, 7th floor, Las Condes, Santi- ties, the new shares in relation to which sum of $1,038,597,784,976, divided 2018. The MOU considers the opening ago, in order to know about and pronounce 4. Operations with Related Parties: as a said preemptive subscription right shall into 2,518,795,103 shares of one sole of a minimum of nine IKEA® stores in the on the following: fourth matter, take note about the ap- have been either waived or not exercised, series, nominative and without par value, three countries, plus an IKEA® web site per proval given by the Board to an opera- being able to settle all situations, modali- of which $533,409,643,676 has been country, during the next nine years, with an 1. Capital increase: as a first issue, approve tion with a related party denominated ties, supplementations, modifications and paid, corresponding to 2,434,465,103 approximate total investment equivalent to the following interdependent matters and “Collaboration Agreement”, between the details that might arise or be required in subscribed-for and paid-up shares. To US$600 million. related to the Company’s capital increase: Company and Inversiones Los Olivos S.A. relation to the capital increase and the reflect the capital increase article five Material Event N°6 amendment of the bylaws as agreed by and interim article one of the Company’s August 1, 2018 • A capital increase through the issuance 5. General Authority to the Board of Direc- the Meeting; and, bylaws have been amended. of 84,330,000 new cash shares, without tors: as a fifth matter, notwithstanding Today, Inversiones MKTP SpA, and a 100% par value, all of the same and sole existing the authority conferred by law, grant • Take any action deemed necessary or con- 2. Authorize the Board of Directors of the controlled subsidiary of Falabella, acquired series, which valued according to articles wide-ranging authority to the Board of venient to supplement or comply with the Company to register the shares represen- all the shares of New TIN Linio I GmbH, a 23 and 132 of the Stock Corporations Directors to conduct the necessary acts decisions made at the Meeting or to fulfill tative of the capital increase in the Securi- limited responsibility company incorporat- regulation in relation to withdrawal rights to materialize the capital increase and any legal, regulatory or administrative ties Registry of the FMC and in a securities ed under the laws of the German Federal at the date of the Shareholders’ Meeting sale of outstanding shares. requirements, or any demands made by exchange, for their public offering in Chile. Republic, which in turn controls, directly would yield a total amount for the capital the FMC, the Servicio de Impuestos Inter- As well, it was agreed that, concurrently and indirectly, a series of entities, in several increase of $505,188,141,300; Regarding the Authorization of a Simulta- nos (Chilean tax authority), the Santiago with the offering of new shares in Chile, jurisdictions, through which it develops and neous and Synchronized Secondary Offer, Stock Exchange, the Depósito Central the Board be authorized to decide whether operates the marketplace platform business, • Authorize the Board to register the new it will be proposed to the Shareholders’ de Valores (Chilean securities electronic to conduct a private offering thereof to also known as online marketplace, under the shares representative of the capital in- Meeting that, as such manner as is approved register), or any other public authority or qualified investors in the United States WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 125
Material Event N°9 October 10, 2018
In relation to the offering of shares cor- 70,669,211 shares of Falabella were of- dinary Shareholders’ Meeting of Falabella responding to the capital increase of the fered for sale to the public. Of these shares: on August 20, 2018, and whose issue was Company approved by the Extraordinary i) 49,669,211 correspond to new shares registered in the Securities Registry of Shareholders’ Meeting dated August 20, that will be available to the Company once the Financial Market Commission under of the present year, whose issue was reg- the controlling shareholders partially N°1,075. The shareholders members of istered in the Securities Registry of the waive their preemptive subscription rights the controlling group of the Company re- FMC under N°1,075 on September 27, for the same number of shares, waiver that served the right to subscribe 12,314,702 2018, attached is an updated copy of the will be formalized tomorrow October 19, new shares during the preferred option Roadshow presentation to be distributed 2018, once the preemptive option notice period. among investors as part of the above re- has been published and before the opening ferred issuance. Said presentation includes hours of the Santiago Stock Exchange; and As informed in the Material Event 10/19 a final slide which has been added to the ii) 21,000,000 shares corresponding to dated yesterday, on October 16, 2018, an version previously presented to the FMC the secondary offering of shares owned Auction of an Order Book, electronic trad-
and published on the Company’s webpage, by Invesiones Los Olivos S.A., offered si- ing system of the Santiago Stock Exchange, Annual Report | 5. Corporate Information with a summary of subsequent events and multaneously and synchronized with the was entered into said stock exchange, for therefore not included on the Financial new shares as authorized by the Meeting. the offering for sale to the public of: i) the Statements of the Company corresponding amount of 49,669,211 shares of Falabella to the period ended June 30, 2018. The Auction of 70,669,211 shares was corresponding to the new shares issued entered into the Santiago Stock Exchange in connection to the aforementioned Material Event N°10 on October 16, 2018, and its force ex- capital increase and the preemptive sub- October 18, 2018 pired today. The characteristics, terms scription rights thereof were waived by and conditions of said Auction were de- the controlling shareholder group; and ii) The Board of Directors of the Company, in termined and published in accordance to 21,000,000 shares of Falabella owned by ordinary meeting held today, unanimously the manner and terms established in the Inversiones Los Olivos S.A. agreed to establish at $5,250 per share the Manual of Operations in Shares of the price of the preemptive subscription rights Santiago Stock Exchange, as explained in Herein is informed that the Auction was for the subscription of the 84,330,000 the notice published on El Mercurio de declared successful, where all 70,669,211 new shares to be issued as per approved Santiago newspaper on October 11, 2018. shares of the Company were allocated at an by the Extraordinary Shareholders’ Meet- offered price of $5,250 per share. ing of Falabella on August 20, 2018, (the Material Event N°11 “Meeting”) and which were registered on October 19, 2018 Material Event N°12 the Securities Registry of the FMC un- December 27, 2018 der N°1,075. The subscription price was As of this date, shareholders members of determined by the Board of Directors of the controlling group of the Company, an- The extraordinary Board meeting held to- the Company in accordance with the au- nounced through letters sent to the Chief day, approved to pay an interim dividend of thorization granted by the Shareholders’ Executive Officer of Falabella the waiver of $26 per share against 2018 earnings. Said Meeting, and according to the result of the their preemptive subscription rights over dividend will be paid on January 10, 2019, Auction of an Order Book (the “Auction”), a total of 49,669,211 new shares issued to shareholders of the sole existing series an electronic trading system of the San- by the Company in connection with the registered on the Shareholders' Registry tiago Stock Exchange, by virtue of which capital increase approved in the Extraor- as of January 4, 2019. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 127 Annual Report | 5. Corporate Information
Wintter, Yanet, Prisilla and Camilo at the Ahumada Digital Branch. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 129
Stores by Format Shareholders' and Country Comments and Approximately 44% of the stores at a regional level are owned by the Company through its subsidiaries. The rest of the stores are Proposals leased from several real estate developers. Regarding shopping centers, 100% of them are owned by Company subsidiaries.
29 No comments or proposals from sharehold- Statistics Falabella 2017-2018 ers were presented, pursuant to subsection 3°, article 74 of Law 18,046, during the Department Stores in Chile Ordinary Shareholders’ Meeting held on Period # Shares Volume Average Price April 24, 2018. 1Q 2017 62,631,214 $335,281,006,518 $5,353 N° Stores Address City 2Q 2017 101,798,273 $556,891,971,892 $5,471 1 Ahumada Ahumada 25, 165, 167, 366, Santiago Santiago 3Q 2017 101,183,046 $605,004,281,505 $5,979 2 Concepción Barros Arana Nº 802 Concepción Stock Information 4Q 2017 129,003,166 $760,711,553,836 $5,897 3 Parque Arauco Av. Presidente Kennedy Nº 5413, Las Condes Santiago 1Q 2018 104,846,413 $633,943,080,490 $6,046 4 Temuco Arturo Prat Nº 570 Temuco
The stock of Falabella is listed in the San- 2Q 2018 101,293,299 $605,949,658,998 $5,982 Annual Report | 5. Corporate Information 5 Viña del Mar Sucre Nº 250 Viña del Mar tiago Stock Exchange and in the Chilean 3Q 2018 90,978,374 $512,571,124,901 $5,634 Electronic Stock Exchange. During 2018 6 Plaza Vespucio Av. Vicuña Mackenna Nº 7110, Santiago Santiago 4Q 2018 192,731,765 $1,002,873,420,968 $5,203 the stock was also listed in the Valparaiso 7 Lyon Avenida Providencia Nº 2188, Providencia Santiago Stock Exchange, which closed that year. 8 Rancagua Sargento Cuevas Nº 405 Rancagua 9 Plaza Calama Av. Balmaceda Nº 3242, local 268 Calama 10 Alto Las Condes Av. Kennedy Nº 9001, Local 1001, Las Condes Santiago Falabella’s stock price v/s IPSA 11 Plaza Oeste Av. Américo Vespucio Nº 1501, Maipú Santiago 12 Plaza El Trebol Av. José Alessandri Nº 3177 Acceso Carriel Sur Concepción 7,000 13 Osorno Eleuterio Ramírez Nº 840 Osorno 14 Chillán El Roble Nº 770, Local A Chillán 6,500 15 Talca 1 Norte Nº 1485 Talca 16 Plaza Tobalaba Av. Camilo Henríquez Nº 3296, Puente Alto Santiago 6,000 17 Plaza La Serena Alberto Solari Nº 1400, Mallplaza La Serena La Serena 18 Valparaiso Independencia Nº 1806 Valparaiso 5,500 19 Curicó Peña Nº 615 Curicó 20 Iquique Héroes de la Concepción Nº 2555 Iquique 5,000 21 Puerto Montt Av. Juan Soler Manfredini Nº 101 Puerto Montt 22 Quilpué Diego Portales Nº 822 Quilpué 4,500 23 Plaza Los Angeles Valdivia Nº 472 Los Ángeles 24 Plaza Norte Av. Americo Vespucio Nº 1737, Santiago Santiago 4,000 25 Expo Pucón O´Higgins 112, LOCAL 9/10/11 Pucón 26 Puente Puente Nº 530, Santiago Santiago 27 Portal La Dehesa La Dehesa Nº 1445 local 1 , Lo Barnechea Santiago
jan-17 feb-17 mar-17 apr-17 may-17 jun-17 jul-17 aug-17 sept-17 oct-17 nov-17 dec-17 jan-18 feb-18 mar-18 apr-18 may-18 jun-18 jul-18 aug-18 sept-18 oct-18 nov-18 dec-18 28 Plaza Antofagasta Balmaceda Nº 2355, Mallplaza Antofagasta IPSA Falabella 29 La Calera Prolongación J.J. Perez Nº 12010 La Calera 30 Valdivia Arauco Nº 561 Valdivia 31 Melipilla Vargas Nº 457, Melipilla Melipilla
29. Fuente: la Bolsa de Comercio de Santiago, Bolsa Electrónica de Chile y en la Bolsa de Valores de Valparaíso en Chile WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 131
Department Stores Peru
N° Stores Address City 1 San Isidro Av. Paseo de la República Nº 3220, San Isidro Lima 2 San Miguel Av. La Marina Nº 2100 (Plaza San Miguel), San Miguel Lima 3 Jockey Plaza Av. Javier Prado Este Nº 4200 (Jockey Plaza), Santiago de Surco Lima 4 Lima Centro Jr. de la Unión Nº 517, Lima Cercado Lima 5 Piura Esquina Jr. Arequipa 802 y Jr. Huancavelica 551, Piura Cercado Piura Annual Report | 5. Corporate Information 6 Arequipa Av. Ejército Nº 793, Cayma Arequipa 7 Miraflores Av. Arequipa Nº 5280, Miraflores Lima 8 Chiclayo Mall Calle Miguel de Cervantes Nº 300 (Real Plaza), P.J. Diego Ferré Chiclayo 9 MegaPlaza Av. Industrial Nº 3515 (MegaPlaza), Independencia Lima 10 Cajamarca Jr. Sor Manuela Gil Nº 151 Urb, San Carlos Cajamarca 11 Trujillo CC Av. Mansiche s/n (Mall Aventura Plaza), Caserío El Cortijo Trujillo 12 Bellavista Av. Óscar R. Benavides Nº 3866 (Mall Aventura Plaza), Bellavista Lima N° Stores Address City 13 Atocongo Av. Circunvalación (Atocongo Open Plaza), San Juan de Miraflores Lima 32 Punta Arenas Avenida Frei Nº 01110 Punta Arenas 14 Angamos Av. Angamos Este Nº 1803 (Angamos Open Plaza), Surquillo Lima 33 Manquehue Avenida Manquehue Sur N° 329, Las Condes Santiago 15 Piura Mall Open Plaza Av. Andres Avelino Caceres Nº 147 (Piura Open Plaza), Castilla Piura 34 Plaza Alameda Av. Libertador Bernardo O Higgins Nº 3470 Local A-2, Estación Central Santiago 16 Arequipa Porongoche Av. Porongoche Nº 502 (Mall Aventura Plaza), Paucarpata Arequipa 35 San Bernardo Av. Jorge Alessandri Nº 20040, Local 1, San Bernardo Santiago 17 Chimbote Avenida Victor Raúl Haya de la Torre Nº 4694, Nuevo Chimbote Chimbote 36 San Felipe Av. Bernardo O'Higgins Nº 1150 San Felipe 18 Santa Anita Av. Carretera central Nº 111 (Tienda TD-1) Santa Anita - Lima Lima 37 Costanera Center Avenida Andrés Bello Nº 2461, Providencia Santiago 19 Lima Norte Av. Alfredo Mendiola Nº 1400, Ancla 6 (C.C. Plaza Norte) - Independencia Lima 38 Arauco Maipu Av. Américo Vespucio Nº 399, Local 500, Maipú Santiago 20 Cañete MegaPlaza Expo Av. Mariscal Benavides Nº 1000 – San Vicente de Cañete – Cañete Lima 39 Expo Puente Alto Av. Concha y Toro Nº 1477 Santiago 21 Ica Mall Calle Lima Nº 433, Ica Cercado Ica 40 Ovalle Prolongación Benavente Nº 1075 Ovalle 22 Pucallpa OP Av. Centenario Nº 2086 – Ancla 2 - Yarinacocha Pucallpa 41 Plaza Egaña Larrain Nº 5862, La Reina Santiago 23 Iquitos Expo Jr. Prospero Nº 560 – Maynas Iquitos 42 San Fernando Chillán 744, San Fernando San Fernando 24 Salaverry Av. General Felipe Salaverry Nº 2370 – Jesus Maria Lima 43 Plaza Copiapo Maipú Nº 110 Copiapó 25 Huánuco Jr. Dos De Mayo Nº 125 Huánuco 44 Castro San Martin Nº 457 Castro 26 Centro Cívico Av. Garcilaso de la Vega Nº 1337 Lima 45 Los Domínicos Av. Padre Hurtado Sur Nº 875, Las Condes Santiago 27 Crate & Barrel * Av. Javier Prado Este Nº 4200 (Jockey Plaza), Santiago de Surco Lima 46 Arica Av. Diego Portales 640 Arica 28 Mall del Sur Av. Los Lirios 301 - Urb. Entel - San Juan de Miraflores Lima 47 Independencia Av. Independencia 565 Santiago 29 Huancayo Av. Ferrocarril 146 - Huancayo Huancayo
* Crate & Barrel is a furniture and home articles stores chain, acknowledged for its designs, functionality and price/quality relation, based in the US. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 133
Department Stores Colombia Home Improvement Chile
N° Stores Address City N° Stores Address City 1 Santafe Calle 185 Nº 45 - 03, Centro Comercial Santafé Bogotá 1 Imperial Santa Rosa Av. Santa Rosa Nº 7850, La Granja, Santiago Santiago 2 Suba Avenida Carrera 104 Nº 148 - 07, Centro Comercial Plaza Imperial Bogotá 2 HC Concepción Av. Los Carrera Nº 1175, Concepción Concepción 3 San Diego Carrera 43 Nº 36 - 04, Centro Comercial Sandiego Medellín 3 Co Viña del Mar Calle Limache Nº 3119, Viña del Mar Viña del Mar 4 Hayuelos Callen 20 Nº 82 - 52, Centro Comercial Hayuelos Bogotá 4 Co Cantagallo Av. Las Condes Nº 12422, Lo Barnechea, Santiago Santiago 5 Unicentro Bogotá Avenida 15 Nº 123 - 30, Centro Comercial Unicentro Bogotá 5 Co Valparaíso Yungay Nº 2532, Valparaíso Valparaíso 6 Galerías Calle 53 Nº 25 - 35, Centro Comercial Galerías Bogotá 6 Co Talcahuano Colón Nº 1891, Talcahuano Talcahuano 7 Unicentro Cali Calle 5 Carrera 100 Cruce Paso Ancho, Centro Comercial Unicentro Cali 7 Hc San Antonio 21 de Mayo 950, San Antonio San Antonio 8 Chipichape Calle 38 Norte Nº 6N – 35; Local 406 CC Chipichape Cali 8 HC Las Condes Av. Las Condes Nº 11049, Las Condes, Santiago Santiago 9 Centro Mayor Autopista Sur Carrera 27 Nº 38 A Sur, Centro Comercial Centro Mayor Bogotá 9 Co Antofagasta Av. Antonio Rendic Nº 6852, Antofagasta Antofagasta 10 Santafe Medellin Carrera 43a Nº 7 Sur - 170, Centro Comercial Santafé Medellín Medellín 10 HC Viña del Mar Av. 15 Norte Nº 961, Viña del Mar Viña del Mar 11 Pereira Av. Circunvalar Nº 5 - 20, Local 214, Parque Arboleda Centro Comercial Pereira 11 HC Rancagua Av. Nueva Einstein Nº 297, Rancagua Rancagua 12 Villa Country Calle 78 Nº 53 - 70 local 100, Centro Comercial Villa Country Pereira 12 HC Puente Alto Av. Concha y Toro Nº 1315, Puente Alto, Santiago Santiago 13 Titan Carrera 72 Nº 80-94 Local 130-350, Centro comercial Titán Plaza Bogotá 13 HC Maipu Av. Pajaritos Nº 4444, Maipú, Santiago Santiago 14 El Castillo Carrera 13 Nº 31-45 Chambacu local 125, Centro Comercial Mallplaza Cartagena 14 HC El Trébol Autopista Nº 9200, Hualpén Hualpén 15 Floridablanca Carrera 23 Nº 29-145 Local 101, Centro Comercial Parque Caracoli Bucaramanga 15 HC La Serena Av. Fco. de Aguirre Nº 02, La Serena La Serena
16 Ibague Calle 57 Nº 60K - 8E Avenida Guabinal, Centro Comercial Acqua Ibague 16 Imperial Mapocho Calle Mapocho Nº 5906, Quinta Normal, Santiago Santiago Annual Report | 5. Corporate Information 17 WTC Cali Avenida 6ª norte entre calles 35an y 36an, World Trade Center Cali 17 HC Parque Arauco Av. Pdte. Kennedy Nº 5601, Las Condes, Santiago Santiago 18 Cacique Transversal Oriental 93 # 34 - 99, Centro Comercial Cacique Bucaramanga 18 Imperial Maipú Calle Alberto Llona Nº 1153, Maipú, Santiago Santiago 19 Chía Km 2.5 vía Chía-Cajicá Centro Comercial Fontaner Chía 19 Imperial Vespucio Av. Américo Vespucio Nº 1030, Peñalolén, Santiago Santiago 20 Jardin Plaza Carrera 98 N° 16 - 20 local 229, Centro Comercial Jardín Plaza Cali 20 HC San Miguel Av. José Miguel Carrera Nº 5505-5514, San Miguel, Santiago Santiago 21 Primavera Calle 15 N°42 - 01 Loc 101 – 201 -301, Centro Comercial Primavera Villavicencio 21 HC La Reina Av. Jorge Alessandri Nº 1347, La Reina, Santiago Santiago 22 Plaza Central Avenida Calle 13, entre las Carrera. 62 #11-2 y la Carrera 65 #11-48 Centro Comercial Bogotá 22 Co Vallenar Merced Nº 501, Vallenar Vallenar Plaza Central 23 HC Ñuble Av. Vicuña Mackenna Nº 1700, Ñuñoa, Santiago Santiago 23 Diverplaza Dirección Trasversal 99 # 70 A – 89, Centro Comercial Diverplaza Bogotá 24 HC Valdivia Av. Ramón Picarte Nº 3349, Valdivia Valdivia 24 Crate & Barrel * Carrera 58D #145-51; (Avenida Boyacá), Centro Comercial La Colina Bogotá 25 HC Nueva La Florida Av.José Pedro Alessandri Nº 6402, Peñalolén, Santiago Santiago 25 Colina Campestre Carrera 58D #145-51; (Avenida Boyacá), Centro Comercial La Colina Bogotá 26 Imperial Valparaíso Av. Independencia Nº 3033, Valparaíso Valparaiso 26 La Felicidad Avenida Boyacá con Calle 13, Centro Comercial MultiPlaza Bogotá 27 HC SS Temuco Av. Caupolicán Nº 457, Temuco Temuco 27 La Carola Carrera 11 No. 56a - 16 ; (Avenidad Kevin Angel), Centro Comercial La Carola Manizales 28 HC Huechuraba Av. Américo Vespucio Nº 1737, Huechuraba, Santiago Santiago 29 HC Villarrica Av. Saturnino Epulef Nº 1580, Villarrica Villarrica Department Stores Argentina 30 HC Osorno Av. René Soriano Nº 2619, Osorno Osorno 31 HC Angol Av. Bdo O´Higgins Nº 1744, Angol Angol 32 HC Chillan Av. Ecuador Nº 599, Chillán Chillan N° Stores Address City 33 HC Curico Av. Carlos Condell Nº 1192, Curicó Curico 1 Mendoza Acc. Este Nº 3280 - Guaymallén Mendoza 34 HC Coquimbo Ruta 5 Norte Nº 859, Coquimbo Coquimbo 2 Rosario Córdoba Nº 1101 Rosario 35 HC Plaza Oeste Av. Américo Vespucio Nº 1501, Cerrillos, Santiago Santiago 3 Cordoba Duarte Quiroz Nº 1400 Córdoba 36 HC La Calera Prolongación JJ Pérez Nº 12010, La Calera La Calera 4 San Juan Peatonal Tucumán Nº 163 Sur San Juan 37 HC Pto.Montt Av. Presidente Ibañez Nº 650, Puerto Montt Puerto Montt 5 Unicenter Paraná Nº 3745, Martínez Buenos Aires 38 Co Fontova Pedro Fontova Nº 5810, Conchalí, Santiago Santiago 6-8 Florida Florida Nº 202 / 343 / 665, Capital Federal Buenos Aires 39 HC Plaza Vespucio Av. Américo Vespucio Nº 7310, La Florida, Santiago Santiago 9 Avellaneda Güemes Nº 897, Avellaneda Buenos Aires 40 HC San Felipe Calle Tocornal 2810, San Felipe San Felipe 10 Dot Vedia Nº 3626, Capital Federal Buenos Aires 41 HC Arica Av. Santa María Nº 2985, Arica Arica 11 Tortugas Panamericana Ramal Pilar Km 36,5 Buenos Aires 42 Imperial Concepción Tucapel Nº 1259, Concepción Concepción 43 HC Iquique Av. Héroes de la Concepción Nº 2311, Iquique Iquique 44 HC Antofagasta Av. Balmaceda 2366, Antofagasta Antofagasta 45 HC Plaza Concepción Av. Pdte. Jorge Alessandri Nº 3177, Talcahuano Talcahuano WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 135 Annual Report | 5. Corporate Information
Sodimac Distribution Center. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 137
Home Improvement Chile Home Improvement Peru
N° Stores Address City N° Stores Address City 46 HC Punta Arenas Avda. Pdte. Eduardo Frei M. Nº 01400, Punta Arenas Punta Arenas 1 HC San Miguel Av. La Marina Nº 2355 C.C. Open Plaza Lima 47 HC Linares Leon 0376, Linares Linares 2 HC Megaplaza Av. Industrial Nº 3515 - 3517 Local A-08 CC. Mega Plaza - Independencia Lima 48 Imperial Huechuraba Av. A. Vespucio Nº 1399, esquina Pedro Fontova, Huechuraba, Santiago Santiago 3 HC Atocongo Av. Circunvalación Nº 1801 - 1803 - 1805. Lima 49 HC Talca Av. 2 Norte Nº 3344, Talca Talca 4 HC Javier Prado Av. Javier Prado Este Nº 1057 Lima 50 HC Copiapó Panamericana Sur Nº 140, Copiapó Copiapó 5 HC Chiclayo Calle Víctor Raul Haya De La Torre N° S/N - Urb. San Eduardo Chiclayo 51 HC Estación Central San Francisco de Borja Nº 402, Estación Central, Santiago Santiago 6 HC Trujillo Open Plaza Av. América Norte Nº 1245, Ancla 2 Urb. Los Jardines-Open Plaza Trujillo 52 HC Los Angeles Av. Alemania Nº 850, Los Angeles Los Angeles 7 HC Lima Centro Av. Tacna Nº 640 Lima 53 HC El Bosque Av. José Miguel Carrera Nº 10375, El Bosque, Santiago Santiago 8 HC Canta Callao C.C. Canta Callao Open Plaza. Av. Japón (Ex Bertello) / Calle Las Begonias S/N Callao Lima 54 HC Calama Av. Balmaceda Nº 3398, Calama Calama 9 HC Trujillo Av. Mansiche S/N – CC Mall Aventura Plaza Trujillo 55 HC San Bernardo Av. Jorge Alessandri N° 20040, San Bernardo, Santiago Santiago 10 HC Bellavista Av. Oscar R. Benavides N° 3866 - LOCAL TH-1 , Mallplaza Bellavista Lima 56 Imperial Temuco Av. Caupolicán Nº 1151, Temuco Temuco 11 Co Ica Minka Av. San Martin N° 727 Interior 101 (LM) Ica 57 Homy Parque Arauco Av. Pdte. Kennedy Nº 5601, Piso 3, Las Condes, Santiago Santiago 12 HC Angamos Av. Nueva Tomás Marsano N° 961 ESQ C/ ANGAMOS N° 961 ESQ. C/ ANGAMOS N° 1803 - AN 1 Lima 58 Imperial Hualpen Av. Cristóbal Colón Nº 8483, Hualpén Hualpén 13 HC Piura Av. Andrés Avelino Cáceres 147 Urb. Miraflores Tienda Ancla 1 Secc. Sector, Distrito de Castilla, Provincia y departamento de Piura Piura 59 HC Coyhaique Av. Ogana Nº 869, Coyhaique Coyhaique 14 HC Arequipa Av. Porongoche N° 500, Mall Aventura , del distrito de Paucarpata Arequipa 60 HC Quilpue Av. Freire Nº 1351, Quilpué Quilpue 15 HC Jockey Plaza Av.Prado, Javier Este N° 4010 Tda TD-3 Urb. El Fundo Monterrico Chico Lima
61 Co Rancagua Av. Koke Nº 011, Rancagua Rancagua Annual Report | 5. Corporate Information 16 HC Chimbote Av. Victor Raul Haya De la Torre N° 4694 Interior A04 Mz. 1-A-1-A2 Parque Gran Chavín Chimbote 62 Imperial Rancagua Calle La Cruz Nº 01000, Rancagua Rancagua 17 HC Santa Anita (Ate) Av. Los Frutales Nro. 202 - Fundo Monterrico Grande Oeste - ATE Lima 63 HC Reñaca Santa Julia Calle Subida Alessandri 4025 ex 4085 Gomez Carreño, Viña del Mar Viña del Mar 18 HC Cañete Av. Mariscal Benavides Cdra 10 Lima 64 HC Quinta Vergara Av. Valparaíso Nº 1070, Viña del Mar Viña del Mar 19 HC Huacho Esquina de la Av. 28 de Julio con Av. 9 de Octubre S/N Lima 65 HC Quilicura Av. Manuel A. Matta Nº 581, Quilicura, Santiago Santiago 20 HC San Juan Lurigancho Av. Las Lomas, Las 601-649 MZ. L Lt. 11 - Urb- Zarate Industrial Lima 66 HC Plaza Tobalaba Av. Camilo Henríquez Nº 3692, Puente Alto, Santiago Santiago 21 HC Pucallpa Av. Centenario N° 2086 - Ancla 3 - Distrito de Yarinacocha Pucallpa 67 HC Ribera Norte Av. Los Carreras Poniente Nº 301, Concepción Concepción 22 HC Sullana Av. Carretera Sullana - Paita / Av. Las Dalias - Calle Los Médalos entre Urb. Jardín y Asoc. Pro Vivienda Mariano Santos Sullana 68 Imperial Reñaca Camino Internacional Nº 1025 (rotonda Santa Julia), Viña del Mar Viña del Mar 23 HC Villa El Salvador Parque Ind. Parc. II Manz. C Lote 1 y 7 Lima 69 Imperial Talca Av. San Miguel Nº 2687, esquina 23 Oriente (ex San Pablo), Talca Talca 24 HC Cajamarca OP Av. Andres Zevallos cuadra 26, Urb. Horacio Zevallos Gomez Cajamarca 70 HC Talca Poniente Av. Colín Nº 0635, Talca Talca 25 Maestro Chacarilla Av. Caminos del Inca N° 100 MZ. A Lt. 1,2,3,4,5, Urb. El Tambo de Monterrico Lima 71 HC San Fernando Av. B. O'Higgins Nº 0450, San Fernando San Fernando 26 Maestro Surquillo Av. Angamos Este N° 1353 - 1355 Esq. Con Av. República de Panamá - Jr. San Lorenzo N° 881 Lima 72 Homy Plaza Oeste Av. Américo Vespucio Nº 1501, Cerrillos, Santiago Santiago 27 Maestro Pueblo Libre Av. Universitaria Sur N° 2271 - Pueblo Libre Lima 73 Imperial San Bernardo Av. Padre Hurtado Nº 15057-15095, San Bernardo, Santiago Santiago 28 Maestro Chorrillos Av. Paseo de la República, Prlg. N° S/N Departamento LM 04, Plaza Lima Sur Lima 74 Homy Plaza Vespucio Av. Vicuña Mackena 7110 Hm 300, La Florida, Santiago Santiago 29 Maestro Ate Av. La Molina 378 Lima 75 HC Alto Hospicio Av. Los Aromos Nº 2780, Alto Hospicio Alto Hospicio 30 Maestro Arequipa Av. Los Incas N° 400-A Ref. Sector Lambramani Arequipa Arequipa 76 HC Castro Ruta 5 Norte Nº 2456 , sector Ten Ten, Castro Castro 31 Maestro Naranjal Avenida Mendiola, Alfredo N° 5118 - 5150 , Lot. Industrial Infantas, II Etapa - Los Olivos Lima 77 HC Santa Cruz Av. Rafael Casanova Nº 360 ex 460, Santa Cruz Santa Cruz 32 Maestro Callao Av. Argentina N° 2842 - 2868 Callao ( dirección tomada de ficha ) Lima 78 HC Ovalle Av. Prolongación Benavente Nº 1075, Ovalle Ovalle 33 Maestro Colonial Av. Colonial 751 - Lima Cercado Lima 79 Homy Plaza Egaña Av. Larrain Nº 5862, La Reina, Santiago Santiago 34 Maestro Piura Zona Industrial III Avenida Sanchez Cerro N° 3254 V 07 Piura 80 HC Quillota Av. Ramón Freire 1551, Quillota Quillota 35 Maestro Independencia Esq. Tomas Valle con Pan. Norte, Sector 6 - CC. Lima PLaza Norte Lima 81 Imperial Puerto Montt Pilpilco 200, Parque Industrial, camino a Pargua, Pto.Montt Puerto Montt 36 Maestro Chiclayo Calle Hermanos Galindo S/N - Cuadra 3 - Urb. Patazca Chiclayo 82 HC Coronel Av. Carlos Prats 0901, Coronel Coronel 37 Maestro Trujillo Av. Ameríca Sur N° 1451 - 1459, Calle Jose Galvez N° 955 Urb. Barrio Chicago Trujillo 83 HC Copiapó II Av. Los Carrera 4723, Copiapó Copiapó 38 Maestro Huancayo Av. Huancavelica N° 221 - 225 El Tambo - Huancayo Huancayo 84 HC Los Dominicos Av. Padre Hurtado Sur Nº 875 Local H100, Las Condes, Santiago Las Condes 39 Maestro Ica Av. Los Maestros N° 206 - 208 Ica 85 HC Talagante Av. Bernardo O'Higgins 2337, Talagante Talagante 40 Maestro Cusco Urbanización Versalles Cusco 86 HC Melipilla Av. Vicuña Mackenna 1415, Melipilla Melipilla 41 Maestro Arequipa 2 El paso de Challapampa Predio las Rojas (Costado del Grifo la Fonda) Arequipa 87 Imperial La Serena AV Balmaceda 3070, La Serena La Serena 88 Reconstructor Cauquenes Catedral s/n esquina Antonio Varas, Cauquenes Cauquenes 89 HC La Serena - Balmaceda Av. Balmaceda 2885, La Serena La Serena 90 HC Independencia Av. Independencia N° 565, Independencia Independencia WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 139
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N° Stores Address City N° Stores Address City 42 Maestro San Luis Av. Nicolás Ayllón N° 1680, Urb. Pino Distrito de San Luis Lima 25 HC Envigado Calle 37 Sur Cra 48, entre calles 34 sur y 32B sur Medellín 43 Maestro Villa El Salvador Parque Ind. Parc. II Manz. B Lote 1 Lima 26 HC Valledupar Transversal 19 No. 3-150 Valledupar 44 Maestro Tacna Cercado - Parcela - 03 Prolong. 2 de Mayo Tacna 27 HC Santa Marta Cra 35 No. 29A-355 Lote B Santa Marta 45 Maestro Cajamarca Jr. San Luis S/N , Sector N° 09 - Pueblo Libre Cajamarca 28 HC Palmira Calle 42 con Cra 39 esquina Cali 46 Maestro Sullana Av. Sanchez Cerro N° 100 Mz. A2 LT 01 - AH. Santa Teresita - Sullana Sullana 29 HC Barranquilla Centro Carrera 46 Nro 48 – 50 Barranquilla 47 Maestro Comas Av. Chacra Cerro N° 121 Ex. Fundo Chacra Cerro - Comas Lima 30 HC Armenia Carrera 6 3-180 Armenia 48 Maestro Puente Piedra Calle 07 Mz. J Lt. 01 Urbanización Las Vegas Lima 31 HC Rionegro Cra 43 No. 54 - 134 Rionegro 49 Maestro Huacho Esq. Panam. Norte S/N - Av. Las Delicias Fundo Vista Alegre - Santa María Huacho 32 HC Chia Km 27 Vía Bogotá - Cajicá Chia 50 Maestro Chincha Av. San Idelfonso - C.P Acequia Grande Cinco Esquina - Sunampe Chincha 33 HC Tintal Calle 10 B No. 86 – 50 Tintal 51 Maestro Pucallpa Jr. Salvador Allende N° 350 Pucallpa 34 HC Girardot Carrera 5 No. 35-111 / 125 Girardot 52 Maestro Ventanilla Calle Alonso de Molina Mz. I-13 Lotes 5,6,7,8,9 y Sub Lote 14-C Zona Industrial Lima 35 HC Yopal Calle 24 No. 35-59 Yopal 53 Maestro San Juan de Av. Belisario Suarez N° 181 Zona Industrail Lima 36 HC Cartagena 2 Calle 31 # 82 – 112 Lote 1. Cartagena Miraflores 37 HC Tuluá Carrera 40 # 37-229, Barrio el Retiro Tulúa 54 Maestro Barrios Altos Jr. Luis Sotomayor 252 Lima 38 HC Barranquilla3 Calle 30 # 4B – 400 // Carrera 10 # 27B – 211 Barranquilla 55 HC Chiclayo 2 Av. Jose María Escriva de Balaguer N° 1415, Carretera Lambayeque Chiclayo 39 HC Tunja Av Universitaria, Tunja, Boyacá, Colombia Tunja 56 Sodimac Huancayo Av. Ferrocarril 146-150 – 1ª Piso Tienda Ancla 01 – Huancayo – Junin Ciudad de Huancayo 40 HC Mosquera Funza Vía Principal Funza, Mosquera, Cundinamarca, Colombia Mosquera PQ29+9H Annual Report | 5. Corporate Information Home Improvement Colombia Home Improvement Argentina
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1 HC Calle 80 Avenida Carrera 68 No. 80-77 Bogotá N° Stores Address City 2 HC Sur Avenida 68 37-37 Sur // AK 68 35A 65 Sur Bogotá 1 HC San Martín Av. San Martín Nº 421 Buenos Aires 3 HC Norte Avenida Carrera 45 No. 174B-45 Bogotá 2 HC Malvinas Argentinas Presidente Arturo Illia 3770 Buenos Aires 4 HC Medellín Industriales Avenida Los Industriales No. 14-135 Medellín 3 HC San Justo Avenida Don Bosco Nº 2680 Buenos Aires 5 HC Cali Sur Carrera 100 No. 16-251, Centro Comercial Jardín Plaza Cali 4 HC Villa Tesei Av. Gobernador Vergara 1910 Buenos Aires 6 HC Barranquilla Carrera 53 No. 99–148 Mz 22 Lt 1 Barranquilla 5 HC Vicente Lopez Av. Libertador 77 Buenos Aires 7 HC Pereira Avenida de las Américas No. 45-06 Pereira 6 HC Tortugas Av. Olivos 4051 Buenos Aires 8 HC El Dorado CL 46A 85D 25 Bogotá 7 HC Córdoba Av. Colón 4800 Córdoba 9 HC Medellín San Juan Calle 44 No. 65-100 Medellín 8 HC La Plata Camino General Belgrano S/N entre calles 514 y 517 La Plata 10 HC Cali Norte Avda 6A Nte. No. 35–00, Santa Monica del norte Cali 9 HC Adrogué Boulevard Shopping - Av. Hipólito Yrigoyen 13298 , Adrogué Buenos Aires 11 HC Suba Carrera 104 148-07 Local 152 Bogotá 12 HC Soacha Cra 7 No. 32-35 Local 177, Centro Comercial Mercurio Bogotá Home Improvement Brazil 13 HC Ibagué Carrera 5 No. 73-100 Ibague 14 HC Cartagena Avenida del Lago Calle 29 No. 22-108 Local 1-69, Barrio Pie de la Popa - Centro Comercial Cartagena Caribe Plaza N° Stores Address City 15 HC Bello Diagonal 51 34-16, Centro Comercial Puerta del Norte Medellín 1 Dicico Ipiranga R. dos Patriotas, 1211, Ipiranga - São Paulo -SP São Paulo 16 HC Molinos Medellín Calle 30A 82A-26 Centro Comercial Los Molinos, Local 1200 Medellín 2 Dicico Sto. Amaro Av. João Dias, 1713, Santo Amaro - São Paulo - SP São Paulo 17 HC Cúcuta Avenida Diagonal Santander No. 11-200 Cucuta 3 Dicico Santos R. Alexandre Martins, 80, Lj. 301, Nivel III, Aparecida, Santo - SP Santos 18 HC Villavicencio Carrera 48 No. 1-180, KM 2 Vía Acacias Villavicencio 4 Dicico Sorocaba Av. Professora Izoraida Marques Peres, 401, Lj B, Parque Campolim, Sorocaba - SP Sorocaba 19 HC Bucaramanga Carrera 21 No. 45 - 02 // Calle 45 No. 20-02. Barrio La Concordia Bucaramanga 5 Dicico Piracicaba Av. Limeira, 722, SUC B Vila Rezende, Piracicaba - SP Piracicaba 6 Dicico São Vicente R. Prefeito José Monteiro, 1045, box 52 - Jardim Independencia, São Vicente - SP São Vicente 20 HC Calima Carrera 27 No. 21-75 Bogotá 7 Dicico M. Tietê Av. Tomaz Edson, 1324, Loja B, Barra Funda, São Paulo - SP São Paulo 21 HC Monteria Calle 65 No. 10-19 Monteria 8 Dicico Multi Radial Leste Av. Alcântara Machado, 1993, Bras, São Paulo - SP São Paulo 22 HC Neiva Calle 50 No. 16-120 Supermanzana 1 Neiva 9 Dicico Aricanduva Av. Aricanduva, 5555, Ancora B02, Vila Aricanduva, São Paulo - SP São Paulo 23 HC Manizales Calle 67 con Carrera 18 y Carrera 19 entre Calle 70 y 71, Sector baja Suiza Manizales 10 Dicico Campinas DP Rod. Dom Pedro I, km 127/128, Box25, Parque Imperador, Campinas - SP Campinas 24 HC Cedritos Calle 152 9-08 // Avenida Carrera 9 No. 152A - 23 Bogotá WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 141
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N° Stores Address City N° Stores Address City 11 Dicico Multi São Miguel Av. São Miguel, 8201,Vila Jacui, São Miguel, São Paulo - SP São Paulo 1 HC Giannattasio Arizona 865 Canelones 12 Dicico Suzano R. João Batista Fitipaldi, 380, Bloco A, Vila Maluf, Suzano - SP Suzano 2 HC Sayago Camino Ariel 4620 Montevideo 13 Dicico Praia Grande Av. Presidente Kennedy, 1876, Bloco B, Guilhermina, Praia Grande - SP Praia Grande 3 HC Maldonado Ruta 39 esquina Perimetral Luis A. de Herrera. Maldonado 14 Dicico Pirituba Av. Raimundo Pereira de Magalhães, 11.980, Bloco B Parada de Taipas, Pirituba, São Paulo - SP São Paulo 15 Dicico Taubaté Av. Charles Shnneider, 850, Santa Fé, Parque Senhor do Bonfim, Taubaté - SP Taubaté 16 Dicico Mogi R. Professor Ismael Alves dos Santos, 455, Vila Mogilar, Mogi das Cruzes - SP Mogi das Cruzes Home Improvement Mexico 17 Dicico Tremembé Av. Coronel Sezefredo Fagundes, 1855, Tucuruvi, São Paulo - SP São Paulo
18 Dicico V. Carvalho Av. Santos Dumont, 458, Sitio Paecara - Vicente de Carvalho, Guarujá - SP Guarujá N° Stores Address City 19 Dicico Peruíbe Av. Padre Anchieta, 4741, Três Marias, Peruibe - SP Peruíbe 1 HC Izcalli Av. 1° de Mayo S/N, Centro Urbano, 54750 Cuautitlán Izcalli, Méx. Ciudad de México 20 Dicico Multi Diadema Av. Piraporinha, 50, Vila Nogueira - Jardim Concordia, Diadema - SP Diadema 2 HC Arboledas Av. Gustavo Baz Prada 4001, Centro Industrial Tlalnepantla, 54030 Tlalnepantla, Méx. Ciudad de México 21 Dicico Bertioga Av. Marginal, 10001, Quadrag, Jardim Albatroz, Bertioga - SP Bertioga 3 HC Jacarandas Ricardo Flores Magon, 62370 Cuernavaca, Mor. /PASEO CUAUHNAHUAC 101 Cuernavaca 22 Dicico T. Vilela Av. Senador Teotônio Vilela, 8030, Bloco 2, Jardim São Rafael / Parelheiros, São Paulo - SP São Paulo 23 Dicico Enseada Av. Dom Pedro I, 2520, Cidade Atlantica, Guaruja - SP Guarujá 24 Dicico Itanhaém R. João Pedro Orsi, 117 a 120, Jardim Fazendinha, Itanhaem - SP Itanhaém Supermarkets Chile 25 Dicico Mongaguá R. Antonio Martins de Araújo, 100, Centro, Mongagua - SP Mongagua Annual Report | 5. Corporate Information 26 Dicico Cubatão Av. Nove de Abril, 3.400, Vila Nova, Cubatão - SP Cubatão N° Stores Address City 27 Dicico Atibaia Av. Dr. Joviano Alvim, 1190, Atibaia Jardim, Atibaia - SP Atibaia 1 El Monte Los Libertadores Nº 316, El Monte Santiago 28 Dicico Guaratinguetá Av. Juscelino Kubitschek de Oliveira, 880, Campo do Galvão, Guaratingueta - SP Guaratingueta 2 Talagante Plaza EyzaguirreNº 715, Talagante Santiago 29 Dicico Jacareí Praça Charles Gates, 90, Jardim das Industrias, Jacarei - SP Jacareí 3 SB Plaza O'Higgins Nº 550, San Bernardo Santiago 30 Dicico Limeira R. Miguel Guidotti, 2155, Parque Egisto Ragazzo, Limeira - SP Limeira 4 Buin San Martin Nº 174, Buin Santiago 31 Dicico M. Tito Av. Marechal Tito, 5.768, Itaim Paulista, São Paulo - SP São Paulo 5 SB Estación Arturo Prat Nº 117, San Bernardo Santiago 32 Dicico Indaiatuba R. Presidente Kennedy, 303, Cidade Nova I, Indaiatuba - SP Indaiatuba 6 Peñaflor Alcalde Luis Araya Cereceda Nº 4237, Peñaflor Santiago 33 Dicico Mauá Av. Governador Mário Covas Junior, 01, Centro, Maua - SP Mauá 7 Rengo Condell Nº 100 Rengo 34 Dicico Itu Av. Nove de Julho, 897, Loja 2, Bairro Jardim Padre Bento, Itu - SP Itu 8 Melipilla Avda. Serrano Nº 395, Melipilla Santiago 35 Dicico Mogi Guaçu Av. Mogi Mirim, 256, Centro, Mogi Guaçu - SP Mogi Guaçu 9 San Antonio Avda. Barros Luco Nº 1399 San Antonio 36 Dicico Guarapiranga Av. Guarapiranga, 881, Loja 1, Vila Socorro, São Paulo - SP São Paulo 10 Talagante Cordillera Caletera Los Aromos Nº 0441, Talagante Santiago 37 Dicico Santo André R. Antonio Cardoso, 536, SUC B, Bangu, Santo Andre - SP Santo André 11 Puente Alto Avda. Concha Y Toro Nº 1477, Puente Alto Santiago 38 Dicico Santa Bárbara R. do Ósmio, 915, Comércio 01, Sitio Geriva, Santa Barbara D'Oeste Santa Barbara d'Oeste 12 Nataniel Nataniel Cox Nº 620, Santiago Santiago 39 Dicico Arujá Av. João Manoel, 1150, Aruja Centro Residencial, Aruja - SP Arujá 13 La Calera Prolongacion Perez Nº 12010 La Calera 40 Dicico Fernão Dias Rod. Fernão Dias, Km 87, Parque Edu Chaves, São Paulo - SP São Paulo 14 Pedro Fontova Pedro Fontova Nº 5810, ConchalÍ Santiago 41 Dicico Guarujá Balsa Av. Adhemar de Barros, 1531, Vila Santa Rosa, Guarujá - SP Guarujá 15 Antofagasta Mall Balmaceda Nº 2355 Antofagasta 42 Dicico Caraguatatuba Av. Rio Branco, 450, Indaia, Caraguatatuba - SP Caraguatatuba 16 Plaza Oeste Avda.Americo Vespucio Nº 1501, Cerrillos Santiago 43 Dicico Poá Rod. João Afonso de Souza Castellano, 141, Loja 1, Vila Lucia, Poá - SP Poá 17 Puente Alto Eyzag. Eyzaguirre Nº 105, Puente Alto Santiago 44 Dicico São Carlos Av. Getúlio Vargas, 157, Vila Lutfalla, São Carlos - SP São Carlos 18 La Florida Avda. Americo Vespucio Nº 7310, La Florida Santiago 45 Dicico Guaianases Est. Itaquera Guianases, 2000, D, Jardim Helena, São Paulo - SP São Paulo 19 Antofagasta Centro Condell Nº 2639-2645 Antofagasta 46 Dicico S.J.Campos Av. Engenheiro Francisco José Longo, 1595, Loja 1, Jardim São Dimas, São José dos Campos - SP São José dos Campos 20 Kennedy Avda. Kennedy Nº 5601, Las Condes Santiago 47 Dicico Jundiaí Av. Antônio Frederico Ozanan, 6080, Loja 1, Vila Rio Branco, Jundiaí - SP Judiaí 21 Colina Avda.Concepcion Nº 47, Colina Santiago 48 Dicico Sumaré Av. José Mancini, 350, Orestes Ongaro, Jardim São Carlos, Sumaré - SP Sumaré 22 Alameda Av. Libertador Bernardo O'Higgins N° 3470, Estación Central Santiago 49 HC Sodimac Tamboré Alameda Araguaia 1801, Sitio Tamboré, Barueri - SP Barueri 23 El Bosque Gran Avenida, José Miguel Carrera Nº 10375, El Bosque Santiago 50 HC Sodimac Ribeirao Preto Av. Fábio Barreto 263, Vila Tibério, Ribeirão Preto - SP Ribeirão Preto 51 HC San Jose Los Campos Rodovia Presidente Dutra, KM 155, Jardim das Indústrias, São José dos Campos - SP São José dos Campos 52 HC Sodimac Guarulhos R. Bartolomeu Gusmão, 316, Lote QD 20/26 Portaria A, Jardim Santa Francisca, Guarulhos - SP Guarulhos 53 HC Sodimac Anchieta AVMD Anchieta, S/N KM 11,5 Bloco A, Jardim Santa Cruz (Sacoma), São Paulo - SP São Paulo WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 143
Supermarkets Chile
N° Stores Address City N° Stores Address City 1 El Monte Los Libertadores Nº 316, El Monte Santiago 45 Ovalle Prolongación Calle Benavente Nº 1075, Local 200 Ovalle 2 Talagante Plaza EyzaguirreNº 715, Talagante Santiago 46 Quilpué Av. Freire Nº 120 Quilpué 3 SB Plaza O'Higgins Nº 550, San Bernardo Santiago 47 Concón Av. Manantiales N° 955 Concón 4 Buin San Martin Nº 174, Buin Santiago 48 Walker Martínez Walker Martínez Nº 3600, La Florida Santiago 5 SB Estación Arturo Prat Nº 117, San Bernardo Santiago 49 Mallplaza Copiapó Maipú N°109, Lote B Copiapó 6 Peñaflor Alcalde Luis Araya Cereceda Nº 4237, Peñaflor Santiago 50 Reñaca Av. Vicuña Mackenna 1050, local N°1; Reñaca Bajo Viña del Mar 7 Rengo Condell Nº 100 Rengo 51 Chamisero Av. Chamisero, Lote A8, Local N° 1, Colina Santiago 8 Melipilla Avda. Serrano Nº 395, Melipilla Santiago 52 Vivaceta Av. Fermin Vivaceta Nº 1018-1030, Independencia Santiago 9 San Antonio Avda. Barros Luco Nº 1399 San Antonio 53 Copiapó Los Carrera Av. Los Carrera N°4723 Copiapó 10 Talagante Cordillera Caletera Los Aromos Nº 0441, Talagante Santiago 54 Maitencillo Via F-30 e, Esquina Calle San Isidro, Local N°1, Maitencillo, Puchuncavi Maitencillo 11 Puente Alto Avda. Concha Y Toro Nº 1477, Puente Alto Santiago 55 Talca Colín Av. Colín Nº 0665 Talca 12 Nataniel Nataniel Cox Nº 620, Santiago Santiago 56 Cerro Blanco Av. Recoleta N°888, Recoleta Santiago 13 La Calera Prolongacion Perez Nº 12010 La Calera 57 Quillota Las Palmas Av. Condel 1687 - local A3, Quillota Quillota 14 Pedro Fontova Pedro Fontova Nº 5810, ConchalÍ Santiago 58 Ciudad Empresarial Av. Del Parque 4722, Local 22, Huechuraba Santiago 15 Antofagasta Mall Balmaceda Nº 2355 Antofagasta 59 Coquimbo Av. Alessandri 1117, Coquimbo Coquimbo
16 Plaza Oeste Avda.Americo Vespucio Nº 1501, Cerrillos Santiago 60 Quilicura Av Libertador Bernardo Ohiggins 800, Local 1 Santiago Annual Report | 5. Corporate Information 17 Puente Alto Eyzag. Eyzaguirre Nº 105, Puente Alto Santiago 61 Vitacura Alderete Av. Vitacura 6980, Vitacura Santiago 18 La Florida Avda. Americo Vespucio Nº 7310, La Florida Santiago 62 La Cisterna Gran Avenida 8988, Local 1, La Cisterna Santiago 19 Antofagasta Centro Condell Nº 2639-2645 Antofagasta 63 Los Domínicos Av. Padre Hurtado 875, Las Condes Santiago 20 Kennedy Avda. Kennedy Nº 5601, Las Condes Santiago 64 Los Andes Av. Santa Teresa 680 Local 1, Los Andes Santiago 21 Colina Avda.Concepcion Nº 47, Colina Santiago 65 Piedra Roja Av. Chicureo S/N, Lote 14 A-4, Colina Santiago 22 Alameda Av. Libertador Bernardo O'Higgins N° 3470, Estación Central Santiago 66 Balmaceda Balmaceda 2.885, Sector La Pampa, La Serena La Serena 23 El Bosque Gran Avenida, José Miguel Carrera Nº 10375, El Bosque Santiago 67 Los Ángeles Alemania Av. Alemania 831 Local N°1, Los Ángeles. Los Ángeles 24 San Fernando Av. Carampangue Nº 681 San Fernando 25 Padre Hurtado Camino San Alberto Hurtado N° 2436, Padre Hurtado Santiago Supermarkets Peru 26 San Felipe Av. Libertador Bernardo O'Higgins N° 1150 San Felipe 27 Talca Calle 4 Norte N°1530 Talca N° Stores Address City 28 Peñalolén Av. Tobalaba Nº 11.201, Peñalolen Santiago 1 Megaplaza Alfredo Mendiola Nº 3698, Centro Comercial Mega Plaza, Independencia Lima 29 Catedral Catedral Nº 1850, Santiago Santiago 2 Las Begonias Av.Las Begonias Nº 785, - Urb. Jardín, San Isidro Lima 30 Machalí Avda. San Juan Nº 133, Machalí Machalí 3 La Marina Av. La Marina Nº 2355 Urb Maranga - 1era Etapa Ancla 2 - San Miguel Lima 31 Santa Julia Avda. Alessandri Nº 4025 Viña del Mar 4 Atocongo Av. Circunvalacion Nº 1803 Tienda Ancla Nº2 San Juan de Miraflores Lima 32 Calama Mall Mall Balmaceda Nº 2902 Calama 5 Huaylas Av Defensores del Morro Nº 1350, Chorrillos Lima 33 Calama Centro Centro Avda. Granaderos Nº 3651 Calama 6 Trujillo 1 Av. Mansiche S/N - Caserio Cortijo Trujillo 34 Huechuraba Santa Marta de Huechuraba Nº 7300, Huechuraba Santiago 7 Chiclayo 1 Victor Raul Haya de la Torre 150 - 250 - Urb. San Eduardo - Tienda Ancla 1 Chiclayo 35 Llolleo Av. Los Aromos Nº 318 Llolleo, Comuna de San Antonio Llolleo 8 Quilca Av. Lima Nº 4208, Urb. Bocanegra, Provincia Constitucional del Callao Lima 36 Bío Bío Avda. Los Carrera Poniente Nº 301, Concepción Biobío 9 Saenz Peña Calle Castilla Nº 496, Provincia Constitucional del Callao Lima 37 Chillán Ecuador Nº 599 Chillán 10 Canta Callao Carretera Canta Callao Nº 378 , Calle Castilla 496, Provincia Constitucional del Callao Lima 38 Rancagua Centro Cuevas Nº 405 Rancagua 11 Lima Centro Av. Tacna Nº 665 - Cercado de Lima Lima 39 Vicuña Mackenna Av. Vicuña Mackenna Nº 665, Santiago Santiago 12 El Agustino Av. Ancash Nº 2479, El Agustino Lima 40 Mallplaza Tobalaba Avda. Camilo Henríquez Nº 3692, Local H100 Puente Alto Santiago 13 Puente Piedra Av. Puente Piedra Sur Nº 322 - Alt. Km 30 Panamericana Norte - Puente Piedra Lima 41 Los Ángeles Mendoza Nº 535 Los Ángeles 14 Trujillo 2 Av. America Norte Nº 1245 Urb. Los Jardines Open Plaza Trujillo Trujillo 42 Vitacura Avda. Vitacura Nº 9019, Vitacura Santiago 15 Bellavista Av. Oscar R.Benavides Nº 3866 (SM 1) Bellavista - Callao Lima 43 El Trébol Av. Jorge Alessandri Nº 3177 Talcahuano 16 Ica Av. San Martin Nº 763 Ica 44 Plaza Egaña Av. Larrain Nº 5862, Local H100, La Reina Santiago WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 145
Supermarkets Peru
N° Stores Address City N° Stores Address City 17 Pachacútec Av. Prolong. Pachacutec Nº 6321, Tablada de Lurin Zona 4 Villa Maria del Triunfo Lima 50 Huaral Av. Chancay km. 8. 5 Huaral Lima 18 Zorritos Av. Colonial Nº 1291, 1293 - Jr. Zorritos Nº 1504, 1548, 1552 Lima 51 Huacho Avenida Moore, Nº 213-215, Huacho, Provincia de Huaura, Departamento de Lima Lima 19 La Fontana Av. La Fontana Nº 790, Urb. La Rivera de Monterrico II Etapa La Molina Lima 52 HB Guardia Civil Av. Guardia Civil Mza M Lote 13 – La Campiña - Chorrillos Lima 20 Angamos Av. Angamos Este Nº 1803 - Esq Tomas Marsano y Angamos Este - Surquillo Lima 53 Lima Sur Av. Los Lirios Nro. 301 Urb. Entel Peru - San Juan de Miraflores Lima 21 Tusilagos Av. Los Tusilagos Oeste Nº 281 Urb. Los Jardines de San Juan Sector 3 San Juan de Lurigancho Lima 54 HB Chincha Cal. Leopoldo Carrillo Nro. 0 – Chincha Alta – Ica Chincha 22 Piura Av. Andrés Avelino Cáceres Nº 147 Sector 1B Tda Ancla 2 - Urb. Miraflores - Castilla Piura 55 HB Pisco Calle Comercio 700 - Pisco Ica 23 Arequipa Cayma Av. Ejercito Nº 793, Arequipa Cayma Arequipa 56 HB Barrios Altos Jr. Huanuco 925 - Cercado de Lima Lima 24 Arequipa Porongoche Av. Porongoche N° 500, Distrito de Paucarpata Arequipa 57 HT Piura Norte Av. Sanchez Cerro N° 3264 – Interior 101, distrito de 26 de Octubre, Piura Piura 25 Próceres Av. Los Próceres N° 1030, Santiago de Surco Lima 58 Tottus Huancayo Av. Ferrocarril esquina con Prolongación San Carlos S/N Sector 14 Huancayo 26 Jockey Plaza Av. Javier Prado EsteNº 4010, Urb. Fundo Monterrico Chico, Santiago de Surco Lima 59 Villa el Salvador Mza. D Lote. 3 - Zona Agropecuaria (Frente Mercado Unicachi ) Villa El Salvador, Lima Lima 27 HB Chiclayo Belaúnde y Lora Av. Fernando Belaunde Terry Nº 685 - Urb La Primavera Chiclayo 60 Cusco La Cultura Av. De la Cultura 1617, Cusco Cusco 28 Campoy Av. Prolongación Malecón Checa, con A.D.V Villa Mercedes, con calle 5 Manzana L Sub lote 1-1A* Lima 61 HB Chulucanas Av. Ramón Castilla N°1480 Chulucanas Morropón - Piura Piura 29 Chincha Esquina Av. Massaro con esquina Mariscal Castilla - Chincha Alta - Chincha - Ica* Ica 62 HB Ica Panamericana Urb. San Joaquín Sub Lote 2A - C Ica Ica 30 Chimbote Av. Panamericana Norte 505 MZ. B Lote. 1A-1-A2 Chimbote - Santa - Ancash Chimbote 63 Comandante Espinar Av. Comandante Espinar 719 - Miraflores Lima 31 Santa Anita Z.I. A - B Carretera Central N° 135, Santa Anita Lima 64 Dominicos Av. Tomás Valle 3305 Callao Lima Annual Report | 5. Corporate Information 32 Los Olivos Av. Alfredo Mendiola Nº 5810, Los Olivos Lima 65 HB Sullana Maestro Calle Jorge Chavez N° 131 – Mz. A2, Sub Lote A – A.H. Santa Teresita - Sullana Sullana 33 Chiclayo San José Av. Luis Gonzales N° 881 Chiclayo 66 HB Trujillo Piérola Av. Nicolás de Piérola N° 1971, Urb. La Esperancita - Trujillo Trujillo 34 Cañete Av. Mariscal Benavides N° 1000 - San Vicente de Cañete - Cañete - Lima Cañete 67 HB Ica La Tingüiña Av. Rio de Janeiro 361, Distrito de La Tingüiña - Ica Ica 35 Av. Central Av. Canta Callao N° 3005 - S.M.P. (Mz. G lote 3 - Urb. Huertos del Naranjal) Lima 68 HB Huacho Panam. Norte Ex. Panamericana Norte 1320 Santa María, Huacho Lima 36 HB Chiclayo Leguía Av. Saenz Peña N° 1771 - Chiclayo Cercado Chiclayo 69 HB Nicolas Dueñas Av. Nicolás Dueñas 475, Cercado de Lima Lima 37 Pacasmayo Av. Gonzalo Ugaz Salcedo N° 23 Pacasmayo 38 Arequipa Parra Av. Parra N° 218 - 218A - 220 Arequipa 39 Sullana Av. Panamericana N° 445 esq. Ca. Santo Toribio N° 160 Sullana 40 Pucallpa Av. Centenario Nº 2086, Yarinacocha - Coronel Portillo Pucallpa 41 San Luis Av San Luis Av. San Luis Mz. A Lote 1 Urb. San Borja Centro (Ficha registral) Lima 42 Miraflores Av. 28 de Julio Nº 1045, Miraflores (Centro comercial Paso 28 de Julio) Lima 43 HB Puente Piedra Av. Leoncio Prado Nº 1916 - Puente Piedra - Lima Lima 44 Chepén Carretera Panamericana Nº 715 - 721 Chepén 45 Huánuco Jr. 2 de Mayo Nº 125 - Huánuco Lima 46 HB Huaycán Av. Los Incas Nº 205 Mz. A Lt. 7 Ex. Av. Circunvalacion - Ate Huaycan 47 Cajamarca OP Jr. Cinco Esquinas S/N C/Av. Via De Evitamiento Cajamarca 48 San Hilarión Av San Hilarion Este Nº 150-180 Urb. San Hilarion SJ Lurigancho (temporal) Lima 49 Molicentro Av. 7 Nº 510 - El Suace - Rinconada - La Molina Lima WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 147
Summarized Information about Corporate Structure Subsidiaries
100% S.A.C.I FALABELLA INVERSIONES PARMIN SpA A. Direct subsidiaries
INVERSIONES PARMIN SPA: Inversiones Falabella Ltda 99.9% INVERSIONES PARMIN SpA is a per share corporation incorporated under Chilean Law, whose paid-in capital is the sum of $222,934,223 Chilean pesos. S.A.C.I Fala- bellla is owner of 100% of the stock, without any changes during 2018. Nueva Falabella Dinalsa Falabella Desarrollos Home Falabella Inversiones SpA Retail S.A. Inmobiliarios S.A. Trading S.A. Inversiones Internacional 100.0% Financieras 99.5% 100% 86.1% Purpose SpA S.A. 99.9% 99.9% Investment in all sorts of material and immaterial assets, real estate or personal
property; in transferable securities, bonds, Annual Report | 5. Corporate Information Sociedad Promotora CMR debentures, promissory notes or any other Sodimac Totttus de Rentas Fallabela S.A. 42.17% commercial financial documents; as well Falabella S.A. S.A. S.A. as their operation and administration; the 99.9% 99.9% 88.0% Promotora CMR participation in all types of companies, civil Inversiones S.A. 99.9% and commercial, whether collective or lim- ited, and may concur as a limited partner or Plaza S.A. Imperial Hipermercados Administradora de manager in the latter, public, per shares or Tottus S.A. 59.3% S.A. Servicios y 60.0% limited liability, whichever their purpose. 99.9% Sistemas Automarizados Falabella Ltda. 91.0% Administration Viajes Falabella Corresponds to S.A.C.I. Falabella Limitada 92.0% Class A Proxies:
Servicios e Seguros • Mr. Carlo Solari Donaggio inversiones Falabella Corredores Falabella Ltda. • Mr. Sandro Solari Donaggio 99.5% Ltda. 99.9% • Mr. Juan Carlos Cortés Solari Administradora de ServiciosComp. y de • Mr. Gaston Botazzini Crédito CMR Falabella Ltda. 91.0% INVERSIONES PARMIN SPA Promotora Banco CMR Falabella Falabella S.A. Year 2018 Year 2017 99.9% 57.83% M$ M$ Total Assets 1,620,338 2,229,884 CF Seguros de Total Liabilities 152 470,298 Vida S.A. 90.0% Total Equity 1,620,186 1,759,586 Net Income 253,926 312,922 Change in Equity -139,400 207,096 Net cash and cash equivalents increase (reduction) 1 3 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 149
INVERSIONES FALABELLA LTDA. Purpose Administration Sodimac Colombia INVERSIONES FALABELLA LTDA. is a lim- ited liability company incorporated under Invest in all types of stock, bonds, deben- Corresponds to S.A.C.I. Falabella. Year 2018 Year 2017 Chilean Law, whose paid-in capital is the tures, shares or rights in corporations un- Class A Proxies: M$ M$ sum of $1,591,303,049,224 Chilean pesos. der any title and/or personal property and Total Assets 487,504,755 445,299,705 S.A.C.I. Falabella is the owner of approxi- other yielding personal property, being • Mr. Carlo Solari Donaggio Total Liabilities 263,988,183 227,429,459 mately 99.98% of the stock, and the rest is able to manage those assets, undertake property of Inversiones Parmin SpA. During investments in all sorts of real estate and • Mr. Sandro Solari Donaggio Total Equity 223,516,572 217,870,246 2018, the company increased its capital as the operation and leasing to obtain yields Net Income 39,045,790 39,331,092 stated in a public deed dated December 26, of all those assets. To fulfill its purpose, the • Mr. Juan Cortés Solari Change in Equity 5,646,326 18,723,095 2018, without implying significant changes company may conduct all types of opera- Ownership interest of SACI 49% 49% to the ownership structure. tions and enter into all types of contracts, • Mr. Gaston Botazzini Participation of the asset in the Company 1.41% 1.52% and in general, conduct all necessary acts that the managers may deem appropriate.
SERVICIOS FINANCIEROS INVERSIONES FALABELLA LTDA. Board an administration • Mr. Helder Mao de Ferro SORIANA, S.A.P.I. DE C.V., SOFOM, E.N.R.
Directors: • Mr. Jorge Benlloch Sanz Annual Report | 5. Corporate Information Year 2018 Year 2017
M$ M$ Servicios Financieros Soriana S.A.P.I. de C.V., • Mr. Carlo Solari Donaggio (Chairman) • Mr. Francisco Ramírez Díaz Total Assets 15,835,127,739 14,485,751,837 Sofom, E.N.R. is a stock corporation that Total Liabilities 9,985,200,701 9,004,582,072 promotes investment in variable capital, • Mr. Sandro Solari Donaggio • Mr. Rodrigo Jesús Benet Cordova Total Equity 5,849,927,038 5,481,169,765 financial company with multiple purposes, Net Income 542,839,977 556,196,189 non-regulated entity, incorporated under • Mr. Gaston Bottazzini the Mexican Law, whose paid-in capital is Chief Executive Officer: Change in Equity 368,757,273 797,516,327 the sum of $15,427,748 Mexican pesos. • Mr. Ricardo Martin Bringas Net cash and cash equivalents increase (decrease) 145,660,736 (80,454,487) S.A.C.I. Falabella is directly the owner of • Mr. Ricardo Zimerman 50% of the stock, without any changes • Mr. Alberto Martín Soberón during 2018. B. Direct Associates • Mr. Ismael Humberto Fayad Wolff Summarized Purpose SODIMAC COLOMBIA S.A. Alternate Directors: commercialization of agricultural goods and Alternate Directors: Grant all sorts of loans and of any nature Sodimac Colombia S.A. is a public com- or seeds for sowing, surveillance and secu- and documented in accordance with ap- • Mr. Juan Manuel Matheu pany incorporated under Colombian rity equipment, as well as all supplementary • Mr. Daniel Echavarría Arango plicable regulation, with or without guar- Law, whose paid-in capital is the sum of services to the aforementioned activitides. antees, with or without interest, bullet or • Mr. Jordi Gaju Nicolau $29,975,000,000 Colombian pesos. S.A.C.I. • Mr. José Eugenio Muñoz Menéndez amortizing, even by issuing credit cards in Falabella is the owner of approximately Board and management accordance with contracts to open checking 49% of the stock, without any changes • Mr. Rodrigo Agustín Fajardo Zilleruelo account credits. during 2018. • Mr. Álvaro Andres Echavarría Olano • Mr. Sergio Muñoz Gómez SERVICIOS FINANCIEROS SORIANA S.A.P.I. DE C.V. SOFOM, E.N.R.: Summarized Purpose • Mr. Julio Manuel Ayerbe Muñoz Chief Executive Officer: Year 2018 Year 2017 Puchase, sale, distribution, manufactur- • Mr. Gaston Bottazzini M$ M$ ing, production, import, export, transport • Mr. Miguel Pardo Brigard and commercialization of goods, products, • Mr. Enrique Gundermann Wylie Total Assets 57,413,835 32,958,130 suitable for use or human consumption Total Liabilities 29,759,002 3,261,302 or animal consumption, including within Total Equity 27,654,833 29,696,828 these all types of fish, pets and animals, Net Income (10,826,112) 599,942 goods, machinery, and services oriented to Change in Equity (2,041,995) - construction, decoration, remodeling, im- provement and home improvement sectors, Ownership interest of SACI 50.0% 50.0% Asset participation in the Company 0.17% 0.21% WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 151
Subsidiaries with Participation
OWNERSHIP INTEREST SOCIEDAD DISTRIBUIDORA DE Develop and build stores that sell any sort of • Mr. Carlo Solari Donaggio Participation CHILEAN ID FUNCTIONAL over total assets goods and services, in one or the other case, COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY MEJORAMIENTO DEL HOGAR Y NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- CONSTRUCCIÓN S.A.P.I. DE C.V.: directly or indirectly, through the vehicles or • Mr. Gaston Bottazzini % % % % dual Dec-18, % companies that the Company establishes or Sociedad Distribuidora de Mejoramiento in which it participates for those purposes, • Mr. Enrique Gundermann Wylie 76.020.391-2 INVERSIONES FALABELLA 99.989 0.011 100 100 CHILE CLP 71.05% LTDA del Hogar y Construcción S.A.P.I. de C.V., is through the construction or improvement a stock corporation that promotes invest- of any type of building, being able to sell, Alternate Directors: 76.020.385-8 INVERSIONES PARMIN SpA 100 - 100 100 CHILE CLP 0.02% ment in variable capital incorporated under without being limited to, vehicles related to 0-E FALABELLA SUCURSAL 100 - 100 100 URUGUAY CLP 0.08% the Mexican Law, whose paid-in capital is hardware stores and tools, wood products, • Mr. Jorge Benlloch Sanz URUGUAY S.A. the sum of $150,100,000 Mexican pesos. electricity and illumination and plumbing, 99.500.360-0 HOMETRADING S.A. - 100 100 100 CHILE CLP 7.48% S.A.C.I. Falabella is directly the owner of doors and windows, furniture, cookware • Mr. Francisco Ramírez Díaz 99.593.960-6 DESARROLLOS INMOBILIA- - 100 100 100 CHILE CLP 20.28% 50% of the stock, without any changes and tableware, painting and coating, bath- RIOS SpA. during 2018. room and kitchen, flooring, and gardening. • Mr. Ismael Humberto Fayad Wolff 0-E FALLBROOKS PROPERTIES - 99.999 99.999 99.999 I.V. CLP 0.08% LTD BRITÁNICAS Summarized Purpose Board an administration • Mr. Jordi Gaju Nicolau 99.556.170-0 SOCIEDAD DE RENTAS - 100 100 100 CHILE CLP 5.05% Directors: FALABELLA S.A. Promotion, organization, acquisition, consti- • Mr. Daniel Lazo Varas 76.882.330-8 NUEVOS DESARROLLOS S.A. - 45.94 45.94 45.94 CHILE CLP 7.35% (EX-PLAZA ALAMEDA S.A.)
tution, sale or administration of commercial • Mr. Ricardo Martin Bringas (Chairman) Annual Report | 5. Corporate Information businesses, civil or commercial companies, • Mr. Sebastián Simonetti 99.555.550-6 PLAZA ANTOFAGASTA S.A. - 59.278 59.278 59.278 CHILE CLP 1.18% escrows or any other entity, with or without • Mr. Alberto Martin Soberón 76.882.090-2 PLAZA CORDILLERA S.A. - 45.94 45.94 45.94 CHILE CLP 0.37% legal personality, and in accordance with Chief Executive Officer: 96.653.660-8 PLAZA DEL TRÉBOL SpA - 59.278 59.278 59.278 CHILE CLP 7.11% the laws of any jurisdiction. • Mr. Rodrigo Jesús Benet Cordova 96.795.700-3 PLAZA LA SERENA SpA - 59.278 59.278 59.278 CHILE CLP 1.59% • Mr. Patricio Silva 96.653.650-0 PLAZA OESTE SpA - 59.278 59.278 59.278 CHILE CLP 12.50% 76.017.019-4 PLAZA S.A. - 59.278 59.278 59.278 CHILE CLP 24.50% 76.034.238-6 PLAZA SpA. - 59.278 59.278 59.278 CHILE CLP 0.00% SERVICIOS FINANCIEROS SORIANA S.A.P.I DE C.V. SOFOM E.N.R. 96.791.560-2 PLAZA TOBALABA SpA. - 59.278 59.278 59.278 CHILE CLP 1.30% 76.677.940-9 PLAZA VALPARAÍSO S.A. - 45.94 45.94 45.94 CHILE CLP -0.03% Year 2018 Year 2017 96.538.230-5 PLAZA VESPUCIO SpA. - 59.278 59.278 59.278 CHILE CLP 4.72% M$ M$ 79.990.670-8 ADMINISTRADORA PLAZA - 59.272 59.272 59.272 CHILE CLP 1.58% Total Assets 76,014,468 11,468,224 VESPUCIO S.A. Total Liabilities 72,465,845 3,221,230 76.883.720-1 DESARROLLOS E INVER- - 59.278 59.278 59.278 CHILE CLP 1.71% SIONES INTERNACIONALES Total Equity 3,548,623 8,246,994 SpA. Net Income (13,285,169) (4,383,778) 99.564.380-4 DESARROLLOS URBANOS - 45.94 45.94 45.94 CHILE CLP 0.96% Change in Equity (4,698,371) 3,677,319 SpA. Ownership interest of SACI 50.0% 50.0% 76.299.850-5 INVERSIONES PLAZA LTDA. - - - 59.278 CHILE CLP 0.00% (EX INV. ALCALÁ) Asset participation in the Company 0.02% 0.06% 76.044.159-7 AUTOPLAZA SpA. - 59.278 59.278 59.278 CHILE CLP 0.10% 96.792.430-K SODIMAC S.A. - 100 100 100 CHILE CLP 3.71% 99.556.180-8 SODIMAC TRES S.A. 100 100 100 CHILE CLP 0.01% 96.681.010-6 TRAINEEMAC S.A. 100 100 100 CHILE CLP 0.01% 76.054.094-3 INVERSIONES SODMIN SpA 100 100 100 CHILE CLP 0.00% 76.054.151-6 TRAINEEMAC S.A. 100 100 100 CHILE CLP 0.01% 76.821.330-5 IMPERIAL S.A. 60 60 60 CHILE CLP 0.53% 76.222.370-8 SERVICIOS GENERALES 100 100 100 CHILE CLP 0.01% BASCUÑÁN LTDA 76.644.120-3 APORTA SpA 100 100 100 CHILE CLP 0.00% 76.046.439-2 APYSER SpA 100 100 100 CHILE CLP 0.11% WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 153
OWNERSHIP INTEREST Participation OWNERSHIP INTEREST Participation CHILEAN ID FUNCTIONAL over total assets CHILEAN ID FUNCTIONAL over total assets COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- % % % % dual Dec-18, % % % % % dual Dec-18, % 76.662.120-1 CERRO COLORADO LTDA 88 88 88 CHILE CLP 0.00% 96.951.230-0 INMOBILIARIA MALL CALA- 59.278 59.278 59.278 CHILE CLP 1.00% MA SpA 96.579.870-6 SERVICIOS GENERALES 100 100 100 CHILE CLP 0.00% FALABELLA RETAIL SpA 0-E SHEARVAN CORPORATE S.A. 100 100 100 I.V. BRITÁNICAS USD 0.08% 76.012.536-9 SERVICIOS GENERALES 100 100 100 CHILE CLP 0.00% 76.042.371-8 NUEVA FALABELLA INVER- 100 100 100 CHILE CLP 27.54% MULTIBRAND SpA SIONES INTERNACIONALES SpA 76.557.960-0 SERVICIOS GENERALES 88 88 88 CHILE CLP 0.00% TOTTUS LTDA 96.647.930-2 INVERSIONES INVERFAL 100 100 100 CHILE CLP 27.67% PERÚ SpA 76.383.840-4 SERVICIOS GENERALES 100 100 100 CHILE CLP 0.00% PRESERTEL SpA 76.023.147-9 NUEVA INVERFIN SpA 100 100 100 CHILE CLP 2.47% 76.035.886-K PRESTADORA DE SERVICIOS 100 100 100 CHILE CLP 0.00% 76.007.317-2 INVERCOL SpA - 100 100 100 CHILE CLP 0.00% TELEFÓNICOS SpA 0-E INVERSORA FALKEN S.A. - 100 100 100 URUGUAY CLP 0.08% 78.334.680-K SERVICIOS GENERALES 100 100 100 CHILE CLP 0.00% 0-E TEVER CORP. - 100 100 100 URUGUAY CLP 0.08% ZONA I SpA 0-E INVERSIONES FALABELLA - 99.999 99.999 99.999 ARGENTINA ARS 0.08% 78.636.190-7 SERVICIOS GENERALES 100 100 100 CHILE CLP 0.00% ARGENTINA S.A. ZONA II SpA 0-E FALABELLA S.A. - 99.999 99.999 99.999 ARGENTINA ARS 0.08% 78.738.460-9 TRANSPORTES Y DISTRIBU- 100 100 100 CHILE CLP 0.00% CIONES SpA 0-E CMR FALABELLA S.A. - 99.999 99.999 99.999 ARGENTINA ARS 0.08% 78.919.640-0 TRANSPORTES Y DISTRIBU- 100 100 100 CHILE CLP 0.00% 0-E VIAJES FALABELLA S.A. - 99.999 99.999 99.999 ARGENTINA ARS 0.08% CIONES DEL SUR SpA 0-E CENTRO LOGÍSTICO APLICA- - 99.999 99.999 99.999 ARGENTINA ARS 0.08% 78.745.900-5 TRASCIENDE LTDA 100 100 100 CHILE CLP 0.00% DO S.A. Annual Report | 5. Corporate Information 76.042.509-5 INVERSIONES Y PRESTACIO- 100 100 100 CHILE CLP 0.90% 0-E SERVICIOS DE PERSONAL - 99.999 99.999 99.999 ARGENTINA ARS 0.08% NES VENSER SEIS LTDA LOGÍSTICO S.A. 76.046.445-7 CONFECCIONES INDUSTRIA- 100 100 100 CHILE CLP 0.29% 0-E INVERSIONES FALABELLA - 99.999 99.999 99.999 COLOMBIA COP 0.08% LES SpA DE COLOMBIA S.A. 96.573.100-8 MANUFACTURAS DE VES- 100 100 100 CHILE CLP 0.30% 0-E FALABELLA COLOMBIA S.A. - 65 65 65 COLOMBIA COP 0.08% TUARIO MAVESA LTDA 0-E AGENCIA DE SEGUROS - 65 65 65 COLOMBIA COP 0.08% 76.039.672-9 DINALSA SpA 100 100 100 CHILE CLP 1.06% FALABELLA LTDA 78.627.210-6 HIPERMERCADOS TOTTUS 88 88 88 CHILE CLP 1.04% 0-E AGENCIA DE VIAJES Y TU- - 65 65 65 COLOMBIA COP 0.08% S.A. RISMO FALABELLA S.A.S. 78.722.910-7 TOTTUS S.A. 88 88 88 CHILE CLP 0.98% 0-E ABC DE SERVICIOS S.A.S. - 65 65 65 COLOMBIA COP 0.08% 76.046.433-3 FALABELLA INVERSIONES 100 100 100 CHILE CLP 11.31% 0-E FALABELLA PERÚ S.A.A. - 99.758 99.758 99.758 PERÚ PEN 0.08% FINANCIERAS S.A. 0-E SAGA FALABELLA S.A. - 97.799 97.799 97.799 PERÚ PEN 0.08% 90.743.000-6 PROMOTORA CMR FALABE- 99.996 99.996 99.996 CHILE CLP 6.33% LLA S.A. 0-E HIPERMERCADOS TOTTUS - 99.758 99.758 99.758 PERÚ PEN 0.08% S.A. 77.612.410-9 ADESSA LTDA 100 100 100 CHILE CLP 0.54% 0-E SODIMAC PERÚ S.A. - 99.758 99.758 99.758 PERÚ PEN 0.08% 79.598.260-4 ADMINISTRADORA CMR 100 100 100 CHILE CLP -0.19% FALABELLA LTDA 0-E OPEN PLAZA S.A.C. - 99.758 99.758 99.758 PERÚ PEN 0.08% 77.235.510-6 SERVICIOS DE EVALUACIO- 100 100 100 CHILE CLP 0.00% 0-E VIAJES FALABELLA S.A. - 97.799 97.799 97.799 PERÚ PEN 0.08% NES Y COBRANZAS SEVALCO 0-E CORREDORA DE SEGUROS - 99.758 99.758 99.758 PERÚ PEN 0.08% LTDA FALABELLA S.A.C. 76.027.825-4 PROMOCIONES Y PUBLICI- 100 100 100 CHILE CLP 0.00% 0-E FALABELLA SERVICIOS - 99.759 99.759 99.759 PERÚ PEN 0.08% DAD LIMITADA GENERALES S.A.C. 78.566.830-8 SOC. DE COBRANZAS LEGA- 100 100 100 CHILE CLP 0.02% 0-E FALABELLA SERVICIOS - 99.759 99.759 99.759 PERÚ PEN 0.08% LES LEXICOM LTDA CENTRALES S.A.C. 96.847.200-3 SERVICIOS E INVERSIONES 100 100 100 CHILE CLP 0.21% 0-E INMOBILIARIA KAINOS S.A.C. - 99.758 94.758 99.758 PERÚ PEN 0.08% FALABELLA LTDA 77.099.010-6 SEGUROS FALABELLA 100 100 100 CHILE CLP 0.02% CORREDORES LTDA 76.512.060-8 SOLUCIONES CREDITICIAS 100 100 100 CHILE CLP 0.01% CMR LTDA 78.997.060-2 VIAJES FALABELLA LTDA 100 100 100 CHILE CLP 0.05% 77.261.280-K FALABELLA RETAIL S.A. 100 100 100 CHILE CLP 3.08% 76.000.935-0 PROMOTORA CHILENA DE 65 65 65 CHILE CLP 0.08% CAFÉ COLOMBIA S.A. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 155
OWNERSHIP INTEREST Participation OWNERSHIP INTEREST Participation CHILEAN ID FUNCTIONAL over total assets CHILEAN ID FUNCTIONAL over total assets COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- % % % % dual Dec-18, % % % % % dual Dec-18, % 0-E LOGÍSTICA Y DISTRIBUCIÓN - 99.758 99.758 99.758 PERÚ PEN 0.08% 0-E INVERSIONES FALABELLA - 100 100 100 URUGUAY UYU 0.08% S.A.C. URUGUAY S.A. 0-E INVERSIONES CORPORATI- - 99.758 99.758 99.758 PERÚ PEN 0.08% 0-E HOMECENTER SODIMAC - 100 100 100 URUGUAY UYU 0.08% VAS BETA S.A.C. S.A. 0-E INVERSIONES CORPORATI- - 99.758 99.758 99.758 PERÚ PEN 0.08% 0-E JOSMIR S.A. - 100 100 100 URUGUAY UYU 0.08% VAS GAMMA S.A.C. 76.335.739-2 INVERSIONES MÉXICO SpA - 100 100 100 CHILE CLP -0.29% 96.509.660-4 BANCO FALABELLA S.A. - 100 100 100 CHILE CLP 7.30% 76.282.188-5 INVERFAL BRASIL SpA - 100 100 100 CHILE CLP -1.74% 0-E BANCO FALABELLA PERÚ - 99.759 99.759 99.759 PERÚ PEN 0.08% 0-E SAGA FALABELLA IQUITOS - 97.799 97.799 97.799 PERÚ PEN 0.08% S.A. S.A.C. 0-E BANCO FALABELLA S.A. - 65 65 65 COLOMBIA COP 0.08% 0-E SAGA FALABELLA ORIENTE - 97.799 97.799 97.799 PERÚ PEN 0.08% (COLOMBIA) S.A.C. 0-E SALÓN MOTOR PLAZA S.A. - 59.278 59.278 59.278 PERÚ PEN 0.08% 0-E CONSTRUDECOR S.A.(1) - 100 100 64.981 BRASIL BRL 0.08% 76.011.659-9 BANCO FALABELLA CORRE- - 100 100 100 CHILE CLP 0,01% 0-E CONSTRUDECOR SERVICIOS - 100 100 65.016 BRASIL BRL 0.08% DORES DE SEGUROS LTDA LTDA.(1) 0-E SERVICIOS INFORMÁTICOS - 99.759 99.759 99.759 PERÚ PEN 0.08% 0-E CONSTRUDECOR PROPER- - 100 100 65.051 BRASIL BRL 0.08% FALABELLA S.A.C. TIES LTDA.(1) 76.141.045-8 INVERSIONES INVERFAL - 100 100 100 CHILE CLP 1.75% 0-E SEGUROS FALABELLA PRO- - 99.999 99.999 99.999 ARGENTINA ARS 0.08% COLOMBIA SpA DUCTORES S.A. 76.141.046-6 INVERSIONES INVERFAL - 100 100 100 CHILE CLP -1.53% 76.327.698-8 SERVICIOS GENERALES FA- - 100 100 100 CHILE CLP 0.00% ARGENTINA SpA
LABELLA ZONA NORTE SpA Annual Report | 5. Corporate Information 76.153.987-6 ADMYSER SpA - 100 100 100 CHILE CLP 0.12% 0-E LILLE INVESTIMENTOS (1) - 100 100 65.016 BRASIL BRL 0.08% 76.153.976-0 CAPYSER SpA - 100 100 100 CHILE CLP 0.01% 0-E SHEARVAN PURCHASING - 100 100 100 INDIA INR 0.08% 0-E CENTRO COMERCIAL EL - - - 59.278 COLOMBIA COP 0.08% INDIA CASTILLO CARTEGENA S.A.S. 76.434.317-4 PROMOTORA INVERSIONES - 99.996 99.996 99.996 CHILE CLP 0.03% 0-E MALL PLAZA COLOMBIA - 59.278 59.278 59.278 COLOMBIA COP 0.08% S.A. S.A.S. 76.389.515-7 SERVICIOS GENERALES - 100 100 100 CHILE CLP 0.00% 0-E CENTRO COMERCIAL MANI- - - - 47.422 COLOMBIA COP 0.08% FALABELLA ZONA PONIENTE ZALES S.A.S. SpA 76.142.721-0 GIFT CORP SpA - 100 100 100 CHILE CLP 0.01% 0-E TIENDAS DEL MEJORA- - 99.758 99.758 99.758 PERÚ PEN 0.08% MIENTO DEL HOGAR S.A. (EX 76.149.308-6 INVERSIONES BRASIL SpA - 100 100 100 CHILE CLP -1.74% MAESTRO PERÚ S.A.) 76.159.664-0 INVERSIONES URUGUAY SpA - 100 100 100 CHILE CLP -0.35% 0-E MAESTRO PERÚ AMAZONIA - 99.758 99.758 99.758 PERÚ PEN 0.08% 76.159.684-5 INVERFAL URUGUAY SpA - 100 100 100 CHILE CLP -0.35% S.A.C. 0-E COMPAÑÍA SAN JUAN S.A.C. - 99.758 99.758 99.758 PERÚ PEN 0.08% 0-E INMOBILIARIA DOMEL S.A.C. - 99.758 99.758 99.758 PERÚ PEN 0.08% 76.308.853-7 NUEVA INVERFAL ARGEN- - 100 100 100 CHILE CLP 0.67% 0-E INDUSTRIAS DELTA S.A.C. - 99.758 99.758 99.758 PERÚ PEN 0.08% TINA SpA 0-E CENTRO COMERCIAL BA- - - - 38.531 COLOMBIA COP 0.08% 76.179.527-9 FALABELLA MÓVIL SpA - 100 100 100 CHILE CLP 0.09% RRANQUILLA S.A.S. 76.167.965-1 SERVICIOS LOGISTICOS - 100 100 100 CHILE CLP 0.04% 76.427.811-9 SERVICIOS DE INFRAES- - 100 100 100 CHILE CLP 0.00% SODILOG LTDA TRUCTURA FALABELLA SpA 76.201.304-5 RENTAS HOTELERAS SpA - 100 100 100 CHILE CLP -0.01% 76.477.116-8 CF SEGUROS DE VIDA S.A. - 90 90 90 CHILE CLP 0.24% 0-E CONTAC CENTER FALABE- - 99.759 99.759 99.759 PERÚ PEN 0.08% LLA S.A.C. 0-E OPEN PLAZA ORIENTE S.A.C. - 99.758 99.758 99.758 PERÚ PEN 0.08% 96.824.450-7 INMOBILIARIA MALL LAS - 45.143 45.143 45.143 CHILE CLP 0.33% AMÉRICAS S.A. 0-E SHEARVAN COMMERCIAL - 100 100 100 CHINA CNY 0,08% (SHANGAI) 0-E HIPERMERCADOS TOTTUS - 99.758 99.758 99.758 PERÚ PEN 0.08% ORIENTE S.A.C. 0-E SODIMAC PERÚ ORIENTE - 99.758 99.758 99.758 PERÚ PEN 0.08% S.A.C. 76.319.068-4 INVERSIONES INDIA SpA - 100 100 100 CHILE CLP 0.00% 0-E FALABELLA BRASIL LTDA - 100 100 100 BRASIL BRL 0.08% 0-E SODIMAC BRASIL LTDA - 100 100 100 BRASIL BRL 0.08% WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 157
OWNERSHIP INTEREST Participation OWNERSHIP INTEREST Participation CHILEAN ID FUNCTIONAL over total assets CHILEAN ID FUNCTIONAL over total assets COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY COMPANY Dec 31, 2018 Dec 31, 2018 Dec 31, 2018 Dec 31, 2017 COUNTRY NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- NUMBER DIRECT INDIRECT TOTAL TOTAL CURRENCY of SACI Indivi- % % % % dual Dec-18, % % % % % dual Dec-18, % O-E GESTIONES INTEGRALES DE - 99.15 99.15 99.15 PERÚ PEN 0.02% O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% SERVICIOS S.A. SECHSTE VERWALTUNGS KG C/O ROCKET INTERNET O-E MALL PLAZA PERÚ S.A. - 86.265 86.265 86.265 PERÚ PEN 0.02% GMBH O-E GEMMA NEGOCIOS S.A.C. - 60.386 60.386 60.386 PERÚ PEN 0.02% O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% O-E INVERFAL MEXICO S.A. DE - 100 100 100 MEXICO MXN 0.02% SIEBTE VERWALTUNGS KG C.V. O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% 76.582.813-9 NUEVA INVERFAL MEXICO - 100 100 100 CHILE CLP -0.29% ACHTE VERWALTUNGS KG SpA O-E JADE 1364 GMBH & CO. NE- - 100 100 - ALEMANIA EUR 0.02% 76.587.847-0 FALABELLA SERVICIOS PRO- - 100 100 100 CHILE CLP 0.00% UNTE VERWALTUNGS KG FESIONALES DE TI SpA O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% 76.683.615-1 ASESORIAS Y EVALUACIÓN - 100 100 100 CHILE CLP 0.00% ZEHNTE VERWALTUNGS KG DE CRÉDITOS LTDA O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% O-E PATRIMONIO AUTONOMO - 59.278 59.278 - COLOMBIA COP 0.02% ELFTE VERWALTUNGS KG MALL PLAZA CALI O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% O-E PATRIMONIO AUTONOMO - 59.278 59.278 - COLOMBIA COP 0.02% ZWÖLFTE VERWALTUNGS CENTRO COMERCIAL CAR- KG TAGENA O-E JADE 1364 GMBH & CO. 13. - 100 100 - ALEMANIA EUR 0.02% O-E PATRIMONIO AUTONOMO - 47.424 47.424 - COLOMBIA COP 0.02% VERWALTUNGS KG CENTRO COMERCIAL MANI- O-E JADE 1364 GMBH & CO. 14. - 100 100 - ALEMANIA EUR 0.02% ZALES DOS VERWALTUNGS KG
O-E PATRIMONIO AUTONOMO - 38.532 38.532 - COLOMBIA COP 0.02% Annual Report | 5. Corporate Information O-E BAZAYA MEXICO S. DE R.L. - 100 100 - MÉXICO MXM 0.02% CENTRO COMERCAL BA- DE C.V. RRANQUILLA O-E LINIO MIAMI EXPORTS, INC. - 100 100 - EEUU USD 0.02% 76.788.282-3 DIGITAL PAYMENTS SpA - 100 100 100 CHILE CLP 0.00% O-E LINIO COLOMBIA S.A.S. - 100 100 - COLOMBIA COP 0.02% 76.803.189-4 INVERFAL INDIA SpA - 100 100 100 CHILE CLP 0.00% O-E LINIO PERU S.A.C. - 100 100 - PERÚ PEN 0.02% O-E TENERIFE EMPRENDIMIEN- - 100 100 100 BRASIL BRL 0.02% TOS E PARTICIPACOES LTDA O-E LINIO LATAM CORP. - 100 100 - PANAMÁ PAN 0.02% O-E FONDO DE CAPITAL - 59.278 59.278 - COLOMBIA COP 0.02% 76.212.492-0 INVERSIONES BAZAYA CHILE - 100 100 - CHILE CLP 0.00% PRIVADO MALL PLAZA DE LTDA. COLOMBIA O-E LINIO ARGENTINA S.R.L. - 100 100 - ARGENTINA ARS 0.02% O-E MALL PLAZA SERVICIOS - 100 100 100 COLOMBIA COP 0.02% O-E ECUAELECOMMERCE S.A. - 100 100 - ECUADOR ECU 0.02% S.A.S. O-E LINIO ASIA LIMITED - 100 100 - CHINA HKD 0.02% O-E MALL PLAZA INMOBILIARIA - 86.266 86.266 86.266 PERÚ PEN 0.02% S.A. O-E LINIO CONSULTING (SHEN- - 100 100 - CHINA CNY 0.02% ZHEN) CO.,LTD. O-E INVERSIONES FALABELLA - 99.758 99.758 99.758 PERÚ PEN 0.02% S.A.C. O-E FALABELLA CORPORATE - 100 100 100 INDIA INR 0.02% SERVICES INDIA PRIVATE LIMITED 76.899.941-4 INVERSIONES MKTP SPA - 100 100 - CHILE CLP 0.00% O-E NEW TIN LINIO I GMBH - 100 100 - ALEMANIA EUR 0.02% O-E TIN JADE GBMH - 100 100 - ALEMANIA EUR 0.02% O-E JADE 1364. GMBH - 100 100 - ALEMANIA EUR 0.02% O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% ERSTE VERWALTUNGS KG O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% ZWEITE VERWALTUNGS KG O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% DRITTE VERWALTUNGS KG O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% VIERTE VERWALTUNGS KG O-E JADE 1364 GMBH & CO. - 100 100 - ALEMANIA EUR 0.02% FÜNFTE VERWALTUNGS KG WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 159
TABLA Annual Report | 5. Corporate Information
Falabella Parque Arauco. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 161
Financial Statements are available to the public on the websites of the reporting entity and the Financial Markets Commission.
Management’s Discussion and Analysis
Consolidated revenues for 2018 were Consolidated EBITDA for 2018 decreased $9,236,259 million, a 3.4% increase com- 1.0%, reaching $1,213,960 million, with pared to the previous exercise, explained an EBITDA margin of 13.0%. mainly by the 20 new stores launched during the year (seven stores were closed Non-operating income recorded a loss during the period), by the increase in online of $150,789. Consolidated net income sales and the increase in loans in CMR reached $478,468 million, a 6.1% decrease in Chile. with respect to 2017, with a 5.2% net mar- gin. Consolidated net income does not The consolidated loan portfolio reached include the re-assessment of investment $5,018,641 million as of December 31, property assets, as the company adopted 2018, 7.3% larger compared to the same the historical cost method. date of the previous year. This expansion was fueled mainly by CMR Chile, Ban- During 2018, we inaugurated shopping co Falabella Chile and Banco Falabella centers in Arica in Chile and Manizales Colombia, with 11.0%, 4.8% and 41.2% in Colombia. In addition, 20 new stores Annual Report | 6. Summarized Consolidated Financial Statements increases (in local currency), respectively. were opened in the region. Falabella Re- tail opened three department stores (one Gross margin for the period was 36.7%, in Colombia and two in Chile). Sodimac while gross income reached $3,391,012 opened eight home improvement stores: million, increasing 2.8%. The increase in three in Chile;, three in Mexico; two in Summarized Consolidated gross income is due mainly to the perfor- Colombia; and one in Argentina. Tottus mance of the operations in Chile, Colombia opened eight supermarkets: three in Chile and Peru. and five in Peru.
Operating income reached $879,014 mil- Financial Statements lion, a 5.4% decline. This is due mainly to the performance of Department Stores in Chile and Argentina in general, which was partially compensated by the good performance of CMR Chile and the real Management's discussion Consolidated statements of estate businesses. and analysis comprehensive income Consolidated statements Consolidated statements of of financial position 3shareholders' equity Consolidated statements Consolidated statements of of comprehensive income cash flow (direct method) by function WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 163
Consolidated Statements of Financial Position
N° Dec-31-18 Dec-31-17 N° Dec-31-18 Dec-31-17 Note M$ M$ Note M$ M$
Assets Net equity and liabilities Non-Banking Businesses (Presentation) Non-banking businesses (Presentation) Current assets Current liabilities Cash and cash equivalents 3 352,100,505 232,027,185 Other financial liabilities, current 18 990,064,907 834,648,234 Other financial assets, current 4 25,831,939 16,161,447 Trade and other accounts payable, current 19 1,129,345,048 1,085,467,329 Other non-financial assets, current 5 127,043,970 109,045,269 Accounts payable to related companies, current 7 15,308,531 7,636,329 Trade and other accounts receivable, current 6 2,049,771,504 1,965,407,382 Other provisions, current 20 54,553,693 14,296,634 Accounts receivable from related companies, current 7 60,013,844 8,568,867 Tax liabilities, current 9 33,639,010 37,030,912 Inventory 8 1,410,494,616 1,238,138,783 Employee benefits provisions, current 21 146,754,253 138,464,318 Current tax assets 9 88,499,062 76,587,049 Other non-financial liabilities, current 22 162,987,699 162,716,905 Total current assets other than disposable assets or groups of assets classified as available for sale or held for 4,113,755,440 3,645,935,982 Total current liabilities 2,532,653,141 2,280,260,661 distribution to owners Non-current liabilities Non-current assets or disposable groups of assets classified as available for sale or held for distribution to 2 ,16 17,371,457 10,866,456 owners Other financial liabilities, non-current 18 2,806,585,586 3,006,175,090 Non-current assets or disposable groups of assets classified as available for sale or held for distribution to 17,371,457 10,866,456 Trade and other accounts payable, non-current 19 1,089,919 1,081,931 owners Other provisions, non-current 20 9,324,355 11,045,759 Total current assets 4,131,126,897 3,656,802,438 Deferred tax liabilities 10 591,757,849 568,622,314 Non-current assets Employee benefits provisions, non-current 21 45,630,958 32,997,676 Other financial assets, non-current 4 105,525,159 65,197,065 Other non-financial liabilities, non-current 22 55,124,675 45,681,427 Other non-financial assets, non-current 5 95,232,966 74,750,007 Total non-current liabilities 3,509,513,342 3,665,604,197 Trade and other accounts receivable, non-current 6 298,849,318 275,089,053 Total liabilities other than baking businesses liabilities 6,042,166,483 5,945,864,858 Investments accounted for using the equity method 11 135,735,296 138,296,518 Liabilities Banking Businesses (Presentation) Intangible assets other than goodwill 12 303,352,066 279,330,294 Deposits and other demand liabilities 639,081,704 543,154,221 Annual Report | 6. Summarized Consolidated Financial Statements Goodwill 13 632,457,101 504,394,517 Cash items in process of being cleared 3 46,413,806 15,139,196 Property, plant and equipment 14 2,725,671,484 2,544,923,700 Time deposits and other time liabilities 23 2,538,382,394 1,987,726,066 Investment properties 15 2,972,046,449 2,908,777,208 Financial derivative contracts 87,064,300 31,181,315 Tax assets, non-current 9 16,341,601 - Interbank borrowings 24 78,714,860 81,391,043 Deferred tax assets 10 190,054,669 148,118,365 Issued debt instruments 25 268,117,240 242,256,771 Total non-current assets 7,475,266,109 6,938,876,727 Other financial liabilities 25 112,289,216 130,641,388 Total assets other than banking businesses assets 11,606,393,006 10,595,679,165 Current taxes 9 91,904 - Banking Business Assets (Presentation) Provisions 20 11,609,125 1,669,445 Cash and deposits in Banks 3 275,984,373 225,800,376 Other liabilities 26 67,449,182 68,126,678 Cash items in process of collection 3 57,290,605 21,370,300 Total liabilities banking businesses 3,849,213,731 3,101,286,123 Trading investments 3 148,258,611 71,182,626 Total liabilities 9,891,380,214 9,047,150,981 Financial derivative contracts 88,101,263 26,600,918 Net equity Loans and accounts receivable from customers, net 6 2,823,447,682 2,590,709,808 Share capital 34 919,419,389 533,409,643 Available for sale investments 16 658,887,042 657,507,389 Retained earnings 4,421,138,544 4,183,008,108 Investments in associates and other companies 11 3,179,466 2,861,251 Share premium 34 93,482,329 93,482,329 Intangibles 12 68,260,141 60,658,539 Treasury shares -44,808,966 -27,042,749 Fixed assets 14 41,050,857 33,933,667 Other reserves 34 -321,368,626 -383,842,804 Current taxes 9 5,214,005 7,766,383 Equity attributable to shareholders 5,067,862,670 4,399,014,527 Deferred taxes 10 24,924,698 16,036,209 Non-controlling interest 919,494,553 894,442,977 Other assets 17 77,745,688 30,501,854 Total shareholders’ equity 5,987,357,223 5,293,457,504 Total banking business assets 4,272,344,431 3,744,929,320 Total liabilities and shareholders’ equity 15,878,737,437 14,340,608,485 Total assets 15,878,737,437 14,340,608,485 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 165
Net income attributable to: Consolidated Statements of Comprehensive Income by Function Net income attributable to shareholders 32 478,468,376 509,593,496 Net income attributable to non-controlling interests 65,259,002 49,310,698 Total net income 543,727,378 558,904,194 Jan-01 -18 Jan-01 -17 N° Dec-31 -18 Dec-31 -17 Earnings per share Note M$ M$ Basic earnings per share Income Statement Basic earnings per share from continuing operations 32 0,19 0,21 Non-banking businesses (Presentation) Basic earnings per share 0,19 0,21 Operating revenues 27 8,483,577,333 8,209,851,510 Diluted earnings per share Cost of sales 28 -5,508,545,374 -5,296,642,965 Diluted earnings per share from continuing operations 32 0,19 0,21 Gross margin 2,975,031,959 2,913,208,545 Diluted earnings per share 0,19 0,21 Distribution costs -115,829,431 -96,735,311 Administration expenses 29 -1,946,931,176 -1,847,408,431 Other expenses, by function 31 24,079,804 3,289,726 Other income (losses) 37,280,766 15,113,935 Financial income 30 -181,505,280 -195,372,181 Consolidated Statements of Comprehensive Income Financial expenses 11 7,092,186 15,279,304 Share of net income (losses) of associated and joint businesses accounted for under the equity method -15,793,359 -466,040 Jan-01-18 Jan-01-17 Comprehensive Income Statement Dec-31-18 Dec-31-17 Exchange differences 30 -22,494,868 -17,264,195 M$ M$ Income before income taxes 618,525,741 640,330,711 Consolidated net income 543,727,378 558,904,194 Income tax expense 10 -152,653,830 -159,920,613 Components of other comprehensive income that will not be reclassified to income for the year, before tax Net income from non-banking businesses 465,871,911 480,410,098 Actuarial losses for defined benefit plans, before tax -9,299,135 -1,510,130 Banking business (Presentation) Other comprehensive income that will not be reclassified to income for the year -9,299,135 -1,510,130 Interest income 27 598,968,122 580,503,510 Components of other comprehensive income that will be reclassified to income for the year, before tax Interest expense 28 -123,592,686 -131,789,244 Currency translation Net interest income 475,375,436 448,714,266 Currency translation gain (loss), before tax 113,736,888 -112,117,633 Fee and commission income 27 151,585,276 144,686,063 Other comprehensive income, before tax, currency translation 113,736,888 -112,117,633 Annual Report | 6. Summarized Consolidated Financial Statements Fee and commission expenses 28 -46,909,811 -40,914,588 Gain (loss) on re-measurement of financial assets available for sale, before tax -789,764 -822,980 Net fee and commission income 104,675,465 103,771,475 Other comprehensive income, before tax, financial assets available for sale -789,764 -822,980 Net income (expense) from financial operations 20,658,479 5,013,585 Cash flow hedges Net foreign exchange gain -8,982,788 5,549,303 Gain (loss) from cash flow hedges, before tax -31,777,502 4,044,508 Other operating income 2,128,723 1,377,030 Other comprehensive income, before tax, cash flow hedges -31,777,502 4,044,508 Provisions for loan losses 28 -177,873,734 -178,991,294 Other components of other comprehensive income which will be reclassified to income for the year, before tax 81,169,622 -108,896,105 Net operating profit 415,981,581 385,434,365 Income tax related to components of other comprehensive income Personnel salaries and expenses 29 -110,207,176 -100,447,175 Income tax related to defined benefit plans in other comprehensive income 2,510,791 417,480 Administrative expenses 29 -154,941,600 -138,010,605 Total income tax related to components of other comprehensive income that will not be reclassified to income for the 2,510,791 417,480 year Depreciations and amortizations 29 -21,175,299 -19,762,997 Income tax related to components of other comprehensive income Other operating expenses 29 -20,509,182 -17,374,480 Income tax related to financial assets available for sale in other comprehensive income 213,236 210,277 Total operating expenses -306,833,257 -275,595,257 Income tax related to cash flow hedges in other comprehensive income 8,615,471 -1,008,123 Operating income 109,148,324 109,839,108 Total income tax related to components of other comprehensive income 8,828,707 -797,846 Income from investments in associates and other companies 11 551,214 469,655 Total other comprehensive income 83,209,985 -110,786,601 Income before tax 109,699,538 110,308,763 Total comprehensive income 626,937,363 588,221,041 Income tax expense 10 -31,844,071 -31,814,667 Comprehensive income attributable to Net income from banking businesses 77,855,467 78,494,096 Comprehensive income attributable to shareholders 562,286,415 408,436,551 Total net income 543,727,378 558,904,194 Comprehensive income attributable to non-controlling interest 64,650,948 39,681,042 Total comprehensive income 626,937,363 448,117,593 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 167
Consolidated Statements of Shareholders' Equity, Dec. 2018
Gains or losses on Treasury shares Actuarial gains or Foreign currency re-measurement Other Share capital Cash flow hedge losses on defined Other Accumulated gains Equity attributable Non-controlling Share capital translation of financial assets miscellaneous Total equity premium reserves benefits plans reserves (losses) to shareholders interest reserves available for sale reserves (Note 21.d) reserves reserves
Opening balance as of 01/01/2018 533,409,643 93,482,329 -27,042,749 -249,687,237 -28,860,865 -8,744,314 2,007 -96,552,395 -383,842,804 4,183,008,108 4,399,014,527 894,442,977 5,293,457,504 Reduction due to application of new accounting rules -55,396,466 -55,396,466 -581,684 -55,978,150 Modified opening balance 533,409,643 93,482,329 -27,042,749 -249,687,237 -28,860,865 -8,744,314 2,007 -96,552,395 -383,842,804 4,127,611,642 4,343,618,061 893,861,293 5,237,479,354 Changes in equity Comprehensive income Net income for the year ------478,468,376 478,468,376 65,259,002 543,727,378 Other comprehensive income - - - 113,538,882 -22,359,520 -6,788,384 -572,939 - 83,818,039 - 83,818,039 -608,054 83,209,985 Comprehensive income - - - 113,538,882 -22,359,520 -6,788,384 -572,939 - 83,818,039 478,468,376 562,286,415 64,650,948 626,937,363 Equity issue 386,009,746 ------386,009,746 6,716,847 392,726,593 Dividends ------106,417,696 -106,417,696 -11,266,365 -117,684,061 Increase (decrease) due to transfers and ------23,484,284 -23,484,284 -78,523,778 -102,008,062 -34,468,170 -136,476,232 other changes Increase (decrease) due to transactions - - -17,766,217 - - - - 2,140,423 2,140,423 - -15,625,794 - -15,625,794 in treasury shares Total equity changes 386,009,746 - -17,766,217 113,538,882 -22,359,520 -6,788,384 -572,939 -21,343,861 62,474,178 293,526,902 724,244,609 25,633,260 749,877,869 Closing balance as of 31/12/2018 919,419,389 93,482,329 -44,808,966 -136,148,355 -51,220,385 -15,532,698 -570,932 -117,896,256 -321,368,626 4,421,138,544 5,067,862,670 919,494,553 5,987,357,223 Annual Report | 6. Summarized Consolidated Financial Statements Consolidated Statements of Shareholders' Equity, Dec. 2017
Gains or losses on Treasury shares Actuarial gains or Foreign currency re-measurement Other Share capital Cash flow hedge losses on defined Accumulated gains Equity attributable Non-controlling Share capital translation of financial assets miscellaneous Other reserves Total equity premium reserves benefits plans (losses) to shareholders interest reserves available for sale reserves (Note 21.d) reserves reserves
Opening balance as of 01/01/2017 533,409,643 93,482,329 -35,125,632 -146,884,310 -32,209,059 -7,651,577 611,482 -97,649,976 -283,783,440 3,872,333,532 4,180,316,432 868,040,688 5,048,357,120 Changes in equity Comprehensive income Net income for the year ------509,593,496 509,593,496 49,310,698 558,904,194 Other comprehensive income - - - -102,802,927 3,348,194 -1,092,737 -609,475 - -101,156,945 - -101,156,945 -9,629,656 -110,786,601 Comprehensive income - - - -102,802,927 3,348,194 -1,092,737 -609,475 - -101,156,945 509,593,496 408,436,551 39,681,042 448,117,593 Equity issue ------6,924,284 6,924,284 Dividends ------109,162,192 -109,162,192 -7,873,118 -117,035,310 Increase (decrease) due to transfers and ------1,182,958 -1,182,958 -89,756,728 -90,939,686 -12,329,919 -103,269,605 other changes Increase (decrease) due to transactions - - 8,082,883 - - - - 2,280,539 2,280,539 - 10,363,422 - 10,363,422 in treasury shares Total equity changes - - 8,082,883 -102,802,927 3,348,194 -1,092,737 -609,475 1,097,581 -100,059,364 310,674,576 218,698,095 26,402,289 245,100,384 Closing balance as of 31/12/2017 533,409,643 93,482,329 -27,042,749 -249,687,237 -28,860,865 -8,744,314 2,007 -96,552,395 -383,842,804 4,183,008,108 4,399,014,527 894,442,977 5,293,457,504 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 169
Consolidated Statements of Cash Flows (Direct Method)
Jan-01-18 Jan-01-17 Cash Flow Statement - Direct Method Dec-31-18 Dec-31-17 M$ M$ Cash flow statement Banking businesses (Presentation) Cash flows provided by (used in) operating activities Net increase of instruments available for sale -1,920,294 -92,016,465 Non-Banking businesses (Presentation) Acquisitions of fixed assets -33,036,205 -33,890,115 Proceeds from operating activities Dividends received 503,392 527,972 Proceeds from the sale of goods and services 9,900,628,400 9,600,223,865 Other cash proceeds 443,055 447,989 Payments for operating activities Subtotal net cash flows used in investment activities from banking businesses -34,010,052 -124,930,619 Payments to suppliers for goods and services -7,710,610,192 -7,392,342,971 Net cash flows used in investment activities -570,796,158 -717,924,094 Payments to and on behalf of employees -1,097,083,781 -1,045,665,138 Income tax paid -192,063,303 -154,680,844
Other cash payments -303,682,699 -209,188,043 Jan-01-18 Jan-01-17 Subtotal net cash flows provided by operating activities from non-banking businesses 597,188,425 798,346,869 Cash Flow Statement – Direct Method Dec-31-18 Dec-31-17 M$ M$ Banking businesses (Presentation) Cash flows provided by (used in) financing activities Consolidated net income 77,855,467 78,494,096 Non-banking businesses (Presentation) Charges (credits) to income that do not represent cash flows Proceeds from share issuance 397,209,317 6,924,284 Depreciation and amortization 21,175,299 19,762,997 Proceeds (payments) from the sale (acquisition) of shares of the Company -14,881,439 10,929,316 Provisions for loan losses 222,163,485 204,498,683 Proceeds from long-term loans 115,417,743 362,571,213 Net income from investment in companies with significant influence -551,214 -469,655 Proceeds from short-term loans 2,383,703,642 2,362,155,656 Other charges that do not represent cash flows 31,844,071 31,814,667 Total proceeds from loans 2,499,121,385 2,724,726,869 Net change in interest income and fee and commission income accrued on assets and liabilities 4,476,197 -6,403,651 Loan repayments -2,691,655,869 -2,622,413,341 Changes in assets and liabilities that affect operating cash flows Payment of financial lease liabilities -21,629,321 -18,352,153 Increase of loans and accounts receivables from customers -483,327,317 -171,296,527 Dividends paid -154,142,646 -215,061,388 Net (increase) decrease of instruments held for trading -63,143,345 -18,892,461 Interests paid -168,127,341 -166,699,508 Annual Report | 6. Summarized Consolidated Financial Statements Increase of deposits and other demand liabilities 95,927,483 115,453,966 Other cash payments -71,402,887 -2,967,781 (Decrease) increase of time deposits and other time liabilities 540,771,952 -23,320,615 Subtotal net cash flows used in financing activities from non-banking businesses -225,508,801 -282,913,702 (Decrease) increase of obligations with Banks -2,676,183 -35,332,205 Banking businesses (Presentation) Other cash payments -67,960,201 -20,717,617 Letters of credit redeemed -10,824,643 -7,023,624 Subtotal net cash flows provided by operating activities from Banking businesses 376,555,694 173,591,678 Issue (repayment) of bonds 25,860,469 -21,731,107 Net cash flows provided by operating activities 973,744,119 971,938,547 Other cash payments -7,771,804 -7,871,902 Cash flows provided by (used in) investment activities Subtotal net cash flows used in financing activities from banking businesses 7,264,022 -36,626,633 Non-banking businesses (Presentation) Net cash flows used in financing activities -218,244,779 -319,540,335 Cash flows used for the acquisition of subsidiaries or other businesses -87,420,365 - Net cash and cash equivalents increase (decrease), before exchange rate translation effects 184,703,182 -65,525,882 Contributions to subsidiaries -3,997,815 -25,737,222 Exchange rate translation effects over cash and cash equivalents Loans to related entities -38,220,224 - Exchange rate translation over cash and cash equivalents 9,749,830 -15,508,194 Proceeds from the sale of property, plant and equipment, and investment properties 86,782,388 2,251,308 Net increase (decrease) decrease in cash and cash equivalents 194,453,012 -81,034,076 Acquisitions of property, plant and equipment -362,589,652 -375,895,985 Cash and cash equivalents at beginning of the period 494,958,665 575,992,741 Acquisitions of intangible assets -55,153,317 -43,739,158 Cash and cash equivalents at the end of the period 689,411,677 494,958,665 Acquisitions of other long-term assets -100,630,655 -157,183,611 Dividends received 5,396,419 5,201,313 Interest received 19,629,721 15,541,228 Other cash payments -582,606 -13,431,348 Subtotal net cash flows used in investment activities from non-banking businesses -536,786,106 -592,993,475 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 171
Definition of Materiality
Within the framework of a transformation The identification of material issues and into a physical and digital ecosystem, in the development of this report have been which we seek an increasingly transversal prepared considering the methodology es- view of our capabilities, during 2018 we did, tablished by the Global Reporting Initiative for the first time, a corporate materiality (GRI) guidelines, in accordance with the study. We worked together with an inde- “Essential” conformity option of the GRI pendent consultant specialized in social and Standards guide. The indicators selected environmental management. Thus, during during 2018 comply with comparability the next years we will work on generating in terms of the information collected in strategic guidelines that enable us to focus 2017 and 2016. Some indicators omit the our investment priorities. required level of disaggregation for not having such detailed information on all our The materiality study is an independent subsidiaries. In most cases, detailed infor- analysis that seeks to identify the most mation is presented in the sustainability
relevant and critical issues for Falabella in reports of each business, which comply Sustainability GuidelinesAnnual Report | 7. terms of an ESG management. This analysis with the GRI Standards guide. constitutes a key tool for communicating with our stakeholders, internal as well as Identified issues are ranked under two crite- external, given that it allows us to learn ria: influence on our business and relevance about their real interests and concerns, as for our external stakeholders. well as their perceptions about where they believe we have the largest real or potential impact and in what areas is more important to take action. Sustainability Guidelines MATRIX DEVELOPMENT AND IDENTIFICATION OF ISSUES INTERNAL RELATIONSHIP EXTERNAL RELATIONSHIP VALIDATION
Review secondary information Understand internal perspec- Segment stakeholders by group Develop the first version of the to update the knowledge of the tives and compare the differ- or subgroup and consult them matrix and validate it with the external context. ences among businesses. in appropriate ways. team.
Steps Steps Steps Steps
Definition of Materiality 1. List of material issues 2A. Interviews with managers of 3. Specific interviews / Exter- 4A. Validation of the matrix 2. List of stakeholders key areas at S.A.C.I. Falabella nal surveys draft with management GRI Index in all businesses 4B. Final matrix with recom- 2B. Employee survey mendations Non-financial Audit Letter WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 173
Based on obtained results, a materiality matrix was determined, where the “y” axis cor- responds to the external perception and the “x” axis to the internal perception, regarding 21 issues identified as material. These issues were grouped into six main priorities, which allow us to advance in the creation of economic, social and environmental value, in line with our stakeholders.
3,80
2 6 9 8 4 1 11 13 3 3,40 12 10 15 14 5 7 19 18 16 21 7. Sustainability GuidelinesAnnual Report | 7. External perception 20 3,00
17
2,60 2,60 3,00 3,40 3,80
Internal perception
Exceed customer Develop our employees Social value expectations integrally creation
1. Data protection and privacy 6. Diversity and inclusion 8. Positive value creation 3. Offer adaptation and reaction capacity 7. Attract, retain and develop talent 14. Social regeneration and integration 5. Consumer experience 15. Employee wellbeing 20. Financial education 16. New dynamics in labor relations 17. Unifying purpose 19. Reconversion of work positions
Governance Manage our supply chain Manage our environmental impact
2. Business ethics 10. Responsible supplier management 13. Product quality management 4. Corporate governance 12. Local support and development 18. Environmental performance 9. Human rights 21. Climatic strategy 11. Stakeholder information transparency WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 175
GRI Index Material topics Exceed client expectations
GRI Standard Content Page Number Omission 103-1 Explanation of the material topic and its Boundaries 31
Fundaments 103-2 The management approach and its components 31
General Disclosures 103-3 Evaluation of the management approach 31 102-1 Name of the organization 109 GRI Standard Content Page Number Omission 102-2 Activities, brands, products and services 109 y 110 Exceed client expectations 102-3 Location of headquarters 109
102-4 Location of operations 10, 13, 17, 20 Data protection and privacy 102-5 Ownership and legal form 109 Client privacy Cybersecurity training 43 102-6 Markets served 10 a 21 102 Organization Profile Offer reaction and 102-7 Scale of the organization 23, 47, y 172 adaptation capacity
102-9 Supply chain 71 Client satisfaction 45 measurement 102-10 Significant changes to the organization and its supply chain 98, 121, y 147 Customer experience 102-11 Precautionary Principle or approach 62 y 73 Client satisfaction NPS 45 102-12 External initiatives 68 measurement
102-13 Membership of associations 70 Develop our employees 102 Strategy 102-14 Statement from senior decision-maker 4 integrally 7. Sustainability GuidelinesAnnual Report | 7. 102 Ethics and integrity 102-16 Values, principles, standards, and norms of behavior 62 a 66 103-1 Explanation of the material topic and its Boundaries 45
102 Governance 102-18 Governance structure 85 y 90 a 95 103-2 The management approach and its components 45
102-40 List of stakeholder groups 29 103-3 Evaluation of the management approach 45
102 Stakeholder 102-42 Identifying and selecting stakeholders 29 y 170 Diversity and inclusion engagement 102-43 Approach to stakeholder engagement 29 y 170 405 Diversity and Equal 405-1 Diversity of governance bodies and employees 47 y 48 102-44 Key topics and concerns raised 30 Opportunities 405-2 Ratio of basic salary and remuneration of women to men 46
102-45 Entities included in the consolidated financial statements 147 Attract, retain and develop talent 102-46 Defining report content and topic Boundaries 171 Disaggregation by category is omi- 102-47 List of material topics 30 404-1 Average hours of training per year per employee 52 tted. Information not available for 102-48 Restatements of information 171 404 Training and Education some businesses. Work is being 404-3 Percentage of employees receiving regular performance and career 52 done to obtain the information for 102-49 Changes in reporting 171 development reviews next year. 102-50 Reporting period 161 Employee wellbeing 102-51 Date of most recent report 161 102 Reporting practice Disaggregation by category is omi- 102-52 Reporting cycle 171 tted. Information not available for 403 Occupational Health 403-2 Hazard identification, risk assessment, and incident investigation 57 some businesses. Work is being 102-53 Contact point for questions regarding the report 109 and Safety done to obtain the information for next year. 102-54 Claims of reporting in accordance with the GRI Standards 170 New dynamics in labor 102-55 GRI context index 174 GRI Index relations
178 Non-financial Unionization Unionization rates 55 audit letter / 182 102-56 External assurance Consolidated Finan- Unifying Purpose cial Statements Values We are a team 9 y 45
Reconversion of Work Positions
Total number of hires and dismis- sals, disaggregated by age, gender and region is omitted. Information 401 Employment 401-1 New employee hires and employee turnover 53 not available, as we don't have sufficient coverage. Work is being done to obtain the information for next year. WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 177
GRI Standard Content Page Number Omission GRI Standard Content Page Number Omission
Social value creation Manage our impact on the environment
103-1 Explanation of the material topic and its Boundaries 58 103-1 Explanation of the material topic and its Boundaries 73
103-2 The management approach and its components 58 103-2 The management approach and its components 73
103-3 Evaluation of the management approach 58 103-3 Evaluation of the management approach 73
Positive value creation Product quality manage- ment Social investment 58 301 Materials 301-2 Recycled input materials used 73 Integration and social regeneration Environmental performance 413-1 Operations with local community engagement, impact assessments, and 413 Local Communities 59-61 Buildings Environmentally friendly constructions 76 development programs Renewable energy Renewable energy consumption 77 Financial education Efficient water usage New facilities 74 Financial education program 61 facilities Commitment on emissions 78 Governance Climatic strategy 103-1 Explanation of the material topic and its Boundaries 62
103-2 The management approach and its components 62 Sustainability GuidelinesAnnual Report | 7.
103-3 Evaluation of the management approach 62
Business ethics
205 Anti-corruption 205-2 Communication and training about anti-corruption policies and procedures 62
206 Anti-competitive 206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly 68 Behavior practices
Human Rights Information at a group level is omi- 412 Human Rights Assess- 412-1 Operations that have been subject to human rights reviews or impact 69 tted, since it does not apply. Work ments assessments is being done at a business level.
Manage our supply chain
103-1 Explanation of the material topic and its Boundaries 71
103-2 The management approach and its components 71
103-3 Evaluation of the management approach 71
Responsible supplier mana- gement
308 Supplier Environmental The classification of new ones is 308-1 New suppliers that were screened using environmental criteria 71 Assessment omitted, totals are shown.
414 Supplier Social Assess- The classification of new ones is 414-1 New suppliers that were screened using social criteria 71 ment omitted, totals are shown. Local support and develo- pment Local entrepreneurship and 61 employment fostering WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 179
1. Data review, covering key figures for the different business units at S.A.C.I. Falabella in Chile, Peru, Argentina, Brazil, Uruguay, Colombia, Mexico and India. . 2. General questions about data collection and monitoring systems to the contact responsible for the coordination of the evidence. 3. Execution of error verification routines in order to identify possible faults in the subjacent data. Independent Audit Letter for key Non-Financial Data 4. Discussion of specific questions regarding inconsistencies in the subjacent data with the owners of the relevant S.A.C.I. Falabella: ISAE 3000 declaration problems within each business area. Independence
Corporate Citizenship has worked with S.A.C.I. Falabella since 2014 in advisory projects related with the application to the Dow Jones Sustainability Index (DJSI), Materiality Study and implementation of the LBG framework for Social Impact measurement. Corporate Citizenship has previously provided verification Nature of the Assurance services to S.A.C.I. Falabella.
This is a report prepared by Corporate Citizenship for the Corporate Chief Financial Officer of S.A.C.I. Conclusion Falabella. Based on the scope of the work and the conducted assurance procedures, nothing draws our attention in Corporate Citizenship has conducted a limited audit of the non-financial data to be published in the Annual order to make us believe that the assured data was not prepared in accordance with the GRI Standards to Report of S.A.C.I. Falabella in accordance with the GRI Standards to determine Report quality. The following determine Report quality. non-financial data were covered: 7. Sustainability GuidelinesAnnual Report | 7. 1. Employees: occupational disease ratio; lost days ratio; headcount diversity; attrition ratio; and, training hours. 2. Community investment: money contributions; volunteering cost during paid hours; contributions in kind; and, administration expenses.
S.A.C.I. Falabella is entirely and completely responsible for the production and publication of the assured data, while Corporate Citizenship is responsible for its assurance.
This audit was conducted in accordance with the International Standard on Assurance Engagement (ISAE) 3000 (Assurance Engagements other than Audits or Reviews of Historical Financial Information).
Corporate Citizenship has complied with the requirements of independence, professional ethic and quality control established on the ISAE 3000.
Assurance Engagement
The assurance engagement was requested in February 2019, and was completed on April 3, 2019. Detailed Corporate Citizenship evidence was obtained from meetings and mail. A team of four people, led by a Senior Analyst, conducted the London assurance engagement and commentaries. A Director acted as advisor to the team. April 3, 2019
The scope of the assurance engagement included the following activities:
WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 181
Responsibility Statement
The Directors of S.A.C.I. Falabella and the Corporate Chief Executive Officer, signatories of this declaration, based on the information prepared by management, are responsible under oath for the information present- ed in this Annual Report. Annual Report | 8. Declaration of Responsibility
Responsibility Statement WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 183 9. ConsolidatedAnnual Report | 9. Financial Statements
Consolidated Financial Statements
M$ - Thousand Chilean pesos WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 185
TABLA 9. ConsolidatedAnnual Report | 9. Financial Statements WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26 WorldReginfo - 3ceb885d-0b8b-4e8e-a9ec-375109099b26