CONSOLIDATED FINANCIAL STATEMENTS for the Years Ended December 31, 2019 and 2018

CONSOLIDATED FINANCIAL STATEMENTS For the years ended December 31, 2019 and 2018

EMPRESAS CMPC S.A. AND SUBSIDIARIES In thousands of United States Dollars (ThUS$)

This document contents:

 Report of Independent Auditors  Consolidated Statement of Financial Position  Statement of Changes in Equity  Consolidated Statements of Comprehensive Income  Consolidated Statement of Cash Flows  Notes to the Consolidated Financial Statements

Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

INDEX

CONSOLIDATED STATEMENT OF FINANCIAL POSITION ...... 5

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY ...... 6

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME ...... 7

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ...... 15

2.1. Basis of preparation ...... 16

2.2. Basis of presentation ...... 16

2.3. Financial information by segment reporting ...... 17

2.4. Foreign currency transactions ...... 18

2.5. Business Combinations ...... 20

2.6. Property, plant and equipment ...... 21

2.7. Biological assets (forest plantations) ...... 22

2.8. Intangible assets ...... 23

2.9. Goodwill ...... 24

2.11. Financial instruments ...... 25

2.12. Hedging instruments ...... 26

2.13. Inventory ...... 28

2.14. Trade and other accounts receivable ...... 28

2.15. Cash and cash equivalents ...... 29

2.16. Issued capital ...... 29

2.17. Trade and other accounts payable ...... 29

2.18. Interest-bearing loans ...... 29

2.19. Current and deferred Income taxes ...... 30

2.20. Employee benefits ...... 30

2.21. Provisions ...... 31

2.22. Revenue recognition ...... 32

2.23. Leases ...... 33

2.24. Dividends distributed ...... 35

2 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

2.25. Environment ...... 35

2.26. Research and development ...... 35

2.27. Advertising expenses ...... 35

2.28. Earnings per share ...... 35

NOTE 3 –RISK MANAGEMENT ...... 36

NOTE 4 - ACCOUNTING ESTIMATES AND JUDGMENT ...... 48

NOTE 5 – CHANGES IN ACCOUNTING POLICIES ...... 51

NOTE 6 - NEW ACCOUNTING PRONOUNCEMENTS ...... 54

NOTE 7 - FINANCIAL SEGMENT REPORTING ...... 55

NOTE 8 – FINANCIAL ASSETS ...... 62

NOTE 9 - OTHER NON-FINANCIAL ASSETS...... 69

NOTE 10 - TRADE AND OTHER ACCOUNTS RECEIVABLE ...... 70

NOTE 11 - ACCOUNTS RECEIVABLE FROM RELATED PARTIES ...... 73

NOTE 12 - INVENTORY ...... 74

NOTE 13 – BIOLOGICAL ASSETS ...... 75

NOTE 15 – BUSINESS COMBINATIONS ...... 81

NOTE 17 - INTANGIBLE ASSETS OTHER THAN GOODWILL ...... 85

NOTE 18 - GOODWILL ...... 85

NOTE 19 - PROPERTY, PLANT AND EQUIPMENT ...... 86

NOTE 20 - LEASES ...... 90

NOTE 21 - DEFERRED TAXES ...... 94

NOTE 22 - OTHER FINANCIAL LIABILITIES...... 97

NOTE 23 - TRADE AND OTHER ACCOUNTS PAYABLE ...... 118

NOTE 24 - ACCOUNTS PAYABLE TO RELATED PARTIES ...... 121

NOTE 25 – PROVISIONS AND CONTINGENT ASSETS AND LIABILITIES...... 122

NOTE 26 - EMPLOYEE BENEFITS PROVISIONS ...... 129

NOTE 27 - OTHER NON-FINANCIAL LIABILITIES ...... 132

NOTE 28 - EQUITY ...... 133

NOTE 29 - REVENUE ...... 140

3 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

NOTE 30 - OTHER PROFIT (LOSS) ...... 142

NOTE 31 - FINANCE COSTS ...... 142

NOTE 32 - DIFFERENCES OF CHANGE OF ASSETS AND LIABILITIES IN FOREIGN CURRENCY ...... 143

NOTE 33 - INCOME TAX EXPENSE ...... 149

NOTE 34 - EXPENSES, BY NATURE ...... 152

NOTE 35 - COMMITMENTS ...... 152

NOTE 36 - SHAREHOLDER AND TRANSACTIONS WITH RELATED PARTIES ...... 153

NOTE 37 - CONSOLIDATED FINANCIAL STATEMENTS ...... 158

NOTE 38 - ENVIROMENT ...... 160

NOTE 39 - SUBSEQUENT EVENTS AFTER THE REPORTING PERIOD ...... 164

4 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

As of As of December December 31, 2019 31, 2018 Note N° ThUS$ ThUS$ Assets Current assets Cash and cash equivalents 8.1 615,038 967,504 Other financial assets 8.2 4,563 11,390 Other non financial assets 9 140,273 143,732 Trade and other accounts receivable 10.1 855,612 970,029 Accounts receivable from related parties 11 1,091 724 Inventory 12 1,280,141 1,264,442 Biological assets 13 321,317 326,637 Current tax assets 14 239,030 71,925 Total current assets 3,457,065 3,756,383 Non-current assets Other financial assets 8.3 14,278 21,172 Other non-financial assets 9 178,907 171,868 Non-current accounts receivable 10.3 39,053 38,319 Investments accounted for using the equity method 16 502 149 Intangible assets other than goodwill 17 125,250 32,366 Goodwill 18 250,513 104,459 Property, plant and equipment 19 7,808,616 7,695,455 Biological assets 13 3,041,258 3,073,955 Non-current current tax assets 14 940 5,411 Deferred tax assets 21 39,414 83,774 Total non-current assets 11,498,731 11,226,928 Total assets 14,955,796 14,983,311

Liabilities and shareholders' equity Liabilities Current liabilities Other financial liabilities 22 512,847 439,007 Liabilities for current operating leases 20 22,949 - Trade and other accounts payable 23 814,273 824,252 Accounts payable to related parties 24 1,005 1,707 Other current provisions 25 4,465 2,160 Current tax liabilities 14 24,804 114,244 Employee benefits provisions 26 76,580 66,433 Other non-financial liabilities 27 68,147 202,778 Total current liabilities 1,525,070 1,650,581 Non-current liabilities Other financial liabilities 22 3,432,197 3,436,223 Liabilities for non-current operating leases 20 168,762 - Other non-current provisions 25 8,605 9,232 Non-current tax liabilities 21 1,598,412 1,560,891 Employee benefits provisions 26 80,181 80,096 Other non-financial liabilities 27 6,994 2,270 Total non-current liabilities 5,295,151 5,088,712 Total liabilities 6,820,221 6,739,293 Shareholders' equity Issued capital 28.1 1,453,728 1,453,728 Retained earnings 28.3 7,154,299 7,157,302 Other reserves 28.2 (474,717) (369,195) Shareholders' equity attributable to owners of the parent 8,133,310 8,241,835 Non-controlling interest 28.5 2,265 2,183 Total shareholders' equity 8,135,575 8,244,018 Total liabilities and shareholders' equity 14,955,796 14,983,311

The accompanying notes are an integral part of the Consolidated Financial Statements.

5 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Actuarial Currency Cash flow profits or Equity translation translation (losses) on Other Retained attributable Issued differences differences defined benefit miscellaneous Other earnings to owners of Non-controlling Total capital reserve reserve plan reserves reserves reserves (losses) the parent interest equity Note 28.1 Note 28.2 Note 28.3 Note 28.5 ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ For the period ended as of December 31, 2019 Current period beginning balance 1/1/2019 1,453,728 (624,398) 29,439 (23,430) 249,194 (369,195) 7,157,302 8,241,835 2,183 8,244,018 Increase (decrease) due to changes in accounting policies ------(31,041) (31,041) - (31,041) Restated beginning balance 1,453,728 (624,398) 29,439 (23,430) 249,194 (369,195) 7,126,261 8,210,794 2,183 8,212,977 Changes in equity Comprehensive income Profit (loss) ------84,492 84,492 (101) 84,391 Other comprehensive income - (96,133) (2,209) (7,035) (145) (105,522) - (105,522) (14) (105,536) Comprehensive income - (96,133) (2,209) (7,035) (145) (105,522) 84,492 (21,030) (115) (21,145) Dividends ------(56,454) (56,454) - (56,454) Increase (decrease) due to transfers and other changes ------197 197 Total changes in equity - (96,133) (2,209) (7,035) (145) (105,522) 28,038 (77,484) 82 (77,402) Ending balance as of 12/31/2019 1,453,728 (720,531) 27,230 (30,465) 249,049 (474,717) 7,154,299 8,133,310 2,265 8,135,575

For the period ended as of December 31, 2018 Previous period beginning balance 1/1/2018 1,453,728 (534,777) 22,083 (21,010) 249,056 (284,648) 6,913,036 8,082,116 2,366 8,084,482 Increase (decrease) due to changes in accounting policies ------(4,780) (4,780) - (4,780) Restated beginning balance 1,453,728 (534,777) 22,083 (21,010) 249,056 (284,648) 6,908,256 8,077,336 2,366 8,079,702 Changes in equity Comprehensive income Profit (loss) ------502,502 502,502 (192) 502,310 Other comprehensive income - (89,621) 7,356 (2,420) 138 (84,547) - (84,547) (187) (84,734) Comprehensive income - (89,621) 7,356 (2,420) 138 (84,547) 502,502 417,955 (379) 417,576 Dividends ------(253,456) (253,456) - (253,456) Increase (decrease) due to transfers and other changes ------196 196 Total changes in equity - (89,621) 7,356 (2,420) 138 (84,547) 249,046 164,499 (183) 164,316 Ending balance as of 12/31/2018 1,453,728 (624,398) 29,439 (23,430) 249,194 (369,195) 7,157,302 8,241,835 2,183 8,244,018

The accompanying notes are an integral part of the Consolidated Financial Statements.

6 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the period ended as of December 31, 2019 2018 Note ThUS$ ThUS$ Income Statement, by function of expenditure Profit (loss) Revenue 29 5,670,277 6,274,472 Cost of sales (4,562,448) (4,480,693) Gross profit 1,107,829 1,793,779 Other income, by function 13 118,155 106,305 Distribution costs (247,731) (261,302) Administrative expenses (323,988) (286,399) Other expenses, by function (219,367) (219,036) Other losses 30 (70,284) (52,765) Operating profit 364,614 1,080,582 Finance income 20,703 19,006 Finance costs 31 (195,350) (215,970) Share in profit (loss) of associates and joint ventures accounted for using the equity 16 (9) 2 method Foreign currency translation differences 32 (8,801) (12,586) Gain from indexation units 32 40,105 9,163 Profit, before taxes 221,262 880,197 Income tax expense 33 (136,871) (377,887) Profit (loss) from continuing operations 84,391 502,310 Profit (loss) 84,391 502,310 Profit attributable to Profit (loss) attributable to owners of the parent 84,492 502,502 Profit (loss) attributable to non-controlling interest 28.5 (101) (192) Profit (loss) 84,391 502,310 Earnings per share Basic earnings per share Basic profit per share from continuing operations (US$ per share) 28.4 0.0338 0.2010 Basic profit per share from discontinuing operations (US$ per share) - - Basic profit per share 0.0338 0.2010 Diluted earnings per share Diluted profit per share from continuing operations (US$ per share) 28.4 0.0338 0.2010 Diluted profit per share from discontinuing operations (US$ per share) - - Diluted profit per share 0.0338 0.2010

The accompanying notes are an integral part of the Consolidated Financial Statements.

7 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (continued)

For the period ended as of December 31, 2019 2018 Note ThUS$ ThUS$ Comprehensive income statement Profit (loss) for the period 84,391 502,310 Other comprehensive income Components of other comprehensive income that will not be reclassified to income for the year, before taxes Other comprehensive income, before taxes, gain (loss) on new measurement of (8,758) (3,430) defined benefits plans Other comprehensive income (loss) that will not be reclassified to profit or (8,758) (3,430) loss before taxes Other comprehensive income that will not be reclassified to income for the year, before taxes Foreign currency translation differences Profit (loss) on foreign currency translation differences, before taxes (96,943) (85,974)

Other comprehensive income (loss), before taxes, foreign currency (96,943) (85,974) translation differences Cash flow hedging Profit (loss) on cash flow hedging, before taxes (3,636) 6,963

Other comprehensive income (loss), before taxes, cash flow hedging (3,636) 6,963 Share of other comprehensive income (loss) of associates and joint ventures accounted for using the equity method that will be reclassified to income for the (159) 9 period, before taxes Other comprehensive income (loss) that will be reclassified to income for the (100,738) (79,002) period, before taxes Income taxes related to components of other comprehensive income that will not be reclassified to income for the period Income taxes related to new measurements of defined benefits plans of other 1,723 1,010 comprehensive income (loss) Income taxes related to components of other comprehensive income (loss) 1,723 1,010 that will not be reclassified to income for the period Income taxes related to components of other comprehensive income that will be reclassified to income for the period Income tax related to exchange rate differences for the conversion of other 810 (3,705) comprehensive income (loss) Income tax related to cash flow hedges of other comprehensive income (loss) 1,427 393 Income taxes related to components of other comprehensive income (loss) 2,237 (3,312) that will be reclassified to income for the period Other comprehensive income (105,536) (84,734) Comprehensive income (loss) (21,145) 417,576

Comprehensive income attributable to: Comprehensive income (loss) attributable to owners of the parent (21,030) 417,955 Comprehensive income (loss) attributable to non-controlling interest (115) (379) Comprehensive income (loss) (21,145) 417,576

The accompanying notes are an integral part of the Consolidated Financial Statements.

8 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

CONSOLIDATED STATEMENT OF CASH FLOWS (DIRECT METHOD)

For the period ended as of December 31, 2019 2018 Note ThUS$ ThUS$ Statement of cash flows Cash flows provided by (used in) operating activities Proceeds from operating activities Proceeds from goods sold and services rendered 6,313,933 6,526,898 Proceeds of premiums and services, annuities and other obligations on policies 9,077 31,123 subscribed Other proceeds from operating activities 264,867 213,544 Payments to operating activities - - Payments to suppliers for goods and services (4,871,896) (4,675,237) Payments to and on account of employees (439,623) (452,737) Payments of premiums and services, annuities and other obligations on policies (30,420) (12,460) subscribed Other operating activity payments (196,062) (396,397) Net cash flows provided by (used in) operating activities 1,049,876 1,234,734 Income taxes paid (403,014) (228,426) Net cash flows provided by (used in) operating activities 646,862 1,006,308 Cash flows provided by (used in) investing activities Cash flows used to obtain control of subsidiaries or other businesses (341,320) - Proceeds from disposal of property, plant and equipment 94 31 Additions to property, plant and equipment (248,060) (294,926) Additions to intangible assets (3,998) (3,997) Additions to other non current assets (169,679) (84,579) Interest received 19,655 20,616 Other cash inflows (outflows) 30,244 2,227 Net cash flows provided by (used in) investing activities (713,064) (360,628) Cash flows provided by (used in) financing activities Proceeds from loans 602,178 587,739 Proceeds from non-current loans 22.3 207,319 418,388 Proceeds from current loans 22.3 394,859 169,351 Loans reimbursement 22.3 (493,431) (749,366) Financial lease payments 22.3 (18,720) (20,957) Dividends paid (202,883) (118,966) Interest paid 22.3 (166,084) (185,779) Net cash flows provided by (used in) financing activities (278,940) (487,329) Net increase (decrease) in cash and cash equivalents, before the effect of changes in (345,142) 158,351 the exchange rate Effects of changes in the exchange rate on cash and cash equivalents - - Effects of changes in the exchange rate on cash and cash equivalents (7,324) (23,601) Net increase in cash and cash equivalents (352,466) 134,750 Cash and cash equivalents at beginning of the period 8 967,504 832,754 Cash and cash equivalents at the end of the period 8 615,038 967,504

The accompanying notes are an integral part of the Consolidated Financial Statements.

(1) Includes ThUS$28,930 associated to Cash and cash equivalents of Papelera Panamericana S.A. and Sepac - Serrados e Pasta e Celulose Ltda. at the date of acquisition through Business Combination (see Note 15).

9 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2019 AND 2018

NOTE 1 - CORPORATE INFORMATION

Empresas CMPC S.A., the parent company, was incorporated in Chile in 1920 with a legal form of a Corporation (S.A.) and is subject to the Chilean Corporations Act (Law No. 18,046 dated October 22nd of 1981). Empresas CMPC S.A. is listed in the Chilean Financial Markets Commission (hereinafter the “CMF” in Spanish) under number 0115. For Chilean tax purposes, its tax identification number is 90.222.000-3.

The Company is controlled by the Matte Group by having a direct and indirect share interest through its investments in Empresas CMPC S.A. Please see Note 36 for the list of shareholders of the Company.

The head office of Empresas CMPC S.A. is domiciled at Agustinas 1343, Santiago, Chile, telephone (56-2) 24412000.

CMPC along with its consolidated subsidiaries (collectively, the “CMPC” or “Empresas CMPC”) is one of the leading forestry companies in Latin America and participates in multiple segments within that industry. Its production and commercial activities are carried out across three business segments: Pulp, Biopackaging and Softys. The Company is responsible for strategic management of the subsidiaries and provides administrative, financial support services and relationship with external entities.

The Company has over 688,000 hectares of forest plantations, mainly pine and eucalyptus, of which 449,000 hectares are located in Chile, 181,000 hectares in Brazil and 58,000 hectares in Argentina. The Company also has usufruct, sharecropping and lease contracts with third parties covering 42,000 hectares of forest plantations distributed in Chile and Brazil.

The Company has 47 manufacturing plants distributed in Chile, Argentina, Peru, Uruguay, Mexico, Colombia, Brazil and Ecuador. CMPC primarily sells to Chile, Asia, Europe, Argentina and Brazil. As of December 31, 2019 81% of the Company’s consolidated revenue is generated by exports by its foreign subsidiaries (80% as of December 31, 2018) and approximately 19% is generated in Chile (20% as of December 31, 2018). CMPC also has subsidiaries for commercial and financial operations in Europe, the United States and the Cayman Islands and a foundation (CMPC Foundation) whose mission is to strengthen the education and culture of the communities where CMPC has a presence.

As of December 31, 2019, the CMPC Group consists of 60 entities: Empresas CMPC S.A., the parent company, 54 subsidiaries and 3 associates and 2 joint ventures. CMPC has consolidated in its financial statements the results of all companies over which it has control and has applied the equity method of accounting on entities in which it exercises significant influence. Total assets of the Parent Company as of December 31, 2019, amounted ThUS$8,499,857 (ThUS$8,691,175 as of December 31, 2018).

10 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The subsidiaries included in these consolidated financial statements are detailed as follows:

P e r c e n t a g e o f p a r t i c i p a t i o n Taxpayer Country of Functional Consolidated companies As of December 31, 2019 As of December 31, 2018 No. origin Currency Direct Indirect Total Direct Indirect Total Inversiones CMPC S.A. 96.596.540-8 Chile US$ 99.9988 0.0012 100.0000 99.9988 0.0012 100.0000 Inmobiliaria Pinares SpA 78.000.190-9 Chile US$ 99.9900 0.0100 100.0000 99.9900 0.0100 100.0000 CMPC Celulosa S.A. 76.600.628-0 Chile US$ 48.0663 51.9337 100.0000 48.0663 51.9337 100.0000 CMPC Papeles S.A. 96.757.710-3 Chile US$ 0.1000 99.9000 100.0000 0.1000 99.9000 100.0000 CMPC Tissue S.A. 96.529.310-8 Chile CLP 0.0497 99.9503 100.0000 0.0776 99.9224 100.0000 CMPC Pulp SpA 96.532.330-9 Chile US$ 7.3883 92.6117 100.0000 7.3883 92.6117 100.0000 Forestal Mininco SpA 91.440.000-7 Chile US$ 5.3042 94.6824 99.9866 5.3042 94.6824 99.9866 CMPC Maderas SpA 95.304.000-K Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Cooperativa Agrícola y Forestal El Proboste Ltda. 70.029.300-9 Chile US$ 0.0000 75.9234 75.9234 0.0000 78.2910 78.2910 Bioenergías Forestales SpA 76.188.197-3 Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Inmobiliaria y Constructora San Roque SpA 76.395.604-0 Chile US$ 0.0000 99.9866 99.9866 0.0000 99.9866 99.9866 Cartulinas CMPC SpA 96.731.890-6 Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Papeles Cordillera SpA 96.853.150-6 Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Forsac SpA 79.943.600-0 Chile US$ 0.0177 99.9823 100.0000 0.0177 99.9823 100.0000 Empresa Distribuidora de Papeles y Cartones SpA 88.566.900-K Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Envases Impresos SpA 89.201.400-0 Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Chilena de Moldeados SpA 93.658.000-9 Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Sociedad Recuperadora de Papel SpA 86.359.300-K Chile US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Inversiones Protisa SpA 96.850.760-5 Chile CLP 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 CMPC Papeles Tissue S.A. 77.054.086-0 Chile US$ 0.1000 99.9000 100.0000 0.1000 99.9000 100.0000 CMPC Papeles Forestal S.A. 77.054.083-6 Chile US$ 0.1000 99.9000 100.0000 0.1000 99.9000 100.0000 CMPC Inversiones de Argentina S.A. Foreign Argentina ARS 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Forestal Bosques del Plata S.A. Foreign Argentina US$ 0.0000 99.9879 99.9879 0.0000 99.9879 99.9879 Forestal Timbauva S.A. Foreign Argentina US$ 0.0000 99.9879 99.9879 0.0000 99.9879 99.9879 Naschel S.A. Foreign Argentina ARS 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Fabi Bolsas Industriales S.A. Foreign Argentina US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 La Papelera del Plata S.A. Foreign Argentina ARS 0.0000 99.9906 99.9906 0.0000 99.9906 99.9906 Melhoramentos CMPC Ltda. Foreign Brazil BRL 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Sepac - Serrados e Pasta e Celulose Ltda. Foreign Brazil BRL 0.0000 100.0000 100.0000 0.0000 0.0000 0.0000 CMPC Celulose Riograndense Ltda. Foreign Brazil US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 CMPC Riograndense Ltda. Foreign Brazil US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Guaíba Administração Florestal Ltda. Foreign Brazil US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Channel CMPC Investments Ltd. Foreign US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Islands Drypers Andina S.A. Foreign Colombia COP 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Protisa Colombia S.A. Foreign Colombia COP 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Productos Tissue del Ecuador S.A. Foreign Ecuador US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 CMPC Europe Ltd. Foreign England US$ 0.0000 99.9866 99.9866 0.0000 99.9866 99.9866 Cayman Inversiones CMPC Cayman Ltd. Foreign US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Islands Grupo ABS Internacional S.A. de C.V. Foreign Mexico MXN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Absormex S.A. de C.V. Foreign Mexico MXN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Convertidora de Productos Higiénicos S.A. de C.V. Foreign Mexico MXN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Convertidora CMPC México S.A. de C.V. Foreign Mexico MXN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Absormex CMPC Tissue S.A. de C.V. Foreign Mexico MXN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Forsac México S.A. de C.V. Foreign Mexico US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 CMPC Maderas México S.A. de C.V. Foreign Mexico US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Productos Tissue del Perú S.A. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Forsac Perú S.A. Foreign Peru US$ 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Softys Arequipa S.A.C. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 0.0000 0.0000 Activar S.A.C. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 0.0000 0.0000 Papelera Panamericana S.A. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 0.0000 0.0000 Tissue Cayman Ltd. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Propa Cayman Ltd. Foreign Peru PEN 0.0000 100.0000 100.0000 0.0000 100.0000 100.0000 Industria Papelera Uruguaya S.A. Foreign Uruguay UYU 0.0000 99.7269 99.7269 0.0000 99.6105 99.6105 CMPC USA Inc. Foreign United States US$ 0.0000 99.9999 99.9999 0.0000 99.9999 99.9999

CMPC’s subsidiary Inversiones CMPC S.A. is registered in the CMF under number 0672 and prepares consolidated financial statements, which are available to the public. The accounting policies followed are consistent with those applied by CMPC in the preparation of its consolidated financial statements.

11 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The following changes have occurred in the share percentage and capital contributions of the following subsidiaries included in consolidation:

(1) On October 31, 2019 the subsidiary CMPC Melhoramentos Ltda. materialized and formalized the acquisition of 100% of the social rights of Sepac - Serrados e Pasta e Celulose Ltda. The control was effective from November 1, 2019 and from this date the financial statements for this new subsidiary are consolidated.

(2) On October 30, 2019, the subsidiary CMPC Melhoramentos Ltda. performed a capital increase that was fully subscribed by its shareholder CMPC Tissue S.A. As a result of this operation, the capital stock of CMPC Melhoramentos Ltda. was increased by a total of ThUS$330,121 and consequently the new shareholders are CMPC Tissue S.A. 99.97% and Inversiones Protisa SpA 0.03%.

(3) On October 30, 2019 the subsidiary CMPC Tissue S.A. performed a capital increase that was fully subscribed by its shareholder Inversiones CMPC S.A. As a result of this operation, the capital stock of CMPC Tissue S.A. was increased in a total of ThUS$330,121 and consequently the new shareholders are Empresas CMPC S.A. 0.05%, CMPC Papeles Tissue S.A. 1.42% e Inversiones CMPC S.A. 98.53%.

(4) At the extraordinary shareholders’ meeting of the subsidiary CMPC Tissue S.A. held on October 17, 2019, it was agreed to carry out a capital increase of ThUS$22,723 through the contribution of real estate domain and credits or accounts receivable at that date were owned by Inversiones CMPC S.A. As a result of this operation, the shareholder Inversiones CMPC S.A. subscribe all the shares of the new issue, and new shareholders are Empresas CMPC S.A that holds 0.08%, CMPC Papeles Tissue S.A. that holds 2.14% and Inversiones CMPC S.A. that holds 97.78%.

(5) On August 20, 2019 the subsidiary Softys Arequipa S.A.C. transferred 1 share of the share capital of Activar S.A.C. to CMPC Tissue S.A. This avoids the full dissolution of the acquired company. The new shareholders are Softys Arequipa S.A.C. that holds 99.99% and CMPC Tissue S.A. that holds 0.01% of the shares.

(6) By public deeds dated June 7, 2019, the sale and purchase agreements of participation fees on the subsidiary Cooperativa Agrícola y Forestal El Proboste Ltda. was acquired. As a result of this operation, the new shareholders of the Cooperativa are CMPC Maderas SpA 18.69%, Forestal Mininco SpA 19.60%, CMPC Pulp SpA 18.88% and Inmobiliaria Pinares SpA 18.76%.

(7) On April 5, 2019 the subsidiary Softys Arequipa S.A.C. acquired 100% of the shares of Activar S.A.C. y Papelera Panamericana S.A. As a result of this operation, the financial statements of both subsidiaries are consolidated, whose shareholders are Softys Arequipa S.A.C. 100% for Activar S.A.C. and Softys Arequipa S.A.C. 44.98% with Activar S.A.C. 55.02% for Papelera Panamericana S.A.

(8) By public deed of March 9, 2019, extended before the public notary of Lima, Mr. Eduardo Laos de Lama, Softys Arequipa S.A.C. was established. At the general meeting of shareholders of the subsidiary, held on March 27, 2019, it was agreed to increase the share capital of Softys Arequipa S.A.C., totaling an amount of ThUS$14,500 subscribed and paid by its shareholders CMPC Tissue S.A. 99.999998% and Productos Tissue del Perú S.A. 0.000002%.

12 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

(9) At the extraordinary shareholders’ meeting of the subsidiary Industria Papelera Uruguaya S.A., held on February 20, 2019, it was agreed to carry out a capital increase of ThUS$14,156 through the capitalization of funds previously deposited by its main shareholder Inversiones Protisa SpA. The new participation on this society is equivalent to 99.73%.

(10) During the year 2019 the share capital of the subsidiary Drypers Andina S.A. from Colombia was increased by ThUS$1,000 (ThUS$5,000 during 2018), paid by shareholders CMPC Tissue S.A. 70.00%, Inversiones Protisa SpA 29.70%, Inversiones CMPC S.A and other subsidiaries 0.30%.

(11) At the extraordinary shareholders’ meeting of the subsidiary Forestal Mininco SpA, held on December 27, 2018, it was agreed to merge the company with Forestal y Agrícola Monte Águila S.A. Forestal Mininco acquired Forestal and Agricola Monte Aguila. As result of the merger, it was agreed to increase the share capital of Forestal Mininco SpA, as the legal continuing entity, by a total of ThUS$45,214, the new shareholders are Inversiones CMPC S.A. 6.42%, CMPC Celulosa S.A. 87.96%, Empresas CMPC S.A. 5.30% and CMPC Papeles S.A. 0.30%.

(12) At the extraordinary shareholders’ meeting of the subsidiary CMPC Papeles S.A., held on November 26, 2018, it was agreed to split the company, forming two new closed corporations CMPC Papeles Tissue S.A. and CMPC Papeles Forestal S.A. As results, it was agreed to decrease the share capital of CMPC Papeles SpA by ThUS$24,618, constituting the paid capital of the new companies in this way. The shareholders of the three subsidiaries are Inversiones CPMC S.A. 99.90% and Empresas CMPC S.A. 0.10%.

(13) During the year the subsidiary Melhoramentos CMPC Ltda. from Brazil increased its share capital by ThUS$37,000, which was paid by its shareholders CMPC Tissue S.A. 99.93% and Inversiones Protisa SpA 0.07%.

(14) At the extraordinary shareholders’ meeting of the subsidiary Forestal Mininco SpA, held on June 20, 2018, it was agreed to merge the company Inversiones Timbauva S.A. and Protisa Forestal S.A. Forestal Mininco SpA acquired these two entities. As a result, it was agreed to increase the share capital of Forestal Mininco SpA, as the legal continuing entity, by a total of CLP 124,689,919,261 (ThUS$194,369), by issuing 38,182,319 new paid shares. Considering the incorporation by exchange of shares of Empresas CMPC S.A. and CMPC Papeles S.A., the shareholders are CMPC S.A. 6.78%, CMPC Celulosa S.A. 92.89%, Empresas CMPC S.A. 0.01% and CMPC Papeles S.A. 0.30%.

(15) At the extraordinary shareholders’ meeting of the subsidiary Forsac S.A., held on June 20, 2018, it was agreed to merge Inversiones Forsac SpA and Protisa Forsac S.A. Forsac S.A. acquired these two entities. As result of the merger, it was agreed to increase the share capital of CLP 7,620,692,899 (ThUS$11,879), by issuing 31,094 new paid shares. Considering the incorporation by exchange of shares of Empresas CMPC S.A., the shareholders are Inversiones CMPC S.A. 25.14%, CMPC Papeles S.A. 74.84% and Empresas CMPC S.A. 0.02%.

Considering the continued profitable operations of the Company, new investment plans locally in Chile and abroad and the access to resources in the financial market, the Management declares that the principle of the company of going concern is fully complied with.

13 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The total workforce of the Company and its subsidiaries as of December 31, 2019 consists of 18,921 employees (17,472 as of December 31, 2018) distributed among the various operating segments detailed as follows:

Managers and key Professionals & Segment Employees Total executives technicians Pulp 187 1,579 3,265 5,031 Biopackaging 129 897 2,369 3,395 Softys 368 2,953 6,786 10,107 Other 51 325 12 388 Total (unaudited) 735 5,754 12,432 18,921

The average number of employees of CMPC for the period ended December 31, 2019 was 17,814 (16,908 as of December 31, 2018).

These Consolidated Financial Statements include the Consolidated Statement of Financial Position, Consolidated Statement of Comprehensive Income, Consolidated Statement of Cash Flows (direct method), and Consolidated Statement of Changes in Equity and the accompanying disclosure Notes.

The Company’s functional currency and presentation currency is the United States dollar (hereinafter the "dollar"). Except for subsidiaries in the Softys operating segment, which use the local currency of each country as their functional currency, as the main revenue and expenses are generated and paid in local currencies.

Subsidiaries from Softys operating segment (with the exception of the subsidiaries La Papelera del Plata S.A. and Naschel S.A. which operate in a hyperinflationary economy, see note 2.4.d) whose functional currency is other than the dollar, have converted their financial statements from their functional currency to the Group’s presentation currency, which is the dollar. The following exchange rates have been used: the Statement of Financial Position, net at the financial statement period-end exchange rate, and the Statement of Comprehensive Income, the Statement of Changes in Equity and Statement of Cash Flows at the transaction date exchange rate or average monthly exchange rate, as appropriate.

These Consolidated Financial Statements are presented in thousands of dollars (ThUS$) and have been prepared from the accounting records of Empresas CMPC S.A. and its subsidiaries.

Assets and liabilities are classified according to their current maturities, those maturing in twelve months or less, and non-current maturities, those whose maturity is greater than twelve months in the Consolidated Statement of Financial Position. In turn, in the Consolidated Statement of Comprehensive Income, expenses classified by function are presented in Note 34 additional information on their nature. The Consolidated Statement of Cash Flows is presented by using the direct method.

The Consolidated Financial Statements present fairly the equity and financial position as of December 31, 2019, as well as the results of operations, changes in equity and consolidated cash flows generated by the Subsidiaries of the CMPC Group Company during the twelve-month period ended as December 31, 2019.

14 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The figures in the Consolidated Statement of Financial Position, Consolidated Statement of Changes in Equity, Consolidated Statement of Comprehensive Income, Consolidated Statement of Cash Flows and their respective Explanatory Notes are presented compared with the same previous periods, in accordance with the requirements of the IFRS (International Financial Reporting Standards).

The Company's Management declares that these Consolidated Financial Statements have been prepared in accordance with the IFRS as adopted by the IASB (International Accounting Standards Board).

These consolidated financial statements have been approved by the Board of Directors during the Meeting held on March 5th, 2020, at which the Directors granted the Management an authorization to publish and transmit these financial statements to the regulatory and market authorities.

Capital management

Capital management refers to the management of the Company's equity capital. The objectives of the Company in relation to capital management are to safeguard the Company's capacity to continue as a going concern, as well as its capacity to generate ensuring returns for its shareholders. To meet these objectives, the Company is constantly monitoring the returns obtained by each business, maintaining its correct operation and thus maximizing financial returns for the shareholder. In addition, financial instrument investment decisions of each business (division) are in line with the Company’s conservative profile and are performed at normal market conditions. Financial instruments are constantly monitored by the Company’s Board. Among the activities relating to capital management, the Company reviews its cash balance daily to make its investment decisions.

CMPC manages its capital structure so that its indebtedness does not affect its ability to pay its obligations or obtain an adequate return for its investors. CMPC has acquired an obligation to comply with certain financial ratios from its issuance of debt instruments: it needs to maintain a ratio of financial obligations to third parties and equity (adjusted for contracts) equal to or less than 0.80. As of December 31, 2019 and 2018, this relationship is comfortably met, reaching levels of 0.50 and 0.47 in both periods (see note 22.2.e). In addition to the above, and as part of the financial covenants CMPC must comply with, at the end of each financial year the Company must maintain minimum equity of Chilean “Unidades de Fomento” (UF) 71,580,000 plus 85% of new capital issuances after March 31, 2012 (total, a sum equal to US$3,308 million as of December 31, 2019 and US$3,442 million as of December 31, 2018). Condition that is comfortably met, considering that equity (adjusted for contracts) amounted to US$7,761 million as of December 31, 2019 and US$8,105 million as of December 31, 2018 (see Note 22.2.e). Similarly, the Company must maintain a consolidated EBITDA coverage ratio to financial expenses for the trailing 12 months greater than 3.25x, a condition that was met by reaching a coverage of 6.09x as of December 31, 2019 and 8.50x as of December 31, 2018. (See Note 22.2.e).

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The main accounting policies adopted in the preparation of these consolidated financial statements are described below. As required by IAS 1 “Presentation of Financial Statements”, these policies have been designed considering the IFRS accounting standards effective as of December 31, 2019, together with the

15 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

policy changes, which became effective as of January 1, 2019, and have been consistently applied to the financial years presented in these Consolidated Financial Statements when applicable.

2.1. Basis of preparation

The preparation of the Consolidated Financial Statements under IFRS requires the use of certain critical accounting estimates and requires the management to exercise its judgment in the process of applying accounting policies in the Company. Note 4 discloses the areas that imply a higher degree of judgment or complexity or the areas where the hypotheses and estimates are significant for the Consolidated Financial Statements.

The Company generally uses cost accounting as its criteria to value assets and liabilities, except for hedging financial instruments, certain financial assets and liabilities, and biological assets, which are recorded at fair value, thus, this manner of periodic measurement eliminates or reduces inconsistencies in their valuations and/or yields.

Some balances of the comparative financial statements as of December 31, 2018, were reclassified for a consistent presentation with the financial statements as of December 31, 2019.

2.2. Basis of presentation a) Subsidiaries

Subsidiaries are those companies in which Empresas CMPC S.A. controls, directly or indirectly, most substantive voting rights or else has rights that grant them the present capacity to direct their relevant activities, and included for this purpose are any potential voting rights in CMPC´s possession, or those belonging to third parties, exercisable or convertible as of each year-end. In addition, CMPC is exposed or entitled to the variable returns of these companies and has the capacity to influence these amounts.

Subsidiaries are consolidated from the date on which control is transferred to Empresas CMPC S.A. and are excluded from consolidation on the date on which such control ceases. b) Non-controlling interests and transactions

As part of the consolidation process, transactions, receivable and/or payable balances and unrealized income from transactions between related CMPC companies are eliminated. The accounting policies of subsidiaries are consistent with those of the parent company.

Non-controlling interests are presented under Shareholders’ Equity in the Consolidated Statements of Financial Position. The profit or loss attributable to non-controlling interests is presented in the Statement of Comprehensive Income as profit (loss) for the year. Results of transactions between non-controlling shareholders and the shareholders of the subsidiaries where ownership is shared are accounted for in equity and are therefore shown in the Statements of Changes in Equity.

16 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

c) Associates

Associates are all entities over which Empresas CMPC S.A. has significant influence but not control over the financial and operating policies. Investments in associates are accounted for using the equity method.

In accordance with the equity method, the investment in an associate or joint venture is initially recorded at cost, and the carrying amount is increased or decreased to recognize the share of CMPC in the income of the investee for the period, after the date of acquisition. Distributions received from the investee reduce the carrying amount of the investment. Changes in the comprehensive income of the investee that arise from revaluation of property, plant and equipment and foreign currency translation differences are recognized in the Company´s statement of comprehensive income.

When the Company´s share in the losses of an associate is equal to or exceeds its investment in the associate, including any other unsecured accounts receivable, the Company´s does not recognize additional losses unless it has incurred obligations or made payments on behalf of the associate.

At the time of the acquisition of the investment, any difference between the cost of the investment and CMPC’s share in the net fair value of the identifiable assets and liabilities of the investee are accounted for in the following manner: i) goodwill related to an associate or a joint venture is included in the carrying amount of the investment (amortization of this goodwill is not permitted) and ii) any excess of the fair value of the net identifiable assets and liabilities of the investee over purchase price of the investment in a bargain purchase is recorded as income in the statement of comprehensive income at the date of acquisition. (See Note 2.9.).

2.3. Financial information by segment reporting

IFRS 8 “Operating Segments” requires that entities disclose the information on operating segments in the same manner the key executives monitor the operations of the Company. In general, this is the information that management uses internally to assess the performance of the segments and decide how to allocate resources to them.

The Company presents information by segment (which corresponds to business areas) based on the financial information made available for decision makers, regarding matters such as measuring profitability and allocation of investments, and based on differentiation of products, as indicated in IFRS 8.

Segments, thus determined, which reflect the current business management structure, are detailed as follows:

Pulp Biopackaging Softys

Income from areas other than the mentioned segments, related to the parent Company (CMPC) and others not transferred to operating segments, is presented under “Other”. Additionally these operating segments do not individually represent amounts that are significant enough for their designation as an operating segment.

17 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

2.4. Foreign currency transactions a) Presentation and functional currency

Items included in the financial statements of each of the entities of the Company are measured using the currency of the primary economic environment in which the entity operates (functional currency). The consolidated financial statements are presented in dollars, which is the functional currency of the Company. b) Transactions and balances

All operations performed by Empresas CMPC S.A. or its subsidiaries in a currency other than the functional currency of each company are treated as foreign currency transactions and are recorded at the exchange rate prevailing on the transaction date.

Balances of monetary assets and liabilities denominated in foreign currencies are valued at the exchange rate at each period. The variation between the original and closing value is recorded in foreign currency translation differences in the Statement of Comprehensive Income (loss), except when these changes are deferred in the Statement of Changes in Equity, such as cash flow hedges.

Changes in the fair value of investments in debt instruments denominated in foreign currency classified as Fair Value Through Other Comprehensive Income (FVOCI), if any, are separated between exchange differences and the increase corresponding to the gain of the instrument measured in the functional currency. Exchange differences are recognized in the comprehensive income statement of the year and the profit of the financial instrument is recognized in equity. c) Subsidiaries of Empresas CMPC S.A.

The profit and financial position of all CMPC entities (which do not operate with the currency of a hyperinflationary economy) with a functional currency other than the presentation currency are converted to the presentation currency as follows: i) The assets and liabilities of each statement of financial position are converted at the financial statements period-end exchange rate; ii) The income and expenses of each income statement account are converted at the daily exchange rate or when this is not possible, the average monthly exchange rate is used as a reasonable approximation; and iii) The variations determined by exchange differences between the investment accounted for in a company whose functional currency is different to the functional currency of the subsidiary in which it has been invested is recorded in the Consolidated Statement of Comprehensive Income, forming part of the Equity as currency translation differences reserve.

Foreign currency translation differences by balances maintained in long-term current accounts between subsidiaries with different functional currencies are eliminated from income and recorded in the foreign currency translation differences reserves account under net equity, since they are treated as net investments in those subsidiaries.

18 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

d) Hyperinflation in Argentina

In accordance with IAS 29 "Financial information in hyperinflationary economies", an economy is considered to be hyperinflationary if it presents a series of characteristics, such as an accumulated inflation rate above 100% over the past three years. For purposes of IAS 29, as of July 1, 2018, the economy of Argentina is considered hyperinflationary and, therefore, the financial statements presented by the subsidiaries whose functional currency is the Argentine peso, were prepared by applying the requirements of IAS 29 as if the economy had always been hyperinflationary, in accordance with the interpretation of IFRIC 7 "Application of the Restatement Procedure" according to IAS 29.

The financial statements of the subsidiary La Papelera del Plata S.A. and Naschel S.A., whose functional currency is the Argentine peso, were adjusted retrospectively at the date the Group applied IAS 29, by applying a general price index to historical cost, in order to measure changes in the purchasing power of the Argentine peso at the closing date of these financial statements, prepared in accordance with IAS 29, and subsequently converted to the dollar in accordance with IAS 21 "Effects of changes in the exchange rates of the foreign currency ", using the closing exchange rate as of September 30, 2019 for all the figures in the consolidated statements of financial position and the consolidated statements of comprehensive income; considering that the functional and presentation currency of Empresas CMPC S.A does not correspond to that of a hyperinflationary economy according to IAS 29, the re-expression of the comparative periods is not required in the financial statements. The rates and coefficients used for the re-expression were the following:

Rates: Domestic wholesale price indexes (IPIM) as of December 31, 2016 - consumer price index of the CABA (IPCBA) for the months of November and December 2015 in which the National Institute of Statistics and Cencos (INDEC) did not publish the IPIM - and national consumer price indexes (CPI) as of January 1, 2017.

Coefficients: Coefficients were determined based on the aforementioned indices, considering as base 100 the index of December 31, 2016.

It should be noted that the Consumer Price Index for the period ended December 31, 2019 it was 53.8% (47.6% for period ended December 31, 2018) according to figures provided by INDEC.

e) Foreign currency exchange rate

The exchange rates (represented as units of each currency per dollar) of the primary currencies used in the accounting processes of the CMPC companies as of December 31, 2019 and 2018 are as follows:

19 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

12/31/2019 12/31/2018 Cumulative Cumulative Currency Closing monthly Closing monthly average average Chilean peso CLP 748.74 702.63 694.77 640.29 Unidad de fomento * UF 0.026 0.025 0.025 0.024 Argentinean peso ARS 59.89 48.24 37.70 28.11 Peruvian new sol PEN 3.32 3.34 3.38 3.29 Mexican peso MXN 18.85 19.26 19.68 19.24 Uruguayan peso UYU 37.31 35.24 32.41 30.72 Colombian peso COP 3,277.14 3,279.61 3,249.75 2,955.81 Euro EUR 0.89 0.89 0.87 0.85 Brazilian real BRL 4.03 3.95 3.87 3.65 Pound Sterling GBP 0.76 0.78 0.79 0.85

* The “Unidad de Fomento” (UF) is a monetary unit denominated in Chilean pesos indexed to Chile's inflation rate. Its value is established daily and in advance, based on the variation of the Consumer Price Index (IPC) of the previous month. The effects generated by updating assets and liabilities in UF are recorded in the caption Result for adjustment units in the Consolidated Statement of Comprehensive Income.

2.5. Business Combinations

The business combination is recognized using the acquisition method, except some assets and liabilities that are recognized according to other methods established in other standards, as required by IFRS 3 "Business Combinations". Applying the acquisition method requires: i) identifying the acquirer, ii) determining the acquisition date, iii) recognizing and measuring the identifiable assets acquired, the liabilities assumed and any non-controlling interest in the acquiree, and iv) recognizing and measuring goodwill or a gain from a bargain purchase.

The application of the principle and the conditions of recognition may result in the accounting of some assets and liabilities that the acquiree has not previously recognized as such in its financial statements, for example the identifiable intangible assets acquired that were generated internally and affected results in the period that the expense was incurred.

For each business combination, CMPC will measure the net identifiable assets acquired and the liabilities assumed at their fair values on the acquisition date. Meanwhile, the components of the non-controlling interests will be measured at fair value or proportional share of the identifiable net assets of the acquiree.

If the acquisition cost exceeds the fair value of the net identifiable assets of the acquiree, the Company shall recognize a goodwill according to the description on note 2.9. Otherwise, if the acquisition cost is lower than the fair value of the net identifiable assets of the acquiree, the gain should be included in the Consolidated Financial Statement of Comprehensive Income in Other gains (loses).

In a business combination achieved in stages, the acquirer shall remeasure its previously held equity interest in the acquiree at its acquisition-date fair value and recognize the resulting gain or loss, if any, in profit or loss.

20 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

When the company carries out an inverse acquisition (the subsidiary absorbs its parent company), the goodwill is recorded in the statement of financial position of the continuing entity. In this merger the parent company is dissolved, transmitting all of its assets and liabilities to the subsidiary, which is the legal continuing entity and receives all the legal rights over the parent that was absorbed.

A business combination under common control is recorded using the pooling of interest method as a reference. Under this method the assets and liabilities involved in the transaction are kept reflected at the same value books in which they were originally registered. Any difference between the assets and liabilities contributed to the consolidation and the consideration given is recorded in the line of Other Reserves within Equity.

2.6. Property, plant and equipment

Additions to property, plant and equipment are accounted for at acquisition cost. Additions purchased in a currency other than the functional currency are converted to that currency at the exchange rate on the date of acquisition. Acquisitions made by subsidiaries whose functional currency is different from the dollar are accounted for at their functional moment, restated in dollars at the year-end exchange rate.

For the measurement of the main properties, plants and relevant equipment acquired before the date of transition to IFRS, their fair value was determined based on appraisals made by the expert staff. For the rest of the properties, plants and equipment, the historical cost model was used.

In an eventual financing of an asset through direct and indirect loans, interest is capitalized during the construction or acquisition period, to the extent that said assets can be identified.

The cost may also include gains or losses on qualifying hedges of cash flows from acquisitions in foreign currency of property, plant and equipment if the hedge is taken exclusively for the acquisition of the property, plant and equipment.

Depreciation of property, plant and equipment is calculated using the straight-line method. The useful life of property, plant and equipment is determined based on expected natural wear, technical or commercial obsolescence derived from changes and / or improvements in production and changes in market demand for the products whose production is supported by such assets. Land included in this account, whether forestry or industrial, is not depreciated.

Subsequent to its recognition as an asset, an item of property, plant and equipment shall be recorded at cost less accumulated depreciation and the accumulated amount of impairment losses if they exist.

The useful lives of assets are reviewed and adjusted, if necessary, at the end of each reporting period. The Company has determined that the residual value assigned to the property, plant and equipment is zero, given that said assets are productive plants and the company has no plans to sell such assets.

21 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The estimated useful lives (in years) for the main type of assets are the following:

Minimun Maximun Type of assets useful life useful life Buildings 5 80 Plant and equipment 3 50 Office equipments 5 10 Fixture and accessories 3 5 Transportation equipment 5 20 Other property, plant and equipment 3 10

Expenses associated with daily maintenance and common repairs are recorded as expenses in the statement of comprehensive income for the year, in which they are incurred. In contrast, replacement of parts or pieces and spare parts with significant useful lives are capitalized and depreciated over the useful lives of the underlying primary assets, based on the component approach.

Profits and losses on disposal of property, plant and equipment are calculated comparing the proceeds to the carrying amount (net of depreciation) and are included in the statement of comprehensive income at line item “Other profits (losses)”.

2.7. Biological assets (forest plantations)

Forest plantations are presented in the statement of financial position at fair value according to IAS 41 “Agriculture” and IFRS 13 “Fair value”. Groups of forests are accounted for at fair value at a "standing timber" level, i.e. discounting harvesting costs and transportation expenses to the point of sale, there is a presumption that the measurement can be identified reliably.

At the end of the period, the effect of the growth of forest plantations, expressed in the fair value of the same (sale price less estimated costs at the point of sale), is presented as "Other income, by function" in the consolidated statement of comprehensive income.

The forest plantations that will be harvested in the 12 months following the date of presentation of the consolidated financial statements are classified as current biological assets.

Plantations in their first year are valued at their cost of establishment, equivalent to the fair value at that date.

The costs of setting up forest plantations are classified as biological assets and the maintenance expenses of these assets are recorded as expenses in the year in which they are incurred and are presented as cost of sales.

Biological assets are recognized and measured at fair value separately from the land. However, a forest plantation has economically associated the growth and soil while it is in development.

22 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

2.8. Intangible assets

Intangible assets refer mainly to trademarks, water rights, emission rights, power line easements and expenses incurred in the acquisition and/or development of computer software. a) Software

Costs for the acquisition and development of relevant and specific computer software for the Company are activated and amortized during the period once the period in which it is expected to generate future cash flows from its use (average useful life of three years), charged to the depreciation and amortization expense account in the item Cost of sales of the Consolidated Statement of Comprehensive Income. b) Power line easements

The Company has paid for easements for the construction and operation of power lines on third-party land which are necessary for the operation of its industrial plants. Since these rights are perpetual, they are not amortized; however, they are tested for impairment on an annual basis. c) Water rights

The water rights acquired by the Company correspond to the right to use existing water in natural sources and are recorded at their acquisition cost. Since these rights have indefinite useful lives, they are not amortized; however, they are tested for impairment on an annual basis.

d) Emission rights

In Chile, the Company has emission rights for particulate material and NOx (nitrogen oxides), both those allocated directly to the Company by the National Environmental Commission (CONAMA) and those purchased from third parties. These emission rights are necessary for the normal operation of the Company´s factories. These rights are recorded at acquisition cost, to the extent that there are payments, since the Company obtains control and measurement of them. These rights have an indefinite useful life and are subject to deterioration evaluation annually. e) Trademarks

CMPC has a portfolio of trademarks, which were mainly developed internally, but also bought from third parties. These are valued at their registration cost in the Public Trademarks Registry or at acquisition cost, respectively. Disbursements incurred in trademark development are recorded as operating expenses in the period in which they are incurred.

23 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

2.9. Goodwill

Goodwill is determined on the date of acquisition of a subsidiary and is measured as the excess of: i) the sum of the consideration transferred plus the amount of any non-controlling interest in the acquired company over and ii) the sum of the fair value of the net identifiable assets acquired and liabilities assumed on the acquisition date. Goodwill related to the acquisition of subsidiaries is annually tested for impairment, recognizing corresponding cumulative impairment losses that correspond in the result of the period. Profits and losses from the sale of an entity include the carrying amount of the goodwill related to the entity sold.

Goodwill originated from the acquisition of companies which functional currency is other than the dollar is booked in the same way as if they were foreign currency assets, i.e. are adjusted by the variation in the foreign exchange rate of the respective currency.

Goodwill is allocated to Cash Generating Units (CGUs) for the assessment of impairment losses (see note 2.10). The allocation is made in those CGUs that benefit from the business combination in which the acquired Goodwill arose. Each of these CGUs represent the investment in a subsidiary for each segment of CMPC.

In a business combination with more advantageous terms than the market, the difference between the purchase price and the fair value of the net assets identified is recorded as a gain of the period in the Consolidated Statement of Comprehensive Income.

2.10. Impairment losses on non-financial assets

Intangible assets with an indefinite useful life and acquired goodwill are not amortized and are tested annually (or sooner if there is evidence of impairment) to ensure that the carrying amount does not exceed the recoverable value.

Assets subject to depreciation (property, plant and equipment) are tested for impairment if some event or change in business circumstances indicates that the carrying amount may not be recoverable. An impairment loss is recognized when the carrying amount is greater than the recoverable amount. The recoverable amount of an asset is either its fair value minus the cost of sale or its value in use, whichever is higher. In order to assess impairment, individual assets are grouped with other assets of the cash-generating unit of which they are part and that generate individual cash flows at the CGU level. The company has determined as UGE the investment in a subsidiary for each of the CMPC segments.

Non-financial assets other than goodwill that have been subject to impairment are tested on each accounting closing date to check for possible reversal of losses if there is evidence that the current market situation or other conditions that triggered impairment have changed. Impairment losses can be reversed only up to the amount of the losses recognized in previous years, in order for the carrying amount of these assets not to exceed the value they would have had if such adjustments had not been recorded. This reversal is recorded in other profits (losses) in the Consolidated Statement of Comprehensive Income.

24 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

2.11. Financial instruments a) Classification and measurement

The Company classifies financial instruments based on the business model in which they are managed and their contractual cash flows characteristics.

The classification and measurement of CMPC's financial instruments is as follows: i) Financial instruments at Fair Value Through Profit and Loss "FVTPL". These instruments are measured at fair value. Net earnings and losses, including any interest or dividend income, are recognized in profit or loss for the period. ii) Financial instruments measured at amortized cost that are maintained with the objective of collecting contractual cash flows that meet the criteria "solely payments of principal and interest on the principal amount" “SPPI”. This category includes trade and other accounts receivable, trade and other accounts payable, and loans included in other current and non-current financial liabilities. iii) Financial instruments measured at Fair Value Through Other Comprehensive Income "FVOCI", with gains or losses reclassified to results of the period at the time of recognition. The financial instruments in this category meet the SPPI criteria and are kept within of the Company business model both to collect cash flows and to sell. b) Subsequent measurement

Financial instruments are subsequently measured at "FVTPL", Amortized cost or "FVOCI". The classification is based on two criteria: i) the Company's business model for managing financial instruments, and ii) whether the contractual cash flows of the financial instruments represent “SPPI” (Solely Payments of Principal and Interest test, i.e. contractual cash flow characteristics test). i) Financial instruments at "FVTPL": These instruments are subsequently measured at fair value. Net gains or losses, including any interest or dividend income, are recognized in the Consolidated Statement of Comprehensive Income.

Financial instruments measured at "FVTPL" are held for trading and are acquired mainly for the purpose of selling in the short term. Derivative instruments are also classified as held for trading unless they are designated with hedge accounting treatment. Financial instruments in this category are classified as other current assets or liabilities. Its subsequent valuation is made by determining its fair value, recording the changes in value in the Consolidated Statement of Comprehensive Income, in the line "Other gains (losses)". ii) Financial instruments at amortized cost: These instruments are subsequently measured at amortized cost using the effective interest method. The amortized cost is reduced by impairment losses. Financial income and expenses, foreign exchange earnings and losses, and impairment are recognized in results. Any earning or loss is recognized in profit or loss of the period.

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Loans and trades are non-derivative financial instruments with fixed or determinable payments that are not quoted in an active market. This category includes "Trade and other accounts receivable", “Trade and other accounts payable” and loans included in “Other current and non-current financial liabilities”. Its recognition is made through the amortized cost, recording the accrual of the agreed conditions directly in results. iii) Financial instruments at "FVOCI": These instruments are subsequently measured at fair value. Interest income calculated using the effective interest method, exchange gains and losses and impairment are recognized in income. Other net gains and losses are recognized in other comprehensive income "OCI". On de-recognition, earnings and losses accumulated in "OCI" are reclassified to results.

As of the date of each Consolidated Statement of Financial Position, CMPC evaluates if there is objective evidence that a financial instrument or group of financial instruments may have suffered impairment losses.

2.12. Hedging instruments

Derivatives are initially recognized at fair value on the date a derivative contract is executed and are subsequently re-measured at their fair value on each accounting closing date. The method for recognizing the resulting profit or loss depends on whether the derivative has been designated as a hedge instrument or not, and if it has been designated as such, it shall depend on the nature of the item that is being hedged.

CMPC designates certain derivatives as:

- Fair value hedges on recognized assets and liabilities (fair value hedge). - Hedges on a specific risk associated with a recognized liability or a highly probable foreseen transaction (cash flow hedge).

At inception of the transaction, the Company documents the transaction relationship between the hedging instrument and the hedged item, as well as its risk management objectives and strategy for undertaking various hedging transactions. The Company also documents its assessment, both at the beginning and end of each period, as to whether the derivatives used in hedging transactions are highly effective in offsetting changes in the fair value or cash flows of the hedged items.

The fair value of derivative instruments used for hedging purposes is disclosed in Notes 8 and 22 (hedging assets and liabilities, respectively). Movements in the Cash Flow Hedge Reserve in equity are disclosed in Note 28. The total fair value of hedging derivatives is classified as a non-current asset or liability when the hedged item matures in more than 12 months or as a current asset or liability if the hedged item matures in less than 12 months.

a) Fair value hedge

Changes in the fair value of derivative instruments that are designated, and qualify as hedges of the fair value of existing assets and liabilities, are recorded in the same accounts in the Consolidated Statement of Comprehensive Income where changes in the fair value of these assets or underlying liabilities are recorded.

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b) Cash flow hedges

The objective of currency forwards and cross-currency swaps is to reduce the financial risk of income and expense flows committed in currencies other than the dollar. The objective of oil price swaps is to hedge the risk of potential changes in the oil costs, which affect the rates of marine freight transportation of pulp, and the consumption of natural gas, indexed to oil, at CMPC’s plants. In particular, currency forwards are used to hedge financial risks associated with the volatility of sales in euros and sterling pounds of the lumber and cardboard unit business, and the cross-currency swaps are used mainly to cover the price variations of the different currencies and interest rates.

Hedges are documented and tested to measure their effectiveness.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in equity in the statement of comprehensive income within equity under cash flow hedge reserves. The profit or loss related to the non-effective portion is recognized immediately in the statement of comprehensive income under other profits (losses).

In the case of currency forwards, at the time of accrual of underlying income or at the time of payment of obligations on investments in property, plant and equipment, the amount accumulated in equity (up to that date is transferred to income for the period (revenue from operating activities or costs of sales) or to property, plant and equipment, respectively, the accrued amount in the Consolidated Statement of Changes in Equity (Cash flow hedge reserve) until that date.

Regarding the cross-currency swaps each time the hedged obligation in a cross-currency swap affects income for the year, the respective amount is reclassified from the Consolidated Statement of Changes in Equity (Cash Flow Coverage Reserve) to adequately reflect the effects of the hedge.

Valuation methodologies:

CMPC values its derivative contracts by in-house computer-used models, which are mainly based on discounting future cash flows at relevant market rates.

This system incorporates all the relevant market information ("data") at the time of the valuation and uses the Bloomberg as a source.

Main data: i) Closing exchange rates for each currency obtained from Bloomberg. ii) Future exchange rates constructed from closing exchange rates plus “forward” points obtained directly from Bloomberg (calculated with the rate differential). iii) Respective interest rates obtained from Bloomberg to discount cash flows to present value. Management uses swap rates to discount cash flows for more than 12 months as an approximation to the zero coupon rate.

For oil derivatives, valuation is obtained from information provided by third parties (at least two banks).

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These measurements are classified in Level II according to IFRS 13, considering that the main input data are observable in the market.

2.13. Inventory

Finished products are measured at production cost, and their net realizable value, considering production cost to be the value determined using the weighted average cost method.

The net realizable value is the estimated selling price in the ordinary course of business, less distribution and sale expenses. In the event that the market conditions generate that the cost exceeds its net realization value, an adjustment for the value differential is recorded, and the value of the inventories is reduced.

Such allowance also takes into account amounts related to obsolescence due to slow turnover, technical obsolescence and products withdrawn from the market.

Finished and in-process products costs include raw materials, personnel compensation, depreciation of properties, industrial plant and equipment, other costs and direct expenses related to production and transfers to the point of sale.

The allocation of indirect or fixed expenses to production considers the normal production capacity of the factory or plant that generates such expenses, excluding inefficiencies and plant shutdowns.

Supplies and raw materials acquired from others are valued initially at acquisition cost and when consumed are included in the cost of finished products using the weighted average cost method.

Raw materials derived from the harvest of biological assets are transferred to inventories and are initially valued based on their fair value less costs to sell at the harvest point.

2.14. Trade and other accounts receivable

Trade debtors and other accounts receivable are presented initially at their fair value and subsequently at their amortized cost.

The Company measures the accumulated losses in an amount equal to the Expected Credit Loss "ECL" for life.

The Company uses the simplified approach with the practical expedient included in IFRS 9 in the stratification of the maturity of the portfolio.

To determine whether there is impairment on the portfolio, the Company performs risk analysis according to historical experience (three years) over the default of the receivables, which is adjusted according to macroeconomic variables, with the objective of obtaining forward-looking information for the estimate.

CMPC considers that the financial assets are in default when: i) It is unlikely that the debtor will pay its credit obligations in full, without the Company taking actions such as the insurance claim, or ii) Financial asset has exceeded the expiration date contractually agreed.

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a) Measurement of the expected loss

The "ECL" is a weighted estimate of the probability of credit losses. Credit losses are measured considering the recoverability of the last three years. These historical ratios are adjusted with the statistical calculation of "Forward Looking" which converts the historical loss into an estimated projected loss according to a correlation of macroeconomic variables. b) Credit impairment

On each accounting closing date, the Company evaluates if the financial assets accounted for at amortized cost have credit impairment. A financial asset has "credit impairment" when one or more events that have a detrimental impact on the estimation of future cash flows occur. c) Presentation of Impairment

Impairment losses on the financial assets measured at amortized cost are deducted from their gross amount.

2.15. Cash and cash equivalents

Cash and cash equivalents are the balances of money held in the Company and current bank accounts, time deposits and other financial investments (negotiable securities that are easy to liquidate, subject to an insignificant risk of changes in value) that are due less than 90 days from the date of investment. Also included within this item are those investments inherent to the administration of cash, such as repurchase agreements whose maturity is in accordance with the previously defined.

Bank over facilities used are included in interest bearing loans as “other current financial liabilities.”

2.16. Issued capital

Ordinary shares are classified as shareholder’s equity.

2.17. Trade and other accounts payable

Accounts payable to suppliers are initially recognized at fair value and are subsequently valued at amortized cost.

2.18. Interest-bearing loans

Interests bearing loans, classified as other financial liabilities, are initially recognized at fair value, which corresponds to the value of the net debt of directly associated transaction expenses, and are then measured at amortized cost using the effective interest rate.

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2.19. Current and deferred Income taxes

The income tax expense includes the taxes of Empresas CMPC S.A. and its subsidiaries, based on their taxable income for the year, together with tax adjustments for previous years and changes in deferred taxes.

Deferred income tax is calculated using the liability method, on temporary differences arising between the tax base of assets and liabilities and their carrying amounts. However, deferred tax is not recorded if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction does not affect accounting income or taxable income or loss. Deferred tax is determined using income tax rates under current laws or laws that are on the verge of being enacted, in each country of operation, on the date of the financial statement and which are expected to apply when the related deferred tax asset is realized, or the deferred tax liability is settled.

Deferred tax assets are recorded when it is considered likely that the group entities will generate sufficient future taxable income against which temporary differences can be used.

In accordance with IAS 12 “Income Taxes”, deferred taxes have been recognized on temporary differences arising between the taxable and accounting value generated by investments in related companies, since the Company maintains control of the moment of reversal of the temporary difference. Therefore, deferred tax arising from foreign currency translation or shares in other comprehensive income of associates recorded directly in net equity in the other comprehensive income statement has not been recorded.

In accordance with IFRIC 23, uncertainty regarding income tax treatments, current and deferred current taxes reflect uncertainty related to income taxes, when applicable.

2.20. Employee benefits

Many of CMPC’s subsidiaries located in Chile have collective bargaining agreements with their employees that grant termination benefits in the event of voluntary retirement or termination. A liability is therefore recognized in accordance with the accounting standards using an actuarial methodology that considers turnover, discount rate, salary increase rate and average retirement age. This liability is presented at present value using the projected unit credit method.

Brazilian subsidiary Melhoramentos CMPC Ltda. signed a commitment in 1997 with the employee labor union to provide medical assistance for life to its retired employees as of that date. The amount recorded in the current financial statements refers to the actuarial calculation of the obligation generated by this commitment.

These obligations are considered as “Defined Benefit Plans” according to IAS 19 "Employee Benefits", and are recorded in Provisions for employee benefits, current and non-current liabilities, based on the probability of payment before or after 12 months from the date of presentation of the consolidated statement of financial position of the company. The expenses related to these commitments are recorded according to accrual criteria during the employees' working life.

Profits or losses due to changes in actuarial assumptions, if any, are recognized in equity in other comprehensive income within “Actuarial profits or (losses) on defined benefit plans reserves”.

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For employees of foreign subsidiaries whose country legislation establishes the providing of seniority benefits to employees, an obligation is recorded on the basis of actuarial studies carried out using the projected unit credit method. Distinguishing between those that are expected to be settled in the short and long term.

Brazilian subsidiary CMPC Celulose Riograndense Ltda. has a collective bargain agreement with its employees that establishes annual accrual of profit sharing according to established goals, payable every three years.

Additionally, the Company maintains obligations associated with Seniority Awards.

These obligations are according with the characteristics of short-term and other long-term employee benefits, depending if they are expected to be settled before or after the 12 months from the date of presentation of the Consolidated Financial Statements; which "Current and non-current provisions for employee benefits" will be classified as liabilities. For both cases, the provision is recorded as an expense in the accrued period.

2.21. Provisions

Provisions are recognized when CMPC has a present legal or constructive obligation as a result of past events, when it is estimated that it is probable that an outflow of funds will be required to settle the obligation and when the amount of this obligation can be reliably estimated.

The amount recognized as a provision reflects the best estimate of the disbursements that are expected to be necessary to cancel the obligation at the end of the period, and is discounted to the present value when the financial effect produced by the discount is considered material.

Restructuring provisions are recognized in the year in which CMPC is legally or constructively committed to the plan. Relevant costs are only those which are incremental or incurred as a result of the restructuring.

Restructuring provision is recognized with the estimated cost according with the formal plan of closing, and is revaluated annually, or as of the date on which such obligations are known. The Company recognizes restructuring provision at net present value discounting the provision using the free-risk discount rate depending on the underlying currency and depending on the duration of the obligation. Variables related to discount rates used and of the costs of incurring are reviewed annually.

Additionally, they are considered provisions to be charged to income as a result of civil, labor and tax lawsuits. These provisions correspond to estimates made in accordance with the accounting policy of CMPC and are intended to cover eventual effects that may arise from the resolution of lawsuits in which the company and its subsidiaries are involved. These lawsuits are derived from transactions that form part of the normal course of CMPC's business and their details and scope are not publicly known and their detailed exposure could affect the company’s interests, progress and resolution, according to legal reserves of each administrative and judicial procedure. Therefore, based on IAS 37 "provisions, contingent liabilities and contingent assets", paragraph 92, although the amounts provisioned in relation to these lawsuits are indicated, no further detail of them is disclosed at the close of these Consolidated Financial Statements.

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2.22. Revenue recognition

Revenue from contracts with customers is composed of sales of products, raw materials and services, at the exchange rate on the day of the transaction in consideration of the functional currency of each subsidiary.

Sales associated with discounts by volume subject to compliance with certain objectives are recognized at net value, estimating the probability that those discounts will either be met or not.

Sales subject to return and their associated costs are recognized at net value considering the provision estimated for future returns.

Revenue from the sale of goods is recognized once the Company has transferred control of those goods to the customer and does not maintain the right to dispose of them.

The acceptance of the goods and services by the customers indicates that they have obtained control. CMPC has defined as an indicator of transfer of control for exports, the international rules and terms for trade contracts (Incoterms 2010) agreed with the customer, being the official rules as issued by the International Chamber of Commerce.

- DAT (Delivered at Terminal), DAP (Delivered at Place), DDP (Delivered Duty Paid) and similar, by virtue of which the Company has to deliver the goods to the customer at the port of destination or on the last means of delivery transport used, or at the place of destination agreed, in which case the sale is made at the time of delivery to the customer, recognizing the revenue at the time of delivery of the product.

- CIF (Cost, Insurance & Freight) and similar, by means of which the Company organizes and pays the cost of external transport and some other expenses, although CMPC ceases to be responsible for the goods once they have been delivered to the ocean or air shipping company according to the relevant deadline. The point of sale is, consequently, the delivery of the goods to the carrier hired by the seller for transport to the destination.

- FOB (Free on Board) and similar, where the customer organizes and pays for the transport, therefore, the point of sale is the delivery of the goods to the carrier hired by the buyer.

When sales do not comply with the conditions described above, it will be recognized as deferred income in current liabilities, subsequently recognized as Revenue from ordinary activities to the extent that the conditions of transfer of control of the goods are met.

CMPC acts as principal against the performance obligation associated with the transport of the goods to customer' facilities, these costs are not invoiced separately but are included in the sale price of the invoiced goods, therefore an additional performance obligation is generated which is satisfied at the time of the transfer of control of the goods to the customer and is recognized as part of the cost of sales.

Revenue from sales of products, raw material and services are recognized once the performance obligation is satisfied, i.e., once the product is received and the customer has accepted the service.

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2.23. Leases

CMPC has adopted IFRS 16 "Leases" using the modified retrospective approach since January 1, 2019 and, therefore, comparative information has not been restated and continues to be reported according to IAS 17 "Leases" and IFRIC 4 "Determination of whether an agreement contains a lease.” a) Accounting policy from January 1, 2019

At the start of a contract, the Company evaluates whether this is, or contains, a lease, that is, if the contract gives the right to control the use of an identified asset for a period in exchange for a consideration. To assess if a contract conveys the right to control the use of an identified asset, Empresas CMPC evaluates if: i) The contract implies the use of an identified asset; this can be specified explicitly or implicitly. If the supplier has a substantial replacement right, then the asset is not identified; ii) The Company has the right to obtain substantially all the economic benefits of the use of the asset during the period; and, iii) The Company has the right to direct the use of the asset, this right is considered when the decision making is relevant, for example how and for what purpose the asset is used. In exceptional cases where the decision on how and for what purpose the asset is used is predetermined. Empresas CMPC has the right to direct the use of the asset if it has the right to operate the asset, or designed the asset in a way that predetermines how and for what purpose it will be used.

At the beginning or in the re-evaluation of a contract that contains a lease component, Empresas CMPC allocates the compensation in the contract to each lease component based on their independent relative prices, which is, allocating the associated capital cost separately.

Lessee

CMPC recognizes a right of use the asset and a lease liability at the date the lease contract is initiated.

The right of use of the asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payment made on or before the start date, plus the initial direct costs incurred and an estimate of the costs to dismantle the underlying asset or to restore the underlying asset or the site in which it is located, less the lease incentives received.

The right of use the asset is subsequently depreciated using the straight-line method from the start date to the end of the estimated useful life according to the term of the contract.

The estimated useful lives of the right of use the assets are determined according to the term of the contract considering any probabilities of future renewals. In addition, the right of use of the asset is periodically reduced by impairment losses (note 2.10), if applicable, and adjusted for certain new measurements of the lease liability.

33 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The lease liability is initially measured at the net present value of future minimum lease payments, discounted using the interest rate implicit in the lease or, if that rate cannot be easily determined, the Company's average independent borrowing rate, incorporating additional adjustments considering the risk of the country and each of the subsidiaries.

The lease payments included in the measurement of the lease liability include the following:

- Fixed payments, included in the contract, less any lease incentive receivable; - Variable lease payments, which depend on an index or a rate; - Amounts that the lessee expects to pay as residual value guarantees; - The exercise price under a purchase option that the Company can reasonably exercise; - Penalties for early termination of a lease unless the Company is reasonably certain that the contract will not be terminated in advance.

The lease liability is measured at amortized cost using the effective interest rate method. It is re-measured when there is a change in minimum future lease payments that arise from a change in an index or rate: i) The term of the lease, ii) The evaluation of an option to purchase the underlying asset, iii) The amounts payable expected in a residual value guarantee, or iv) The indices or rates used to determine future lease payments. When the lease liability is modified, an adjustment is made to the corresponding book value of the right of use of an asset, or it is recorded in profit (loss) if the book value of right of use of asset has been reduced to zero.

CMPC presents right of use of assets in property, plant and equipment category and the associated obligations in Liabilities for operating leases, current and non-current, within the Consolidated Statement of Financial Position.

In the Consolidated Statement of Comprehensive Income, interest expense and asset depreciation charge are presented separately, so that interest is recorded in the Financial Costs item in the period incurred.

CMPC has chosen not to recognize right of use if assets and lease liabilities for those contracts which term is 12 months or less, and for those contracts, which assets are less than US$20,000. The Company recognizes the lease payments associated with these operations as a linear expense during the term of the contract.

Lessor

When CMPC acted as a lessor, it determined at the beginning of the lease whether each contract corresponds to a financial or operating lease.

The Company recognizes lease payments from operating leases as income in a linear manner during the term of the contract

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b) Treatment under IAS 17 (Applicable before January 1, 2019)

In the comparative period, as lessee, CMPC classified the leases that transfer substantially all the risks and benefits of the property as financial leases.

Assets held under other leases were classified as operating leases and were not recognized in the Consolidated Statement of Financial Position. Payments made under operating leases were recognized in income on a straight-line basis over the term of the contract.

The lease incentives received were recognized as an integral part of the total lease expense during the term of the contract.

The accounting policies applicable to the Company as lessor in the comparative period are not different from those stipulated by IFRS 16.

2.24. Dividends distributed

The distribution of dividends to shareholders is recognized as a liability at the close of each fiscal year in the Consolidated Financial Statements, based on the dividend policy agreed by the Board of Directors and reported to the shareholders meeting.

2.25. Environment

If there are environment liabilities these are recognized on the basis of current interpretation of environmental laws and regulations, when a current obligation is likely to be incurred and the amount of that liability can be reliably estimated.

Investments in infrastructure intended to comply with environmental requirements are capitalized following the general accounting criteria for property, plant and equipment.

2.26. Research and development

These expenses are presented in the statement of comprehensive income at line item “Administrative expenses”, and are recorded in the period in which they are incurred.

2.27. Advertising expenses

These expenses are presented in the statement of comprehensive income in the period in which they are incurred.

2.28. Earnings per share

Earnings per share are calculated by dividing the net profit attributable to the shareholders that are owners of the Company by the weighted average number of ordinary shares subscribed and paid during the year. There are no diluted shares.

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2.29. Insurance expenses for goods and services

Payments of insurance policies purchased by the Company are recognized as an expense in proportion to the period of time they cover, regardless of the payment terms. Amounts paid and not consumed are recognized within current assets as “Other non-financial assets”.

The costs of claims are recognized in the statement of comprehensive income once the amounts are known. Recoverable amounts are recognized in trade and other accounts receivable as a reimbursable asset by the insurance company, calculated according to the terms of the insurance policies, once all the conditions that guarantee their recovery are met.

NOTE 3 –RISK MANAGEMENT

Empresas CMPC S.A. and its subsidiaries are exposed to a combination of market, financial, operating, compliance and strategic risks inherent to their business. The program of Risk Management of CMPC seeks to identify and manage such critical and emerging risks, including all risks caused or intensified by climate change, in the most adequate manner to minimize potential adverse effects. CMPC’s Board of Directors establishes the general framework for the Company’s risk management, which is then implemented at the different levels of the organization. The Board supervises the risk management of CMPC and establishes committees to analyze in details different type of risks, such as financial risk, Ethics and Compliance, Corporate Affairs, Sustainability and Audit. Additionally, the management coordinate and control the correct execution of the prevention and mitigation policies of the main risks identified, among them are the Risk, Finance, Compliance, Sustainability and Internal Audit departments.

3.1. Financial risk

The main financial risks that CMPC has identified are: commodity risk, risk arising from the conditions of the financial markets (including foreign currency exchange rate and interest rate risks), credit risk and liquidity risk.

The Company follows a policy of concentrating a large portion of its financial debt, bond issuances, foreign exchange and derivatives trading in its subsidiary, Inversiones CMPC S.A. The purpose of this policy is to optimize resources, achieve an economy of scale, and improve operating controls.

On the other hand, the ability to access loans in local or international capital markets may be restricted due to external reasons at the time when financing is needed, which could have material adverse effects on the flexibility on reacting to various economic and market conditions. a) Commodity price risk

A considerable share of CMPC’s revenue is derived from products, which price depends on the prevalent conditions at international markets over which the Company has no significant influence or control. These factors include fluctuations in global demand (mainly driven by economic conditions in China, North America, Europe and Latin America), variations in the industry’s installed capacity and real production, inventory levels,

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business strategies and competitive advantages of the main players in the forestry industry, availability of substitute products and the stage of the product’s life cycle. One of CMPC’s main product categories is Bleached Kraft Pulp, which represents 44% of consolidated sales and is distributed to approximately 208 customers approximately 43 countries in Asia, Europe, America and Oceania.

On the other hand, the Company benefits, partially, from the diversification of its business lines and the vertical integration of its operations to have some flexibility in managing its exposure to fluctuations in pulp prices. The impact of a possible decrease in pulp prices would be offset to a partial extent by the resulting reduced input cost of certain other more elaborated products, especially tissue paper and boxboard.

It should be noted that the ability to redistribute the export of our products to different markets in response to potential adverse circumstances and achieve the desired price could be limited. b) Risk of exchange rate

CMPC is affected by currency fluctuations in three ways: a) the Company’s income, costs and expenses, which directly or indirectly are denominated in currencies other than the functional currency; b) exchange rate variations arising from a possible accounting mismatch that exists between assets and liabilities in the Consolidated Balance Sheet denominated in currencies other than its respective functional currency; and c) the provision of current taxes mainly due to the investments of Softys outside of Chile and deferred taxes, mainly in Brazil, for those companies that use a functional currency distinct from its tax currency.

Exports by CMPC and its subsidiaries accounted for approximately 50% of sales of 2019, with the primary destinations being the markets of Asia, Europe, Latin America and the United States. Most of these export sales were made in dollars.

On the other hand, CMPC’s domestic sales in Chile and those of its subsidiaries in Argentina, Brazil, Colombia, Ecuador, Mexico, Peru and Uruguay, represented 50% of the Company’s total sales. These sales were primarily made in the local currency of the respective country.

Furthermore, the cash inflow from sales in dollars or indexed to this currency amounts to approximately 59% of the Company’s total sales. At the same time, expenses, raw materials, supplies and replacements required for continued operation, such as investing in property, plants and equipment, are also mostly denominated in or indexed to dollars.

Due to the nature of CMPC’s business, the Company’s subsidiaries make sales or acquire payment commitments in currencies other than their functional currency. In order to avoid the risk of exchange rate, hedging transactions are carried out through derivatives in order to fix the exchange rates in question. As of December 31, 2019, a significant portion of the estimated sales of cardboard and wood in Europe, in euros and British pounds, was covered up to the current year and to a lesser extent for the year 2020.

Considering that the structure of the Company’s revenue is highly indexed to the dollar, most liabilities have been incurred in that currency. In the case of foreign subsidiaries dedicated to CMPC’s Softys business segment, which collect receivables in local currency, part of their debt is denominated in the same currency to reduce financial and accounting mismatches. Other mechanisms used to reduce accounting mismatches are managing the currency denomination of the financial investment portfolio, occasional contracting of short-term future operations and, in certain cases, transactions using options, which are subject to limits

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previously authorized by the Board of Directors and represent a small amount in relation to the Company’s total sales.

From an accounting point of view, fluctuations in the exchange rate of local currencies have an impact on the deferred tax provision. This effect is caused by the difference in value of assets and liabilities in the financial accounting as opposed to the value reflected in the tax accounting when the functional currency ( dollar) is different from the tax currency (local currency of the respective business unit). The main impact is derived from the pulp segment of Brazil. Thus, devaluation in the currencies of those countries with respect to the dollar implies a higher deferred tax provision.

Although these adjustments in the provision do not involve a cash flow, they cause volatility in the reported financial results.

Sensitivity analysis

The Company has an active accounting exposure in relation to currencies other than the dollar, which is the Company’s functional currency. As of this date, the Company has more assets than liabilities denominated in currencies other than the dollar, including the underlying rights and obligations of current derivative contracts, in the amount of US$1,893 million as of December 31, 2019 (US$1,167 million as of December 31, 2018). In addition, if the exchange rate of these currencies (mostly Chilean pesos, Brazilian real) appreciated or depreciated by 10%, it is estimated that the effect on the Company's equity would be an increase or decrease of US$189 million calculated with figures as of December 31, 2019 (US$117 million as of December 31, 2018). The effect described above would have been recorded as credit or charge in the Reserves for Exchange Differences by Conversion and as loss or gain for the year, as shown below:

December 31, 2019 December 31, 2018 10% 10% 10% 10% appreciation depreciation appreciation depreciation ThUS$ ThUS$ ThUS$ ThUS$ Effect of foreign currency translation differences on reserves 185,413 (185,413) 115,801 (115,801) Effect on profit (loss) 3,901 (3,901) 879 (879) Net effect on equity 189,314 (189,314) 116,680 (116,680)

As of December 31, 2019 and 2018, the Company has assets in Brazil, which functional currency for financial purposes is the dollar and for tax effects is Brazilian real. This generates temporary differences due to the variation of the mentioned currency. It should be noted that, like the previous sensitivity analysis, this analysis is forward-looking using the closing figures of the corresponding periods. Below is the sensitivity analysis of this concept:

December 31, 2019 December 31, 2018 10% 10% 10% 10% appreciation depreciation appreciation depreciation ThUS$ ThUS$ ThUS$ ThUS$ Effect on income tax expenses 68,145 (68,145) 68,694 (68,694)

c) Interest rate risk

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The Company's financial investments bear interest primarily at fixed interest rates, eliminating the risk of changes in the market interest rate. Financial liabilities are mostly at fixed interest rates. For debt with variable interest rates, CMPC minimizes the risk by using derivative instruments, thereby managing to fix the interest rate for approximately 99% of the debt. It should be noted that the remaining 1% is mainly debt in Brazilian real. d) Credit risk

Credit risk arises primarily from the potential insolvency of certain customers of CMPC´s subsidiaries and the consequent inability to collect on outstanding accounts receivable and finalize transactions.

In order to minimize its exposure to credit risk, CMPC through its subsidiaries, has signed credit insurance policies that cover a significant portion of sales, both export and local. The insurance policies that the Company holds are provided by Atradius Credit Insurance NV (rated A2 according to the credit rating agency Moody’s) and Compañía de Seguros de Crédito Continental S.A. (rated AA- according to both Humphreys and Fitch Ratings credit rating agencies). Both policies have a coverage of 90% of the amount of each invoice, for preferential and non-preferential clients. Additionally, CMPC also has at its disposal letters of credit and other instruments which allow to ensure and mitigate the credit risk.

Furthermore, the CMPC Corporate Credit Committee is in charge of supervising and evaluating on a regular basis its clients’ ability to pay, as well as managing the granting, rejection or modification of clients’ lines of credit. For that purpose, CMPC has a Credit Policy applicable to all of its subsidiaries, which allows control and management of the credit risk of forward sales.

Accounts receivable according to coverage as of December 31, 2019 and 2018 are detailed as follows:

12/31/2019 12/31/2018 % % Credit Insurance or Letters of Credit 81% 79% Not covered with insurance policies 19% 21% Trade accounts receivable 100% 100%

Effective management of credit risk and wide distribution and diversity of sales has resulted in very low customer portfolio credit losses, which in the current period amount to 0.05% of sales as of December 31, 2019 and 2018.

There is also credit risk in the execution of financial operations (counterparty’s risk). Counterparty’s risk arises when there is a likelihood that the counterparty to a financial contract will not be able to fulfill the financial obligations to the Company that it has incurred. To reduce this risk in its financial operations, CMPC establishes individual exposure limits by financial institution, approved periodically by the Board of Directors of Empresas CMPC S.A.

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The financial institutions in which CMPC has investments are detailed as follows:

12/31/2019 12/31/2018 Issuer Portfolio % ThUS$ Portfolio % ThUS$ Citibank N.A. N.Y. - United States 19.67% 116,303 4.42% 42,492 MUFG Bank, Ltd. - United States 19.35% 114,399 5.22% 50,147 Banco BCI - Chile 10.20% 60,294 12.19% 117,093 Scotiabank - Chile 8.51% 50,279 12.54% 120,482 BNP Paribas New York - United States 6.77% 40,000 - - Banco Itaú Corpbanca - Chile 5.10% 30,154 22.05% 211,874 Banco Santander - Brazil 5.00% 29,586 1.39% 13,326 Banchile Corredores de Bolsa S.A. - Chile 3.92% 23,169 4.13% 39,695 Banco Safra S.A. - Brazil 3.33% 19,665 - - BBVA Corredores de Bolsa S.A. - Chile 2.85% 16,874 1.71% 16,452 Banco de Crédito del Perú 2.18% 12,860 0.77% 7,361 Banco Itaú - Brazil 2.13% 12,594 1.06% 10,218 Banco BBVA - Peru 1.64% 9,668 0.25% 2,359 Banco Santander - Chile 1.56% 9,226 21.15% 203,213 Caixa Econômica Federal - Brazil 1.35% 7,990 - - Banco Nacional de México, S.A. 1.33% 7,854 - - Banco do Brasil 0.85% 5,002 0.01% 87 Bank of America Merrill Lynch Banco Múltiplo S.A. - Brazil 0.67% 3,983 0.00% 17 Banco de Chile 0.52% 3,045 0.66% 6,307 Banco Bradesco S.A. - Brazil 0.51% 3,043 0.04% 397 JP Morgan Chase Bank, N.A. - United States 0.50% 2,939 5.82% 55,927 Banco MUFG Brasil S.A. 0.41% 2,448 0.03% 334 Citibank - Peru 0.35% 2,066 0.00% 3 Scotiabank Inverlat S.A. - Mexico 0.33% 1,931 0.19% 1,806 Galicia Administradora de Fondos S.A. - Argentina 0.33% 1,928 0.09% 863 JP Morgan Chase Bank, N.A. - Brazil 0.17% 982 0.00% 13 BNP Paribas - France 0.12% 733 - - Scotiabank - Peru 0.12% 682 0.10% 954 Citibank N.A. N.Y. - England 0.09% 508 0.64% 6,186 Banco Santander - Mexico 0.04% 259 0.66% 6,306 Bank of America, N.A. - England 0.04% 233 - - JP Morgan Chase Bank, N.A. - England 0.03% 165 0.04% 414 Banco Monex, S.A. - Mexico 0.02% 141 0.01% 105 BBH & Co. Money Market Fund - United States 0.01% 116 0.01% 142 Banco de la Producción S.A. Produbanco - Ecuador 0.00% 32 0.00% 7 Banco Banrisul - Brazil 0.00% 18 - - BancoEstado - Chile - - 2.18% 20,980 Consorcio Corredores de Bolsa S.A. - Chile - - 1.01% 9,659 Scotiabank Azul - Chile - - 0.92% 8,840 BancoEstado S.A. Corredores de Bolsa - Chile - - 0.64% 6,112 Goldman Sachs International - United Kingdom - - 0.05% 509 JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil - - 0.01% 92 HSBC Bank - Chile - - 0.01% 50 Subtotal 100.00% 591,169 100.00% 960,822 Plus: cash and bank accounts 42,710 39,244 Total cash and cash equivalents and other financial 633,879 1,000,066 assets e) Liquidity risk

This risk refers to the eventual inability of the Company to fulfill its obligations as a result of insufficient liquidity. CMPC manages this risk through the appropriate distribution, extension of due dates and limits on the amount of its debt, as well as by maintaining a liquidity reserve and management of its operational and investment cash flows.

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The Company, as previously mentioned, has a policy of concentrating its financial debt in the subsidiary Inversiones CMPC S.A. which finances the operating subsidiaries. Debt is primarily incurred through bank loans and bonds placed in international markets and in the local Chilean market.

To maintain an adequate reserve of liquidity, in addition to the effective cash position held by the Company, in March 2017, the subsidiary Inversiones CMPC S.A. obtained a Committed Line of credit with Banco Santander, Export Development Canada, Scotiabank & Trust (Cayman) Ltd. and MUFG Bank, Ltd., acting as structurer. This credit line amounts to ThUS$400,000 and has a maximum term of 3 years. In August 2018, this committed credit line was extended for two additional years (from September 13, 2020 to September 14, 2022) for a total amount of ThUS$200,000 with Banco Santander y Export Development Canada, Scotiabank & Trust (Cayman) Ltd. As of December 31, 2019, the credit line is fully available.

The financial policy followed by CMPC, contained in its financial objectives policy, along with its strong competitive position and high quality assets, enables Empresas CMPC S.A. to have an international credit rating of BBB- according to Standard & Poor’s (stable outlook), Baa3 according to Moody’s (positive outlook) and BBB according to Fitch Ratings (stable outlook) one of the best ratings in the forestry, pulp and paper industry in the world.

It should also be noted that the Board of Empresas CMPC S.A. together with its management, have established a policy of financial objectives, beyond those required by creditors in order to maintain a solid financial position.

The Financial Objectives Policy considers the following criteria: i) Cash (*) > debt amortization + finance costs in the next 18 months. ii) Net financial debt (**) / EBITDA between 2.5 to 3.5: The objective of CMPC is to be in the lower part of the range indicated in ii) however, this indicator may fluctuate within the range, especially during and after periods of significant investments and / or cycles of low pulp prices. iii) Financial debt with third parties (***) over equity (adjusted for contracts) < 0.50. iv) Interest coverage ratio [(EBITDA + finance income) / finance costs] > 5.0.

(*) Cash: Cash and cash equivalents plus time deposits over 90 days (see Note 8). Additionally, all the committed and non-disbursed lines that CMPC maintains with one or more Financial Institutions will be considered. (**) Net financial debt: financial debt with third parties less cash. (***) Financial debt with third parties: total interest bearing loans - other obligations + liabilities on swap and cross-currency swap operations + hedging liabilities - assets on swaps and cross-currency swaps - hedging assets (see Note 22 letter e).

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The Board of directors and Management constantly monitor compliance with these objectives. If the net financial debt / EBITDA reaches 4 times, the necessary measures are taken to assure that this indicator falls below the expected limit within the next 6 months.

As of December 31, 2019 and 2018, Empresas CMPC S.A meets fully with all the established financial objectives.

3.2. Strategic risks a) Water availability risk for industrial processes

Water is an indispensable and strategic resource for the Company‘s industrial operations. Climate change could have an impact on the availability of water due to acute events such as draughts, or chronic ones such as a gradual decrease in precipitations and/or precipitations which are more concentrated in time. It could also mean less accumulation of mountain water in the watersheds where the Company operates in Chile.

CMPC owns rights for the extraction of enough water for its industrial operations. Additionally, the Company is examining new technology and processes in order to reduce its industrial water consumption. Nonetheless, it is not immune from risk associated with significant changes in the availability of water as a result of environmental phenomena such as the ones previously mentioned. b) Risks of rural fires and lack of fiber availability

In turn, forest plantations can suffer losses due to fires affecting fiber availability. The Company has developed fire prevention programs with communities and in parallel it has developed fire fighting systems to reduce its impact. Additionally, there are other natural risks, which can affect fiber availability, such as strong winds or pests that can affect the plantations. These potential events have partial insurance coverage limited by deductibles and compensation maximums, determined in accordance with the historical losses and the levels of prevention and protection implemented. If these losses are generated, a shortage of wood fiber and a rise in its price can be generated, which would negatively impact the Company's operations.

On the other hand, rainfall is a fundamental element in the growth and yield of plantations. Although the company, through management and genetic improvements, has been able to increase the yield of the plantations, it is not without risks due to significant changes in environmental conditions, which result in significant reductions to precipitation and/or more isolated rainfall. c) Risks of the relation with the community and social license to operate

CMPC runs forestry and industrial operations in different geographical locations in Chile and abroad. The Company's community relations policy aims to contribute to the environmental and social sustainability of all these communities, generating programs for employment, education and the furthering of productive development, including support for micro-entrepreneurship initiatives by families that live in these areas and places, as well as permanent communication spaces.

The forestry and industrial presence of CMPC in Chile includes municipalities in the regions of Biobío and Araucanía, where attacks and acts of violence have taken place and have been widely reported by the media

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and investigated by the corresponding institutions. The affected areas have low development levels and various long-standing social problems. Despite the escalation in the amount and violence of the actions indicated, until now the problem has been limited to specific areas and the effects on CMPC have been limited.

It is worth highlighting the initiatives to safeguard and appreciate the ancestral Mapuche culture, including the protection of 22 sites of cultural interest and the support of productive and artisan enterprises, and plans for the use of local labor (“MOL” in Spanish).

In the field of education, the CMPC Foundation, which in 2019 reached 19 years of existence, benefits more than 6,500 children from 58 schools, kindergartens and nurseries in 11 municipalities. It provides training and counseling to 222 teachers, 71 school principals and 138 nursery teachers and assistants. Additionally, since March 2019, the HIPPY program is instructed in 222 households through 25 tutors in 8 communes, making a total of 6,656 home visits to date.

In the cultural sphere, the Jorge Alessandri Park located in Coronel, an eleven hectare park open to the community in the Bío-Bío Region, received approximately 140,027 visits in its cultural and educational areas in 2019 and the Artequín Museum of CMPC in Los Angeles, Chile, received 19,556 visitors over the same period. d) Geopolitical and economic risks

Changes in the political or economic conditions in the countries where CMPC operates could affect the Company's financial and operating performance, as well as the fulfilment of its business plan. CMPC has industrial operations in 8 countries (Chile, Brazil, Argentina, Colombia, Ecuador, Mexico, Peru and Uruguay). The operations located in Chile account for 57% of total assets and originate 51% of sales. In turn, Brazil represents approximately 31% of CMPC's total assets.

In the countries where CMPC operates, the state has substantial influence over many aspects of the private sector, including changes in tax regulations, monetary policies, the exchange rate and public spending. It can also influence regulatory aspects, such as labor and environmental regulations. In recent years, in countries such as Chile, Mexico, Peru and Colombia, tax reforms have been implemented, while in Brazil a tax reform is currently under discussion. Additionally, after the civil movements in Chile, the country is in the process of potentially changing the constitution. All these legal modifications impact and will impact the economic performance of the Company by decreasing its cash flows destined to pay for the investments made there, as well as affecting its savings and future investments.

In the event that there are restrictions on international trade such as protectionist actions, as announced by economic powers recently, the execution of our commercial strategy could be affected. However, despite the fact that a significant part of our exports are destined for the Asian market, our commercial relations with all countries and the final customers of our products have remained fluid and balanced.

Below are the strategic risks that were identified during 2019 with a brief description, since their analysis and deepening to generate a strategy of their management is still under development:

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i) Positioning of the forest, wood and bio-packaging industry: The Company identifies the risk of failing to position the relevance of the forest, use of biofuels and the generation of bioproducts in society. At the same time, there are important opportunities in the positioning of the forest industry as an industry that plays a crucial role in carbon sequestration, which also occurs with the wood industry. In addition, bioproducts have an important positioning opportunity as renewable alternatives that replace options based on non-renewable fossil products. ii) Risks of acquisitions and investment projects: CMPC has an important investment plan, with annual amounts around ThUS$500,000. In addition, CMPC carries out investment projects that imply significant disbursements. Additionally, CMPC is a company that bases its growth not only on organic growth, but also evaluates, and can carry out, acquisitions of businesses or companies. All these investments have a risk of not being properly evaluated, or have the risk that the assumptions and scenarios considered in the evaluations do not occur as they were budgeted. Although CMPC has different levels of review and approval of investment and acquisition projects, is not exempt from the risk that they do not generate the desired value. iii) Product innovation risks for the market: The Company has identified the need to have a special orientation towards the market and customers. In this way, product innovation is considered a key issue for the company. Thus, CMPC identifies as critical the risks associated with not innovating in relation to the competition, to not anticipating opportunely the needs of the market or to the appearance of substitutes and alternatives that imply a loss of value to our products.

Therefore, the company is working, and will continue to deepen, in different projects aimed at increasing the capacities and culture of innovation in the company. iv) Knowledge and talent management risks: Part of the company's competitive advantages, and its future perspectives, depend on knowledge management and talent retention and attraction. CMPC identifies knowledge and talent management as fundamental and strategic, therefore CMPC identified this issue within the main risks. Proper management of talent and knowledge not only prevents the risk of loss of knowledge and the inability to retain or attract talent, but also allows to be proactive, capturing the various associated opportunities.

3.3 Operational risks

The main operational risks identified by the company are fires or explosions of industrial facilities, natural disasters, critical equipment failures, environmental incidents, attacks on assets and blockages of access and roads, and accidents or occupational diseases.

Another operational risk that can have a high impact for the company is that of cybersecurity. The increase in cases of cybersecurity and cybercrime in Chile and the world represents a potential risk to the security of our information technology systems, including those of our productive plants, service providers, as well as the confidentiality, integrity and availability of the data stored in these systems, some of which depend on the services provided by third parties.

CMPC and its main IT service providers have contingency plans and have adopted measures to prevent or mitigate the impact of events such as interruptions, failures or breaches, due to causes such as natural

44 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

calamities, power outages, security breaches, computer viruses or cybersecurity attacks. Despite that, the company remains susceptible to possible information attacks in the countries where it operates.

These risks, if materialized, can have a significant impact on the continuity of operations, generating paralyzes, along with impacting production goals, affecting the ability to meet customer needs. In addition, they may force unscheduled disbursements in asset maintenance and recovery, all of which may adversely affect CMPC's financial results. Additionally, the materialization of these risks can have significant consequences on the occupational health and safety of workers, the environment, communities and the reputation of the company.

CMPC’s operational risk management objectives are to efficiently and effectively protect employees, the Company's assets, process and systems, the environment and the continuity of business operations in general. For that purpose, the Company uses a balanced combination of accident and prevention measures. Loss prevention work is systematic and carried out in accordance with pre-established guidelines and regular inspections by insurance company specialists. In addition, CMPC has a continuous improvement plan for its operational risk conditions in order to minimize the probability of occurrence and attenuate the possible effects of losses incurred. Each of the Company's business units manages these plans in accordance with regulations and standards defined and implemented at a corporate level.

In addition, CMPC and its subsidiaries maintain insurance coverages to protect themselves against a substantial part of their main risks. These risk coverages are purchased from high quality local and international insurance companies. The risks associated with the operating activities of the business are periodically reviewed to optimize coverage, according to the insurance market´s competitive offers. In general, the conditions on limits and deductibles of insurance policies are established on the basis of maximum estimated losses for each risk category and the coverage conditions offered in the market.

All the Company’s infrastructure assets (buildings, installations, equipment, etc.) are covered for operational risks by insurance policies at their replacement value.

3.4 Compliance risks a) Corruption and affectation of free competition

Compliance risks are associated with the Company’s ability to comply with legal, regulatory, contractual, and non-contractual obligations and standards that are self-imposed in, in addition to the risks already discussed above. Every business unit at CMPC regularly reviews its operating and administrative processes in order to ensure proper compliance with the laws and regulations applicable to it. In addition, CMPC is renowned for maintaining a proactive attitude in matters relating to safety, the environment, labor conditions, market operation and community relations.

The Company has implemented and is taking actions that continue to strengthen a series of processes, controls and systems to prevent the occurrence of acts of corruption, both internal and public. Within the framework of this constant concern, international best practices have been adopted and corporate governance structures modified, in order to make more efficient and deepen the efforts described. Along with the existence of board committees that oversee the correct identification and mitigation of these risks,

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there are corporate areas with a high level of independence that interact transversally in these processes, whose objective is to make the controls and preventive actions defined more effective. These areas are the Risk, Finance, Compliance and Internal Audit Management. These structures, standards and controls have been implemented with the support of experts, both domestic and foreign, in order to obtain an expert, independent and objective point of view of the best practices and industry standards. b) Environmental regulatory changes

Additionally, the Company identifies, within the critical risks, the risk of changing environmental regulations in all countries where it operates. CMPC has been adopting best practices for sustainable development of its businesses, which has meant the voluntary adoption of and compliance with standards stricter than required by legal regulations. This has enabled the Company to adapt to modifications in environmental legislation and meet the new requirements. However, climate change as well as future changes in these environmental regulations or in the interpretation of these laws might have an impact on the Company’s operations. It is important to point out that failing to comply with these or other environmental regulations could cause the Company additional costs which might affect its profitability.

It should be noted that CMPC is committed to sustainability and the environment beyond regulations in the countries where it operates. Since 2012, CMPC's plantations in Chile and Brazil have maintained a certification granted by the Forest Stewardship Council® (FSC®). This accreditation represents a reaffirmation of CMPC's concern for the environment and sustainable development and complements similar long-standing certifications that CMPC has held. In addition, CMPC has a PEFC forestry management certification and an ISO 14,001 environmental management system certification covering most of its operations. Since 2015, Empresas CMPC has been included in the Dow Jones Sustainability Index Chile and since 2017 – in the MILA Pacific Alliance Index, which include 31 Chilean companies and 58 Latin American companies respectively, that meet the sustainability criteria better than their industry peers. In addition, in 2019 the Company was included as the only representative of the Pulp & Paper sector within the 98 global companies highlighted in the Dow Jones Emerging Markets sustainability index (Emerging Markets). Additionally, CMPC is part of the FTSE4Good index since 2015 acknowledging the Company’s commitment to corporate social responsibility and sustainable development.

In 2019, CMPC announced its commitment to specific science-based environmental goals to reduce its emissions of greenhouse gases, water consumption and energy from fossil fuels, improve the quality of water effluents and increase energy generation bio-renewable self-generated. With these efforts, the Company seeks to mitigate the effects of climate change, seize opportunities that arise and anticipate regulatory environmental changes that could have adverse effects on its business and finances.

3.5 Emerging Risks

As part of the first stage of the Risk Management Program that CMPC implemented during 2019, several emerging risks were identified, which are risks that have acquired the status of critical risks in recent years due to changes in the environment. Among the prioritized risks, there are risks that meet this condition more than others, such as cybersecurity risk. This risk has been positioned as a critical risk in many companies in recent years. Another risk that has acquired greater relevance is that of communities and social license to

46 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

operate. This in response to the importance of improving the standards of interaction with the community environment in industries with industrial operations or natural resources, such as forestry.

Some of these risks have in common that climate change is one of its causes, such as the risks of water availability for industrial processes, fiber availability (which is associated with water availability via rainfall for the growth of plantations), and environmental regulatory changes.

Others, for example, rural fires in Chile, although they are mostly caused by humans, are also affected by climate change, since this may favor the spread of fires.

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NOTE 4 - ACCOUNTING ESTIMATES AND JUDGMENT

Estimates and judgments are continuously evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

The preparation of consolidated financial statements under IFRS requires estimates and judgments involving the measure of assets and liabilities, potential exposure to contingent assets and liabilities, and amounts of income and expenses during the period. Consequently, actual results later observed could differ from these estimates.

The accounting principles and areas requiring the use of estimates and judgments in the preparation of the financial statements are biological assets, termination benefits obligations, litigation, other contingencies, useful lives, impairment testing, fair value of derivative contracts or other financial instruments and the determination of a lease term under IFRS 16.

4.1. Biological assets

To determine fair value, CMPC has developed a valuation model that estimates the current value of a forest plantation using the discounted cash flow (NPV) model. This methodology requires the use of economic and forestry assumptions that imply a high level of professional judgment on the part of the Management. Any change in the parameters or assumptions that are applied in the model would generate an appreciation or devaluation in the current valuation of forest plantations.

This model establishes fair values, in dollars, per stand and species, considering different estimations (variables) made by the Management such as:

- Exchange rates (short and long term) - Type of product - Short and long-term harvest program - Lumber price levels - Discount rate - Costs of establishment, administration, harvest, transport and roads - Dasometric information to estimate plantation growth among others

These measurements are classified in Level III according to the requirements of IFRS 13, considering the main data are not observable in the market.

Certain parameters used in the valuation of forest plantations are based on market information. These include prices of the different products marketed, in addition to the costs of harvest, transport and roads. These parameters are the same as those used by the farm purchase team to value the new forests that the Company acquires in the market from third parties.

The Management carries out periodic reviews of the variables that affect the valuation of forest plantations. During the last six months of 2019, the update of these variables has not presented significant effects.

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4.2. Obligations for post-employment benefits and other actuarial liabilities

The Company has actuarial commitments related to: i) Compensation for years of service (Chile), iii) Seniority awards (Chile) iii) Benefits for medical assistance (Brazil)

The provision originated by these concepts is measured according to actuarial techniques, using a methodology that considers a series of economic and demographic assumptions, mainly:

- Discount rate - Labor turnover rate - Salary growth rate - Retirement age - Mortality rate - Disability rate - Estimated inflation rate - Estimated medical inflation rate

This value, thus determined, is presented an actuarial value using the projected unit credit method.

For compensation for years of service and seniority awards, in Chile, CMPC obtains, in a compound form, the annual nominal discount rate based on the yields of the bonds of the Central Bank of Chile in CLP, at similar terms or interpolations thereof. The turnover rates have been determined by reviewing the Company's own experience, considering each subsidiary´s independent turnover rates. Assumptions regarding salary increases are based on market expectations and forecasts, while withdrawals for men and women depend on the age of retirement legally established in the region. The mortality rate and the disability rate used for the actuarial calculations are directly derived from the mortality tables issued by the CMF, understanding that these are an appropriate representation of the Chilean market.

In the case of benefits for medical assistance, in Brazil, the discount rate is determined based on the performance of long-term government securities of the Brazilian government, while the estimated rate of medical inflation and mortality depends on rates prepared by study institutions in level of health and social welfare.

4.3. Litigation and other contingencies

CMPC is involved in various lawsuits for which it cannot accurately determine the possible economic effects on the financial statements in the event of one more unfavorable outcome. In cases where management and the Company's legal counsel believe that favorable results will be obtained, or that the results are uncertain and the lawsuits are pending sentencing, no provisions have been established. In cases where the opinion of the Company’s management and legal counsel is totally or partially unfavorable, provisions have been recognized in “Other gains (losses)” based on estimates of the most likely amounts payable.

The lawsuits and contingencies are detailed in Note 25 to these Consolidated Financial Statements.

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4.4. Useful lives and impairment testing of property, plants and equipment and intangible assets

Property, plant and equipment and intangible assets are depreciated and amortized on a straight-line basis over the useful lives that Management has estimated for each of these production assets. An estimate of the useful life might change significantly as a consequence of technological innovations and actions by competitors in response to significant changes in the industrial sector. Management will review the technical useful life of the assets annually.

Management considers that the assigned values and useful lives, as well as the assumptions used, are reasonable.

In addition, in accordance with IAS 36 “Impairment of Assets”, as of each period, or earlier if there is any indication of impairment, CMPC evaluates the recoverable value of property, plant and equipment, grouped in cash generating units (CGUs), including proportional goodwill determined, to verify whether there are impairment losses. If, as a result of this evaluation, the fair value is lower than the net carrying amount, an impairment loss is recorded as an operating item in the statement of comprehensive income.

4.5. Fair value of derivative contracts or other financial instruments

The fair value of financial instruments not traded at an active market is determined using valuation techniques commonly accepted in the financial market, which are based mainly on market conditions existing as of the date of each financial statement.

These valuation techniques consist of comparing market variables agreed at the inception of a contract to market variables at the time of valuation to calculate the present value of such differences, by discounting future cash flows at relevant market rates, which determine market value as of the valuation date.

4.6. Determination of the lease term

Management applies its judgment and best estimation to determine the lease term for lease contracts that include any renewal options. The evaluation was performed using the best estimation as of the date of the current consolidated financial statements considering the determination if such assets is critical and specific for the operations of the Group. The strategic plans of each subsidiary and holding was reviewed to ensure the reliability of the estimate.

The renewal options affect the underlying lease term and therefore have an impact on the liability and right of use of asset recorded on the consolidated statement of financial position of the Group.

The Management considers that the terms of assigned contracts are reasonable as of the date of issuance of these consolidated financial statements.

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NOTE 5 – CHANGES IN ACCOUNTING POLICIES

The accounting policies, described in the consolidated financial statements as of December 31, 2019, reflect the impact as well the modifications made by the adoption of IFRS 16 and IFRIC 23.

The effect of the initial application of both standards is detailed as follows:

As of As of December IFRS 16 adjustment IFRIC 23 adjustment January 1, Empresas CMPC S.A. and subsidiaries 31, 2018 2019 (audited) Debit Credit Debit Credit (audited) ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Assets Current assets Cash and cash equivalents 967,504 - - - - 967,504 Other financial assets 11,390 - - - - 11,390 Other non financial assets 143,732 - - - - 143,732 Trade and other accounts receivable 970,029 - - - - 970,029 Accounts receivable from related parties 724 - - - - 724 Inventory 1,264,442 - - - - 1,264,442 Biological assets 326,637 - - - - 326,637 Current tax assets 71,925 - - - - 71,925 Total current assets 3,756,383 - - - - 3,756,383 Non-current assets Other financial assets 21,172 - - - - 21,172 Other non-financial assets 171,868 - - - - 171,868 Non-current accounts receivable 38,319 - - - - 38,319 Investments accounted for using the equity method 149 - - - - 149 Intangible assets other than goodwill 32,366 - - - - 32,366 Goodwill 104,459 - - - - 104,459 Property, plant and equipment 7,695,455 187,437 - - - 7,882,892 Biological assets 3,073,955 - - - - 3,073,955 Non-current current tax assets 5,411 - - - - 5,411 Deferred tax assets 83,774 61,112 - - - 144,886 Total non-current assets 11,226,928 248,549 - - - 11,475,477 Total assets 14,983,311 248,549 - - - 15,231,860

Liabilities and shareholders' equity Liabilities Current liabilities Other financial liabilities 439,007 - - - - 439,007 Trade and other accounts payable - - 24,250 - - 24,250 Trade accounts payable and other accounts payable 824,252 - - - - 824,252 Accounts payable to related parties 1,707 - - - - 1,707 Other current provisions 2,160 - - - - 2,160 Current tax liabilities 114,244 - - - 13,472 127,716 Employee benefits provisions 66,433 - - - - 66,433 Other non-financial liabilities 202,778 - - - - 202,778 Total current liabilities 1,650,581 - 24,250 - 13,472 1,688,303 Non-current liabilities Other financial liabilities 3,436,223 - - - - 3,436,223 Liabilities for non-current operating leases - - 188,315 - - 188,315 Other non-current provisions 9,232 - - - - 9,232 Liabilities for deferred taxes 1,560,891 - 53,553 - - 1,614,444 Employee benefits provisions 80,096 - - - - 80,096 Other non-financial liabilities 2,270 - - - - 2,270 Total non-current liabilities 5,088,712 - 241,868 - - 5,330,580 Total liabilities 6,739,293 - 266,118 - 13,472 7,018,883 Shareholders' equity Issued capital 1,453,728 - - - - 1,453,728 Retained earnings 7,157,302 17,569 - 13,472 - 7,126,261 Other reserves (369,195) - - - - (369,195) Shareholders' equity attributable to owners of the parent 8,241,835 17,569 - 13,472 - 8,210,794 Non-controlling interest 2,183 - - - - 2,183 Total shareholders' equity 8,244,018 17,569 - 13,472 - 8,212,977 Total liabilities and shareholders' equity 14,983,311 17,569 266,118 13,472 13,472 15,231,860

51 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

5.1. IFRS 16 “Leases”

The Company adopted IFRS 16 as of January 1, 2019, and as a result it has modified its accounting policy for lease agreements.

IFRS 16 introduced a unique accounting model in the Statement of Financial Position of the tenants. As a result, Empresas CMPC has recognized the right to use assets that represent the rights to use the underlying assets and lease liabilities representing the obligation to make lease payments. The lessor's accounting remains the same as under the previous lease liabilities accounting policies.

CMPC applied IFRS 16 using the modified retroactive approach, according to which the cumulative effect of the initial application is recognized in the gain (loss) accumulated within Equity as of January 1, 2019. Consequently, the comparative information presented as of December 31, 2018 has not been re-expressed, that is, it is presented as previously reported, according to IAS 17 and the related interpretations. The details of the changes in the accounting policies are disclosed below: a) Lease definition

The Company evaluates whether a contract is or contains a lease based on the definition of a lease, as explained in note 2.23.

In transition to IFRS 16, the Company chose to apply the practical expedient to evaluate which transactions are leases. The Company applied IFRS 16 to lease and service contracts that contained the use of assets.

As a lessor, CMPC is not required to make adjustments in the transition to IFRS 16. The Company applied IFRS 15 to allocate the consideration in the contract to each lease and non-lease component. b) Lessee

Within the analysis carried out by the Company, construction, machinery, vehicle and IT equipment leases were identified.

CMPC previously classified the leases as operating or financial based on their assessment of whether the lease transferred significantly all the risks and benefits of ownership of the underlying asset in accordance with IAS 17. Under IFRS 16, CMPC recognizes the right of use of asset and the lease liabilities for most of the leases, that is, these leases are reflected in the Consolidated Statement of Financial Position.

However, the Company has chosen not to recognize the right of use of assets and lease liabilities for some leases of assets which contract value is less than US$5,000 and contracts which term is less than 12 months. Empresas CMPC recognizes the associated lease payments as straight line expense during the term of the contract.

CMPC presents the right of use of assets in property, plant and equipment, and the lease liability in Other non- financial liabilities, current and non-current.

52 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The Company recognizes a right of use of assets and a lease liability on the initiation of each lease.

The right of use of asset is initially measured at cost and, subsequently, at cost less any accumulated depreciation and impairment losses, and is adjusted for any modifications of the lease liability in accordance with CMPC's accounting policies.

The lease liability is initially measured at the net present value of the lease payments that are not paid on the start date, discounted using the interest rate implicit in the lease or, if that rate cannot be easily determined, the individual average borrowing rate of each subsidiary. The lease liability is subsequently increased by the cost of interest on the lease liability and is reduced by lease payments. It is modifies when there is a change in minimum future lease payments that arise from a change in an index or rate, a change in the estimate of the amount expected to be paid, changes in assessing whether an option or renewal is reasonably certain to be exercised or termination option is not reasonably certain to be exercised.

Empresas CMPC has applied judgment to determine the lease term for the lease agreements where there is a renewal option. The evaluation of whether the Company exercises such options has an impact on the term of the lease, which significantly affects the amount of lease liabilities and recognized right-of-use assets. c) Transition from IAS 17 to IFRS 16

Previously, CMPC classified the leases of property, plant and equipment as operating leases according to IAS 17.

Within the operating lease contracts, the warehouses, machinery and computer equipment were mainly identified, which contemplate the option to renew after the end of the period. Some leases provide additional rental payments based on changes in local price indices.

In the transition, for leases classified as operating leases according to IAS 17, the lease liabilities were measured at net present value of the remaining lease payments, discounted at the individual average borrowing rate of each subsidiary at 1 January 2019. The applied weighted rate is around 8.00%. The right to use the assets was measured as if IFRS 16 had been applied since the start date, discounted using the individual borrowing cost on the date of initial application, on January 1, 2019.

Currently, CMPC has leases classified as financial leases according to IAS 17. For these financial leases, the book value of the right to use the asset and the lease liability as of January 1, 2019 were determined at the carrying amount of the lease asset and the lease liability in accordance with IAS 17 immediately prior to that date. That is, these contracts were not analyzed and will be presented separately from IFRS 16. d) Lessor

For leases that were classified as financial under IAS 17, the book value of the right to use the asset and the lease liability as of January 1, 2019 are determined by the carrying amount of the asset and the lease liability under IAS 17 immediately prior to that date.

53 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

5.2 IFRIC 23 “Uncertainty over income tax treatments”

In June 2017, IASB issued IFRIC 23 to explain the application of the recognition and measurement criteria of IAS 12 when there is uncertainty about the treatments to be applied. The Interpretation consider the following issues: i) joint or independent application of tax treatments, ii) the assumptions to be made regarding the review of tax treatments by the tax authorities, iii) how to determine the tax gain (loss), the tax bases, unused tax losses, unused tax credits and tax rates, and iv) how to consider changes in facts and circumstances.

This interpretation is effective since January 1, 2019. The management has performed an analysis about the effects of this standard in the Consolidated Financial Statements and has registered an increase of ThUS$13,472 in current tax liabilities that was recorded as accumulated earnings (losses) within Equity.

NOTE 6 - NEW ACCOUNTING PRONOUNCEMENTS

The following new accounting pronouncements had effective application as of January 1, 2019:

Standards, interpretations and amendments Mandatory application IFRS 16: Leases Annual periods beginning on or after January 1, 2019 IFRIC 23: Treatment of uncertain tax positions Annual periods beginning on or after January 1, 2019 Amendment to IFRS 3: Business combinations - interests Annual periods beginning on or after January 1, 2019 previously held in a joint operation. Amendment to IFRS 9: Financial instruments - payments with Annual periods beginning on or after January 1, 2019 negative compensation. Amendment to IFRS 11: Joint agreements - interests previously Annual periods beginning on or after January 1, 2019 held in a joint operation Amendment to IAS 12: Income taxes - tax consequences of Annual periods beginning on or after January 1, 2019 payments related to financial instruments classified as equity Amendment to IAS 19: Employee benefits - modification, reduction Annual periods beginning on or after January 1, 2019 or liquidation of a plan. Amendment to IAS 23: Loan costs - eligible loan costs to be Annual periods beginning on or after January 1, 2019 capitalized. Amendment to IAS 28: Investments in associates - long-term Annual periods beginning on or after January 1, 2019 investments in associates or joint ventures.

The Company implemented IFRS 16 and IFRIC 23 as of January 1, 2019 and the disclosure of the impacts has been disclosed on the consolidated financial statements (note 5). The application of other accounting pronouncements has not had significant effects for CMPC. The rest of the accounting policy applied during the year 2019 has not varied with respect to those used in the previous year.

54 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

As of the date of issuance of the consolidated financial statements, the following accounting pronouncements have been issued by the International Accounting Standards Board (“IASB”).

Standards, interpretations and amendments Mandatory application IFRS 17: Insurance contracts Annual periods beginning on or after January 1, 2021 Conceptual Framework: Amendments to references in the Annual periods beginning on or after January 1, 2020 Conceptual Framework for Financial Information. Amendments to IFRS 3: Business Combination – Definition of a Annual periods beginning on or after January 1, 2020 business Amendments to IAS 1 and IAS 8: Definition of material Annual periods beginning on or after January 1, 2020 Amendments to IFRS 10 and IAS 28: Consolidated Financial Statements - Sale or contribution of assets between an investor To be determined and its associate or joint venture Amendments to IFRS 9, IAS 39 and IFRS 7: Reform of the Annual periods beginning on or after January 1, 2020 Reference Interest Rate

NOTE 7 - FINANCIAL SEGMENT REPORTING

Operating segments are reported in a manner consistent with the presentation of internal reports used by the Management in the business analysis, management control and decision making process.

CMPC designates business segments based on product differentiation and financial information made available to final decision makers, as relates to matters such as profit measurement and investment allocation.

Operating segments thus determined are detailed as follows:

Pulp

Pulp: The activities in this business area are carried out by subsidiary CMPC Celulosa SpA This subsidiary operates 4 production lines in Chile and 2 in Brazil, through its subsidiary CMPC Celulosa Riograndense Ltda., with total annual production capacity of approximately 4.1 million metric tons of pulp (plus 121,000 tons of paper of different kinds and weights). Pulp installed production capacity is 800,000 tons of bleached softwood kraft pulp (BSKP, using Radiata pine lumber), including 32,000 tons of non-bleached pulp (UKP) and 3.2 million tons of bleached hardwood kraft pulp (BHKP, using eucalyptus wood). All of them have established standards of processes, quality, environment and people's safety. In addition, the plants in Chile have their chain of custody certified under FSC and CERTFOR-PEFC standards, guaranteeing that their raw materials come from cultivated forests or controlled origin plantations, free of controversies and perfectly traceable from the forest up to their final destination.

Of the total pulp produced, approximately 430,000 tons are sold to subsidiaries and the difference is exported from Chile and Brazil to more than 220 customers in America, Europe, Asia and Oceania. CMPC Pulp SpA is positioned among the leading companies in the world industry and has an efficient logistics network, which enables it to provide excellent dispatch services to its customers. The main external markets are based in Asia (China and South Korea), Europe (Italy and Germany) and America.

Subsidiary Bioenergías Forestales SpA also forms part of this segment and has a biomass electric energy production plant located in Nacimiento (Bío-Bío Region in Chile).

55 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Forestry: The forestry segment reported by CMPC correspond to its business, led by its subsidiary Forestal Mininco SpA, which has the mission of managing the Company’s forest resources and managing the solid lumber business. Its main products are the sawn lumber, remanufactured products and plywood sheets.

CMPC currently has more than 688,000 hectares of forest plantations, mainly pine and eucalyptus, of which 449,000 hectares are located in Chile, 181,000 hectares in Brazil and 58,000 hectares in Argentina. In addition, the company has 72,000 hectares to plant; 56,000 hectares are located in Chile, 7,000 hectares in Argentina and 9,000 hectares in Brazil. In addition, the Company has usufruct, sharecropping and lease contracts with third parties comprising approximately 40,000 hectares of forest plantations distributed in Chile and in Brazil. The Company's forest plantations have CERTFOR-PEFC (Chile), CERTFLOR-PEFC (Brazil) and FSC (Chile and Brazil) certification.

The main customer of wood logs are industrial pulp factory, remanufactured products and plywood sheets of the Company.

Lumber: CMPC Maderas SpA is responsible to manage the solid lumber business and their main products are sawn lumber, remanufactured products and plywood. It has three sawmills in Bío-Bío, Chile: Bucalemu, Mulchén and Nacimiento with annual production capacity close to 770,000 cubic meters of sawn lumber, of which it exports approximately 46%. It also has two remanufacturing plants, in Coronel and Los Ángeles, Chile, which are capable of producing approximately 170,000 cubic meters of products manufactured from dry sawn lumber (moldings, sheets and laminates), and one plywood plant with an annual capacity of 500,000 cubic meters, of which approximately 70% is exported.

The main external customers of the solid lumber products are in the construction materials distribution sector and are based in North America (United States), Asia (Japan and China), Middle East (United Arab Emirates) and Europe (Italy).

Biopackaging

This business area consists of ten subsidiaries with commercial operations and a Holding that groups them. One of them participates in the production and marketing of cardboard and another produces paper for corrugation. There are six subsidiaries whose line of business is manufacturing and marketing elaborated paper products, such as corrugated cardboard boxes, bags or industrial sacks and molded pulp trays. Finally, this business area also has a subsidiary specializing in the distribution of paper and another dedicated to paper recycling.

The subsidiary Cartulinas CMPC SpA operates the plants of Maule (Maule Region in Chile) and Valdivia (De los Ríos Region in Chile) which have a capacity to sell 530,000 tons of cardboard annually to 45 countries in Latin America, Europe, Asia, North America and Oceania.

The subsidiary Papeles Cordillera SpA, located in Puente Alto (Metropolitan Region of Chile), markets a variety of papers for corrugation and for plasterboard. This subsidiary currently has a paper machine, with the capacity to produce 260,000 tons of corrugated paper per year based on recycled fibers.

56 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The corrugated cardboard boxes business is addressed through Envases Impresos SpA, which manufactures cardboard boxes for the fruit and winemaking sectors and for the salmon industry in its three plants in Chile. Two are located in the Metropolitan Region, in Buin and Til-Til and the third one in Osorno (Los Lagos Region).

Subsidiary Chilena de Moldeados SpA, whose plant is located in Puente Alto (Metropolitan Region of Chile) manufactures and markets molded pulp trays destined to the exporting of apples and avocados, and egg trays and cartons.

The multi-ply paper sacks business is operated by subsidiary Forsac SpA in Chile with a plant in Chillán (Bío- Bío Region of Chile); Fabi Bolsas Industriales S.A. in Argentina is located in Hinojo; Forsac Perú S.A., operates in Lima, and Forsac México S.A. operates in Guadalajara. The respective local markets are serviced from these different locations, particularly the cement and construction materials industry and there are also exports to various countries in Latin America and the United States.

In addition to these paper production subsidiaries, the segment includes Distribuidora de Papeles y Cartones SpA, a distribution company in charge of marketing paper in the Chilean market and Sociedad Recuperadora de Papel SpA, a company that is responsible for collecting used cardboard boxes in Chile to be recycled as raw materials in CMPC Tissue SpA, Chilena de Moldeados SpA and Papeles Cordillera SpA.

Softys

This business segment is engaged in the production and selling of tissue products (toilet paper, paper towels, paper napkins and facial tissues), sanitary products (baby diapers, wipes, adult diapers and sanitary napkins) and specialized hygiene products for consumption in institutions and public places, in Chile, Argentina, Brazil, Colombia, Ecuador, Mexico, Peru and Uruguay.

The main production and marketing subsidiaries in this segment are CMPC Tissue S.A. (Chile), La Papelera del Plata S.A. (Argentina), Melhoramentos CMPC Ltda. (Brazil), Productos Tissue del Perú S.A. (Peru), Papelera Panamericana S.A. (Peru), Industria Papelera Uruguaya S.A., Absormex CMPC Tissue S.A. de C.V. (Mexico), Protisa Colombia S.A., Drypers Andina S.A. (Colombia) and Productos Tissue del Ecuador S.A. (Ecuador).

CMPC’s Softys business offers a wide range of products in terms of quality and price in the categories in which it operates. Products are mainly sold under its own brands, which have achieved high levels of recognition by consumers.

Elite® is the regional trademark used by CMPC Tissue. Similarly, Confort® and Nova® in Chile and Higienol® and Sussex® in Argentina are the leading brands in their markets in the categories of toilet paper and paper towels, respectively. Disposable diapers for babies and adults, wipes, and sanitary napkins are marketed under the trademarks Babysec®, Cotidian® and Ladysoft®, respectively. In addition, as a result of the acquisition of Sepac - Serrados e Pasta e Celulose Ltda., Important brands such as Duetto ® have been incorporated in Brazil.

CMPC Tissue S.A. reaches its consumers through a wide distribution network, highlighting supermarkets, pharmacies and distributors.

57 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Others

The results (income and expenses) from other areas than the segments mentioned above, referring to general administration services (finance, supply chain, accounting, information technology, human resources, innovation, legal and corporate affairs, etc.) are not transferred to the operating segments, and are presented under “Other” and represent results that at majority are expenses (such as finance, accounting, IT and remunerations) that are invoiced to the subsidiaries based on the current service agreements.

58 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

General information on income as of December 31, 2019 and 2018 is detailed as follows:

Business areas (operating segments) ThUS$ Adjustments Total Description Pulp Biopackaging Softys Others (1) and Total CMPC segments eliminations Balance as of December 31, 2019 Revenue from external customers 2,686,308 890,225 2,093,744 5,670,277 - - 5,670,277 Revenue between operating segments of the same entity 308,797 24,645 932 334,374 33,444 (367,818) - Revenue from external and related customers 2,995,105 914,870 2,094,676 6,004,651 33,444 (367,818) 5,670,277 Cost of sales (2,527,149) (817,613) (1,545,322) (4,890,084) - 327,636 (4,562,448) Gross profit 467,956 97,257 549,354 1,114,567 33,444 (40,182) 1,107,829 Other income, by function 118,155 - - 118,155 - - 118,155 Distribution costs (54,726) (24,805) (173,889) (253,420) - 5,689 (247,731) Administration expenses (132,461) (45,163) (107,736) (285,360) (75,070) 36,442 (323,988) Other expenses, by function (31,914) (13,420) (173,829) (219,163) (879) 675 (219,367) Other income (expense) (38,276) (2,739) (20,956) (61,971) (15,343) 7,030 (70,284) Profit (loss) of operational activities 328,734 11,130 72,944 412,808 (57,848) 9,654 364,614 Finance income 25,106 3,293 3,415 31,814 128,908 (140,019) 20,703 Finance costs (128,557) (8,204) (53,516) (190,277) (142,130) 137,057 (195,350) Participation in profit (loss) of associates and joint ventures that are (9) (718) 256 (471) 86,994 (86,532) (9) accounted for using the equity method Exchange differences (9,741) (759) (63,610) (74,110) 65,329 (20) (8,801) Gain (loss) from indexation units 558 128 38,577 39,263 (3,106) 3,948 40,105 Profit (loss), before taxes 216,091 4,870 (1,934) 219,027 78,147 (75,912) 221,262 Income tax expense (121,622) (2,452) (19,142) (143,216) 6,345 - (136,871) Profit (loss) 94,469 2,418 (21,076) 75,811 84,492 (75,912) 84,391 Profit (loss) from continuing operations (2) 367,010 13,869 93,900 474,779 (42,505) 2,624 434,898 EBITDA determined by segment (3) 928,681 70,021 201,074 1,199,776 (26,769) (4,197) 1,168,810 Assets 10,979,156 1,539,726 2,636,399 15,155,281 4,135,074 (4,334,559) 14,955,796 Investments accounted for using the equity method 502 - - 502 - - 502 Increases in non-current assets (4) 349,039 51,376 204,006 604,421 3,242 - 607,663 Liabilities 5,011,090 458,897 1,619,047 7,089,034 4,039,643 (4,308,456) 6,820,221 Raw material and supplies (1,626,854) (708,616) (1,434,546) (3,770,016) - 321,767 (3,448,249) Employee benefits expenses (207,909) (92,384) (264,910) (565,203) (26,022) - (591,225) Depreciation and amortization expense (356,915) (56,152) (107,174) (520,241) (15,736) 6,821 (529,156) Impairment losses of assets recognized in profit or loss (5) (26,240) (1,456) (5,875) (33,571) - - (33,571) Reversal of impairment losses of assets recognized in profit or loss (5) 375 577 3,729 4,681 - - 4,681 Cash flows from operating activities 601,385 79,598 40,961 721,944 (85,849) 10,767 646,862 Cash flows from investment activities (302,951) (51,778) (408,323) (763,052) (15,026) 65,014 (713,064) Cash flows from financing activities (265,165) (26,659) 417,812 125,988 (329,148) (75,780) (278,940)

(1) Corresponds to the operations of Empresas CMPC S.A. and Inversiones CMPC S.A. not included in the main segments. (2) Corresponds to the Profit (loss) before Expenditure on income taxes, Income and Financial Costs, Exchange differences, Result for adjustment units, Other gains (losses) and Participation in gains (losses) of associates and businesses sets that are accounted for using the participation method. (3) Corresponds to the Gross Profit plus Depreciation and amortization, plus Cost of training of harvested plantations, plus higher cost of the exploited and sold part of the plantations derived from the revaluation due to their natural growth (see note 13: Biological assets), less Distribution costs, less Administrative expenses and less Other expenses, by function. (4) The increase in non-current assets does not include financial instruments, deferred tax assets or rights derived from insurance contracts. (5) Losses and reversal impairment losses include the effects of the provision on comercial debtors, inventories, biological assets and propetiy, plant and equipment.

59 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

(Continued)

Business areas (operating segments) ThUS$ Adjustments Total Description Pulp Biopackaging Softys Others (1) and Total CMPC segments eliminations Balance as of December 31, 2018 Revenue from external customers 3,377,316 923,604 1,973,552 6,274,472 - - 6,274,472 Revenue between operating segments of the same entity 358,352 26,932 1,371 386,655 31,964 (418,619) - Revenue from external and related customers 3,735,668 950,536 1,974,923 6,661,127 31,964 (418,619) 6,274,472 Cost of sales (2,559,622) (833,637) (1,470,340) (4,863,599) - 382,906 (4,480,693) Gross profit 1,176,046 116,899 504,583 1,797,528 31,964 (35,713) 1,793,779 Other income, by function 106,305 - - 106,305 - - 106,305 Distribution costs (67,279) (25,960) (173,849) (267,088) - 5,786 (261,302) Administration expenses (110,492) (47,456) (91,731) (249,679) (66,356) 29,636 (286,399) Other expenses, by function (40,921) (12,683) (168,563) (222,167) - 3,131 (219,036) Other income (expense) (30,437) (793) (7,731) (38,961) (7,824) (5,980) (52,765) Profit (loss) of operational activities 1,033,222 30,007 62,709 1,125,938 (42,216) (3,140) 1,080,582 Finance income 3,842 3,136 1,881 8,859 109,009 (98,862) 19,006 Finance costs (104,571) (5,143) (39,856) (149,570) (165,262) 98,862 (215,970) Participation in profit (loss) of associates and joint ventures that are 2 (1,999) 64 (1,933) 518,244 (516,309) 2 accounted for using the equity method Exchange differences 6,078 (3,770) (89,998) (87,690) 74,956 148 (12,586) Gain (loss) from indexation units 538 213 11,520 12,271 (3,108) - 9,163 Profit (loss), before taxes 939,111 22,444 (53,680) 907,875 491,623 (519,301) 880,197 Income tax expense (347,999) (12,505) (28,261) (388,765) 10,878 - (377,887) Profit (loss) 591,112 9,939 (81,941) 519,110 502,501 (519,301) 502,310 Profit (loss) from continuing operations (2) 1,063,659 30,800 70,440 1,164,899 (34,392) 2,840 1,133,347 EBITDA determined by segment (3) 1,615,704 81,430 153,195 1,850,329 (28,484) (5,662) 1,816,183 Assets 11,054,342 1,512,408 2,090,194 14,656,944 4,486,708 (4,160,341) 14,983,311 Investments accounted for using the equity method 149 - - 149 - - 149 Increases in non-current assets (4) 281,880 37,875 133,254 453,009 5,191 - 458,200 Liabilities 4,988,888 423,098 1,369,973 6,781,959 4,072,098 (4,114,764) 6,739,293 Raw material and supplies (1,705,877) (733,218) (1,384,673) (3,823,768) - 364,349 (3,459,419) Employee benefits expenses (210,806) (96,521) (253,159) (560,486) (28,477) - (588,963) Depreciation and amortization expense (328,422) (50,630) (82,755) (461,807) (5,907) 8,501 (459,213) Impairment losses of assets recognized in profit or loss (5) (22,841) (4,437) (2,905) (30,183) - - (30,183) Reversal of impairment losses of assets recognized in profit or loss (5) 62 36 387 485 - - 485 Cash flows from operating activities 1,152,189 (40,081) (101,460) 1,010,648 (6,200) 1,860 1,006,308 Cash flows from investment activities (226,330) 22,792 (115,702) (319,240) 566,813 (608,201) (360,628) Cash flows from financing activities (934,027) 15,297 85,377 (833,353) (260,318) 606,342 (487,329)

60 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Each segment is accounted for in accordance with the Company's general accounting policies.

Transactions between CMPC subsidiaries are accounted for at market prices and balances, transactions and profits or losses remain in the segment of origin and are only eliminated at the entity's consolidated financial statements.

CMPC’s policy of concentrating a large part of its financial operations in its subsidiary Inversiones CMPC S.A. results in outstanding balances in current accounts between subsidiaries, which are subject to market interest rates.

Administration Management services provided by Empresas CMPC S.A. are invoiced to each segment on the basis of time consumed and “drivers” identified in each of them.

In general, there are no special conditions or criteria for transactions between subsidiaries that might affect the results or valuation of the assets and liabilities of each segment.

Revenue from sales to CMPC's external customers were distributed across the following geographical areas:

Year Markets 2019 2018 ThUS$ ThUS$ Chile (Company's country of domicile) 1,076,108 1,223,187 China 706,042 894,036 Europe 634,904 825,841 Rest of Asia 625,067 790,769 Brazil 488,915 448,429 Mexico 449,443 407,547 Peru 424,641 392,558 United States and Canada 368,665 345,688 Argentina 357,871 375,183 Rest of Latin America 385,764 388,323 Others 152,857 182,911 Total 5,670,277 6,274,472

Revenue allocated to the different regions considers exports to those zones and local sales made by the subsidiaries domiciled in those geographic areas.

61 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Non-current assets, excluding financial instruments, deferred tax assets or rights derived from insurance contracts, by geographical area, are detailed as follows:

12/31/2019 12/31/2018 Geographic area description % ThUS$ % ThUS$ Chile (Company's country of domicile) 55.92% 6,400,563 58.68% 6,526,676 Brazil 34.63% 3,963,283 32.88% 3,657,004 Argentina 3.46% 395,666 3.12% 347,099 Peru 2.43% 278,378 2.14% 238,503 Mexico 2.46% 281,287 2.14% 238,483 Colombia 0.55% 63,290 0.52% 57,790 Uruguay 0.31% 35,254 0.34% 37,621 Ecuador 0.22% 25,271 0.18% 18,587 United States 0.02% 2,047 0.00% 219 Total 100.00% 11,445,039 100.00% 11,121,982

NOTE 8 – FINANCIAL ASSETS

Financial assets as of December 31, 2019 and 2018, classified according to the categories established in IFRS 9, are detailed as follows:

Classification Financial Financial Total Hedging assets at Type of financial assets assets at financial assets amortized "FVTPL" assets costs ThUS$ ThUS$ ThUS$ ThUS$ Balance as of December 31, 2019 Cash and cash equivalents - 2,185 612,853 615,038 Other current financial assets 4,563 - - 4,563 Other non-current financial assets 14,278 - - 14,278 Total financial assets 18,841 2,185 612,853 633,879

Balance as of December 31, 2018 Cash and cash equivalents - 15,953 951,551 967,504 Other current financial assets 11,390 - - 11,390 Other non-current financial assets 21,172 - - 21,172 Total financial assets 32,562 15,953 951,551 1,000,066

62 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

8.1. Cash and cash equivalents

Cash and cash equivalents include cash on hand and bank checking accounts, time deposits and other financial investments with original maturity of 90 days or less. This item also includes investments as part of cash management such as repurchase and resale agreements whose maturities are in accordance with the above, as described in IAS 7 “Statement of Cash Flows”.

As of December 31, 2019 and 2018, cash and cash equivalents, classified by currency of origin are detailed as follows:

Chilean Argentinean Uruguayan Peruvian Colombian Mexican Sterling Brazilean Swedish US dollar Euro Total Cash and cash equivalents peso peso peso new sol peso peso pound real Krona ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Balance as of December 31, 2019 Cash 90 110 - 3 2 57 1 5 - 22 - 290 Cash in bank accounts 3,477 18,325 21 2,652 4,703 3,429 1,266 5,577 154 2,816 - 42,420 Time deposit at less than 90 days 123,447 (1) 291,650 461 - - 22,067 - 9,785 47 82,621 22 530,100 Money market securities 40,043 116 - 1,928 - - - 141 - - - 42,228 Total 167,057 310,201 482 4,583 4,705 25,553 1,267 15,508 201 85,459 22 615,038

Balance as of December 31, 2018 Cash 102 104 - 2 2 7 2 3 - 1 - 223 Cash in bank accounts 3,041 27,975 3 1,128 556 241 1,616 2,210 1,706 545 - 39,021 Time deposit at less than 90 days 424,006 (1) 390,642 6,186 - - 4,416 - 6,295 - 23,679 8 855,232 Money market securities 71,918 142 - 863 - - - 105 - - - 73,028 Total 499,067 418,863 6,189 1,993 558 4,664 1,618 8,613 1,706 24,225 8 967,504

(1) As of December 31, 2019 the Company has subscribed forward contracts for currencies, to hedge the financial risk due to exchange rate variations associated with term deposits in Chilean pesos for an amount of ThUS$120,561 (ThUS$418,559 as of December 31, 2018).

Cash and cash in banks are available resources and their carrying amount is equal to their fair value (ThUS$42,710 as of December 31, 2019 and ThUS$39,244 as of December 31, 2018).

63 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Term deposits recorded at amortized cost with a maturity less than 90 days are detailed as follows:

12/31/2019 12/31/2018 Entity Currency ThUS$ ThUS$ Citibank N.A. N.Y. - United States US$ 116,303 42,492 MUFG Bank, Ltd. - United States US$ 114,107 50,147 Scotiabank - Chile CLP 45,587 119,513 Banco BCI - Chile CLP 44,865 69,815 BNP Paribas New York - United States US$ 40,000 - Banco Itaú Corpbanca - Chile CLP 29,950 208,737 Banco Santander - Brazil BRL 29,586 12,946 Banco BCI - Chile US$ 15,060 45,168 Banco Safra S.A. - Brazil BRL 19,665 - Banco Itaú - Brazil BRL 12,594 10,218 Banco de Crédito del Perú PEN 10,951 1,851 Banco BBVA - Peru PEN 8,368 2,359 Caixa Econômica Federal - Brazil BRL 7,990 - Banco Nacional de México, S.A. MXN 7,854 - Banco do Brasil BRL 5,002 87 Bank of America Merrill Lynch Banco Múltiplo S.A. - Brazil BRL 3,740 17 Banco de Chile CLP 3,045 6,251 Banco Bradesco S.A. - Brazil BRL 3,043 397 JP Morgan Chase Bank, N.A. - United States US$ 2,939 55,927 Citibank - Peru PEN 2,066 3 Scotiabank Inverlat S.A. - Mexico MXN 1,931 808 Banco de Crédito del Perú US$ 1,909 5,510 Banco BBVA - Peru US$ 1,300 - JP Morgan Chase Bank, N.A. - Brazil BRL 982 13 Scotiabank - Peru PEN 682 203 Citibank N.A. N.Y. - England EUR 461 6,186 Citibank N.A. N.Y. - England GBP 47 - Banco de la Producción S.A. Produbanco - Ecuador US$ 32 7 JP Morgan Chase Bank, N.A. - England SEK 22 8 Banco Banrisul - Brazil BRL 18 - Banco MUFG Brasil S.A. BRL 1 1 Banco Santander - Chile US$ - 190,640 BancoEstado - Chile CLP - 19,690 Banco Santander - Mexico MXN - 5,487 Scotiabank - Peru US$ - 751 Total 530,100 855,232

Placements are undertaken in accordance with counterparty’s risk parameters authorized by the Board of CMPC. Potential counterparties meeting these risk criteria are subsequently selected on the basis of diversification and financial return criteria.

64 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

Investments in mutual funds and money market securities of CMPC are as follows:

12/31/2019 12/31/2018 Entity Currency ThUS$ ThUS$ Investments in mutual funds: Galicia Administradora de Fondos S.A. - Argentina ARS 1,928 863 BBH & Co. Money Market Fund - United States US$ 116 142 Banco Monex, S.A. - Mexico MXN 141 105 Banchile Corredores de Bolsa S.A. - Chile CLP - 14,843 Marketable securities with resale commitments BBVA Corredores de Bolsa S.A. - Chile CLP 16,874 16,452 Banchile Corredores de Bolsa S.A. - Chile CLP 23,169 24,852 Consorcio Corredores de Bolsa S.A. - Chile CLP - 9,659 BancoEstado S.A. Corredores de Bolsa - Chile CLP - 6,112 Total 42,228 73,028

As of December 31, 2019 and 2018, the book value of time deposits and money market securities does not differ from their fair value and there are no restrictions over use of the cash.

Cash and cash equivalents presented in the consolidated statement of cash flows are detailed as follows:

12/31/2019 12/31/2018 Classes of assets ThUS$ ThUS$ Cash and cash equivalents 615,038 967,504

Cash and cash equivalents presented in the statement of cash flows 615,038 967,504

65 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

8.2. Other current financial assets a) Hedge assets These assets represent the results of hedge contracts the Company poses in order to adequately manage the exchange rate risk, commodity prices, obligations for different investment projects and floating rates of financial obligations of the Company.

- Balances as of December 31, 2019

- Balances as of December 31, 2018

Rights Obligations Fair value of Entities Nature of the risk hedged Currency Amount Currency Amount net assets Maturity ThUS$ ThUS$ ThUS$ Banco BCI - Chile Term deposit exchange rate differences US$ 90,553 CLP 89,771 782 Maturity Banco Itaú Corpbanca - Chile Term deposit exchange rate differences US$ 125,875 CLP 124,301 1,574 Maturity BancoEstado - Chile Term deposit exchange rate differences US$ 80,646 CLP 79,356 1,290 Maturity Scotiabank - Chile Term deposit exchange rate differences US$ 105,623 CLP 104,829 794 Maturity Subtotal currency translation differences 4,440 Banco BCI - Chile Cash flows from sale of cardboard to Europe US$ 14,461 EUR 13,133 1,328 Maturity Banco Itaú Corpbanca - Chile Cash flows from sale of cardboard to Europe US$ 13,422 EUR 12,190 1,232 Maturity HSBC Bank - Chile Cash flows from sale of cardboard to Europe US$ 1,162 EUR 1,112 50 Maturity Scotiabank Azul - Chile Cash flows from sale of cardboard to Europe US$ 19,486 EUR 17,647 1,839 Maturity Banco Itaú Corpbanca - Chile Cash flows from sale of lumber to Europe US$ 4,512 EUR 4,232 280 Maturity Banco Itaú Corpbanca - Chile Cash flows from sale of lumber to Europe US$ 903 GBP 852 51 Maturity Banco Santander - Chile Cash flows from sale of lumber to Europe US$ 526 EUR 503 23 Maturity Scotiabank - Chile Cash flows from sale of lumber to Europe US$ 3,358 EUR 3,183 175 Maturity Scotiabank Azul - Chile Cash flows from sale of lumber to Europe US$ 6,178 EUR 5,733 445 Maturity Scotiabank Azul - Chile Cash flows from sale of lumber to Europe US$ 1,719 GBP 1,579 140 Maturity Subtotal cash flows from sales 5,563 Banco Santander - Brazil Cash flows from Guaíba 2 shutdown BRL 677 US$ 624 53 Maturity Subtotal cash flows from projects 53 Banco Santander - Brazil Bank obligations BRL 24,185 US$ 23,858 327 Monthly JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil Bank obligations BRL 4,329 US$ 4,237 92 Monthly Subtotal bank obligations 419 Goldman Sachs International - United Kingdom Oil price US$ 10,746 US$ 10,237 509 Maturity JP Morgan Chase Bank, N.A. - England Oil price US$ 13,004 US$ 12,598 406 Maturity Subtotal oil price 915 Total other current financial assets 521,365 509,975 11,390

66 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

8.3. Other non-current financial assets a) Hedge assets These assets represent the cumulative result of currency forwards, cross-currency swap operations used to hedge different financial obligations and an interest rate swap to fix the interest rate of a floating debt.

- Balances as of December 31, 2019

Rights Obligations Fair value of Entities Nature of the risk hedged Currency Amount Currency Amount net assets Maturity ThUS$ ThUS$ ThUS$ Banco Santander - Mexico Bank obligations US$ 6,923 MXN 6,664 259 Semiannual MUFG Bank, Ltd. - United States Bank obligations US$ 100,850 US$ 100,558 292 Semiannual Scotiabank - Chile Bank obligations US$ 8,688 US$ 8,628 60 Semiannual Banco Santander - Chile Bonds payable UF 85,129 US$ 75,903 9,226 Semiannual Scotiabank - Chile Bonds payable UF 42,606 US$ 38,165 4,441 Semiannual Subtotal bank obligations and bonds 14,278 payable Total other non-current financial assets 244,196 229,918 14,278

- Balances as of December 31, 2018

Rights Obligations Fair value of Entities Nature of the risk hedged Currency Amount Currency Amount net assets Maturity ThUS$ ThUS$ ThUS$ Banco MUFG Brasil S.A. Bank obligations US$ 50,383 BRL 50,050 333 Quarterly Banco Santander - Mexico Bank obligations US$ 8,462 MXN 7,643 819 Semiannual Scotiabank Azul - Chile Bank obligations US$ 14,228 US$ 13,897 331 Semiannual Scotiabank Inverlat S.A. - Mexico Bank obligations US$ 15,748 MXN 14,750 998 Semiannual Banco de Chile Bonds payable UF 51,117 US$ 51,061 56 Semiannual Banco Santander - Chile Bonds payable UF 88,453 US$ 75,903 12,550 Semiannual Scotiabank Azul - Chile Bonds payable UF 44,251 US$ 38,166 6,085 Semiannual Subtotal bank obligations and bonds 21,172 payable Total other non-current financial assets 272,642 251,470 21,172

Hedges are documented and tested to measure their effectiveness.

Based on a comparison of critical terms, the hedges are highly effective since the hedged amounts match with the proportion of sales and with obligations with the public and banks. Hedging contracts match with the currency in which sales and obligations are denominated and match in their maturity date with the expected maturity date of sales and payment obligations, between the fourth quarter of the year 2019 and the fourth quarter of the year 2020 for the case of sales abroad, between January 2019 to May 2024 for bank obligations and until July 2028 for the case of obligations with the public that mature until the year 2039.

67 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

For the cash flow hedges liquidated during the period ended December 31, 2019, a net income of ThUS$7,023 was transferred from the Reserve of cash flow hedges (profit recorded in Exchange differences for ThUS$8,474 and decreased for a loss recorded in Cost of sales for ThUS$1,451). In turn, the sum of ThUS$156 was transferred with payment to Properties, plant and equipment (Construction in progress) due to the liquidation of hedging instruments associated with the repair of Guaíba 2 Recovery Boiler in Brazil and transferred with payment to Investments The sum of ThUS$3,579 accounted for using the equity method.

During the period ended December 31, 2019, ineffectiveness was not recognized for hedging instruments in the respective results.

For the cash flow hedges liquidated during the period ended December 31, 2018, a net gain of ThUS$16,618 was transferred from Reserve of cash flow hedges (profit recorded in Revenue from ordinary activities for ThUS$376, loss recorded in Cost of sales for ThUS$1,465, loss recorded in Other gains (losses) due to ineffectiveness of hedges for ThUS$47 and gain recorded in Exchange differences for ThUS$17,754). In turn, the sum of ThUS$1,446 was transferred to property, plant and equipment (Construction in progress) due to the liquidation of hedging instruments associated with the Laja industrial project in Chile and the Caldera Recuperadora Guaíba 2 repair in Brazil.

8.4. Fair value hierarchy

The financial assets recorded at fair value in the statement of financial position, have been measured using the methodologies stated in IFRS 13. The following parameters have been considered for the purpose of applying criteria for determining the fair value of financial assets:

Level I: Values or prices quoted in active markets for identical assets and liabilities. Level II: Information from sources other than the values quoted in Level I, but observable in markets for the assets and liabilities whether directly (prices) or indirectly (derived from prices). Level III: Information for assets and liabilities that are not based on observable market data.

The following table presents the financial and hedge assets that are measured at fair value as of December 31, 2019 and 2018:

Hierarchy used to determine fair value Financial instruments measured at fair value Level I Level II Level III ThUS$ ThUS$ ThUS$ Balance as of December 31, 2019 Investment in mutual funds 2,185 - - Hedging assets - 18,841 - Total financial assets at fair value 2,185 18,841 -

Balance as of December 31, 2018 Investment in mutual funds 15,953 - - Hedging assets - 32,562 - Total financial assets at fair value 15,953 32,562 -

68 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

8.5. Committed line

In March 2017, the subsidiary Inversiones CMPC S.A. obtained a Revolver Credit Line with Banco Santander, Export Development Canada, Scotiabank & Trust (Cayman) Ltd. and The Bank of Tokyo-Mitsubishi UFJ, Ltd., acting as structurer. This credit line amounts to ThUS$400,000 and has a maximum term of 3 years. In August 2018, this committed credit line was extended for two additional years (from September 13, 2020 to September 14, 2022) for a total amount of ThUS$200,000 with Banco Santander and Scotiabank & Trust (Cayman) Ltd. As of December 31, 2019, the credit line is fully available.

NOTE 9 - OTHER NON-FINANCIAL ASSETS

Other current and non-current non-financial assets are detailed as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Current Current insurance 21,443 19,255 Recoverable taxes 92,686 96,439 Advance payments 3,355 4,602 Advances to suppliers 21,019 19,556 Others 1,770 3,880 Total 140,273 143,732

Non-current Advance payment to Fibria Celulose S.A. for Predios Losango - Brazil (1) 118,393 118,393 Taxes in the recovery process related to sales and services 36,064 38,208 Guarantees receivable from Melpaper S.A. (Melhoramentos CMPC Ltda.) 388 836 Advance payments for land leasing (Usufruct) 5,031 5,553 Advance payments for forests purchase 13,015 3,340 Advance payments for forest services 3,197 - Advance payments to suppliers of lumber 559 1,112 Investments in other companies 1,075 1,092 Others 1,185 3,334 Total 178,907 171,868

(1) In March 2017, the asset purchase and sale agreement between the subsidiary CMPC Celulose Riograndense Ltda. and Fibria Celulose SA was signed. This agreement included the acquisition by CMPC Celulose Riograndense Ltda. of forest plantations, transfers of land use rights and rights to certain lease contracts for forest properties.

The amount as of December 31, 2019 of ThUS$118,393 disclosed in this note corresponds to the value assigned to the purchase of land, not yet materialized, pending the respective legal authorizations. This operation was formalized with the award of social rights of two companies and their accounting was carried out as an asset acquisition following the criteria defined in International Financial Reporting Standards.

It should be noted that the purchase-sale agreement considers that if the transaction does not materialize, the amounts originally paid by CMPC Celulose Riograndense Ltda. will be restituted by Fibria Celulose S.A.

69 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

NOTE 10 - TRADE AND OTHER ACCOUNTS RECEIVABLE

10.1. Trade and other accounts receivable, current and non-current

Details of current and non-current trade and other accounts receivable is as follow: 12/31/2019 12/31/2018 Description ThUS$ % ThUS$ % Domestic market customers 148,617 199,522 Less impairment provision (2,713) (2,516) Domestic market customers, net 145,904 16.3 197,006 19.5 Export customers 389,090 477,532 Less impairment provision (3,042) (3,177) Export customers, net 386,048 43.2 474,355 47.0 Foreing subsidiaries customer 279,139 239,673 Less impairment provision (2,701) (1,253) Foreing subsidiaries customer, net 276,438 30.9 238,420 23.6 Domestic and export market documents 4,403 0.5 24,306 2.4 Foreing subsidiaries documents, net 11,507 1.3 8,626 0.9 Current accounts with third parties 5,160 0.6 3,803 0.4 Insurance claims 8,582 1.0 7,814 0.8 Current accounts with employees 11,241 1.3 10,638 1.1 Other 6,329 0.5 5,061 0.5 Total trade and other accounts receivable 855,612 95.6 970,029 96.2 Trade and other accounts receivable, non-current (see note 10.3) 39,053 4.4 38,319 3.8 Total trade and other accounts receivable, non-current 39,053 4.4 38,319 3.8 Trade and other accounts receivable, net 894,665 100.0 1,008,348 100.0

The aging of current and non-current trade and other accounts receivable is detailed as follows:

Net values Gross values Aging 12/31/2019 12/31/2018 12/31/2019 12/31/2018 ThUS$ ThUS$ ThUS$ ThUS$ Current accounts receivable 700,373 797,801 700,396 797,853 Up to 30 days overdue 124,626 130,668 124,661 130,753 From 31 to 60 days overdue 14,426 22,769 14,438 22,789 From 61 to 90 days overdue 8,514 12,161 8,523 12,183 From 91 to 120 days overdue 3,146 2,725 3,218 2,809 From 121 to 150 days overdue 881 577 1,006 616 From 151 to 180 days overdue 1,410 421 1,412 421 From 181 to 210 days overdue 400 75 435 78 From 211 to 250 days overdue 165 188 225 199 More than 250 days overdue (insurance claims or in 1,671 2,644 9,754 9,274 judicial process) Total portfolio, current 855,612 970,029 864,068 976,975 Non-current accounts receivable 39,053 38,319 39,053 38,319 Total portfolio, non-current 39,053 38,319 39,053 38,319 Total Cartera, net 894,665 1,008,348 903,121 1,015,294

As of December 31, 2019 and 2018 there are no balances related to refinanced customers.

70 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

The composition of current and non-current trade and other accounts receivable by type of currency is detailed as follows:

12/31/2019 12/31/2018 Currency ThUS$ ThUS$ United States dollar US$ 407,842 519,508 Chilean peso CLP 161,730 207,953 Mexican peso MXN 63,279 58,490 Brazilian real BRL 95,592 65,726 Argentinean peso ARS 51,896 44,728 Peruvian new sol PEN 37,594 33,070 Euro EUR 12,369 9,702 Colombian peso COP 10,568 9,885 Uruguayan peso UYU 8,984 8,296 Sterling pound GBP 5,563 6,249 Unidad de fomento (1) UF 195 6,405 Japanese Yen JPY - 17 Total current portfolio, net 855,612 970,029 Plus impairment provision 8,456 6,946 Total current portfolio, gross 864,068 976,975 Chilean peso CLP 124 258 Unidad de fomento (1) UF 150 88 United States dollar US$ 994 120 Argentinean peso ARS 59 38 Brazilian real BRL 37,726 37,815 Total non-current portfolio, net 39,053 38,319 Plus impairment provision - - Total non-current portfolio, gross 39,053 38,319 (1) Corresponds to guarantees issued by suppliers in UF.

The roll forward provision on current and non-current trade and other accounts receivable is detailed as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Beginning balance 6,946 7,590 IFRS 9 beginning balance adjustment - (962) Increase by business combinations 1,122 - Impairment loss 2,744 2,902 Reversal of impairment loss (1,540) (872) Uses (907) (1,609) Foreign currency transation differences 91 (103) Ending balance 8,456 6,946

As of December 31, 2019 a provision was recorded in the amount of ThUS$2,744 (ThUS$2,902 as of December 31, 2018) which was recognized as an expense under administrative expenses in the statement of comprehensive income. Reversals of impairment losses are due to a change in the risk of non-recovery of certain customers. Normally, amounts charged to the bad debt reserve are written-off when there is no longer any expectation of recovering additional amounts

71 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

There are no customers that individually represent more than 10% of consolidated annual sales.

10.2. Receivable Purchase Program

During the period, the Company signed portfolio sale contracts (RPP), transferring substantially all the risks and rewards of the invoices assigned to Banco Santander - Chile on a non-recourse basis. As of December 31, 2019, the amount of the assigned portfolio (RPP) amounts to ThUS$74,889 (ThUS$84,656 as of December 31, 2018.

10.3. Non-current accounts receivable

Non-current accounts receivable are detailed as follows:

12/31/2019 12/31/2018 Accounts ThUS$ % ThUS$ % Accounts receivable from Guaíba Municipality - Brazil 18,946 48.5 18,645 48.7 Accounts receivable from Receita Federal - Brazil 11,879 30.4 11,953 31.2 Guarantee receivable from Fibria Celulose S.A. - Brazil 4,284 11.0 4,238 11.1 Others 3,944 10.1 3,483 9.0 Total 39,053 100.0 38,319 100.0

72 | Empresas CMPC S.A. and Subsidiaries Consolidated Financial Statements

NOTE 11 - ACCOUNTS RECEIVABLE FROM RELATED PARTIES

As of December 31, 2019 and 2018 current accounts receivable from related parties are detailed as follows:

Outstanding balance Terms of Explanation of the nature Related Nature of relationship Country Accounts receivable 12/31/2019 12/31/2018 transactions of the compensation party Related party name Currency with related party of origin detail with related established to settle the taxpayer No. ThUS$ ThUS$ party transactions Current asset 90.209.000-2 Compañía Industrial El Volcán S.A. Corporate group Chile Sale of products 338 249 CLP 30 days Monetary 77.524.300-7 Fibrocementos Volcán Ltda. Corporate group Chile Sale of products 204 - CLP 30 days Monetary Empresa Nacional de Common shareholders at 92.580.000-7 Chile Sale of products 55 54 CLP 30 days Monetary Telecomunicaciones S.A. the entity or its parent 80.397.900-6 Solcrom S.A. Corporate group Chile Sale of products 365 58 CLP 30 days Monetary 76.138.547-K Megarchivos S.A. Controller / Director Chile Sale of products 20 30 CLP 30 days Monetary 96.848.750-7 Aislantes Volcán S.A. Corporate group Chile Sale of products - - CLP 30 days Monetary Common shareholders at 96.806.980-2 Entel PCS Telecomunicaciones S.A. Chile Sale of products 54 5 CLP 30 days Monetary the entity or its parent Common shareholders at 78.023.030-4 Sofruco Alimentos Ltda. Chile Sale of products 2 302 US$ 120 days Monetary the entity or its parent 96.656.410-5 BICE Vida Compañía de Seguros S.A. Corporate group Chile Sale of products 7 - CLP 30 days Monetary 97.080.000-K Banco BICE Corporate group Chile Sale of products 9 10 CLP 30 days Monetary 96.505.760-9 Colbún S.A. Corporate group Chile Sale of energy 13 1 CLP 30 days Monetary Entity with special Expenses 75.764.900-4 Fundación CMPC Chile - 7 CLP 30 days Monetary purpose reimbursements 76.080.480-6 Compañía e Inversiones Encierra Ltda. Controller / Director Chile Sale of products - 4 CLP 30 days Monetary 91.066.000-4 Carbomet Energía S.A. Controller / Director Chile Sale of energy - 1 CLP 30 days Monetary BICE Hipotecaria Administradora de 96.777.060-4 Corporate group Chile Sale of products - 1 CLP 30 days Monetary Mutuos Hipotecarios S.A. 76.158.513-4 Puerto Central S.A. Corporate group Chile Sale of products - 1 CLP 30 days Monetary 96.959.030-1 Puerto Lirquén S.A. Corporate group Chile Sale of products - 1 CLP 30 days Monetary Common shareholders at 78.600.780-1 Viña la Rosa S.A. Chile Sale of products - - CLP 30 days Monetary the entity or its parent Total 1,091 724

73 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

NOTE 12 - INVENTORY

As of December 31, 2019 and 2018 the breakdown of the inventory, net of obsolescence estimation, are detailed as follows:

12/31/2019 12/31/2018 Classes of inventory ThUS$ ThUS$ Finished products 543,393 580,249 Work in progress 72,906 67,852 Raw materials 292,434 232,053 Production supplies 336,396 367,429 Agricultural and other products 35,012 16,859 Total 1,280,141 1,264,442

The cost of inventory recognized as cost of sales for the period ended December 31, 2019 amounts to ThUS$3,974,227 (MUS$3,902,204 as of December 31, 2018).

The roll forward of the impairment for slow-moving inventory is detailed as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Beginning balance 24,354 18,818 Beginning balance adjustment IAS 29 - 211 Increase by business combinations 31 - Impairment of the period 8,271 11,678 Obsolescence used (3,141) (4,501) Impairment reversal (956) (1,565) Increase (decrease) from foreign currency translation differences (403) (287) Ending balance 28,156 24,354

For the period ended December 31, 2019 the increase in the provision for obsolescence of inventories amounted to ThUS$8,271 (ThUS$11,678 on December 31, 2018). Reversal of the impairment is originated by reuse, during the period, of inventory provisioned in prior years.

During period ended December 31, 2019 and 2018, no inventory has been pledged as guarantee.

The book value of inventory does not exceed the current sale prices, discounting the selling expenses (net realizable value).

74 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

NOTE 13 – BIOLOGICAL ASSETS

As of December 31, 2019 and 2018, biological assets presented in the statement of financial position are detailed as follows:

12/31/2019 12/31/2018 ThUS$ ThUS$ Current biological assets 321,317 326,637 Non-current biological assets 3,041,258 3,073,955 Total 3,362,575 3,400,592

As of December 31, 2019 and 2018 movement of biological assets (increase, decrease and balances) are detailed as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Current Cost value Beginning balance as of January 1 123,607 151,871 Additions through acquisitions from third parties and new plantations 92 868 Sale of standing timber plantations (2,008) (3,289) Transfer of plantations and lumber inventory (logs) (125,325) (112,078) Transfer of plantations from Biological non-current assets 131,131 87,289 Write-offs due to forestry fires - (1,054) Ending balance cost value 127,497 123,607 Fair value adjustment Beginning balance as of January 1 203,030 167,051 Transfer of plantations to lumber inventory (logs) (202,775) (200,490) Transfer of plantations from Biological non-current assets 196,504 243,008 Sale of standing timber plantations (2,939) (3,719) Write-offs due to forestry fires - (2,820) Final adjustment to fair value balance 193,820 203,030 Total biological assets, current 321,317 326,637 Non-current Cost value Beginning balance as of January 1 1,246,191 1,217,400 Additions through acquisitions from third parties and new plantations 199,339 117,738 Transfer of plantations to biological current assets (131,131) (87,289) Write-offs due to forestry fires (3,591) (1,658) Ending balance cost value 1,310,808 1,246,191 Fair value adjustment Beginning balance as of January 1 1,827,764 1,963,705 Profit on adjustment to fair value, less estimated costs at point of sale: Attributable to physical changes 196,583 133,059 Attributable to price changes (78,428) (26,754) Transfer of plantations from Biological non-current assets (196,504) (243,008) Write-offs due to forestry fires (18,965) 762 Final adjustment to fair value balance 1,730,450 1,827,764 Total biological assets, non current 3,041,258 3,073,955

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Biological assets in Chile as of December 31, 2019 represent an increase in growth compared to December 31, 2018, mainly due to updating the discount rate, short and long-term exchange rates, price and cost parameters, update of yield curves, ages according to harvest plans and adjustment of the surface base.

In Brazil, the discount rate was updated for short and long-term exchange rate, updating prices, harvest and transportation cost rates, resulting in an increase in the value of biological assets compared to December 31, 2018.

In Argentina, the physical base was updated, short and long term prices, harvest costs, establishment costs, discount rate, among others, resulting in a decrease in its growth.

As of December 31, 2019, the effect of the natural growth of forest plantations, expressed in fair value (sales price minus estimated costs at the point of sale), is recognized according to the methodology described in Notes 2.7 and 4.1. The increase or decrease in fair value is recognized in the Consolidated Statement of Comprehensive Income, at line item "Other income, by function" concept. The amount reached ThUS$118,155 (ThUS$106,305 as of December 31, 2018). The higher cost of the harvested and sold assets derived from this revaluation is recognized in the line item "Cost of sales" and amounts reached to ThUS$197,903 (ThUS$ 196,516 as of December 31, 2018), together with the cost of formation of harvested plantations, which amounted reached ThUS$125,008 (ThUS$133,412 as of December 31, 2018).

13.1. General Information a) Forest heritage

CMPC's forestry heritage is equivalent to 760,000 hectares (688,000 hectares planted and 72,000 hectares to be planted), between Chile, Brazil and Argentina. The forest plantations (standing tree) are used as raw material in the manufacture of pulp, logs for the sawing and manufacture of boards.

New plantations for the period ended December 31, 2019 reached to 49,000 hectares (for the year ended December 31, 2018, 43,000 hectares), including the reforestation of harvested forests.

As of December 31, 2019, CMPC has usufruct, lease and shareholder agreements with third parties for an amount of ThUS$125,123 (ThUS$131,497 as of December 31, 2018), and comprising 42,000 hectares of forest plantations (40,000 hectares of forest plantations as of December 31, 2018). b) Cycle of forest plantations

Genetics and seeds: In order to optimize the growth and quality of forest plantations, CMPC uses different techniques of genetic improvement, without genetic modifications, which include the selection of superior individuals, crossings, evaluation and propagation of the best genotypes and processes embodied in a continuous improvement program.

Nurseries: The forest plantations originate mainly from seeds and vegetative propagation (stakes are extracted from a parent plant to plant and grow a new plant). The plants obtained from the process carried

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out in the nursery are transferred to the final place where the forest will be established. There, through modern techniques developed by CMPC, the plantation is carried out.

Establishment: This operation is commonly carried out during the winter period, due to low temperatures, the seedlings are in a low activity condition (dormancy) and the soil has a high moisture content, helping the establishment. This process is supported by several soil preparation activities in order to improve the uptake of nutrients and moisture, as well as in advanced weed control and soil fertilization techniques, which facilitate the growth of trees.

Forest Management (Pruning and Thinning): Forest management refers to certain silvicultural interventions that modify final products, which thinning is common, and consists of the extraction of trees to improve the provision of soil resources and solar radiation to trees with better characteristics. In addition, the prunings deal with the partial elimination of the lower branches of the trees, which ensures the obtaining of wood free of knots, which is highly appreciated due to its better production quality and appearance.

Forest Protection: To avoid losses by external agents, the plantations are protected against pests, diseases and fires.

The methodology used to combat pests and diseases is integral management, which includes forestry techniques such as pruning and thinning, as well as the use of natural enemies of harmful agents. The use of chemicals is avoided.

In the case of rural fires, the strategy includes preventive work with neighbors, government agencies and companies in the sector, with special emphasis on the protection of rural-urban contact points. Insurance policies on these assets remain in force.

Forest Harvest: Consists in the felling of adult trees by appropriate techniques and trained personnel, to get the lumber in the conditions required by the industry.

Radiata pine forests are harvested between 18 and 25 years for Chile (Argentina between 17 and 20 years), depending on the quality of the soil in which they are established, their management and the type of products to which they are destined. The forests of eucalyptus (globulus and nitens), mainly destined to cellulose pulp, are generally harvested between 10 and 20 years for Chile. In the case of Brazil, eucalyptus forests are harvested between 7 and 14 years.

Once the trees are harvested, the pieces are moved to collection fields from where, via truck, rail or barge, they are sent to different centers of wood consumption to be used as raw material.

After the trees are cut, in the following winter the same land is reforested, giving birth to a new forest.

c) Biological risks

CMPC's forest plantations could be adversely affected by pests, diseases and other harmful agents. The Technology and Planning Management of Forestal Mininco SpA together with the SAG, INIA, CONAF and other forestry companies (through Consorcio Protección Fitosanitaria Forestal S.A.) develop programs for the prevention and control of forest pests by applying "Integrated Pest Management", which includes both

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forestry and pruning techniques as well as the use of natural enemies of the harmful agents. The use of chemicals is avoided.

13.2. Forest plantations with restriction or pledged as guarantee

As of December 31, 2019 and 2018, the Company does not maintain forest plantations whose ownership has any restrictions or are pledged as guarantee.

13.3. Grants from government

As of December 31, 2019 and 2018, the Company did not receive government grants associated with biological assets.

13.4. Harvests

The total volume of logs harvested as of December 31, 2019 amounted to 18,744 Mm3 (17,078 Mm3 as of December 31, 2018).

13.5. Fair value hierarchy and sensitivity analysis

According to the fair value hierarchy described in IFRS 13, the valuation of the CMPC forest plantations are classified as Level III, due to the complexity of the model described in note 4.1.

The main estimates (variables) used by the Management to calculate fair value of forest plantations are the following:

Discount rates: The methodology used considers differences between the discount rates used for each of the countries in which the Company owns forest plantations and is 6.88% to 13.51%.

Exchange rates: The exchange rate considered in the valuation of forest plantations is defined considering as a reference the average of the projections for the upcoming 2 years of the main investment banks that publish their estimates in Bloomberg.

Prices: The determination of prices used in the valuation of forest plantations considers weighted averages between short term, long term, points of sale, species, products and country, among others.

Costs: The costs considered in the model are the following: i) Establishment of new plantations, ii) Administration, iii) Harvest, iv) Transportation, and v) Construction of roads. All consider weighted averages between short term, long term, species and country, among others.

Below is the effect of the sensitive analysis in the valuation of forest plantations:

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12/31/2019 12/31/2018 Increase 100 Decrease 100 Increase 100 Decrease 100 basis points basis points basis points basis points ThUS$ ThUS$ ThUS$ ThUS$ Lumber prices 72,216 (71,741) 72,661 (72,309) Direct costs (37,748) 37,908 (46,310) 46,192 Performance of forest 38,422 (38,404) 38,509 (38,555) Discount rates (201,154) 233,072 (207,712) 179,955

NOTE 14 - CURRENT AND NON-CURRENT TAX ASSETS AND LIABILITIES

The assets for current taxes as of December 31, 2019 and 2018 are detailed below:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Recoverable tax on profits absorbed by tax losses 53,215 6,388 Balance of monthly prepaid tax installments net of income tax 158,749 38,519 Other income taxes in the process of being recovered 27,066 27,018 Total 239,030 71,925

The liabilities for current taxes as of December 31, 2019 and 2018 are detailed below:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Balance of income tax payable, net of monthly prepaid tax installments 10,374 109,836 for the period Balance of income tax payable, net of monthly prepaid tax installments 14,430 4,408 for the previous period Total 24,804 114,244

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The reconciliation of the balance of income tax with the expense to December 31, 2019 and 2018:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Recoverable credits during the period, net of income taxes 158,749 38,519 Tax loss benefit 47,286 - Less: Income taxes payable for the period, net first category credits (10,374) (109,836) Balance of income taxes payable, net first category credits 195,661 (71,317)

Current tax recognized in profit (loss) (100,187) (361,196) Current tax recognized in other comprehensive income 221 (1,646) Less: Recoverable credits for the period 295,627 291,525 Balance of income taxes payable, net first category credits 195,661 (71,317)

Current and not current tax assets as of December 31, 2019 and 2018 are detailed as follow:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Income taxes in recovery process 940 5,411 Total 940 5,411

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NOTE 15 – BUSINESS COMBINATIONS

15.1. Business combinations Perú

On April 5, 2019, the subsidiary Softys Arequipa S.A.C. acquired 100% of the shares of Activar S.A.C. and Papelera Panamericana S.A. in Peru. The acquiree is an industrial company dedicated to the production and marketing of tissue products, and has approximately 60% of the market share in Arequipa. CMPC expects to obtain future economic benefits of this operation by increasing its market share and expansion of the distribution network in the Southern region of the country which is in line with the company’s strategy.

As results of the negotiation, the new Company was consolidated with the Softys segment, which, include the goodwill generated as is detailed as follow:

Book value Fair value Fair value acquired group adjustment acquired group

ThUS$ ThUS$ ThUS$ Asset Current asset Cash and cash equivalents 2,598 - 2,598 Other non financial assets 105 - 105 Trade and other accounts receivable 785 - 785 Inventory 1,342 - 1,342 Total current assets 4,830 - 4,830 Non-current assets Intangible assets other than goodwill - 2,025 2,025 Property, plant and equipment 10,717 893 11,610 Total non-current assets 10,717 2,918 13,635 Total assets 15,547 2,918 18,465 Liabilities Current liabilities Other financial liabilities 948 - 948 Trade and other accounts payable 1,424 - 1,424 Total current liabilities 2,372 - 2,372 Non-current liabilities Other non-financial liabilities 1,022 - 1,022 Deferred tax liabilities 2,246 861 3,107 Total non-current liabilities 3,268 861 4,129 Total liabilities 5,640 861 6,501 Total identifiable net assets 9,907 2,057 11,964

ThUS$ Value of the investment 13,211 (-) Identifiable net assets 11,964 Goodwill purchased 1,247

As a result of the acquisition of Papelera Panamericana S.A., CMPC has recognized the Ideal brand within the Intangible assets other than goodwill in the Consolidated Statement of Financial Position.

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15.2. Business combination in Brazil

On October 31, 2019, the Company, through its subsidiary CMPC Melhoramentos Ltda., finalized the acquisition of all of the social rights of Sepac - Serrados e Pasta e Celulose Ltda. In Brazil. The acquiree is a leading industrial society in the Brazilian tissue products market, strategically located in the State of Paraná to serve the most relevant consumer markets in the country. Through this operation CMPC manages to incorporate recognized brands such as Duetto into the Softys portfolio and an anual production capacity of 135 thousand tons of tissue paper produced by the Mallet plant, which translates into an approximately a production of 280 thousand tons annually at a consolidated level in Brazil.

As a result of this operation, CMPC has consolidated the new subsidiary in the Softys operating segment, also recognizing a Goodwill for the highest value paid, according to the following detail:

Book value Fair value Fair value acquired group adjustment acquired group

ThUS$ ThUS$ ThUS$ Asset Current asset Cash and cash equivalents 26,332 - 26,332 Other non financial assets 120 - 120 Trade and other accounts receivable 19,474 - 19,474 Inventory 7,829 - 7,829 Current tax assets 4,971 - 4,971 Total current assets 58,726 - 58,726 Non-current assets Other non-financial assets, non-current 71 - 71 Intangible assets other than goodwill 445 86,029 86,474 Property, plant and equipment 70,912 64,321 135,233 Current tax assets, non-current 4,668 - 4,668 Deferred tax assets 124 - 124 Total non-current assets 76,220 150,350 226,570 Total assets 134,946 150,350 285,296 Liabilities Current liabilities Other financial liabilities 8,489 - 8,489 Trade and other accounts payable 18,923 - 18,923 Current tax liabilities 735 - 735 Current provisions for employee benefits 2,070 - 2,070 Other non-financial liabilities, current 40 - 40 Total current liabilities 30,257 - 30,257 Non-current liabilities Other non-financial liabilities 17,514 - 17,514 Deferred tax liabilities - 51,119 51,119 Total non-current liabilities 17,514 51,119 68,633 Total liabilities 47,771 51,119 98,890 Total identifiable net assets 87,175 99,231 186,406

ThUS$ Value of the investment 333,983 (-) Identifiable net assets 186,406 Goodwill purchased 147,577

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NOTE 16 - INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD

CMPC has investments in associated companies which line of business contemplates activities that are complementary to the industrial and commercial activities.

Consorcio Protección Fitosanitaria Forestal S.A. is a company formed by the main forestry companies in Chile, for pest control purposes.

Genómica Forestal S.A. is a company dedicated to research in Chile, which contributes to increasing the competitiveness in the forestry sector.

Consorcio Tecnológico Bioenercel S.A. is a company which line of business is the conversion of lignocelluloses biomass into biofuel.

The constitution of CMPC Europe GmbH & Co. KG. and CMPC Europe Management GmbH comprises the first step of CMPC's strategic alliance with the German Group GUSCO Handel G. Schürfeld + Co. GmbH. These companies created in a joint venture format are expected to become operational from 2020 and seek to strengthen the Company's commercial networks in the sale of pulp, wood and cardboard in Europe.

In accordance with IAS 28, “Investments in Associates”, these investments are recorded using the equity method. The Company recognized its corresponding share of profits and losses in these companies, based on its share participation.

Commercial transactions with these companies or with their related companies are carried out at current local market prices, under fully competitive conditions, and when unrealized profits exist, they are eliminated.

The share of CMPC in its associates is detailed as follows:

Asociated entities Carrying Accrued Tax payer Country of Funcional Interest Company's Income of amount of Name income No. origin currency equity the period the inversion % ThUS$ ThUS$ ThUS$ ThUS$ Balance as of December 31, 2019 96.657.900-5 Consorcio Protección Fitosanitaria Forestal S.A. Chile CLP 29.010 429 (31) (9) 124 76.743.130-9 Genómica Forestal S.A. Chile CLP 25.283 (7) (3) - - 76.077.468-5 Consorcio Tecnológico Bioenercel S.A. Chile CLP 20.000 8 - - 2 Foreign CMPC Europe GmbH Co. KG Germany EUR 55.000 657 - - 361 Foreign CMPC Europe Management GmbH Germany EUR 55.000 27 - - 15 Total 1,114 (34) (9) 502

Balance as of December 31, 2018 96.657.900-5 Consorcio Protección Fitosanitaria Forestal S.A. Chile CLP 29.010 494 6 3 142 76.743.130-9 Genómica Forestal S.A. Chile CLP 25.283 (5) 9 - - 76.077.468-5 Consorcio Tecnológico Bioenercel S.A. Chile CLP 20.000 33 (4) (1) 7 Total 522 11 2 149

The significant influence that the Company exercises over its associated companies is in accordance with what is established in IAS 28.

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As of December 31, 2019 and 2018, assets and liabilities of associated companies are detailed as follows:

12/31/2019 12/31/2018 Assets and liabilities of associates Assets Liabilities Assets Liabilities ThUS$ ThUS$ ThUS$ ThUS$ Current 841 66 169 66 Non-current 380 41 466 47 Total 1,221 107 635 113

Revenue and ordinary expenses and results of the associated companies for the period are detailed as follows:

Year Revenue and expenses of associates 2019 2018 ThUS$ ThUS$ Sum of revenue of associates 528 794 Sum of other income statement items (562) (783) Profit (loss) of associates for the period (34) 11

For the period ended as of December 31, 2019 and 2018, movements of investments accounted for using the equity method are detailed as follow:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Beginning balance as of January 1 149 169 Share income for the period (9) 2 Equity changes in associates 362 (22) Ending balance 502 149

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NOTE 17 - INTANGIBLE ASSETS OTHER THAN GOODWILL

The detail of balances and movements of the main classes of intangible assets other than goodwill as of December 31, 2019 and 2018 are detailed as follow:

Water Emission Electric line Other Software Trademarks Total Description easements entitlements easements intangibles

ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Beginning balance as of January 1, 2019 3,268 2,278 5,221 20,831 768 - 32,366 Additions 47 - - 10,482 85 - 10,614 Acquisitions made through business - - - - 54,219 34,280 88,499 combinations Amortization - - - (4,481) - - (4,481) Increases (decreases) due to other variations - - - (997) (20) - (1,017) Variation from foreign currency translation 1 (69) - (360) (77) (226) (731) differences Ending balance as of December 31, 2019 3,316 2,209 5,221 25,475 54,975 34,054 125,250

Beginning balance as of January 1, 2018 3,271 2,402 5,223 4,885 800 - 16,581 Additions - - - 20,052 24 - 20,076 Amortization - - (2) (3,399) - - (3,401) Increases (decreases) due to other variations (3) - - - - - (3) Variation from foreign currency translation - (124) - (707) (56) - (887) differences Ending balance as of December 31, 2018 3,268 2,278 5,221 20,831 768 - 32,366

NOTE 18 - GOODWILL

The balance of the goodwill acquired as of December 31, 2019 and 2018 is composed as follows:

Original 12/31/2019 12/31/2018 Investor Underlying asset currency ThUS$ ThUS$ Inversiones CMPC S.A. CMPC Pulp SpA, Plant Pacífico US$ 51,081 51,081 Melhoramentos CMPC Ltda. Plantas Sao Paulo, Brazil BRL 29,561 30,793 CMPC Celulose Riograndense Ltda. Unidad Guaíba, Brazil US$ 8,460 8,460 Inversiones CMPC S.A. Forsac SpA, Plant Chillán US$ 5,854 5,854 CMPC Papeles S.A. Envases Impresos SpA, Plant Quilicura US$ 3,114 3,114 CMPC Papeles S.A. Chilena de Moldeados SpA, Plant Puente Alto US$ 2,644 2,644 Inversiones Protisa SpA La Papelera del Plata S.A., Plants Zárate, Naschel y Roca ARS 982 1,561 CMPC Tissue S.A. Grupo ABS Internacional S.A. de C.V., Plants Mexico MXN 498 477 Inversiones CMPC S.A. CMPC Pulp SpA, Plant Santa Fe 1 US$ 254 254 Subsidiarias Forestales - Chile C.A. y F. El Proboste Ltda., Fundos El Proboste US$ 221 221 Softys Arequipa S.A.C. Papelera Panamericana S.A., Plant Arequipa PEN 1,241 - Melhoramentos CMPC Ltda. Sepac – Serrados e Pasta e Celulose Ltda., Plant Mallet BRL 146,603 - Total 250,513 104,459

The roll forward of Goodwill is detailed as follows:

12/31/2019 12/31/2018 Goodwill ThUS$ ThUS$ Beginning balance 104,459 111,333 Increase due to business combinations (see note 15) 148,824 - Variation from foreign currency translation differences (2,770) (6,874) Ending balance 250,513 104,459

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NOTE 19 - PROPERTY, PLANT AND EQUIPMENT

As of December 31, 2019 and 2018, the net and gross values of property, plant and equipment are detailed as follows:

12/31/2019 12/31/2018 ThUS$ ThUS$ Property, plant and equipment Construction in progress 351,099 365,038 Land 1,481,949 1,466,029 Buildings 1,728,565 1,771,995 Plant and equipment 3,867,815 3,953,828 Office equipments 4,718 5,137 Fixture and accessories 1,149 1,545 Transportation equipment 1,856 1,494 Lease property, plant and equipment - IAS 17 95,379 84,796 Other property, plant and equipment 105,271 45,593 Subtotal property, plant and equipment 7,637,801 7,695,455 Right of use asset - IFRS 16 (see note 20.2) 170,815 - Total Property, plant and equipment, Net 7,808,616 7,695,455 Property, plant and equipment (gross) Construction in progress 351,099 365,038 Land 1,481,949 1,466,029 Buildings 2,671,750 2,611,363 Plant and equipment 7,047,345 6,704,062 Office equipments 12,093 11,918 Fixture and accessories 14,414 12,829 Transportation equipment 5,791 4,584 Lease property, plant and equipment - IAS 17 127,652 111,386 Other property, plant and equipment 178,927 107,556 Subtotal property, plant and equipment 11,891,020 11,394,765 Right of use asset - IFRS 16 282,420 - Total property, plant and equipment 12,173,440 11,394,765

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As of December 31, 2019 and 2018, the accumulated depreciation by type of property, plant and equipment is detailed as follows:

12/31/2019 12/31/2018 Accumulated depreciation ThUS$ ThUS$ Buildings 943,185 839,368 Plant and equipment 3,179,530 2,750,234 Office equipment 7,375 6,781 Fixtures and accesories 13,265 11,284 Transportation equipment 3,935 3,090 Leased property, plant and equipment - IAS 17 32,273 26,590 Other property, plant and equipment 73,656 61,963 Subtotal 4,253,219 3,699,310 Right of use asset - IFRS 16 111,605 - Total property, plant and equipment 4,364,824 3,699,310

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The accounting movement of property, plant and equipment, net, as of December 31, 2019 and 2018 is as follows:

Property Office Fixtures & Transp. Lease property, Other property, Construction Buildings, and Land equipment, accesories, Equipment, plant and plant and Totals Description in progress net equipment, net net net equipment, net equipment, net net ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Movements in 2019 Beginning balance as of January 1, 2019 365,038 1,466,029 1,771,995 3,953,828 5,137 1,545 1,494 84,796 45,593 7,695,455 Acquisitions made through business combinations 123 5,542 15,999 55,930 - 652 498 3,459 64,640 146,843 Additions 262,124 15,875 7,801 77,143 16 44 70 - 6,419 369,492 Depreciation expense - - (101,578) (372,813) (736) (1,642) (335) (4,911) (13,728) (495,743) Increase (decrease) from transfer from constructions in progress (227,127) 1,405 45,999 162,727 326 627 175 12,739 3,129 - Increase (decrease) from transfer in foreign exchanges (3,255) (996) (3,932) (11,505) (9) (76) (15) 1,033 (776) (19,531) Increase (decrease) from transfer for other changes (45,804) (5,906) (7,719) 2,505 (16) (1) (31) (1,737) (6) (58,715) Ending balance as of December 31, 2019 351,099 1,481,949 1,728,565 3,867,815 4,718 1,149 1,856 95,379 105,271 7,637,801

Additional information from period 2019 Disbursment recognized during construction 117,590 15,875 6,543 64,948 13 35 58 - 5,398 210,460 Carrying amount (gross) of fully depreciated goods in use - - 200,821 627,436 4,933 10,351 2,172 - 67,331 913,044

Movements in 2018 Beginning balance as of January 1, 2018 508,286 1,466,992 1,818,342 3,977,966 4,248 2,972 1,868 91,147 49,929 7,921,750 Beginning balance adjustment IAS 29 1,662 2,589 15,052 17,483 (10) (22) - - 11 36,765 Additions 275,461 - 208 35,448 77 10 - 324 7,990 319,518 Depreciation expense - - (100,424) (344,819) (662) (1,682) (352) (4,283) (15,218) (467,440) Impairment losses recognized in income statement for the period - - - (20,254) - - - - - (20,254) Increase (decrease) from transfer from work in progress (391,882) 1,520 52,811 331,973 1,642 448 78 11 3,399 - Increase (decrease) from transfer in foreign exchanges (11,310) (4,465) (11,754) (36,191) (149) (180) 1 (2,403) (2,263) (68,714) Increase (decrease) from transfer for other changes (17,179) (607) (2,240) (7,778) (9) (1) (101) - 1,745 (26,170) Ending balance as of December 31, 2018 365,038 1,466,029 1,771,995 3,953,828 5,137 1,545 1,494 84,796 45,593 7,695,455

Additional information for 2018 Disbursment recognized during construction 209,610 - 176 29,840 65 8 - - 6,661 246,360 Carrying amount (gross) of fully depreciated goods in use - - 156,115 547,589 5,023 8,072 1,632 - 62,507 780,938

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The depreciation for the year ended December 31, 2019 and 2018 is as follows:

Year 2019 2018 ThUS$ ThUS$ Total depreciation expense (1) 524,995 467,440 Adjustment for changes in stock (absorption cost) (320) (11,628) Total charged to income (cost of sales) 524,675 455,812

(1) Includes the effect in profit and loss originated by the rights of use of assets disclosed at Note 20.2.

Borrowing cost

During the period of twelve months ended December 31, 2019 the Company capitalized borrowing costs by the amount of ThUS$864 (as of December 31, 2018 ThUS$104). The effective interest rate is 4.53% (as of December 31, 2018, was 4.09%).

Dismantling and restoration costs

As of December 31, 2019, and 2018, the Company does not have a legal or contractual obligation associated with dismantling, withdrawing or rehabilitating sites where it operates, which is why its assets do not include costs associated with such requirements, except the subsidiary Productos Tissue del Ecuador S.A. (ThUS$580 provision recorded at its books in both periods).

Impairment

As of December 31, 2018, the Company recognized an impairment of assets in property, plant and equipment for ThUS$20,254, recorded in other gains (losses), which has been registered in Other profit (loss) and is associated with spare parts whose book value exceeded its recoverable amount. These spare parts comply with the definition of strategic inventory and forms part of property, plant and equipment as described in IAS 16.

Except as described above, the results of the Company for the period ended December 31, 2019 and 2018, have not been influenced by other factors, internal or external, that might require performing impairment tests on the assets of the Company. In general, there have been no significant decreases in the market value of its assets, the use of installed capacity has not been reduced and there have been no market losses of the products or services provided by the entity (by quality, price, product substitutes, etc.). Market interest rates or other rates of return on investments have not increased significantly during the period, and such increases do not affect the discount rate used in the calculation of asset use value, without affecting their recovery value.

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Property, plant and equipment in guarantee

There are not direct guarantees as of December 31, 2019.

NOTE 20 - LEASES

20.1. Financial Leases – IAS 17

All the Company's finance leases are for industrial assets classified as Property, Plant and Equipment in the Consolidated Statement of Financial Position. The net carrying amount as of December 31, 2019 and 2018 are detailed follow:

12/31/2019 12/31/2018 Assets under financial lease, net ThUS$ ThUS$ Buildings and facilities 11,617 12,364 Plant and equipment 83,654 72,372 Transportation equipment 109 60 Subtotal 95,380 84,796 Construction in progress - 6,045 Total 95,380 90,841

20.2. Right of use assets – IFRS 16

The leases of property, plant and equipment, classified by class of asset, as of December 31, and January 1, 2019, are detailed follow:

12/31/2019 12/31/2018 ThUS$ ThUS$ Right to use assets, Net Buildings and facilities 79,516 - Plant and equipment 64,625 - Fixtures and accesories 3,501 - Transportation equipment 23,173 - Total 170,815 -

Right to use assets, Gross Buildings and facilities 125,733 - Plant and equipment 108,953 - Fixtures and accesories 6,463 - Transportation equipment 41,271 - Total Right to use the asset, Gross 282,420 -

The accumulated depreciation of leases of property, plant and equipment by class of asset, as of December 31, 2019 is detailed as follows:

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12/31/2019 12/31/2018 Accumulated depreciation ThUS$ ThUS$ Buildings and facilities 46,217 - Plant and equipment 44,328 - Fixtures and accesories 2,962 - Transportation equipment 18,098 - Total accumulated depreciation of the right to use the asset (1) 111,605 -

(1) The calculation of the right to use related to IFRS 16 was made from the beginning of the contracts.

The accounting movement of the leases of property, plant and equipment as of December 31, 2019 is as follows:

Property and Fixtures & Transp. Buildings, equipment, accesories, Equipment, Total Description net net net net

ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Movements in 2019 Initial balance adjustment IFRS 16 72,606 81,517 4,801 28,513 187,437 Additions 23,955 3,850 95 226 28,126 Depreciation expense (10,012) (13,390) (1,184) (4,666) (29,252) Increase (decrease) from transfer in foreign exchanges (756) (2,143) (63) (191) (3,153) Increase (decrease) from transfer for other changes (6,277) (5,209) (148) (709) (12,343) Balance as of December 31, 2019 79,516 64,625 3,501 23,173 170,815

The classes of assets that the Company maintains under lease correspond to:

Right of use – Buildings

The Company has lease contracts for buildings and warehouses to operate, this include offices and storage of merchandise. These contracts are normally executed for a period of 25 years, considering future renewals as long as these contracts contain the option to renew after the end of the original term.

Right of use – Plant and equipment

The Company has lease contracts of machinery for the operation in the different businesses. These contracts are normally executed for a period of 10 years, considering future renewals as long as these contracts contain the option to renew after the end of the original term.

Right of use – Appliances and accessories

The Company has lease contracts for laptops which are used by people for the execution of different tasks. These contracts are normally executed for a period of 3 to 6 years, considering future renewals as long as these contracts contain the option to renew after the end of the original term.

Right of use – Vehicles

The Company has lease contracts for vehicles for the operation in the different businesses. These contracts are normally executed for a period of 5 to 10 years, considering future renewals as long as these contracts contain the option to renew after the end of the original term.

91 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

CMPC included extension options in new leases to provide operational flexibility. The extended extension options are exercisable only by the Company and at the beginning of the contract; it is evaluated whether it is likely and reasonably to exercise the renewal options. Empresas CMPC reevaluates whether it is likely and reasonably to exercise the options if there is a significant event or a significant change in the circumstances within its control.

Some lease contracts provide additional rental payments that are based on changes in the local price indexes that CMPC performs on the leased asset.

The Company has recognized depreciation expenses and financial costs, instead of operating lease expenses. During the period of twelve months ended December 31, 2019, CMPC recognized ThUS$29,252 for depreciation expense and ThUS$16,867 for financial costs on these leases.

20.3. Liabilities for operating leases

Under this concept, obligations derived from commercial contracts of operating leases with third parties are registered, which were signed within the normal course of business.

The payments made by CMPC during the twelve months of 2019 in relation to the operating lease agreements according to IFRS 16 amount to ThUS$46,119.

Empresas CMPC expects the relative proportions of fixed and variable lease payments to remain generally consistent in future years.

The structure of the liability related to the operating lease contracts as of December 31, 2019 and 2018 are detailed as follow: 12/31/2019 12/31/2018 Description ThUS$ ThUS$ Liabilities for current operating leases 22,949 - Total Liabilities for current operating leases 22,949 - Liabilities for non-current operating leases 168,762 - Total Liabilities for non-current operating leases 168,762 -

Total Liabilities for operating leases 191,711 -

92 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

The analysis of the settlement of the liabilities for current and non-current operating leases recorded as of December 31, 2019, expressed in their final amounts at the respective payment dates is as follows:

Maturity of Liabilities due for Operating Lease More than 1 More than 3 91 days up to More than 5 Up to 90 days year up to 3 years up to 5 Total 1 year years years years ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Balance as of December 31, 2019 Liabilities for operating leases (1) 10,647 31,939 79,883 66,003 96,370 284,842 Total 10,647 31,939 79,883 66,003 96,370 284,842 (1) Include interest payable in future lease terms.

93 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

NOTE 21 - DEFERRED TAXES

Deferred taxes correspond to the amount of income tax the Company will have to pay (liabilities) or recover (assets) in future years, relating to temporary differences between the tax basis and the carrying amount of certain assets and liabilities. The main deferred tax asset corresponds to the entitlement of companies to use tax losses accumulated as of December 31, 2019, that can be used in the future. The main deferred tax liabilities payable in future years correspond to temporary differences arising from the revaluation of biological assets (forest plantations) and the revaluation of property, plant and equipment as of the date of transition to IFRS and to the application of accelerated depreciation for tax purposes.

It should be noted that the book and tax values from prior years will be used significantly in future years and arise, as previously indicated, from revaluations of non-current assets.

As of December 31, 2019 and 2018 deferred tax amounts are as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Tax losses 143,701 181,579 Foreign currency translation differences (1) 113,716 129,395 Provisions 59,003 73,366 Hedging liabilities 16,943 18,034 Other liabilities 6,823 2,425 Leases (Right of use) 7,229 - Property, plant and equipment (1,157,645) (1,152,165) Biological assets (625,045) (646,924) Other assets (77,816) (55,203) Inventory (23,537) (25,412) Income accrued from foreign operations (22,370) (2,212) Deferred tax net balance (1,558,998) (1,477,117)

(1) Effect caused by the difference between the financial functional currency (dollar) and the tax currency (local currency) of the respective business unit, see note 3.1.b.

12/31/2019 12/31/2018 Statement of financial position ThUS$ ThUS$ Deferred tax assets 39,414 83,774 Deferred tax liabilities (1,598,412) (1,560,891) Deferred tax net balance (1,558,998) (1,477,117)

94 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

As of December 31, 2019, deferred tax assets arising from tax losses amount to ThUS$143,701. These can be used to offset future taxable profits that may be generated in companies generating these balances, according to the following detail:

Variation Variation w/o effect on with effect income (for. Deferred tax on tax loss on income Curr. credit Translation (charge) diff) Subsidiaries Country 12/31/2019 12/31/2018 12/31/2019 12/31/2018 ThUS$ ThUS$ ThUS$ ThUS$ CMPC Celulose Riograndense Ltda. Brazil - 17,293 (17,293) - Melhoramentos CMPC Ltda. Brazil 55,796 53,903 3,171 (1,278) CMPC Maderas SpA Chile 22,852 26,655 (3,803) - Drypers Andina S.A. Colombia 8,625 9,567 (862) (80) Envases Impresos SpA Chile 7,396 7,681 (285) - Forestal Mininco SpA Chile 18,586 12,274 6,448 (136) Protisa Colombia S.A. Colombia 5,038 5,081 (1) (42) Grupo ABS Internacional S.A. de C.V. Mexico 980 4,382 (3,578) 176 Inversiones Protisa SpA Chile - 3,280 (2,621) (659) Empresas CMPC S.A. Chile - 8,864 (8,864) - Forsac México S.A. de C.V. Mexico 2,601 1,525 1,076 - Inmobiliaria y Constructora San Roque SpA Chile 1,451 805 646 - Inversiones CMPC S.A. Chile - 20,916 (19,890) (1,026) Bioenergías Forestales SpA Chile 2,763 3,371 (608) - CMPC Inversiones de Argentina S.A. Argentina 11 14 3 (6) Inmobiliaria Pinares SpA Chile - 18 (18) - Forestal Timbauva S.A. Argentina 12 12 - - Productos Tissue del Ecuador S.A. Ecuador - 246 (246) - Sociedad Recuperadora de Papel SpA Chile 92 194 (102) - Industria Papelera Uruguaya S.A. Uruguay (1) 116 (107) (10) CMPC Maderas México S.A. de C.V. Mexico - 1 (1) - CMPC Papeles S.A. Chile 2,555 1,107 1,448 - Fabi Bolsas Industriales S.A. Argentina 44 - 44 - Forestal Bosques del Plata S.A. Argentina 1,187 72 1,115 - Naschel S.A. Argentina 4 - 1 3 La Papelera del Plata S.A. Argentina 13,366 4,202 11,226 (2,062) Papeles Cordillera SpA Chile 7 - (68) 75 Forsac SpA Chile 336 - 336 - Total 143,701 181,579 (32,833) (5,045)

Tax losses that can be charged against future earnings generated by companies in Chile and Brazil do not have expiration dates. However, the tax losses of companies in Mexico expire in 10 years, and for companies in Argentina and Ecuador tax losses expire in 5 years, and for the subsidiaries in Colombia, the tax losses generated as of 2017 expire within 12 years, maintaining the tax losses prior to 2016 their status as imprescriptible. Based on the normal course of business and projections, management estimates that almost all the tax losses will be used in future years.

95 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

Deferred tax movements as December 31, 2019 and 2018 are detailed as follows:

12/31/2019 12/31/2018 Change in deferred taxes ThUS$ ThUS$ Deferred taxes, balance as of 1st January (1,477,117) (1,451,172) Tax losses (37,878) (42,557) Foreign currency translation differences (15,679) 29,774 Provisions (14,363) 19,739 Hedging liabilities (1,091) 8,285 Other liabilities 4,398 235 Leases (Right of use) 7,229 - Property, plant and equipment (5,480) (57,056) Biological assets 21,879 24,254 Other assets (22,613) (15,539) Inventory 1,875 6,369 Income accrued from foreign operations (20,158) 551 Ending balance (1,558,998) (1,477,117)

Temporary differences that generated deferred taxes as of December 31, 2019 and their effect on the income statement are detailed as follows:

Deferred taxes recognized Deferred taxes recognized with effect on w/o effect on income income statement statement (*) Increase Increase Deferred Increase Increase Type of temporary difference (decrease) (decrease) taxes profit (decrease) (decrease) assets liabilities (loss) assets liabilities ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Tax losses (32,833) - (32,833) (5,045) - Foreign currency translation differences (15,679) - (15,679) - - Provisions (11,905) - (11,905) (2,458) - Hedging liabilities (3,135) - (3,135) 2,044 - Other liabilities 4,506 - 4,506 (108) - Leases (Right of use) - (288) (288) - 7,517 Property, plant and equipment - 26,889 26,889 - (32,369) Biological assets - 19,880 19,880 - 1,999 Other assets - 7,095 7,095 - (29,708) Inventory - 1,820 1,820 - 55 Income accrued from foreign operations - (20,235) (20,235) - 77 Total (59,046) 35,161 (23,885) (5,567) (52,429)

(*) The decrease in deferred tax asset recorded, without an effect on income, for ThUS$57,996 (decrease in deferred tax assets of ThUS$5,567 and increase in deferred tax liabilities of ThUS$52,429) corresponds to the following: tax losses, leases, property, plant and equipment and other assets. In addition, an exchange difference effect is recognized when transferring balances expressed in functional currencies other than dollar.

96 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

Temporary differences generated by deferred taxes as of December 31, 2018 and their effect on income are detailed as follows:

Deferred taxes recognized Deferred taxes recognized with effect on w/o effect on income income statement statement (*) Increase Increase Deferred Increase Increase Type of temporary difference (decrease) (decrease) taxes profit (decrease) (decrease) assets liabilities (loss) assets liabilities ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ Tax losses (30,409) - (30,409) (12,148) - Foreign currency translation differences 29,774 - 29,774 - - Provisions 21,111 - 21,111 (1,372) - Hedging liabilities 7,919 - 7,919 366 - Other liabilities (55) - (55) 290 - Property, plant and equipment - (44,509) (44,509) - (12,547) Biological assets - 23,419 23,419 - 835 Other assets - (17,834) (17,834) - 2,295 Inventory - 5,133 5,133 - 1,236 Income accrued from foreign operations - 290 290 - 261 Total 28,340 (33,501) (5,161) (12,864) (7,920)

(*) The decrease in deferred tax asset recorded, without an effect on income, for ThUS$20,784 (a decrease in deferred tax assets of ThUS$12,864 and a decrease in deferred tax liabilities of ThUS$7,920) corresponds to the following: property, plant and equipment and other assets. In addition, an exchange difference effect is recognized when transferring balances expressed in functional currencies other than dollar

NOTE 22 - OTHER FINANCIAL LIABILITIES

As of December 31, 2019 and 2018, other financial liabilities are detailed as follows:

12/31/2019 12/31/2018 Description ThUS$ ThUS$ Interest bearing loans - current 507,480 429,918 Hedging liabilities - current 5,367 9,089 Subtotal other current financial liabilities 512,847 439,007 Interest bearing loans - non-current 3,366,783 3,379,033 Hedging liabilities - non-current 65,414 57,190 Subtotal other non-current financial liabilities 3,432,197 3,436,223

Total 3,945,044 3,875,230

97 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

22.1. Composition of the balance and maturities a) Current and non-current interest bearing loans

Interest bearing loans grouped by maturity dates are detailed as follows:

- Balances as of December 31, 2019

Interest bearing loans (ThUS$) More than More than 3 More than More than More than More than 4 Obligation Debtor Up to 1 1 month More than 5 Effective Debtor's name Currency Creditor's name months up 1 year up 2 years up 3 years up years up to 5 Total Amortization nominal Nominal rate taxpayer No. month up to 3 years rate to 1 year to 2 years to 3 years to 4 years years value month Bank obligations: Banco Santander - Spain (Agency Swedish Export Credit 96.596.540-8 Inversiones CMPC S.A. US$ - - 2,599 2,563 2,563 645 - - 8,370 Semiannual 2.24% 8,972 Libor+0.65% Corporation) - Sweden (**) 96.596.540-8 Inversiones CMPC S.A. US$ MUFG Bank, Ltd. (Administrative Agent) - Japan (**) - 850 - - - - 98,418 - 99,268 Semiannual 3.12% 100,000 Libor+1.05%

96.532.330-9 CMPC Pulp SpA US$ Scotiabank - Chile 200,859 ------200,859 Monthly 2.49% 200,000 Libor+0.58% Nordea Bank AB (publ) (Agency Swedish Export Credit Foreign Absormex CMPC Tissue S.A. de C.V. US$ 2,400 - 2,201 4,402 4,402 4,402 1,347 - 19,154 Semiannual 2.37% 19,808 2.37% Corporation) - Sweden (**) Foreign Absormex CMPC Tissue S.A. de C.V. US$ Banco Nacional de México, S.A. 10 - 9,500 - - - - - 9,510 Maturity 2.75% 9,500 2.75%

Banco Santander - Spain (Agency Swedish Export Credit Foreign La Papelera del Plata S.A. US$ 1,201 20 1,462 2,918 2,918 2,918 2,918 10,212 24,567 Maturity 3.70% 24,546 3.70% Corporation) - Sweden Foreign La Papelera del Plata S.A. US$ Scotiabank - Chile - RUT 97.018.000-1 - 95 5,250 - - - - - 5,345 Semiannual 2.99% 5,250 2.99% Foreign La Papelera del Plata S.A. ARS Banco HSBC Bank LTd. 4,542 ------4,542 Maturity 51.00% 4,542 51.00% Foreign La Papelera del Plata S.A. ARS Banco Patagonia S.A. - Argentina 1,670 ------1,670 Maturity 50.00% 1,670 50.00% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú - 8,442 ------8,442 Maturity 4.32% 8,351 3.66% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 179 351 703 - - - - - 1,233 Monthly 6.99% 1,231 ECM+2.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 201 395 593 - - - - - 1,189 Monthly 8.27% 1,185 TJLP+2.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 122 237 356 - - - - - 715 Monthly 9.27% 711 TJLP+3.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 4 - 217 325 108 - - - 654 Monthly 6.60% 651 ECM+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 8 335 447 74 - - - 864 Monthly 8.23% 856 TJLP+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 5 201 268 45 - - - 519 Monthly 9.23% 514 TJLP+3.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 13 - - 417 455 37 - - 922 Monthly 6.73% 909 ECM+2.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 4 427 427 427 - - - 1,285 Monthly 8.37% 1,281 TJLP+2.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 3 - 384 384 - - - 771 Monthly 9.37% 769 TJLP+3.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 1,375 2,491 11,210 14,794 14,794 1,233 - - 45,897 Monthly 7.06% 47,080 ECM+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 2,315 4,150 18,029 24,669 24,614 - - - 73,777 Monthly 7.06% 76,290 TJLP+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 1,407 2,490 11,204 14,768 14,768 - - - 44,637 Monthly 7.06% 45,774 TJLP+3.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 1,454 2,801 12,603 16,520 16,520 - - - 49,898 Monthly 7.06% 52,015 2.50% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 288 519 2,334 3,090 3,090 - - - 9,321 Monthly 7.06% 9,457 TJLP+1.88% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 29 54 238 322 322 - - - 965 Monthly 7.06% 975 TJLP Banco Santander - Spain and Nordea Bank AB (publ) (Agency Foreign CMPC Celulose Riograndense Ltda. US$ 6,298 - 6,167 11,888 11,888 11,888 11,888 11,899 71,916 Semiannual 4.07% 71,655 2.35% Swedish Export Credit Corporation) - Sweden Banco Santander - Spain and Nordea Bank AB (publ) (Agency Foreign CMPC Celulose Riograndense Ltda. US$ - - 20,663 21,902 21,902 21,902 21,902 21,902 130,173 Semiannual 3.62% 132,000 2.41% Finnish Export Credit Ltd.) - Finland Foreign CMPC Celulose Riograndense Ltda. US$ Banco Itaú S.A. - Brazil 30,028 ------30,028 Monthly 2.25% 30,000 2.25% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 110 219 331 - - - - - 660 Monthly 4.50% 643 4.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 23 47 82 - - - - - 152 Monthly 4.50% 150 4.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 6 13 45 - - - - - 64 Monthly 5.50% 63 5.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 3 7 17 - - - - - 27 Monthly 5.50% 26 5.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 26 51 231 308 308 50 - - 974 Monthly 3.00% 963 3.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 3 5 23 31 31 16 - - 109 Monthly 3.00% 108 3.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 14 28 126 168 168 125 - - 629 Monthly 3.50% 620 3.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 26 48 215 285 287 287 287 - 1,435 Monthly 6.00% 1,400 6.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 67 134 605 200 - - - - 1,006 Monthly 10.18% 966 4.6%+TJLP Foreign Melhoramentos CMPC Ltda. US$ MUFG Bank, Ltd. - United States (**) 336 - 50,000 - - - - - 50,336 Maturity 9.85% 50,000 3.4040%

98 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

(Continued) More than More than 3 More than More than More than More than 4 Obligation Debtor Up to 1 1 month More than 5 Effective Debtor's name Currency Creditor's name months up 1 year up 2 years up 3 years up years up to 5 Total Amortization nominal Nominal rate taxpayer No. month up to 3 years rate to 1 year to 2 years to 3 years to 4 years years value month Bank obligations: Foreign Sepac - Serrados e Pasta e Celulose BRL Banco do Brasil 214 428 1,928 2,571 2,561 205 - - 7,907 Monthly 2.50% 7,829 2.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco do Brasil 2 3 16 21 21 9 - - 72 Monthly 3.00% 71 3.00% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco do Brasil 29 58 260 347 347 339 - - 1,380 Monthly 3.50% 1,361 3.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco do Brasil 60 121 544 725 725 725 518 - 3,418 Monthly 6.00% 3,339 6.00% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco do Brasil 70 139 626 835 835 835 - - 3,340 Monthly 9.50% 3,220 9.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Bradesco S.A. - Brazil 14 27 123 162 155 155 142 13 791 Monthly 6.00% 773 6.00% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Bradesco S.A. - Brazil 63 126 565 439 - - - - 1,193 Monthly 11.50% 1,142 11.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Bradesco S.A. - Brazil 1 3 12 13 - - - - 29 Monthly 9.50% 28 9.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Itaú S.A. - Brazil 21 41 186 248 248 83 - - 827 Monthly 9.50% 797 9.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Caixa Econômica Federal - Brazil 6 11 50 67 67 53 - - 254 Monthly 3.50% 251 3.50% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Santander - Brazil 84 167 754 1,005 1,005 1,005 920 - 4,940 Monthly 12.20% 4,715 12.20% Foreign Sepac - Serrados e Pasta e Celulose BRL Banco Safra S.A. - Brazil 46 93 324 - - - - - 463 Monthly 9.84% 446 9.84% Total Bank obligations 255,619 24,684 163,355 127,529 126,032 46,912 138,340 44,026 926,497

Bonds payable 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - 6,927 - - - - 496,842 - 503,769 Maturity 4.79% 500,000 4.75% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 5,226 - - - - 493,199 498,425 Maturity 4.42% 500,000 4.38% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 4,063 - 498,039 - - - 502,102 Maturity 4.64% 500,000 4.50% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 2,734 - - 497,778 - - 500,512 Maturity 4.47% 500,000 4.38% 96.596.540-8 Inversiones CMPC S.A. UF Bond - F series, Reg. 570 CMF (**) - 3,034 - - - - - 260,142 263,176 Maturity 4.55% 264,671 4.30% 96.596.540-8 Inversiones CMPC S.A. UF Bond - G series, Reg. 733 CMF (**) - - 1,257 - - - - 184,264 185,521 Maturity 3.70% 189,051 3.50% 96.596.540-8 Inversiones CMPC S.A. UF Bond - H series, Reg. 570 CMF (**) 834 - 22,686 22,686 - - - 66,112 112,318 Maturity 1.77% 113,430 1.50% 96.596.540-8 Inversiones CMPC S.A. UF Bond - M series, Reg. 733 CMF (**) 2,034 ------182,762 184,796 Maturity 2.55% 189,051 2.20% 96.596.540-8 Inversiones CMPC S.A. UF Bond - O series, Reg. 733 CMF (**) - - 129 - - - - 97,712 97,841 Maturity 1.22% 94,525 1.69% Foreign Productos Tissue del Perú S.A. PEN Bond - A series - - 372 - - 15,074 14,554 - 30,000 Maturity 6.625% 30,148 6.625% Total bonds payable 2,868 9,961 36,467 22,686 498,039 512,852 511,396 1,284,191 2,878,460

Finance lease obligations: Foreign Protisa Colombia S.A. COP BBVA Colombia S.A. 1 1 5 7 - - - - 14 Monthly 0.93% 14 0.93% Foreign Protisa Colombia S.A. COP BBVA Colombia S.A. 1 1 ------2 Monthly 0.93% 2 0.93% Foreign Drypers Andina S.A. COP BBVA Colombia S.A. - 1 4 6 2 - - - 13 Monthly 0.97% 13 0.97% Foreign Forsac Perú S.A. US$ BBVA Banco Continental S.A. - Peru 201 402 1,806 2,240 2,241 - - - 6,890 Monthly 4.40% 6,890 4.40% Foreign Papelera Panamericana S.A. PEN Banco de Crédito del Perú 6 11 49 70 50 186 Monthly 8.00% 186 8.00% Foreign Papelera Panamericana S.A. PEN BBVA Banco Continental S.A. - Peru 95 83 42 52 57 60 64 28 481 Monthly 7.00% 481 7.00% Foreign Papelera Panamericana S.A. PEN Banco Interamericano de Finanzas - Peru 112 10 93 102 109 116 124 306 972 Monthly 7.70% 972 7.70% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 65 202 287 - - - - 554 Quarterly 7.45% 554 7.45% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 309 963 1,368 722 - - - 3,362 Quarterly 7.55% 3,362 7.55% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 1,784 5,565 7,944 8,587 - - - 23,880 Quarterly 8.10% 23,880 8.10% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru 243 - 747 1,067 1,153 926 - - 4,136 Quarterly 8.15% 4,136 8.15% 91.440.000-7 Forestal Mininco SpA CLP Sodexo Chile S.A. - RUT 94.623.000-6 4 10 46 59 62 68 - - 249 Monthly 10.00% 249 10.00% Total finance lease obligations: 663 2,677 9,522 13,202 12,983 1,170 188 334 40,739

Other obligations: 96.532.330-9 CMPC Pulp SpA US$ Comercial e Industrial ERCO (Chile) Ltda. - RUT 76.163.730-4 139 278 1,247 1,674 1,685 1,696 1,707 20,141 28,567 Monthly 7.80% 28,567 7.80% Total other obligations: 139 278 1,247 1,674 1,685 1,696 1,707 20,141 28,567

Total interest bearing loans 259,289 37,600 210,591 165,091 638,739 562,630 651,631 1,348,692 3,874,263 Total interest bearing loans at fair value 259,289 37,600 210,591 165,091 638,739 562,630 651,631 1,348,692 3,874,263 (*) Loans contracted w ith maturities of more than one year. (**) Risks managed totally or partially through contracts rate swap y cross currency swap .

99 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

- Balances as of December 31, 2018

Interest bearing loans (ThUS$)

More than More than 3 More than More than More than More than 4 Obligation Debtor Up to 1 1 month More than 5 Effective Debtor's name Currency Creditor's name months up 1 year up 2 years up 3 years up years up to 5 Total Amortization nominal Nominal rate taxpayer No. month up to 3 years rate to 1 year to 2 years to 3 years to 4 years years value month

Bank obligations: Banco Santander - Spain (Agency Swedish Export Credit 96.596.540-8 Inversiones CMPC S.A. US$ - - 2,752 2,691 2,691 1,883 563 - 10,580 Semiannual 2.24% 11,344 Libor+0.65% Corporation) - Sweden (**) Nordea Bank AB (publ) (Agency Swedish Export Credit Foreign Absormex CMPC Tissue S.A. de C.V. US$ 2,444 - 2,201 4,401 4,402 4,402 4,402 1,194 23,446 Semiannual 2.37% 24,210 2.37% Corporation) - Sweden (**) Foreign Absormex CMPC Tissue S.A. de C.V. MXN Scotiabank Inverlat S.A. - Mexico (**) - - 34,957 - - - - - 34,957 Maturity 5.66% 34,975 5.66% Foreign Forsac México S.A. de C.V. MXN Scotiabank - Chile - RUT 97.018.000-1 - 7,956 ------7,956 Maturity 6.07% 7,771 6.07% Foreign Industria Papelera Uruguaya S.A. UYU Banco Santander - Uruguay 1,557 ------1,557 Maturity 8.10% 1,552 8.10% Foreign Industria Papelera Uruguaya S.A. UYU Banco Santander - Uruguay 1,780 ------1,780 Maturity 8.10% 1,774 8.10% Foreign Industria Papelera Uruguaya S.A. UYU Banco Santander - Uruguay 2,048 ------2,048 Maturity 8.95% 2,021 8.95% Foreign Industria Papelera Uruguaya S.A. UYU Banco Santander - Uruguay 1,501 ------1,501 Maturity 8.95% 1,481 8.95% Foreign Industria Papelera Uruguaya S.A. UYU Banco Citibank N.A. - Uruguay 7,619 ------7,619 Maturity 15.40% 7,406 15.40% Foreign La Papelera del Plata S.A. ARS Banco de la Provincia de Buenos Aires - Argentina 159 149 ------308 Monthly 49.53% 297 Badlar+2% Foreign La Papelera del Plata S.A. ARS Banco de la Provincia de Buenos Aires - Argentina 3 - 140 - - - - - 143 Semiannual 49.01% 140 Badlar+4.5% Foreign La Papelera del Plata S.A. ARS HSBC Bank - Argentina 3,982 ------3,982 Maturity 60.00% 3,979 60.00% Foreign La Papelera del Plata S.A. ARS Banco Itaú Argentina S.A. 339 ------339 Maturity 60.00% 345 60.00% Banco Santander - Spain (Agency Swedish Export Credit Foreign La Papelera del Plata S.A. US$ - - 11 - - - - 10,827 10,838 Maturity 3.70% 10,828 3.70% Corporation) - Sweden Foreign La Papelera del Plata S.A. US$ Scotiabank - Chile - RUT 97.018.000-1 - - 5,264 - - - - - 5,264 Semiannual 2.99% 5,250 2.99% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú - 8,253 ------8,253 Maturity 3.66% 8,198 3.66% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 185 351 1,582 1,231 - - - - 3,349 Monthly 6.64% 3,340 ECM+2.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 217 409 1,844 1,229 - - - - 3,699 Monthly 8.88% 3,688 TJLP+2.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 131 246 1,106 737 - - - - 2,220 Monthly 9.88% 2,213 TJLP+3.32% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 10 - - 217 325 108 - - 660 Monthly 6.60% 651 ECM+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 9 - 370 444 74 - - 897 Monthly 8.84% 888 TJLP+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 6 - 222 266 44 - - 538 Monthly 9.84% 533 TJLP+3.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 14 - - - 417 455 38 - 924 Monthly 6.74% 909 ECM+2.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 4 - - 664 664 - - 1,332 Monthly 8.88% 1,328 TJLP+2.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil - 3 - - 398 398 - - 799 Monthly 9.88% 797 TJLP+3.42% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 1,410 2,481 11,164 15,109 15,109 15,109 1,259 - 61,641 Monthly 7.76% 62,348 ECM+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 2,472 4,290 19,306 26,101 26,101 26,101 - - 104,371 Monthly 7.76% 105,489 TJLP+2.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 1,506 2,574 11,583 15,661 15,661 15,661 - - 62,646 Monthly 7.76% 63,293 TJLP+3.28% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 1,520 2,900 13,052 17,764 17,764 17,764 - - 70,764 Monthly 7.76% 72,143 2.50% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil (**) 307 537 2,416 3,249 3,249 3,249 - - 13,007 Monthly 7.76% 13,077 TJLP+1.88% Foreign CMPC Celulose Riograndense Ltda. BRL BNDES - Brazil 31 56 251 336 336 336 - - 1,346 Monthly 7.76% 1,348 TJLP Banco Santander - Spain and Nordea Bank AB (publ) (Agency Foreign CMPC Celulose Riograndense Ltda. US$ 6,412 - 5,578 11,461 11,461 11,461 11,461 22,925 80,759 Semiannual 3.62% 83,597 2.35% Swedish Export Credit Corporation) - Sweden Banco Santander - Spain and Nordea Bank AB (publ) (Agency Foreign CMPC Celulose Riograndense Ltda. US$ - - 20,663 21,115 21,115 21,114 21,114 42,226 147,347 Semiannual 3.62% 154,000 2.41% Finnish Export Credit Ltd.) - Finland Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 125 250 1,126 751 - - - - 2,252 Monthly 4.50% 2,213 4.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 13 25 114 89 - - - - 241 Monthly 4.50% 236 4.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 7 13 60 67 - - - - 147 Monthly 5.50% 145 5.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 4 7 32 28 - - - - 71 Monthly 5.50% 69 5.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 27 53 241 320 320 320 52 - 1,333 Monthly 3.00% 1,318 3.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 3 5 24 33 33 33 16 - 147 Monthly 3.00% 145 3.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 15 29 132 174 174 174 130 - 828 Monthly 3.50% 816 3.50% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 25 50 229 299 299 299 299 295 1,795 Monthly 6.00% 1,755 6.00% Foreign Melhoramentos CMPC Ltda. BRL Banco Itaú BBA S.A. - Brazil 65 130 624 777 283 - - - 1,879 Monthly 10.18% 1,804 4.6%+TJLP Foreign Melhoramentos CMPC Ltda. BRL Banco BNDES - Brazil 64 128 128 - - - - - 320 Monthly 13.66% 308 SELIC+2.28% Foreign Melhoramentos CMPC Ltda. BRL Banco BNDES - Brazil 66 131 131 - - - - - 328 Monthly 8.06% 318 TJLP+2.32 Foreign Melhoramentos CMPC Ltda. BRL Banco BNDES - Brazil 39 79 79 - - - - - 197 Monthly 8.95% 190 TJLP+3.28% Foreign Melhoramentos CMPC Ltda. US$ MUFG Bank, Ltd. - United States (**) 335 - - 50,000 - - - - 50,335 Maturity 9.85% 50,000 3.3040% Total Bank obligations 36,435 31,124 136,790 174,432 121,512 119,649 39,334 77,467 736,743 (*) Loans contracted w ith maturities of more than one year. (**) Risks managed totally or partially through contracts rate sw ap y cross currency sw ap.

100 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

(Continued)

Interest bearing loans (ThUS$)

Bonds payable 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - 6,927 - - - - - 496,170 503,097 Maturity 4.79% 500,000 4.75% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 5,226 - - - - 492,263 497,489 Maturity 4.42% 500,000 4.38% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 186,502 - - - - - 186,502 Maturity 6.25% 185,000 6.13% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 4,063 - - 497,176 - - 501,239 Maturity 4.64% 500,000 4.50% 96.596.540-8 Inversiones CMPC S.A. US$ Bond - Rule 144A - - 2,734 - - - 497,109 - 499,843 Maturity 4.47% 500,000 4.38% 96.596.540-8 Inversiones CMPC S.A. UF Bond - F series, Reg. 570 CMF (**) - 3,184 - - - - - 272,516 275,700 Maturity 4.55% 277,733 4.30% 96.596.540-8 Inversiones CMPC S.A. UF Bond - G series, Reg. 733 CMF (**) - - 1,319 - - - - 193,097 194,416 Maturity 3.70% 198,381 3.50% 96.596.540-8 Inversiones CMPC S.A. UF Bond - H series, Reg. 570 CMF (**) 875 ------116,620 117,495 Maturity 1.77% 119,028 1.50% 96.596.540-8 Inversiones CMPC S.A. UF Bond - M series, Reg. 733 CMF (**) 2,134 ------191,006 193,140 Maturity 2.55% 198,381 2.20% Foreign Productos Tissue del Perú S.A. PEN Bond - A series - - 365 - - - 14,489 14,489 29,343 Maturity 6.63% 29,595 6.63% Total bonds payable 3,009 10,111 200,209 - - 497,176 511,598 1,776,161 2,998,264

Finance lease obligations: Foreign Protisa Colombia S.A. COP BBVA Colombia S.A. - 1 5 7 7 - - - 20 Monthly 0.93% 20 0.93% Foreign Protisa Colombia S.A. COP BBVA Colombia S.A. 1 2 6 2 - - - - 11 Monthly 0.93% 11 0.93% Foreign Drypers Andina S.A. COP BBVA Colombia S.A. - 1 4 5 6 2 - - 18 Monthly 0.97% 18 0.97% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 59 ------59 Monthly 6.83% 59 6.83% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 33 66 ------99 Monthly 5.50% 99 5.50% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 8 16 ------24 Monthly 5.10% 24 5.10% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 90 182 92 - - - - - 364 Monthly 6.73% 364 6.73% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 9 19 19 - - - - - 47 Monthly 5.10% 47 5.10% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 9 17 71 - - - - - 97 Monthly 6.80% 97 6.80% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 36 73 300 - - - - - 409 Monthly 5.92% 409 5.92% Foreign Productos Tissue del Perú S.A. PEN Banco de Crédito del Perú 1 1 5 7 - - - - 14 Monthly 5.04% 14 5.04% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 60 184 262 282 - - - 788 Quarterly 7.45% 788 7.45% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 282 879 1,249 1,343 709 - - 4,462 Quarterly 7.55% 4,462 7.55% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru - 1,725 5,380 7,680 8,302 8,974 - - 32,061 Quarterly 8.10% 32,061 8.10% Foreign Productos Tissue del Perú S.A. PEN Scotiabank - Peru 217 - 679 968 1,047 1,132 909 - 4,952 Quarterly 8.15% 4,952 8.15% 91.440.000-7 Forestal Mininco SpA CLP Sodexo Chile S.A. - RUT 94.623.000-6 4 8 43 70 70 70 34 - 299 Monthly 10.00% 299 10.00% Total finance lease obligations: 467 2,453 7,667 10,250 11,057 10,887 943 - 43,724

Other obligations: 96.532.330-9 CMPC Pulp SpA US$ Comercial e Industrial ERCO (Chile) Ltda. - RUT 76.163.730-4 138 276 1,239 1,663 1,674 1,685 1,696 21,849 30,220 Monthly 7.80% 30,220 7.80% Total other obligations: 138 276 1,239 1,663 1,674 1,685 1,696 21,849 30,220

Total interest bearing loans 40,049 43,964 345,905 186,345 134,243 629,397 553,571 1,875,477 3,808,951 Total interest bearing loans at fair value 40,049 43,964 345,905 186,345 134,243 629,397 553,571 1,875,477 3,808,951 (**) Risks managed totally or partially through contracts rate sw ap y cross currency sw ap.

101 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

b) Hedging liabilities

These liabilities represent the cumulative income of currency forwards, the latter of which are used to hedge against the volatility of the cost to hedge financial risk due to changes in the price of currencies associated to sales of products and investment projects and oil swaps used to hedge against the volatility of contracts. Also includes cross-currency swaps used to hedge obligations with banks and with the public.

- Balances as of December 31, 2019

Entitlements Obligations Fair value of Entities Nature of hedged risks Currency Amount Currency Amount the net liability Maturity ThUS$ ThUS$ ThUS$ Current liabilities Scotiabank - Chile Exchange rate of term deposit US$ 15,073 CLP 15,627 554 Maturity Subtotal exchange rate of term deposit 554 Banco Itaú Corpbanca - Chile Flows from lumber sales to Europe US$ 318 GBP 325 7 Maturity Banco Santander - Chile Flows from lumber sales to Europe US$ 1,976 EUR 1,993 17 Maturity Scotiabank - Chile Flows from lumber sales to Europe US$ 6,778 EUR 6,801 23 Maturity Scotiabank - Chile Flows from lumber sales to Europe US$ 971 GBP 1,000 29 Maturity Subtotal flows from sales 76 Morgan Stanley & Co. International plc - England Price of oil US$ 1,212 US$ 1,592 380 Maturity Subtotal price of oil 380 Banco Santander - Brazil Bank obligations BRL 50,558 US$ 52,112 1,554 Semiannual JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil Bank obligations BRL 3,901 US$ 4,118 217 Semiannual Banco Santander - Chile Bank obligations UF 23,095 US$ 25,681 2,586 Semiannual Subtotal bank obligations and bonds 4,357 payable Total 103,882 109,249 5,367

Non-current liabilities Banco Santander - Brazil Bank obligations BRL 85,659 US$ 95,219 9,560 Semiannual Bank of America Merrill Lynch Banco Múltiplo S.A. - Brazil Bank obligations BRL 44,604 US$ 49,458 4,854 Semiannual JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil Bank obligations BRL 6,510 US$ 7,570 1,060 Semiannual Scotiabank Inverlat S.A. - Mexico Bank obligations US$ 12,885 MXN 12,891 6 Semiannual Banco BCI - Chile Bonds payable UF 48,859 US$ 51,053 2,194 Semiannual Banco de Chile Bonds payable UF 48,918 US$ 51,055 2,137 Semiannual Banco Santander - Chile Bonds payable UF 189,213 US$ 208,119 18,906 Semiannual JP Morgan Chase Bank, N.A. - England Bonds payable UF 194,552 US$ 209,314 14,762 Semiannual Scotiabank - Chile Bonds payable UF 140,685 US$ 152,620 11,935 Semiannual Subtotal bank obligations and bonds 65,414 payable Total 771,885 837,299 65,414

- Balances as of December 31, 2018

Entitlements Obligations Fair value of Entities Nature of hedged risks Currency Amount Currency Amount the net liability Maturity ThUS$ ThUS$ ThUS$ Current liabilities Banco Itaú Corpbanca - Chile Term deposit currency translation US$ 20,168 CLP 20,302 134 Monthly Subtotal currency translation 134 Goldman Sachs International - United Kingdom Price of oil US$ 4,365 US$ 4,537 172 Quarterly JP Morgan Chase Bank, N.A. - England Price of oil US$ 5,107 US$ 5,200 93 Quarterly Morgan Stanley & Co. International plc - England Price of oil US$ 5,005 US$ 7,431 2,426 Quarterly Subtotal price of oil 2,691 JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil Industrial project - Guaíba 2 BRL 5,464 US$ 5,540 76 Maturiry Subtotal industrial projects 76 Banco Santander - Brazil Bank obligations BRL 27,688 US$ 29,943 2,255 Monthly Bank of America Merrill Lynch Banco Múltiplo S.A. - Brazil Bank obligations BRL 19,003 US$ 22,936 3,933 Monthly Subtotal bank obligations 6,188 Total 86,800 95,889 9,089

Non-current liabilities Banco Santander - Brazil Bank obligations BRL 117,542 US$ 131,329 13,787 Monthly Bank of America Merrill Lynch Banco Múltiplo S.A. - Brazil Bank obligations BRL 46,669 US$ 49,963 3,294 Monthly JP Morgan Chase Bank, N.A. - Sao Paulo Branch - Brazil Bank obligations BRL 10,229 US$ 11,129 900 Monthly Banco BCI - Chile Bonds payable UF 51,050 US$ 51,059 9 Semiannual Banco Santander - Chile Bonds payable UF 218,975 US$ 233,800 14,825 Semiannual JP Morgan Chase Bank, N.A. - England Bonds payable UF 191,861 US$ 214,004 22,143 Semiannual Scotiabank Azul - Chile Bonds payable UF 47,479 US$ 49,711 2,232 Semiannual Subtotal bank obligations and bonds 57,190 payable Total 683,805 740,995 57,190

102 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

c) Accrued interest payable

The other current financial liabilities account includes accrued interest payable totaling ThUS$29,437 as of December 31, 2019 (ThUS$31,639 as of December 31, 2018).

22.2. Additional information on main financial liabilities a) Interest bearing loans

The most significant interest-bearing loans held by the indicated subsidiaries are detailed as follows:

(1) Inversiones CMPC S.A. with Banco Santander España, as ECA agent (or "EKN" means Exportkreditnämnden, the Swedish Exports Credit Guarantee Board, a Swedish government agency and guarantee institution): In April 2014 the Company entered into a loan for US$24.80 million for a 9-year term, with semiannual payments, at a rate of 180-day Libor + 0.65%. The first payment was performed in May 2014 and contemplates payments up to 2023. The principal balance owed as of December 31, 2019 amounts to US$8.97 million.

The subsidiary Inversiones CMPC S.A. signed interest rate swap contracts with local banks whose fair value is presented in Other non-current financial liabilities.

(2) In September 2019, Inversiones CMPC S.A. with MUFG Bank, Ltd. (Administrative Agent) – Japan, subscribed a syndicated loan in Japan for an amount of US$100 million for a 5-year-term, with semi-annual payments, at an interest rate of 180 days Libor + 1.05%. This operation was led by MUFG Bank, Ltd. The Gunma Bank, Ltd., The Hyakugo Bank, Ltd., The Iyo Bank, Ltd., The Shiga Bank, Ltd., The Bank of Kyoto, Ltd., The Joyo Bank, Ltd., Nanto Bank Ltd. y The Hachijuni Bank Ltd. participated in the operation. In line with previous transactions, it was carried out under the “Green Loan” financing format, becoming the first green loan fully syndicated to Japanese banks, which is known as a “Samurai” structure. The principal balance owed as of December 31, 2019 amounts to US$100 million.

The subsidiary Inversiones CMPC S.A. signed interest rate swap contracts with international banks whose fair value is presented in Other non-current financial liabilities.

(3) CMPC Pulp SpA with Scotiabanck - Chile: In October 2019, signed a financial credit to finance its export operations for US$200.86 million with a fixed annual rate of 2.49%, with a three month term with monthly amortization and maturity on January 30, 2020.

(4) In May 2014, Absormex CMPC Tissue S.A. de C.V. signed a loan agreement with Nordea Bank AB (publ) (Swedish Export Credit Corporation) of Sweden as lender and agent, subscribed a loan for a maximum amount of US$40.80 million to finance payments to suppliers associated with the paper machine construction project in the State of Tamaulipas. Each payment made during the course of the project shall contemplate a portion of the following currencies and shall not exceed the following total amounts: US$7 million, SEK 126 million and EUR10 million. For each payment made an interest rate of 2.37% shall accrue on the dollar with semiannual payments. As of December 31, 2019, outstanding balance is US$19.81 million.

103 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

The subsidiary signed interest rate swap contracts with international banks whose fair value is presented in Other non-current financial liabilities.

(5) La Papelera del Plata S.A. with Banco Santander - Spain (Swedish Export Credit Corporation Agency) – Sweden: In December 2018 the company subscribed a loan for a maximum amount of US$35.06 million to finance payments to suppliers associated with the construction project of P4 Paper Machine at a fixed interest rate of 3.70%, with capital amortization maturity and semi-annual interest payment. The obligations for this operation as of December 31, 2019, amount to US$24.55 million.

(6) CMPC Celulose Riograndense Ltda. signed a loan agreement with Banco Nacional de Desarrollo Económico y Social – BNDES: on November 28, 2011, the company signed a contract for three long-term loans in local currency (Brazilian reals) to develop forestry projects for a total of amount of BRL47.67 million (US$11.83 million) which are detailed as follows: loan “A” for BRL9.54 million indexed (US$2.37 million), at an average annual interest rate of ECM+2.32% (Encargos da Cesta de Moedas) with monthly payments from August 15, 2018 to July 15, 2020; loan “B” for BRL23.84 million (US$5.91 million), at an average annual interest rate of TJLP+2.32% (Taxa de Juros de Longo Prazo) with monthly payments from July 15, 2018 to June 15, 2020; loan “C” for BRL14.30 million (US$3.55 million), at an average annual interest rate of TJLP+3.32% with monthly payments from July 15, 2018 to June 15, 2020. As of December 31, 2019, the outstanding amount is BRL 12.61 million (US$3.13 million).

On December 13, 2012, the Company signed a contract for 6 long-term loans in local currency (Brazilian reals) for development of the Guaíba 2 project for a total of BRL2,510.66 million (US$622.88 million). On December 17, 2015, an amendment to this contract was signed adjusting the amount granted to BRL2,456.77 million (US$609.51 million), reallocating the amounts of loans A, B, C and D, leaving the distribution detailed as follows: “A” for BRL242.60 million indexed (US$60.19 million), at an average annual interest rate of ECM+2.28% with monthly payments from August 15, 2015 to January 15, 2023; loan “B” for BRL742.36 million (US$184.18 million), at an average annual interest rate of TJLP+2.28% with monthly payments from July 15, 2015 to December 15, 2022; loan “C” for BRL445.41 million (US$110.50 million), at an average annual interest rate of TJLP+3.28% with monthly payments from July 15, 2015 to December 15, 2022; loan “D” for BRL559.08 million (US$138.71 million), at an average annual interest rate of 2.5% with monthly payments from January 15, 2015 to December 15, 2022; loan “E” for BRL454.83 million (US$112.84 million), at an average annual interest rate of TJLP+1.88% with monthly payments from July 15, 2015 to December 15, 2022; loan “F” for BRL12.49 million (US$3.10 million), at an average annual interest rate of TJLP with monthly payments from July 15, 2015 to December 15, 2022. As of December 31, 2019, BRL993.47 million (US$231.59 million).

On February 14, 2013, the Company signed a contract for three long-term loans in local currency (Brazilian reals) to develop forestry projects for a total of BRL19.66 million (US$4.88 million) which are detailed as follows: loan “A” for BRL3.93 million indexed (US$0.98 million), at an average annual interest rate of ECM+2.28% with monthly payments from May 15, 2020 to April 15, 2022; loan “B” for BRL9.83 million (US$2.44 million), at an average annual interest rate of TJLP+2.28% with monthly payments from March 15, 2020 to February 15, 2022; loan “C” for BRL5.90 million (US$1.46 million), at an average annual interest rate of TJLP+3.28% with monthly payments from March 15, 2020 to February 15, 2022. As of December 31, 2019, the outstanding amount is BRL8.15 million (US$2.02 million).

104 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

On December 10, 2013, the Company signed a contract for 3 long-term loans in local currency (Brazilian reals) for the development of forestry projects for a total amount of BRL39.72 million (US$9.85 million) which are detailed as follows: loan “A” for BRL7.94 million indexed (US$1.97 million), at an average annual interest rate of ECM+2.42% with monthly payments from February 15, 2021 to January 15, 2023; loan “B” for BRL19.86 million (US$4.93 million), at an average annual interest rate of TJLP+2.42% with monthly payments from January 15, 2021 to December 15, 2022; loan “C” for BRL11.92 million (US$2.96 million), at an average annual interest rate of TJLP+3.42% with monthly payments from January 15, 2021 to December 15, 2022. As of Decembr 31, 2019, the outstanding amount is BRL11.93 million (US$2.96 million).

The subsidiary signed interest rate swap contracts with international banks whose fair value is presented in Other non-current financial liabilities.

(7) CMPC Celulose Riograndense Ltda. and Banco Santander - España y Nordea Bank AB (publ) (signed a loan agreement with Swedish Export Credit Corporation (EKN) of Sweden: on December 20, 2013 to finance the Guaíba 2 project for US$119.16 million (SEK626.89 million and US$21.12 million) at an annual rate of 2.35% with semiannual principal payments from January 2016 to July 2025. As of December 31, 2019, the outstanding amount is US$119.16 million, with an effective annual rate of 4.07% and the total capital debt is US$71.65 million.

(8) CMPC Celulose Riograndense Ltda. with Banco Santander - España y Nordea Bank AB (publ) Finnish Export Credit Ltd. (Finnvera) of Finland: on December 20, 2013, to finance the Guaíba 2 project for US$220 million, at an average annual rate of 2.41% with semiannual principal payments from June 2016 to December 2025. As of December 31, 2019, the effective annual rate is 3.62% and the outstanding amount is US$143.00 million.

(9) Melhoramentos CMPC Ltda. singed a loan agreement with Banco Itaú / BBA of Brazil (financing from Banco Nacional de Desarrollo Económico y Social - BNDES): In June 2010, the Company obtained long-term loans in local currency (Brazilian reals) in order to pay suppliers (Voith and Perini). The nominal values of the loans held, as of December 31, 2019, are as follows: BRL3.20 million (US$0.79 million) at a fixed annual rate of 4.50%, expiring in June 2020 and BRL0.36 million (US$0.09 million) at a fixed annual rate of 5.50%, expiring in June 2020, both with monthly capital amortization from July 15, 2012 to June 15, 2020.

In January 2013, the Company signed a long-term loan in local currency (Brazilian reals) for the acquisition of equipment from supplier Fabio Perini for a total amount of BRL9.91 million (US$2.46 million) at a fixed annual rate of 3.00% with monthly principal payments from March 15, 2015 to February 15, 2023. The principal balance owed as December 31, 2019 amounts to BRL3.88 million (US$0.96 million). In May 2013 it executed a long-term loan in local currency (Brazilian reals) for the acquisition of equipment from supplier Compañía Brasileña de Tecnología Industrial (CBTI) for a total amount of BRL1.0 million (US$0.25 million) at a fixed annual rate of 3.00% with monthly principal payments from July 15, 2015 to June 15, 2023. Outstanding amount as of December 31, 2019 is BRL0.44 million (US$0.11 million).

In February 2014, the Company signed a long-term loan in local currency (Brazilian reals) for the acquisition of equipment from supplier Fabio Perini for a total amount of BRL5.33 million (US$1.32 million) at a fixed annual rate of 3.50% with monthly principal payments from October 15, 2015 to September 15, 2023. Outstanding amount as of December 31, 2019, is BRL2.50 million (US$0.62 million).

105 | Empresas CMPC S.A. y Subsidiarias Estados Financieros Consolidados

In December 2014, the Company signed a long-term loan in local currency (Brazilian reals) for the acquisition of equipment from suppliers Voith and Perini for a total amount of BRL9.26 million (US$2.30 million) at a fixed annual rate of 6.00%, with monthly payments from January 2017 to December 2024. As of December 31, 2019, BRL5.64 million (US$1.40 million).

In June 2016, the Company signed a long-term loan in local currency (Brazilian reals) for a total amount BRL9.42 million (US$2.34 million) at a fixed annual rate of 4.60%+TJPL with monthly capital amortization from April 15, 2018 to March 15, 2021. The principal balance owed as of December 31, 2019, amounts to BRL$3.89 million (US$0.97 million).

(10) Melhoramentos CMPC Ltda. with MUFG Bank, Ltd.: signed a loan agreement: in July 2018 the Company obtained a loan for US$50.00 million at an interest rate of 3.3040% for the period from July 2018 to July 2019 and from July 2019 to July 2020 of 3.4040%, with principal payment upon expiration on July 20, 2020 and quarterly payment of interest.

The subsidiary signed interest rate swap contracts with international banks whose fair value is presented in Other non-current financial liabilities.

Due to some debt contracts, described in the previous points, subscribed by the subsidiaries, Inversiones CMPC S.A., Melhoramentos CMPC Ltda., CMPC Celulose Riograndense Ltda., Absormex CMPC Tissue S.A. de C.V. and La Papelera del Plata S.A. must comply with certain financial indicators (covenants) calculated based on the Consolidated Financial Statements, such as maintaining a minimum equity capital, a maximum debt level and a minimum finance expense coverage ratio. As of December 31, 2019 and 2018, these indicators are met (see note 22.2.e). b) Bonds

(1) On April 18, 2012, subsidiary Inversiones CMPC S.A., through its subsidiary in the Cayman Islands, issued and placed a Bond in the United States amounting to US$500 million, in accordance with Rule 144 A Regulation S of the United States Securities Act of 1933, with a 10-year term. The nominal interest rate is 4.50% and the effective rate is 4.64%, plus a 2.65% spread over 10-year Treasury bonds. Principal is payable as of the maturity date of the bond, whereas interest is paid semiannually. The placement banks were Merrill Lynch, Pierce, Fenner & Smith Inc., HSBC Securities (USA) Inc., Mitsubishi UFJ Securities (USA) Inc. and J.P. Morgan Securities LLC.

The proceeds of the issue were used for general corporate purposes.

(2) On May 8, 2013, subsidiary Inversiones CMPC S.A. through its subsidiary in the Cayman Islands, issued and placed a Bond in the United States amounting to US$500 million, in accordance with Rule 144 A Regulation S, of the United States Securities Act of 1933, with a 10-year term. The nominal interest rate is 4.38%. The effective annual interest rate is 4.47%, plus a 2.70% spread over 10-year US Treasury bonds. Interest shall be paid semiannually. Acted as underwriters Deutsche Bank Securities Inc. y JP Morgan Securities LLC.

The proceeds of the issue were used for general corporate purposes.

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(3) On September 10, 2014, subsidiary Inversiones CMPC S.A. issued and placed a Bond in the United States amounting to US$500 million, in accordance with Rule 144 A Regulation S, of the United States Securities Act of 1933, with a 10-year term. The nominal interest rate is 4.75%. The effective annual interest rate is 4.79%, plus a 2.25% spread over 10-year US Treasury bonds. The capital is payable on the maturity date bond, while the interest thereof is payable semi-annually. Acting as underwriters JP Morgan Securities LLC, Mitsubishi UFJ Securities (USA) Inc. and Santander Investment Securities Inc.

The proceeds of the issue were used for general corporate purposes.

(4) On April 4, 2017, subsidiary Inversiones CMPC S.A. issued and placed a Bond in the United States amounting to US$500 million, in accordance with Rule 144 A Regulation S, of the United States Securities Act of 1933, with a 10-year term. The nominal interest rate is 4.38%. The effective annual interest rate is 4.42%, plus a 2.00% spread over 10-year US Treasury bonds. The capital is payable on the maturity date of the bond, while the interest thereof is payable semi-annually. Acting as placement banks Merrill Lynch, Pierce, Fenner & Smith Inc., JP Morgan Securities LLC, Santander Investment Securities Inc.

This issuance is in line with CMPC's sustainability objectives, since it met the requirements established by the World Bank "Green Bond Principles" (GBP), to be qualified as a green bond, which means that its resources will be used to finance or refinance projects with sustainable environmental benefits, that was the first issue of a Chilean company that meets these conditions.

(5) On March 24, 2009, subsidiary Inversiones CMPC S.A., issued a Series "F" Bond registered in the Securities Registry of the CMF under No. 570, for a 21-year term, for an amount of UF7 million (US$260.87 million). This obligation contemplates semiannual payments with a compound annual interest rate of 4.30%. In addition, this bond was placed at a discount so that the effective placement rate was 4.55%. The principal will be paid upon maturity.