UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 6-K

REPORT OF FOREIGN ISSUER

PURSUANT TO RULE 13a-16 OR 15b-16 OF

THE SECURITIES EXCHANGE ACT OF 1934

September 2017

Date of Report (Date of Earliest Event Reported)

Embotelladora Andina S.A.

(Exact name of registrant as specified in its charter)

Andina Bottling Company, Inc.

(Translation of Registrant´s name into English)

Avda. Miraflores 9153

Renca

Santiago, Chile

(Address of principal executive office)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F x    Form 40-F o

Indicate by check mark if the Registrant is submitting this Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes o         No x

Indicate by check mark if the Registrant is submitting this Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes o         No x

Indicate by check mark whether the registrant by furnishing the information contained in this Form 6-K is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934

Yes o         No x

Consolidated Interim Financial Statements

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Santiago, Chile

As of June 30, 2017, and December 31, 2016

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Financial Statements

as of June 30, 2017 (unaudited) and December 31, 2016

Report of the Independent Auditor

To

Shareholders and Directors

Embotelladora Andina S.A.

We have reviewed the accompanying interim consolidated financial statements of Embotelladora Andina S.A. and Subsidiaries, which comprise the interim consolidated statement of financial position as of June 30, 2017, and the interim consolidated comprehensive income statement for the six and three month periods ended June 30, 2017, the interim consolidated statements of changes in equity and cash flows for the six month period then ended and the related notes to the interim consolidated financial statements.

The interim consolidated financial statements and the interim consolidated comprehensive income statement for the six and three month periods ended June 30, 2016, and the interim consolidated statements of changes in equity and cash flows for the six month period then ended and the related notes to the interim consolidated financial statements were reviewed by other auditors who, based on their review, stated in their report of August 30, 2016, that they were not aware of any significant amendments that should be made to those interim consolidated financial statements to conform to IAS 34 “Interim Financial Reporting” of the International Financial Reporting Standards (IFRS). The consolidated statement of financial position of Embotelladora Andina S.A. and Subsidiaries as of December 31, 2016, and the related consolidated comprehensive income statement, statement of changes in equity and cash flows for the year then ended (which are not enclosed to this report), were audited by other auditors who expressed in their report of February 28, 2017, an unmodified opinion with respect to these audited consolidated financial statements.

Management’s Responsibility for the Interim Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the interim consolidated financial statements in conformity with IAS 34 “Interim Financial Reporting” of the International Financial Reporting Standards (IFRS). This includes the design, implementation and maintainenance of sufficient internal control that provides the basis for the preparation and fair presentation of interim consolidated financial statements in accordance with the applicable financial reporting preparation and presentation framework.

Auditor’s Responsibility

Our responsibility is to perform a review in accordance with Generally Accepted Auditing Standards in Chile applicable to interim financial statement reviews. An interim financial statement review involves performing analytical procedures and making inquiries of the persons in charge of accounting and financial matters. The review is substantially less broad in scope than an audit to the financial statements in accordance with Generally Accepted Auditing Standards in Chile for the purpose of expressing an opinion on the financial statements. Therefore, we express no such opinion.

Conclusion

On the basis of our review, we are not aware of any significant amendments that should be made to the interim consolidated financial statements enclosed hereto for the six and three month periods ended June 30, 2017, so they conform to IAS 34 “Interim Financial Reporting” of the International Financial Reporting Standards (IFRS).

Albert Oppenländer L.	EY Audit SpA.
Santiago, August 29, 2017

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Financial Statements

INDEX

Consolidated Interim Statements of Financial Position as of June 30, 2017 (unaudited) and December 31, 2016	1
Consolidated Interim Statements of Income by Function for the period between January 1 and June 30, 2017 and 2016 (unaudited)	3
Consolidated Interim Statements of Comprehensive Income for the period between January 1 and June 30, 2017 and 2016 (unaudited)	4
Consolidated Interim Statements of Changes in Equity for the period between January 1 and June 30, 2017 and 2016 (unaudited)	5
Consolidated Interim Statements of Cash Flows for the period between January 1 and June 30, 2017 and 2016 (unaudited)	6
Notes to the Consolidated Interim Financial Statements (unaudited)	7

Consolidated Interim Financial Statements

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

As of June 30, 2017, and December 31, 2016

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Financial Position

ASSETS	NOTE	06.30.2017	12.31.2016
		ThCh$	ThCh$
		(unaudited)
Current assets:
Cash and cash equivalents	4	132,214,537	141,263,880
Other financial assets	5	23,274,264	60,152,627
Other non-financial assets	6,1	7,189,458	8,601,209
Trade and other accounts receivable, net	7	129,674,187	190,524,354
Accounts receivable from related companies	11,1	3,194,794	5,788,683
Inventory	8	150,500,675	144,709,348
Current tax assets	9.2	1,291,804	1,702,296
Total Current Assets		447,339,719	552,742,397
Non-Current Assets:
Other financial assets	5	75,426,997	80,180,880
Other non-financial assets	6.2	41,002,075	35,246,823
Trade and other receivables	7	2,967,023	3,527,732
Accounts receivable from related parties	11.1	112,224	147,682
Investments accounted for under the equity method	13.1	96,525,304	77,197,781
Intangible assets other than goodwill	14.1	692,473,968	680,996,062
Goodwill	14.2	101,023,107	102,919,505
Property, plant and equipment	10.1	662,411,585	666,150,885
Total Non-Current Assets		1,671,942,283	1,646,367,350
Total Assets		2,119,282,002	2,199,109,747

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

1

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Financial Position

LIABILITIES AND EQUITY	NOTE	06.30.2017	12.31.2016
		ThCh$	ThCh$
		(unaudited)
LIABILITIES
Current Liabilities:
Other financial liabilities	15	73,656,289	64,800,570
Trade and other accounts payable	16	188,061,146	242,836,356
Accounts payable to related parties	11.2	24,290,414	44,120,335
Provisions	17	829,938	682,778
Income taxes payable	9.3	4,446,704	10,828,593
Employee benefits current provisions	12	27,652,130	35,653,431
Other non-financial liabilities	18	22,188,865	20,612,791
Total Current Liabilities		341,125,486	419,534,854
Other financial liabilities	15	712,668,472	721,570,587
Trade and other payables	16	9,430,144	9,509,827
Provisions	17	73,373,589	72,399,115
Deferred income tax liabilities	9.5	124,295,470	125,608,802
Post-employment benefit liabilities	12	8,467,892	8,157,745
Other non-financial liabilities	18	—	158,790
Non-Current Liabilities:		928,235,567	937,404,866
Equity:	19
Issued capital		270,737,574	270,737,574
Retained earnings		310,443,495	295,708,512
Other reserves		246,620,062	254,159,496
Equity attributable to equity holders of the parent		827,801,131	820,605,582
Non-controlling interests		22,119,818	21,564,445
Total Equity		849,920,949	842,170,027
Total Liabilities and Equity		2,119,282.002	2,199,109,747

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

2

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Income by Function

for the periods ended June 30, 2017 and 2016

		01.01.2017		01.01.2016		04.01.2017		04.01.2016
	NOTE	06.30.2017		06.30.2016		06.30.2017		06.30.2016
		(unaudited)		(unaudited)		(unaudited)		(unaudited)
		ThCh$		ThCh$		ThCh$		ThCh$
Net sales		906,678,646		835,517,931		405,290,627		376,404,798
Cost of sales	23	(526,580,210	)	(486,519,287	)	(243,486,832	)	(221,328,543	)
Gross Profit		380,098,436		348,998,644		161,803,795		155,076,255
Other income	24	388,028		444,591		303,573		323,903
Distribution expenses	23	(92,273,486	)	(86,140,390	)	(42,043,546	)	(39,461,199	)
Administrative expenses	23	(175,049,046	)	(163,445,750	)	(85,127,209	)	(82,616,166	)
Other expenses	25	(9,791,096	)	(10,131,809	)	(4,601,750	)	(6,356,826	)
Other (loss) gains	27	(1,489,419	)	(1,975,388	)	(901,593	)	(1,111,459	)
Financial income	26	6,048,873		5,417,202		2,570,820		2,659,031
Financial expenses	26	(27,248,142	)	(25,159,409	)	(13,440,982	)	(12,795,572	)
Share of profit (loss) of investments in associates and joint ventures accounted for using the equity method	13.3	936,555		247,444		(136,309	)	(515,607	)
Foreign exchange differences		29,945		(384,717	)	(79,469	)	(171,154	)
Income by indexation units		(2,872,611	)	(3,733,173	)	(2,046,844	)	(2,160,819	)
Net income before income taxes		78,778,037		64,137,245		16,300,486		12,870,387
Income tax expense	9.4	(25,603,228	)	(25,187,498	)	(6,851,347	)	(7,456,474	)
Net income		53,174,809		38,949,747		9,449,139		5,413,913
Net income attributable to
Equity holders of the parent		52,503,129		38,358,904		9,605,193		5,346,740
Non-controlling interests		671,680		590,843		(156,054	)	67,173
Net income		53,174,809		38,949,747		9,449,139		5,413,913
Earnings per Share, basic and diluted		$		$		$		$
Earnings per Series A Share	19.5	52.83		38.59		9.66		5.38
Earnings per Series B Share	19.5	58.11		42.45		10.63		5.92

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

3

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Comprehensive Income

for the periods ended June 30, 2017 and 2016

	01.01.2017		01.01.2016		04.01.2017		04.01.2016
	06.30.2017		06.30.2016		06.30.2017		06.30.2016
	(unaudited)		(unaudited)		(unaudited)		(unaudited)
	ThCh$		ThCh$		ThCh$		ThCh$
Net income	53,174,809		38,949,747		9,449,139		5,413,913
Other Comprehensive Income:
Components of other comprehensive income that will not be reclassified to net income for the period, before taxes
Actuarial losses from defined benefit plans	(150,128	)	89,564		(116,552	)	5,152
Components of other comprehensive income that will be reclassified to net income for the period, before taxes
Gain (losses) from exchange rate translation differences	(5,559,434	)	9,843,253		(18,181,889	)	22,950,308
Gain (losses) from cash flow hedges	(5,270,037	)	(37,260,655	)	11,800,729		(20,648,808	)
Income tax related to components of other comprehensive income that will not be reclassified to net income for the period
Income tax benefit related to defined benefit plans	38,283		(21,495	)	29,721		(1,236	)
Income tax related to components of other comprehensive income that will be reclassified to net income for the period
Income tax related to exchange rate translation differences	356,721		(2,527,794	)	722,678		(1,615,821	)
Income tax related to cash flow hedges	3,148,951		12,809,898		(2,419,476	)	7,081,011
Total comprehensive income	45,739,165		21,882,518		1,284,350		13,184,519
Total comprehensive income attributable to:
Equity holders of the parent	44,963,695		21,851,732		1,343,398		13,571,581
Non-controlling interests	775,470		30,786		(59,048	)	(387,062	)
Total comprehensive income	45,739,165		21,882,518		1,284,350		13,184,519

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

4

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Changes in Equity as of June 30, 2017 and 2016 (unaudited)

		Other reserves
	Issued capital	Reserves for exchange rate differences		Cash flow hedge reserve		Actuarial gains or losses in employee benefits		Other reserves	Total other reserves		Retained earnings		Controlling Equity		Non-Controlling interests		Total Equity
	ThCh$	ThCh$		ThCh$		ThCh$		ThCh$	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Opening balance as of 01/01/2017	270,737,574	(168,744,355	)	(2,448,175	)	(1,785,032	)	427,137,058	254.159.496		295,708,512		820,605,582		21,564,445		842,170,027
Changes in Equity
Comprehensive Income
Net income	—	—		—		—		—	—		52,503,129		52,503,129		671,680		53,174,809
Other comprehensive income	—	(5,306,503	)	(2,121,086	)	(111,845	)	—	(7,539,434	)	—		(7,539,434	)	103,790		(7,435,644	)
Comprehensive income	—	(5,306,503	)	(2,121,086	)	(111,845	)	—	(7,539,434	)	52,503,129		44,963,695		775,470		45,739,165
Dividends	—	—		—		—		—	—		(37,768,146	)	(37,768,146	)	(220,097	)	(37,988,243	)
Total changes in equity	—	(5,306,503	)	(2,121,086	)	(111,845	)	—	(7,539,434	)	14,734,983		7,195,549		555,373		7,750,922
Ending balance as of 06/30/2017	270,737,574	(174,050,858	)	(4,569,261	)	(1,896,877	)	427,137,058	246,620,062		310,443,495		827,801,131		22,119,818		849,920,949
		Other reserves
	Issued capital	Reserves for exchange rate differences		Cash flow hedge reserve		Actuarial gains or losses in employee benefits		Other reserves	Total other reserves		Retained earnings		Controlling Equity		Non-Controlling interests		Total Equity
	ThCh$	ThCh$		ThCh$		ThCh$		ThCh$	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Opening balance as of 01/01/2016	270,737,574	(167,447,157	)	27,087,214		(1,796,285	)	427,137,058	284,980,830		274,755,431		830,473,835		21,060,465		851,534,300
Changes in Equity
Comprehensive Income
Net income	—	—		—		—		—	—		38,358,904		38,358,904		590,843		38,949,747
Other comprehensive income	—	7,896,313		(24,450,757	)	47,272		—	(16,507,172	)	—		(16,507,172	)	(560,057	)	(17,067,229	)
Comprehensive income	—	7,896,313		(24,450,757	)	47,272		—	(16,507,172	)	38,358,904		21,851,732		30,786		21,882,518
Dividends	—	—		—		—		—	—		(45,304,230	)	(45,304,230	)	—		(45,304,230	)
Total changes in equity	—	7,896,313		(24,450,757	)	47,272		—	(16,507,172	)	(6,945,326	)	(23,452,498	)	30,786		(23,421,712	)
Ending balance as of 06/30/2016	270,737,574	(159,550,844	)	2,636,457		(1,749,013	)	427,137,058	268,473,658		267,810,105		807,021,337		21,091,251		828,112,588

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

5

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Consolidated Interim Statements of Direct Cash Flows

as of June 30, 2017 and 2016

		01.01.2017		01.01.2016
Cash flows provided by (used in) Operating Activities	NOTE	06.30.2017		06.30.2016
		No Audit		No Audit
		ThCh$		ThCh$
Cash flows provided by Operating Activities
Receipts from the sale of goods and the rendering of services (including taxes)		1,135,448,160		1,141,127,361
Payments for Operating Activities
Payments to suppliers for goods and services (including taxes)		(701,019,638	)	(772,110,821	)
Payments to and on behalf of employees		(108,337,074	)	(105,958,356	)
Other payments for operating activities (value-added taxes on purchases, sales and others)		(178,823,522	)	(149,486,778	)
Dividend received		—		745,803
Interest payments		(26,494,345	)	(25,760,964	)
Interest received		5,002,552		4,362,512
Income tax payments		(26,803,341	)	(19,411,423	)
Other cash movements (tax on bank debits Argentina and others)		(3,951,189	)	(3,887,474	)
Cash flows provided by (used in) Operating Activities		95,021,603		69,619,860
Cash flows provided by (used in) Investing Activities
Cash flow used to acquire non-controlling interests (Capital contribution in Leão Alimentos e Bebidas Ltda.)		(19,379,434	)	(6,105,732	)
Proceeds from sale of Property, plant and equipment		80,831		15,905
Purchase of Property, plant and equipment		(72,685,488	)	(54,710,426	)
Purchase of intangible		(11,923,449	)	—
Proceeds from other long term assets (term deposits over 90 days)		62,758,426		56,922,613
Purchase of other long term assets (term deposits over 90 days)		(28,400,000	)	(50,738,895	)
Payments on forward, term, option and financial exchange agreements		931,628	)	724,075
Net cash flows used in Investing Activities		(68,617,486	)	(53,892,460	)
Cash Flows generated from (used in) Financing Activities
Proceeds from short-term loans obtained		32,379,220		13,234,910
Loan payments		(17,519,568	)	(16,643,139	)
Financial lease liability payments		(2,520,892	)	(2,684,216	)
Dividend payments by the reporting entity		(37,775,408	)	(33,794,529	)
Other inflows (outflows) of cash (Placement and payment of public obligations)		(9,219,536	)	(5,625,547	)
Net cash flows (used in) generated by Financing Activities		(34,656,184	)	(45,512,521	)
Net increase in cash and cash equivalents before exchange differences		(8,252,067	)	(29,785,121	)
Effects of exchange differences on cash and cash equivalents		(797,276	)	649,937
Net decrease in cash and cash equivalents		(9,049,343	)	(29,135,184	)
Cash and cash equivalents — beginning of year	4	141,263,880		129,160,939
Cash and cash equivalents - end of year	4	132,214,537		100,025,755

The accompanying notes 1 to 31 form an integral part of these consolidated interim financial statements

6

EMBOTELLADORA ANDINA S.A. AND SUBSIDIARIES

Notes to the Consolidated Interim Financial Statements (Unaudited)

NOTE 1 - CORPORATE INFORMATION

Embotelladora Andina S.A. is registered under No. 00124 of the Securities Registry and is regulated by the Chilean Superintendence of Securities and Insurance (SVS) pursuant to Law 18.046.

The principal activities of Embotelladora Andina S.A. (hereafter “Andina,” and together with its subsidiaries, the “Company”) are to produce and sell Coca-Cola products and other Coca-Cola beverages. The Company has operations in Chile, Brazil, Argentina and Paraguay. In Chile, the geographic areas in which the Company has distribution franchises are regions II, III, IV, XI, XII, Metropolitan Region, Rancagua and San Antonio. In Brazil, the Company has distribution franchises in the states of Rio de Janeiro, Espírito Santo, Niteroi, Vitoria, Nova Iguaçu, part of Sao Paulo and part of Minas Gerais. In Argentina, the Company has distribution franchises in the provinces of Mendoza, Córdoba, San Luis, Entre Ríos, Santa Fe, Rosario, Santa Cruz, Neuquén, El Chubut, Tierra del Fuego, Río Negro, La Pampa and the western zone of the Province of Buenos Aires. In Paraguay, the franchised territory covers the whole country. The Company has distribution licenses from The Coca-Cola Company in all of its territories: Chile, Brazil, Argentina and Paraguay. Licenses for the territories in Chile expire in 2018 and 2019. In Argentina in 2017 (in the renewal process); in Brazil in 2017 (in the renewal process) and in Paraguay they expire in 2020. The Coca-Cola Company chooses to grant all of these licenses, and they are expected to be renewed under similar conditions on the date of expiration.

As of June 30, 2017, the Freire Group and its related companies hold 55.68% of the outstanding shares with voting rights, corresponding to the Series A shares.

The head office of Embotelladora Andina S.A. is located on Miraflores 9153, municipality of Renca, Santiago, Chile. Its taxpayer identification number is 91.144.000-8.

7

NOTE 2 - BASIS OF PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1Periods covered

These Consolidated financial statements encompass the following periods:

Consolidated Interim Statement of Financial Position: As of June 30, 2017 and December 31, 2016.

Consolidated Interim Income Statements by Function and Comprehensive Income: For the quarter and six months ended June 30, 2017 and 2016.

Consolidated Interim Statements of Direct Cash Flows: For the periods between January 1 and June 30, 2017 and 2016.

Consolidated Interim Statements of Changes in Equity:  Balance and movements between January 1 and June 30, 2017 and 2016.

2.2Basis of preparation

The Company’s Consolidated Interim Financial Statements for the period ended June 30, 2017 and December 31, 2016 were prepared in accordance with International Accounting Standard Nº 34 (IAS 34) incorporated to the International Financial Reporting Standards (hereinafter “IFRS”) issued by the International Accounting Standards Board (hereinafter “IASB”).

The Consolidated Interim Financial Statements have been presented in accordance to the historic cost criteria, although amended by the revaluation of certain financial instruments and derivative financial instruments.

These Financial Statements reflect the consolidated financial position of Embotelladora Andina S.A. and its subsidiaries as of June 30, 2017 and December 31, 2016, and the results of operation, changes in equity and statements of cash flows for the periods between January 1 and June 30, 2017 and 2016, which were approved by the Board of Directors during their meeting held on August 29, 2017.

These Consolidated Interim Financial Statements have been prepared, based on accounting records kept by the Embotelladora Andina S.A. (“Parent Company”) and by other entities forming part thereof. Each entity prepares its financial statements following the accounting principles and standards applicable in each country. Adjustments and reclassifications have been made, as necessary, in the consolidation process to align such principles and then adapt them to IFRS.

8

2.3Basis of consolidation

2.3.1Subsidiaries

These consolidated interim financial statements incorporate the financial statements of the Company and the companies controlled by the Company (its subsidiaries).  Control is obtained when the Company has power over the investee, when it has exposure or is entitled to variable returns from its involvement in the investee and when it has the ability to use its power to influence the amount of investor returns. They include assets and liabilities as of June 30, 2017 and December 31, 2016, and results of operations for the periods between January 1 and June 30, and April 1 and June 30, 2017 and 2016, and cash flows for the periods between January 1 and June 30, 2017 and 2016. Income or losses from subsidiaries acquired or sold are included in the consolidated interim financial statements from the effective date of acquisition through to the effective date of disposal, as applicable.

The acquisition method is used to account for the acquisition of subsidiaries. The consideration transferred for the acquisition of the subsidiary is the fair value of assets transferred, equity securities issued, liabilities incurred or assumed on the date that control is obtained. Identifiable assets acquired and identifiable liabilities and contingencies assumed in a business combination are accounted for initially at their fair values at the acquisition date. Goodwill is initially measured as the excess of the aggregate of the consideration transferred and the fair value of non-controlling interest over the net identifiable assets acquired and liabilities assumed. If the consideration is less than the fair value of the net assets of the subsidiary acquired, the difference is recognized directly in the income statement.

Intercompany transactions, balances, income, expenses and unrealized gains and losses on transactions between Group companies are eliminated. Accounting policies of subsidiaries are changed to ensure consistency with the policies adopted by the Company, where necessary.

The interest of non-controlling shareholders is presented in “Non-Controlling Interest” in the consolidated income statement and “Earnings attributable to non-controlling interests”, in the consolidated statement of changes in equity.

The consolidated interim financial statements include all assets, liabilities, income, expenses, and cash flows after eliminating intercompany balances and transactions.

9

The list of subsidiaries included in the consolidation is detailed as follows:

		Holding control (percentage)
		06-30-2017			12-31-2016
Taxpayer ID	Name of the Company	Direct	Indirect	Total	Direct	Indirect	Total
59.144.140-K	Abisa Corp S.A.	—	99.99	99.99	—	99.99	99.99
Foreign	Aconcagua Investing Ltda.	0.71	99.28	99.99	0.71	99.28	99.99
96.842.970-1	Andina Bottling Investments S.A.	99.90	0.09	99.99	99.90	0.09	99.99
96.972.760-9	Andina Bottling Investments Dos S.A.	99.90	0.09	99.99	99.90	0.09	99.99
Foreign	Andina Empaques Argentina S.A.	—	99.98	99.98	—	99.98	99.98
96.836.750-1	Andina Inversiones Societarias S.A.	99.98	0.01	99.99	99.98	0.01	99.99
76.070.406-7	Embotelladora Andina Chile S.A.	99.99	—	99.99	99.99	—	99.99
Foreign	Embotelladora del Atlántico S.A.	0.92	99.07	99.99	0.92	99.07	99.99
96.705.990-0	Envases Central S.A.	59.27	—	59.27	59.27	—	59.27
96.971.280-6	Inversiones Los Andes Ltda.	99.99	—	99.99	99.99	—	99.99
Foreign	Paraguay Refrescos S.A.	0.08	97.75	97.83	0.08	97.75	97.83
76.276.604-3	Red de Transportes Comerciales Ltda.	99.90	0.09	99.99	99.90	0.09	99.99
Foreign	Rio de Janeiro Refrescos Ltda.	—	99.99	99.99	—	99.99	99.99
78.536.950-5	Servicios Multivending Ltda.	99.90	0.09	99.99	99.90	0.09	99.99
78.861.790-9	Transportes Andina Refrescos Ltda.	99.90	0.09	99.99	99.90	0.09	99.99
96.928.520-7	Transportes Polar S.A.	99.99	—	99.99	99.99	—	99.99
76.389.720-6	Vital Aguas S.A.	66.50	—	66.50	66.50	—	66.50
93.899.000-k	Vital Jugos S.A.	15.00	50.00	65.00	15.00	50.00	65.00

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2.3.2Investments accounted for under the equity method

Associates are all entities over which the Company exercises significant influence but does not have control. Investments in associates are accounted for using the equity method of accounting.

The Company’s share in profit or loss in associates subsequent to the acquisition date is recognized in the income statement.

Unrealized gains in transactions between the Company and its associates are eliminated to the extent of the Company´s interests in those associates. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment on the asset transferred. Accounting policies of the associates are changed, where necessary, to ensure conformity with the policies adopted by the Company.

2.4Financial reporting by operating segment

IFRS 8 requires that entities disclose information on the results of operating segments. In general, this is information that Management and the Board of Directors use internally to assess performance of segments and allocate resources to them. Therefore, the following operating segments have been determined based on geographic location:

·Chilean operations

·Brazilian operations

·Argentine operations

·Paraguayan operations

2.5Foreign currency translation

2.5.1Functional currency and presentation currency

Items included in the financial statements of each of the entities in the Company are measured using the currency of the primary economic environment in which the entity operates (“functional currency”). The consolidated interim financial statements are presented in Chilean pesos, which is the parent company’s functional currency and the Company´s presentation currency.

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2.5.2Balances and transactions

Foreign currency transactions are translated into the functional currency using the foreign exchange rates prevailing on the dates of the transactions. Losses and gains in foreign currency resulting from the liquidation of these transactions and the translation at the closing exchange rate of monetary assets and liabilities denominated in foreign currency are recognized in the income statements under foreign exchange rate differences, except when they correspond to cash flow hedges; in which case they are presented in the statement of comprehensive income.

The exchange rates and value of the UF at the close of each of the periods presented were as follows:

	Exchange rate to the Chilean peso
Date	US$ dollar	R$ Brazilian Real	A$ Argentine Peso	UF Unidad de Fomento	Paraguayan Guaraní	€ Euro
06.30.2017	664.29	200.80	39.95	26,665.092	0.1195	758.32
12.31.2016	669.47	205.42	42.13	26,347.98	0.116	705.60
06.30.2016	661.37	206.05	43.97	26,052.07	0.1183	731.93

2.5.3Translation of foreign subsidiaries

The financial position and results of all entities in the Company (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(i)Assets and liabilities for the statement of financial position are translated at the closing exchange rate as of the reporting date;

(ii)Revenue and expenses of the income statement are translated at average exchange rates for the period; and

(iii)All resulting translation differences are recognized in other comprehensive income.

The companies that have a functional currency different from the presentation currency of the parent company are:

Company	Functional currency
Rio de Janeiro Refrescos Ltda.	R$Brazilian Real
Embotelladora del Atlántico S.A.	A$Argentine Peso
Andina Empaques Argentina S.A.	A$Argentine Peso
Paraguay Refrescos S.A.	G$Paraguayan Guaraní

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In consolidation, translation differences arising from the translation of net investments in foreign entities are recognized in other comprehensive income. Exchange differences from accounts receivable, which are considered part of an equity investment, are recognized as comprehensive income net of deferred taxes, if applicable. On disposal of the investment, such translation differences are recognized in the income statement as part of the gain or loss on the disposal of the investment.

2.6Property, plant, and equipment

Assets included in Property, plant and equipment are recognized at their historical cost or fair value on the IFRS transition date, less depreciation and cumulative impairment losses.

Historical cost of Property, plant and equipment includes expenditures that are directly attributable to the acquisition of the items less government subsidies resulting from the difference between the valuation of liabilities at fair value and the government´s preferential credit rates. Historical cost also includes revaluations and price-level restatements of opening balances (attributable cost) at January 1, 2009, in accordance with the exemptions in IFRS 1.

Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset only when it is probable that future economic benefits associated with the items of Property, plant and equipment will flow to the Company and the cost of the item can be measured reliably. The carrying amount of the replaced part is derecognized. Repairs and maintenance are charged to the income statement in the reporting period in which they are incurred.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line method to allocate their cost or revalued amounts to their residual values over their estimated useful lives.

The estimated useful lives by asset category are:

Assets	Range in years
Buildings	30-50
Plant and equipment	10-20
Warehouse installations and accessories	10-30
Software licenses, furniture and supplies	4-5
Motor vehicles	5-7
Other Property, plant and equipment	3-8
Bottles and containers	2-8

The residual value and useful lives of assets are reviewed and adjusted at the end of each financial statement-reporting period, if appropriate.

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When the value of an asset is greater than its estimated recoverable amount, the value is written down immediately to its recoverable amount.

Gains and losses on disposals of property, plant, and equipment are calculated by comparing the proceeds to the carrying amount and are charged to other expenses by function.

If there are items available for sale, and comply with the conditions of IFRS 5 “Non-current assets held for sale and discontinued operations” are separated from Property, plant and equipment and are presented within current assets at the lower value between the book value and its fair value less selling costs.

2.7Intangible assets and Goodwill

2.7.1Goodwill

Goodwill represents the excess of the consideration transferred over the Company’s interest in the net fair value of the net identifiable assets of the subsidiary and the fair value of the non-controlling interest in the subsidiary on the acquisition date. Since goodwill is an intangible asset with indefinite useful life, it is recognized separately and tested annually for impairment. Goodwill is carried at cost less accumulated impairment losses.

Gains and losses on the sale of an entity include the carrying amount of goodwill related to that entity.

Goodwill is assigned to each cash generating unit (CGU) or group of cash-generating units, from where it is expected to benefit from the synergies arising from the business combination. Such CGUs or groups of CGUs represent the lowest level in the organization at which goodwill is monitored for internal management purposes.

2.7.2Distribution rights

Distribution rights are contractual rights to produce and/or distribute products under the Coca-Cola brand and other brands in certain territories in Argentina, Brazil, Chile and Paraguay that were acquired during Business Combination.  Distribution rights are born from the process of valuation at fair value of the assets and liabilities of companies acquired in business combinations. Distribution rights have an indefinite useful life and are not amortized, as the Company believes that the agreements will be renewed indefinitely by the Coca-Cola Company with similar terms and conditions.  They are subject to impairment tests on an annual basis.

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2.7.3Software

Carrying amounts correspond to internal and external software development costs, which are capitalized once the recognition criteria in IAS 38, Intangible Assets, have been met. Software is amortized in administrative expenses in the consolidated income statement over a period of four years.

2.8Impairments of non-financial assets

Assets that have an indefinite useful life, such as intangibles related to distribution rights and goodwill, are not amortized and are tested annually for impairment or more frequently if events or changes in circumstances indicate a potential impairment. Assets that are subject to amortization are tested for impairment whenever there is an event or change in circumstances indicating that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the carrying value of the asset exceeds its recoverable amount. The recoverable amount is the greater of an asset’s fair value less costs to sell or its value in use.

For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units).

2.9Financial assets

The Company classifies its financial assets into the following categories: financial assets at fair value through profit or loss, loans and receivables, financial assets held to maturity, and available for sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition.

At the close of each period, the Company assesses if there is evidence of impairment for any asset or group of financial assets. As of June 30, 2017 and December 31, 2016, there are no signs impairment in any of the Company’s financial assets.

2.9.1Financial assets at fair value through profit or loss

Fair value financial assets with changes in results are financial assets available for sale in the short term. A financial asset is classified under this category if it is acquired mainly for selling it in the short term.  Assets in this category are classified in current assets.

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Derivatives are also categorized as held for trading unless they are designated as hedges.

Gains or losses from changes in fair value of financial assets at fair value through profit and loss are recognized in the income statement under financial income or expense during the fiscal year in which they are generated.

2.9.2Loans and receivables

Loans and accounts receivable are financial assets with fixed and determinable payments that are not quoted in an active market period. Loans and receivables are not quoted in an active market. They are included in current assets, unless they are due more than 12 months from the reporting date, in which case they are classified as non-current assets. Loans and receivables are included in trade and other receivables in the consolidated interim statement of financial position and they are recorded at their amortized cost less a provision for impairment.

An impairment is recorded on trade accounts receivable when there is objective evidence that the Company and its subsidiaries may not be able to collect the full amount according to the original terms of the receivable, based either on individual or on global aging analyses. The loss is recognized in consolidated administrative expenses.

2.9.3Financial assets held to maturity

Other financial assets corresponds to bank deposits that the Company’s management has the positive intention and ability to hold until their maturity. They are recorded in current assets because they mature in less than 12 months from the reporting date and are carried at cost, which approximates their fair value considering their short-term nature.

Accrued interest is recognized in the consolidated interim income statement under financial income.

2.10Derivatives financial instruments and hedging activities

The Company and its subsidiaries use derivative financial instruments to mitigate risks relating to changes in foreign currency and exchange rates associated with raw materials, and loan obligations.

Derivatives are initially recognized at fair value on the date a derivative contract is entered into and are subsequently re-measured at their fair value. The method of recognizing the resulting gain or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.

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2.10.1Derivative financial instruments designated as cash flow hedges

At the inception of the transaction, the group documents the relationship between hedging instruments and hedged items, as well as its risk management objectives and strategy for undertaking various hedging transactions. The group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of hedged items.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognized in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in the consolidated income statement within “other gains (losses)”

Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss (for example, when foreign currency denominated financial liabilities are translated into their functional currencies). The gain or loss relating to the effective portion of cross currency swaps hedging the effects of changes in foreign exchange rates are recognized in the consolidated income statement within “foreign exchange differences”.  When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognized when the forecast transaction is ultimately recognized in the consolidated income statement.

2.10.2Derivative financial instruments not designated for hedging

The fair value of derivative financial instruments that do not qualify for hedge accounting pursuant to IFRS are immediately recognized in the consolidated income statement under “Other income and losses”.  The fair value of these derivatives is recorded under “other current financial assets” or “other current financial liabilities” in the interim statement of financial position.”

The Company does not use hedge accounting for its foreign investments.

The Company also evaluates the existence of derivatives implicitly in financial instrument contracts to determine whether their characteristics and risks are closely related to the master agreement, as stipulated by IAS 39. As of June 30, 2017 and December 31, 2016, the Company had no implicit derivatives.

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Fair value hierarchy

The Company records assets and liabilities as of June 30, 2017 and December 31, 2016, based on its derivative foreign exchange contracts, which are classified within other financial assets (current assets and non-current) and other current financial liabilities (current and non-current financial liabilities), respectively. These contracts are carried at fair value in the statement of financial position. The Company uses the following hierarchy for determining and disclosing financial instruments at fair value by valuation method:

Level 1:  Quoted (unadjusted) prices in active markets for identical assets or liabilities.

Level 2:  Inputs other than quoted prices included in Level 1 that are observable for the assets and liabilities, either directly (that is, as prices) or indirectly (that is, derived from prices).

Level 3:  Inputs for the assets or liabilities that are not based on observable market data information.

During the reporting periods there were no transfers of items between fair value measurement categories. All of which were valued during the period using Level 2.

2.11Inventories

Inventories are stated at the lower of cost and net realizable value. Cost is determined using the weighted average cost method. The cost of finished goods and work in progress includes raw materials, direct labor, other direct costs and manufacturing overhead (based on operating capacity) to bring the goods to marketable condition, but it excludes interest expense. Net realizable value is the estimated selling price in the ordinary course of business, less applicable variable selling expenses. Spare parts and production materials are stated at the lower of cost or net realizable value.

Estimates are also made for obsolescence of raw materials and finished products based on turnover and age of the related goods.

2.12Trade receivables

Trade accounts receivables and other accounts receivable are recognized initially at fair value and subsequently measured at amortized cost less provision for impairment, given their short-term nature. A provision for impairment is made when there is objective evidence that the Company may not be able to collect the full amount according to the original terms of the receivable, based either on individual or on global aging analyses. The carrying amount of the asset is reduced by the provision amount and the loss is recognized in administrative expenses in the consolidated interim income statement by function.

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2.13Cash and cash equivalents

Cash and cash equivalents includes cash on hand, bank balances, time deposits and other short-term highly liquid and low risk of change in value investments and mutual funds with original maturities of three months or less.

2.14Other financial liabilities

Resources obtained from financial institutions as well as the issuance of debt securities are initially recognized at fair value, net of costs incurred during the transaction. Then, liabilities are valued by accruing interests in order to equal the current value with the future value of liabilities payable, using the effective interest rate method.

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualified assets, considered as those that require a substantial period of time in order to get ready for their forecasted use or sale, are added to the cost of those assets until the period in which the assets are substantially ready to be used or sold. No borrowing costs have been capitalized for the reporting period.

2.15Government subsidies

Government subsidies are recognized at fair value when it is certain that the subsidy will be received and that the Company will meet all the established conditions.

Subsidies for operating costs are deferred and recognized on the income statement in the period that the operating costs are incurred.

Subsidies for purchases of Property, plant and equipment are deducted from the costs of the related asset in Property, plant and equipment and depreciation is recognized on the income statement, on a straight-line basis during the estimated useful life of the related asset.

2.16Income tax

The Company and its subsidiaries in Chile account for income tax according to the net taxable income calculated based on the rules in the Income Tax Law. Subsidiaries in other countries account for income taxes according to the tax regulations of the country in which they operate.

Deferred income taxes are calculated using the liability method on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated interim financial statements, using the tax rates that have been enacted or substantively enacted on the balance sheet date and are expected to apply when the deferred income tax asset is realized or the deferred income tax liability is settled.

Deferred income tax assets are recognized only to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilized.

The Company does not recognize deferred income taxes for temporary differences from investments in subsidiaries in which the Company can control the timing of the reversal of the temporary differences and it is probable that they will not be reversed in the near future.

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2.17Employee benefits

The Company has a provision to cover indemnities for years of service that will be paid to employees in accordance with individual and collective agreements subscribed with employees, which is recorded at actuarial value in accordance with IAS 19.

Results from updated of actuarial variables are recorded within other comprehensive income in accordance with IAS 19.

Additionally, the Company has retention plans for some officers, which have a provision pursuant to the guidelines of each plan. These plans grant the right to certain officers to receive a cash payment on a certain date once they have fulfilled with the required years of service.

The Company and its subsidiaries have recorded a provision to account for the cost of vacations and other employee benefits on an accrual basis. These liabilities are recorded under current non-financial liabilities.

2.18Provisions

Provisions for litigation and other contingencies are recognized when the Company has a present legal or constructive obligation as a result of past event, it is probable that an outflow of resources will be required to settle the obligation, and the amount can be reliably estimated.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.

2.19Leases

a)Operating leases

Operating lease payments are recognized as an expense on a straight-line basis over the term of the lease.

b)Finance leases

Leases of Property, plant and equipment where the Company has substantially all the risks and rewards of ownership are classified as finance leases that are capitalized at the inception of the lease of the item of Property, plant and equipment at the lower of the fair value of the leased assets and the present value of the minimum lease payments.

Each lease payment is allocated between the liability and finance charges.The interest element is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

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2.20Deposits for returnable containers

This liability comprises cash collateral, or deposit, received from customers for bottles and other returnable containers made available to them.

This liability pertains to the deposit amount that is reimbursed when the customer or distributor returns the bottles and containers in good condition, together with the original invoice. The liability is estimated based on the number of bottles given to clients and distributors, the estimated amount of bottles in circulation, and a historical average weighted value per bottle or containers.

Deposits for returnable containers are presented as a current liability in other financial liabilities because the Company does not have legal rights to defer settlement for a period in excess of one year.  However, the Company does not anticipate any material cash settlements for such amounts during the upcoming year.

2.21Revenue recognition

Revenues from regular activities include fair value of the consideration received or to be received for goods sold during the regular course of the Company’s activities.  This revenue is presented net of VAT, reimbursements, deductions and discounts.

The Company recognizes revenue when the amount of revenue can be reliably measured and it is probable that the future economic benefits will flow to the Company.

Revenues are recognized once the products are physically delivered to customers.

2.22Contributions of The Coca-Cola Company

The Company receives certain discretionary contributions from The Coca-Cola Company related to the financing of advertising and promotional programs for its products in the territories where the Company has distribution licenses. The contributions received are recorded as a reduction in marketing expenses in the consolidated income statement. Given its discretionary nature, the portion of contributions received in one period does not imply it will be repeated in the following period.

In certain cases where there are agreements with The Coca-Cola Company, through which the Company receives contributions for the building and acquisition of specific items of Property, plant and equipment, and which set conditions and current and future obligations to the Company, the payments received under these specific agreements are recorded in results to the extent that the obligations set out in the agreements with The Coca-Cola Company have been fulfilled.

2.23Dividend payments

Dividend distribution to Company shareholders is recorded as a liability in the Company’s consolidated interim financial statements, considering the 30% minimum dividend of the period’s earnings established by Chilean Corporate Law.

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2.24Critical accounting estimates and judgments

The Company makes estimates and judgments concerning the future. Actual results may differ from previously estimated amounts. The estimates and judgments that might have a material impact on future financial statements are explained below:

2.24.1Impairment of goodwill and intangible assets with indefinite useful lives

The Company test annually whether goodwill and intangible assets with indefinite useful life (such as distribution rights) have suffered any impairment. The recoverable amounts of cash generating units are generating units are determined based on value in use calculations. The key variables used in the calculations include sales volumes and prices, discount rates, marketing expenses and other economic factors including inflation.  The estimation of these variables requires a use of estimates and judgments as they are subject to inherent uncertainties; however, the assumptions are consistent with the Company’s internal planning end past results. Therefore, management evaluates and updates estimates according to the conditions affecting the variables.  If these assets are considered to have been impaired, they will be written off at their estimated fair value or future recovery value according to the discounted cash flows analysis. Discounted cash flows in the Company’s cash generating units in Chile, Brazil, Argentina and Paraguay generated a higher value than the carrying values of the respective net assets, including goodwill of the Brazilian, Argentinian and Paraguayan subsidiaries.

2.24.2Fair Value of Assets and Liabilities

IFRS requires in certain cases that assets and liabilities be recorded at their fair value. Fair value is the price that would be received for selling an asset or paid to transfer a liability in a transaction ordered between market participants at the date of measurement.

The basis for measuring assets and liabilities at fair value are their current prices in an active market.  For those that are not traded in an active market, the Company determines fair value based on the best information available by using valuation techniques.

In the case of the valuation of intangibles recognized as a result of acquisitions from business combinations, the Company estimates the fair value based on the “multi-period excess earning method”, which involves the estimation of future cash flows generated by the intangible assets, adjusted by cash flows that do not come from these, but from other assets. The Company also applies estimations over the period during which the intangible assets will generate cash flows, cash flows from other assets, and a discount rate.

Other assets acquired and liabilities assumed in a business combination are carried at fair value using valuation methods that are considered appropriate under the circumstances. Assumptions include the depreciated cost of recovery and recent transaction values for comparable assets, among others. These valuation techniques require certain inputs to be estimated, including the estimation of future cash flows.

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2.24.3Allowances for doubtful accounts

The Company evaluates the collectability of trade receivables using several factors. When the Company becomes aware of a specific inability of a customer to fulfill its financial commitments, a specific provision for doubtful accounts is estimated and recorded, which reduces the recognized receivable to the amount that the Company estimates to be able to collect. In addition to specific provisions, allowances for doubtful accounts are also determined based on historical collection history and a general assessment of trade receivables, both outstanding and past due, among other factors.

2.24.4Useful life, residual value and impairment of property, plant, and equipment

Property, plant, and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful life of those assets. Changes in circumstances, such as technological advances, changes to the Company’s business model, or changes in its capital strategy might modify the effective useful lives as compared to our estimates. Whenever the Company determines that the useful life of Property, plant and equipment might be shortened, it depreciates the excess between the net book value and the estimated recoverable amount according to the revised remaining useful life. Factors such as changes in the planned usage of manufacturing equipment, dispensers, transportation equipment and computer software could make the useful lives of assets shorter. The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying value of any of those assets may not be recovered. The estimate of future cash flows is based, among other factors, on certain assumptions about the expected operating profits in the future. The Company’s estimation of discounted cash flows may differ from actual cash flows because of, among other reasons, technological changes, economic conditions, changes in the business model, or changes in operating profit. If the sum of the projected discounted cash flows (excluding interest) is less than the carrying amount of the asset, the asset shall be written-off to its estimated recoverable value.

2.24.5Liabilities for deposits of returnable container

The Company records a liability for deposits received in exchange for bottles and containers provided to its customers and distributors. This liability represents the amount of deposits that must be reimbursed if the customer or distributor returns the bottles and containers in good condition, together with the original invoice. This liability is estimated based on the number of bottles given on loan to customers and distributors, estimates of bottles in circulation and the weighted average historical cost per bottle or container. Management makes several assumptions in order to estimate this liability, including the number of bottles in circulation, the amount of deposit that must be reimbursed and the timing of disbursements.

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2.25.1        New accounting standards (Standards, Interpretations and Amendments) effective application for annual periods beginning on or after January 1, 2017.

Standards and interpretations, as well as the improvements and amendments to IFRS, which have been issued, effective at the date of these financial statements, are detailed below. The Company has applied these rules concluding that they will not significantly affect the financial statements.

	Amendments and/or Improvements	Mandatory Application Date
IFRS 12	Disclosures of Interests in Other Entities	January 1, 2017
IAS 7	Statements of Cash Flows	January 1, 2017
IAS 12	Income Tax	January 1, 2017

2.25.2        New accounting standards (Standards, Interpretations and Amendments) effective application for annual periods beginning on or after January 1, 2018.

Standards and interpretations, as well as the improvements and amendments to IFRS, which have been issued, but are still not effective at the date of these financial statements, are detailed below. The Company has not performed an early application of these rules.

	New Standards	Mandatory application date
IFRS 9	Financial Instruments	January 1, 2018
IFRS 15	Revenue from Contracts with Customers	January 1, 2018
IFRIC 22	Foreign Currency Transactions and Advanced Considerations	January 1, 2018
IFRS 16	Leases	January 1, 2019
IFRIC 23	Uncertainty over Income Tax Treatments	January 1, 2019

IFRS 9 “Financial Instruments”

The final version of IFRS 9 Financial Instruments was issued in July 2014, incorporating all the phases of the IASB project to replace IAS 39 Financial Instruments: Recognition and Measurement.  This standard includes new requirements based on classification and measurement principles, it introduces a “more prospective” model for expected credit losses for impairment accounting and a significantly reformed focus for hedge accounting. Entities will also have the option of early application of accounting for income and losses for changes in fair value regarding “own credit risk” for financial liabilities set at fair value with changes in profit and loss, without applying other IFRS 9 requirements. It is mandatorily effective for periods beginning on or after 1 January 2018 with early adoption permitted.

The adoption of the aforementioned standards, amendments and interpretations do not have a significant impact on the Company’s consolidated financial statements.

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IFRS 15 “Revenue from Contracts with Customers”

IFRS 15 Revenue from Contracts with Customers, issued in May 2014 is a new standard applicable to all contracts with customers, except leases, financial instruments and insurance contracts.  It is joint project with the FASB to eliminate differences upon recognizing revenue between IFRS and US GAAP.  This new standard pretends to improve inconsistencies and weaknesses of IAS 18 and deliver a model that will facilitate comparability of companies in different industries and regions. It grants a new model for recognizing revenue and more detailed requirements for contracts with multiple elements.  It also requires more detailed disclosure.  It is mandatorily effective for periods beginning on or after 1 January 2018 with early adoption permitted.

The adoption of the aforementioned standards, amendments and interpretations do not have a significant impact on the Company’s consolidated financial statements.

IFRIC Interpretation 22 “Foreign Currency Transactions and Advanced Considerations”

The Interpretation addresses the way to determine the date of the transaction in order to establish the exchange rate to be used on the initial recognition of the related asset, expense or income (or the corresponding part of these) in the de-recognition of accounts of a non-monetary asset or liability arising from the payment or collection of advanced consideration in foreign currency, for this purpose the date of the transaction corresponds to the moment in which an entity initially recognizes the non-monetary asset or liability arising from the payment or collection of the advanced consideration.  If there are multiple advanced payments or collections, the entity shall determine a transaction date for each advanced consideration payment or collection.

The adoption of the aforementioned standards, amendments and interpretations do not have a significant impact on the Company’s consolidated financial statements.

IFRS 16 “Leases”

In January 2016, the IASB issued IFRS 16 Leases. IFRS 16 sets the definition of a lease agreement and specifies the accounting treatment of assets and liabilities arising from these contracts from the point of view of the lessor and lessee. The new standard does not differ significantly from the preceding standard, IAS 17 Leases, regarding accounting treatment from the point of view of the lessor. However, from the point of view of the lessee, the new standard requires the recognition of assets and liabilities for the majority of leasing contracts. IFRS 16 will be mandatory for annual periods beginning after January 1, 2019. Early application is permitted if adopted together with IFRS 15 Revenue from Contracts with Customers.

The adoption of the aforementioned standards, amendments and interpretations do not have a significant impact on the Company’s consolidated financial statements.

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IFRIC 23 “Uncertainty over Income Tax Treatments”

In June 2017, the IASB issued IFRIC Interpretation 23, clarifying the application of recognition and measurement criteria required by IAS 12 Income Taxes when there is uncertainty about the tax treatments. This interpretation shall be applied for annual periods beginning after January 1, 2019.

The adoption of the aforementioned standards, amendments and interpretations do not have a significant impact on the Company’s consolidated financial statements.

	Amendments and Improvements	Mandatory application date
IFRS 10	Consolidated Financial Statements	TBD

IFRS 10 “Consolidated Financial Statements”

The amendments to IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures (2011) address a recognized inconsistency between the requirements of 10 IFRS and IAS 28 (2011) in the treatment of the contribution or sale of goods between an investor and the associate or joint venture. Amendments, issued in September of 2014, established that when the transaction involves a business (both in a subsidiary or not) it recognizes all profit or loss generated. A partial gain or loss is recognized when the transaction involves assets that do not constitute a business, even when the assets are in a subsidiary. The date of mandatory application of these modifications is to be determined since IASB plans an in-depth investigation that may result in a simplification of accounting of associates and joint ventures. Immediate adoption is permitted.

The adoption of standards, interpretations and amendments previously described do not have a significant impact on the Company’s Consolidated Financial Statements.

26

NOTE 3 —  REPORTING BY SEGMENT

The Company provides information by segments according to IFRS 8 “Operating Segments,” which establishes standards for reporting by operating segment and related disclosures for products and services, and geographic areas.

The Company’s Board of Directors and Management measures and assesses performance of operating segments based on the operating income of each of the countries where there are Coca-Cola franchises.

The operating segments are determined based on the presentation of internal reports to the Company´s chief strategic decision-maker. The chief operating decision-maker has been identified as the Company´s Board of Directors who makes the Company’s strategic decisions.

The following operating segments have been determined for strategic decision making based on geographic location:

·Operation in Chile

·Operation in Brazil

·Operation in Argentina

·Operation in Paraguay

The four operating segments conduct their businesses through the production and sale of soft drinks and other beverages, as well as packaging materials.

Expenses and income related to corporate management, have been assigned to the Chilean soft drinks segment, since Chile is the country that manages and pays corporate expenses, which would also be substantially incurred, independent to the existence of foreign subsidiaries.

Total revenues by segment include sales to unrelated customers and inter-segments, as indicated in the consolidated statement of income.

27

A summary of the Company’s operating segments in accordance to IFRS is as follows:

For the period ended June 30, 2017	Chile Operation		Argentina Operation		Brazil Operation		Paraguay Operation		Intercompany Eliminations		Consolidated total
	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Net sales	269,592,825		270,153,820		302,380,128		65,663,133		(1,111,260	)	906,678,646
Cost of sales	(160,815,435	)	(146,128,340	)	(181,798,236	)	(38,949,459	)	1,111,260		(526,580,210	)
Distribution expenses	(27,192,168	)	(39,951,123	)	(21,439,166	)	(3,691,029	)	—		(92,273,486	)
Administrative expenses	(58,077,570	)	(51,335,139	)	(55,158,100	)	(10,478,237	)	—		(175,049,046	)
Finance income	1,358,972		953,327		3,554,218		182,356		—		6,048,873
Finance expense	(7,510,956	)	(1,637,157	)	(18,093,578	)	(6,451	)	—		(27,248,142	)
Interest expense, net*	(6,151,984	)	(683,830	)	(14,539,360	)	175,905		—		(21,199,269	)
Share of the entity in income of associates	480,580		(243	)	456,218		—		—		936,555
Income tax expense	(8,467,434	)	(9,387,233	)	(5,518,926	)	(2,229,635	)	—		(25,603,228	)
Other income (loss)	(5,154,183	)	(4,492,989	)	(4,239,044	)	151,063		—		(13,735,153	)
Net income of the segment reported	4,214,631		18,174,923		20,143,514		10,641,741		—		53,174,809
Depreciation and amortization	21,218,314		9,034,295		14,485,873		5,581,863		—		50,320,345
Current assets	199,780,771		83,610,273		140,414,810		23,533,865		—		447,339,719
Non-current assets	648,457,256		105,367,300		662,178,023		255,939,704		—		1,671,942,283
Segment assets, total	848,238,027		188,977,573		802,592,833		279,473,569		—		2,119,282,002
Carrying amount in associates and joint ventures accounted for using the equity method, total	29,972,849		9,661,284		56,891,171		—		—		96,525,304
Capital expenditures and other	35,811,424		25,539,615		31,983,056		10,654,276		—		103,988,371
Current liabilities	121,409,997		96,602,821		99,516,245		23,596,423		—		341,125,486
Non-current liabilities	481,055,755		(1,930,185	)	432,901,896		16,208,101		—		928,235,567
Segment liabilities, total	602,465,752		94,672,636		532,418,141		39,804,524		—		1,269,361,053
Cash flows provided by in Operating Activities	38,380,942		(6,922,316	)	46,154,112		17,408,865		—		95,021,603
Cash flows (used in) provided by Investing Activities	(441,987	)	(25,538,168	)	(31,983,056	)	(10,654,275	)	—		(68,617,486	)
Cash flows (used in) provided by Financing Activities	(47,133,183	)	20,696,321		(8,219,322	)	—		—		(34,656,184	)

(*) Financial expenses associated with external financing for the purchase of companies, including capital contributions are presented in this item.

28

For the period ended June 30, 2016	Chile Operation		Argentina Operation		Brazil Operation		Paraguay Operation		Intercompany Eliminations		Consolidated total
	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Net sales	256,318,956		240,314,315		275,241,936		64,780,646		(1,137,922	)	835,517,931
Cost of sales	(150,861,302	)	(129,770,491	)	(168,209,550	)	(38,815,866	)	1,137,922		(486,519,287	)
Distribution expenses	(25,839,416	)	(35,997,473	)	(21,008,638	)	(3,294,863	)	—		(86,140,390	)
Administrative expenses	(57,887,518	)	(46,828,746	)	(48,249,516	)	(10,479,970	)	—		(163,445,750	)
Finance income	893,538		825,196		3,457,429		241,039		—		5,417,202
Finance expense	(8,172,170	)	(242,314	)	(16,732,757	)	(12,168	)	—		(25,159,409	)
Interest expense, net*	(7,278,632	)	582,882		(13,275,328	)	228,871		—		(19,742,207	)
Share of the entity in income of associates	275,254		—		(27,810	)	—		—		247,444
Income tax expense	(11,231,489	)	(8,040,730	)	(4,187,967	)	(1,727,312	)	—		(25,187,498	)
Other income (loss)	(6,406,721	)	(4,333,200	)	(5,360,971	)	320,396		—		(15,780,496	)
Net income of the segment reported	(2,910,868	)	15,926,557		14,922,156		11,011,902		—		38,949,747
Depreciation and amortization	20,512,901		8,118,034		12,399,290		6,052,068		—		47,082,293
Current assets	251,340,972		64,132,756		135,291,551		26,063,871		—		476,829,150
Non-current assets	653,065,420		90,261,149		628,976,621		249,586,578		—		1,621,889,768
Segment assets, total	904,406,392		154,393,905		764,268,172		275,650,449		—		2,098,718,918
	18,130,250		—		48,395,653		—		—		66,525,903
Carrying amount in associates and joint ventures accounted for using the equity method, total	18,671,938		20,223,591		17,168,721		4,751,908		—		60,816,158
Capital expenditures and other
	134,627,761		75,397,216		97,195,012		20,916,341		—		328,136,330
Current liabilities	514,327,396		(427,180	)	412,139,878		16,429,906		—		942,470,000
Non-current liabilities	648,955,157		74,970,036		509,334,890		37,346,247		—		1,270,606,330
Segment liabilities, total
	28,803,456		6,025,178		19,889,911		14,901,315		—		69,619,860
Cash flows provided by in Operating Activities	(11,469,825	)	(20,265,776	)	(17,399,526	)	(4,757,333	)	—		(53,892,460	)
Cash flows (used in) provided by Investing Activities	(39,665,577	)	2,558,159		(8,405,103	)	—		—		(45,512,521	)
Cash flows (used in) provided by Financing Activities	256,318,956		240,314,315		275,241,936		64,780,646		(1,137,922	)	835,517,931

(*) Financial expenses associated with external financing for the purchase of companies, including capital contributions are presented in this item.

29

NOTE 4 —  CASH AND CASH EQUIVALENTS

Cash and cash equivalents are detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
By item
Cash	637,688	361,797
Bank balances	18,955,853	27,536,924
Time deposits	15,542,879	1,879
Mutual funds	97,078,117	113,363,280
Total cash and cash equivalents	132,214,537	141,263,880
	ThCh$	ThCh$
By currency
Dollar	6,800,748	53,073,628
Euro	17,838	4,926
Argentine Peso	1,189,540	5,105,633
Chilean Peso	75,119,496	48,891,546
Paraguayan Guaraní	5,653,279	8,115,946
Brazilian Real	43,433,636	26,072,201
Total cash and cash equivalents	132,214,537	141,263,880

4.1Time deposits

Time deposits defined as cash and cash equivalents are detailed as follows:

Placement	Institution	Currency	Principal	Annual rate		06.30.2017
			ThCh$	%		ThCh$
06/13/2017	Security	Chilean pesos	8,000,000	3.24	%	8,012,240
06/13/2017	Consorcio	Chilean pesos	2,500,000	3.48	%	2,504,112
06/13/2017	Consorcio	Chilean pesos	1,500,000	3.48	%	1,502,465
06/30/2017	Banco Santander	Chilean pesos	2,000,000	2.40	%	2,000,000
06/30/2017	Banco Santander	Chilean pesos	1,500,000	2.40	%	1,500,000
06/13/2017	Votorantim	Brasilean reales	21,625	8.82	%	22,130
06/07/2017	Plazo fijo Banco Galicia	Argentinean pesos	1,908	26.32	%	1,932
Total						15,542,879

30

Placement	Institution	Currency	Principal	Annual rate		12.31.2016
			ThCh$	%		ThCh$
12/7/2016	Plazo Fijo Banco Galicia	Argentinean pesos	1,853	17.00	%	1,879
Total						1,879

4.2             Money Market

Money market mutual fund´s shares are valued using the share values at the close of each reporting period. Below is a description for the end of each period:

Institution	06.30.2017	12.31.2016
	ThCh$	ThCh$
Mutual fund Itaú - Chile	—	1,500,306
Mutual fund Banco Estado - Chile	16,488,839	14,375,037
Mutual fund Itaú - Brazil	13,368,303	9,097,387
Mutual fund Santander - Brazil	13,330,479	6,287,332
Mutual fund Bradesco - Brazil	13,134,929	6,299,734
Mutual fund Corporativo Banchile - Chile	11,700,580	6,305,390
Mutual fund Banco Security - Chile	9,838,379	5,214,179
Mutual fund Banco Bice - Chile	8,436,773	4,616,379
Mutual fund Banco Santander - Chile	—	8,242,619
Wester Asset Institutional Cash Reserves - USA	5,754,948	46,207,447
Mutual fund Larrain Vial - Chile	3,024,732	—
Mutual fund BTG - Chile	2,000,155	—
Fima fund Primium B - Argentina	—	3,717,158
Mutual fund Scotiabank - Chile	—	1,500,312
Total mutual funds	97,078,117	113,363,280

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NOTE 5 —OTHER CURRENT AND NON-CURRENT FINANCIAL ASSETS

Below are the financial instruments held by the Company other than cash and cash equivalents.  They consist of time deposits with short-term maturities (more than 90 days), restricted mutual funds and derivative contracts. Financial instruments are detailed as follows:

a)Current portion 2017

a.1  Time deposits

Placement	Maturity	Institution	Currency	Principal	Annual rat		6/30/2017
				ThCh$	%		ThCh$
05-08-2017	08-10-2017	Banco Santander - Chile	Unidad de fomento	10,000,000	1.12	%	10,044,885
05-08-2017	08-24-2017	Consorcio - Chile	Unidad de fomento	9,400,000	1.55	%	9,448,159
Subtotal							19,493,044
a.2 Rights in Forward Contracts
Rights in Forward Contracts — Swap (see details in Note 20)							2,283,925
Rights in Forward Contracts — Forward (see details in Note 20)							1,091,803
Subtotal							3,375,728
a.3 Funds in Guaranty
Funds in guaranty for Rofez derivative operations — Argentina (1)							405,492
Total other Financial Assets, current							23,274,264

(1) Corresponds to funds that should remain restricted according to the partial results for derivative operations in Argentina.

32

b)Non-current 2017

	06.30.2017
	ThCh$
Derivative futures contracts
Derivative futures contracts (see note 20)	75,426,997
Total other non-current financial assets	75,426,997

a)Current portion 2016

Time deposits

Placement	Maturity	Institution	Currency	Principal	Annual rate		12-31-2016
				ThCh$	%		ThCh$
01-15-2016	01-04-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	1.35	%	5,207,907
02-25-2016	01-09-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	1.09	%	6,209,086
04-22-2016	02-13-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	1.25	%	5,135,282
06-24-2016	01-09-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	1.11	%	5,088,450
08-31-2016	01-09-2017	Banco HSBC - Chile	Unidad de fomento	7,000,000	1.50	%	7,072,864
08-31-2016	01-09-2017	Banco HSBC - Chile	Unidad de fomento	3,000,000	1.24	%	3,028,570
10-19-2016	02-24-2017	Banco HSBC - Chile	Unidad de fomento	2,000,000	2.30	%	2,017,503
11-09-2016	02-13-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	3.48	%	5,038,755
11-24-2016	05-08-2017	Banco HSBC - Chile	Unidad de fomento	10,000,000	2.85	%	10,046,439
11-24-2016	05-08-2017	Banco HSBC - Chile	Unidad de fomento	5,000,000	2.85	%	5,023,219
03-15-2016	03-15-2017	Banco Votoratim - Brazil	Brazilian reais	19,926	8.82	%	21,632
Subtotal							53,889,707
a.2 Rights in Forward Contracts
Rights in Forward Contracts (see details in Note 20)							4,678,343
a.3 Funds in Guaranty
Funds in guaranty for Rofex derivative operations — Argentina (1)							1,584,577
Total other Financial Assets, current							60,152,627

(1) Corresponds to funds that must be restricted in accordance with the partial results of derivative operations in Argentina.

b)Non-current portion 2016

	12.31.2016
	ThCh$
Derivative futures contracts
Derivative futures contracts (see note 20)	80,180,880
Total other non-current financial assets	80,180,880

33

NOTE 6 — CURRENT AND NON-CURRENT NON-FINANCIAL ASSETS

	06.30.2017	12.31.2016
	ThCh$	ThCh$
Description
Prepaid expenses	5,854,313	5,689,560
Guarantee deposit (Argentine)	10,463	11,226
Disbursements of property, plant & equipment on behalf of Coca-Cola del Valle New Ventures S.A. (1)	279,363	1,991,167
Other current assets	1,045,319	909,256
Total	7,189,458	8,601,209

Note 6.2Other non-current, non-financial assets

	06.30.2017	12.31.2016
	ThCh$	ThCh$
Description
Judicial deposits (see note 21.2)	19,712,808	19,112,974
Prepaid expenses	1,053,054	1,613,989
Fiscal credits	2,908,859	2,975,706
Advance payment to suppliers of property, plant & equipment (2)	15,888,123	11,173,966
Others	1,439,231	370,188
Total	41,002,075	35,246,823

(1)Corresponds to disbursments of property, plant & equipment performed by subsidiaries of the Andina Group in property, plant & equipment that subsequently will be transferred to the equity investee Coca-Cola del Valle New Ventures S.A.

(2)Corresponds to advance payments made for the construction of the new “Duque de Caixas” bottling plant in Brazil.

34

NOTE 7 —  TRADE AND OTHER RECEIVABLES

The composition of trade and other receivables is detailed as follows:

	06.30.2017				12.31.2016
Trade and other receivables	Assets before provisions	Allowance for doubtful accounts		Commercial debtors net assets	Assets before provisions	Allowance for doubtful accounts		Commercial debtors net assets
	ThCh$	ThCh$		ThCh$	ThCh$	ThCh$		ThCh$
Current commercial debtors
Trade debtors	99,464,996	(4,071,285	)	95,393,711	155,792,966	(3,090,160	)	152,702,806
Other current debtors	31,084,211	(2,827,148	)	28,257,063	30,923,474	(2,827,678	)	28,095,796
Current commercial debtors	130,549,207	(6,898,433	)	123,650,774	186,716,440	(5,917,838	)	180,798,602
Prepayments suppliers	4,460,331	—		4,460,331	8,776,211	—		8,776,211
Other current accounts receivable	1,744,162	(181,080	)	1,563,082	1,728,859	(779,318	)	949,541
Commercial debtors and other current accounts receivable	136,753,700	(7,079,513	)	129,674,187	197,221,510	(6,697,156	)	190,524,354
Non-current accounts receivable
Trade debtors	63,809	—		63,809	83,881	—		83,881
Other non-current debtors	2,902,940	—		2,902,940	3,443,851	—		3,443,851
Other non-current accounts receivable	274	—		274
Non-current accounts receivable	2,967,023	—		2,967,023	3,527,732	—		3,527,732
Trade and other receivable	139,720,723	(7,079,513	)	132,641,210	200,749,242	(6,697,156	)	194,052,086

Stratification of portfolio current and non-current debtors from credit operations

	06.30.2017	12.31.2016
	ThCh$	ThCh$
Up to date non-securitized portfolio until 30 days	92,549,551	148,694,299
31 and 60 days	1,148,850	1,463,935
61 and 90 days	686,182	567,318
91 and 120 days	520,981	909,985
121 and 150 days	1,360,958	410,944
151 and 180 days	293,955	155,596
181 and 210 days	548,140	245,947
211 and 250 days	88,230	107,679
More than 250 days	2,331,958	3,321,144
Total	99.528.805	155,876,847

The Company has an approximate number of 259,000 clients, which may have balances in the different sections of the stratification. The number of clients is distributed geographically with 63,000 in Chile, 79,000 in Brazil, 64,000 in Argentina and 53,000 in Paraguay.

	06.30.2017	12.31.2016
	ThCh$	ThCh$
Current commercial debtors	99,464,996	155,792,966
Non-current commercial debtors	63,809	83,881
Total	99,528,805	155,876,847

35

The movement in the allowance for doubtful accounts is presented below:

	06.30.2017		12.31.2016
	ThCh$		ThCh$
Opening balance	6,697,156		5,265,225
Bad debt expense	1,233,288		4,381,803
Provision application	(832,937	)	(2,650,520	)
Change due to foreign exchange differences	(17,994	)	(299,352	)
Movement	382,357		1,431,931
Ending balance	7,079,513		6,697,156

NOTE 8 —  INVENTORIES

The composition of inventories is detailed as follows:

Details	06.30.2017		12.31.2016
	ThCh$		ThCh$
Raw materials (1)	93,997,997		81,841,400
Finished goods	30,377,389		34,304,162
Spare parts and supplies	25,511,743		24,137,074
Work in progress	805,239		670,849
Other inventories	2,745,532		6,668,977
Obsolescence provision (2)	(2,937,225	)	(2,913,114	)
Total	150,500,675		144,709,348

The cost of inventory recognized as cost of sales as of June 30, 2017 and 2016, is ThCh$526,580,210 and ThCh$486,519,287, respectively

(1)Approximately 80% is composed of concentrate and sweeteners used in the preparation of beverages, as well as caps and PET supplies used in the packaging of the product.

(2)The obsolescence provision is related mainly with the obsolescence of spare parts classified as inventories and to a lesser extent to finished products and raw materials. The general standard is to provision all those multi-functional spare parts without utility in rotation in the last four years prior to the technical analysis technical to adjust the provision. In the case of raw materials and finished products, the obsolescence provision is determined according to maturity.

36

NOTE 9 —  CURRENT AND DEFERRED INCOME TAXES

9.1Tax Reform

On September 29, 2014, the Official Daily Newspaper published Law N°20,780 that amends the Chilean tax regime, with the main following changes:

·It establishes a new system of semi-integrated taxation, which can be used as an alternative to the integrated regime of attributed income. Taxpayers may opt freely to any of the two to pay their taxes. In the case of Embotelladora Andina S.A. by a general rule established by law the semi-integrated taxation system applies, which was ratified by the Shareholders’ Meeting.

·The semi-integrated system establishes the gradual increase in the first category tax rate for the business years 2014, 2015, 2016, 2017 and 2018 onwards, increasing to 21%, 22.5%, 24%, 25.5% and 27% respectively.

9.2          Current tax assets

Current tax assets correspond to the following items:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Monthly provisional payments	1,291,804	1,330,379
Tax credits (1)	—	371,917
Total	1,291,804	1,702,296

(1)Tax credits correspond to income tax credits on training expenses, purchase of Property, plant and equipment, and donations.

37

9.3Current tax liabilities

Current tax payables are detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Income tax expense	4,446,704	10,828,593
Total	4,446,704	10,828,593

9.4Income tax expense

The current and deferred income tax expenses are detailed as follows:

Item	06.30.2017	06.30.2016
	ThCh$	ThCh$
Current income tax expense	21,503,747	15,291,340
Current tax adjustment previous period	153,653	801,867
Withholding tax expense foreign subsidiaries	3,732,480	4,296,226
Other current tax expense (income)	33,684	31,097
Current income tax expense	25,423,564	20,420,530
Income (expense) for the creation and reversal of current tax difference	179,664	4,766,968
Expense (income) for deferred taxes	179,664	4,766,968
Total income tax expense	25,603,228	25,187,498

38

9.5Deferred income taxes

The net cumulative balances of temporary differences that give rise to deferred tax assets and liabilities are detailed as follows:

	06.30.2017		12.31.2016
Temporary differences	Assets	Liabilities	Assets	Liabilities
	ThCh$	ThCh$	ThCh$	ThCh$
Property, plant and equipment	2,304,033	47,358,866	2,127,336	48,561,147
Obsolescence provision	1,581,636	—	1,541,553	—
Employee benefits	3,479,116	—	4,383,007	—
Post-employment benefits	63,002	1,025,131	49,900	1,010,779
Tax loss carried-forwards (1)	10,324,119	—	9,928,940	—
Tax Goodwill Brazil	27,951,078	—	31,926,760	—
Contingency provision	41,971,106	—	36,969,451	—
Foreign exchange differences (2)	—	1,751,656	—	2,124,435
Allowance for doubtful accounts	1,146,149	—	1,031,375	—
Coca-Cola incentives (Argentina)	2,537,355	—	2,408,651	—
Assets and liabilities for placement of bonds	—	612,396	—	669,856
Lease liabilities	1,326,348	—	1,767,944	—
Inventories	1,056,979	524,331	1,604,538	806.529
Distribution rights	—	167,390,122	—	168,511,436
Others	1,662,545	1,036,434	2,689,002	353,077
Subtotal	95,403,466	219,698,936	96,428,457	222,037,259
Total liabilities net	—	124,295,470	—	125,608,802

(1)Tax losses mainly associated with the subsidiary Embotelladora Andina Chile S.A. In Chile tax losses have no expiration date

(2)Corresponds to differed taxes for exchange rate differences generated on the translation of debt expressed in foreign currency in the subsidiary Rio de Janerio Refrescos Ltda. and which for tax purposes are recognized in Brazil when incurred.

39

9.6Deferred tax liability movement

The movement in deferred income tax accounts is as follows:

Item	06.30.2017		12.31.2016
	ThCh$		ThCh$
Opening Balance	125,608,802		130,201,701
Increase (decrease) in deferred tax	(1,554,539	)	(6,409,481	)
Increase (decrease) due to foreign currency translation	241,207		1,816,582
Movements	(1,313,332	)	(4,592,899	)
Ending balance	124,295,470		125,608,802

9.7Distribution of domestic and foreign tax expense

The composition of domestic and foreign tax expense are detailed as follows:

Income tax	06.30.2017		06.30.2016
	ThCh$		ThCh$
Current income taxes
Foreign	(17,481,352	)	(9,608,051	)
Domestic	(7,942,212	)	(10,812,479	)
Current income tax expense	(25,423,564	)	(20,420,530	)
Deferred income taxes
Foreign	345,558		(4,347,957	)
Domestic	(525,222	)	(419,011	)
Deferred income tax expense	(179,664	)	(4,766,968	)
Income tax expense	(25,603,228	)	(25,187,498	)

40

9.8             Reconciliation of effective rate

Below is the reconciliation between the effective tax rate and the statutory rate:

Reconciliation of effective rate	06.30.2017		06.30.2016
	ThCh$		ThCh$
Net income before taxes	78,778,037		64,137,245
Tax expense at legal rate (25.5%)	(20,088,398	)	—
Tax expense at legal rate (24.0%)	—		(15,392,938	)
Effect of a different tax rate in other jurisdictions	(1,945,246	)	(2,838,344	)
Permanent differences:
Non-taxable revenues	5,266,185		4,065,602
Non-deductible expenses	(2,713,823	)	(6,168,292	)
Foreign subsidiaries tax withholding expense and other legal tax debits and credits	(6,121,946	)	(4,853,526	)
Adjustments to tax expense	(3,569,584	)	(6,956,216	)
Tax expense at effective rate	(25,603,228	)	(25,187,498	)
Effective rate	32.5	%	39.3	%

Below are the income tax rates applicable in each jurisdiction where the Company operates:

	Rate
Country	2017		2016
Chile	25.5	%	24.0	%
Brazil	34	%	34	%
Argentina	35	%	35	%
Paraguay	10	%	10	%

41

NOTE 10 —  PROPERTY, PLANT AND EQUIPMENT

10.1Balances

Property, plant and equipment are detailed below at the end of each period:

	Property, plant and equipment, gross		Cumulative depreciation and impairment				Property, plant and equipment, net
Item	06.30.2017	12.31.2016	06.30.2017		12.31.2016		06.30.2017	12.31.2016
	ThCh$	ThCh$	ThCh$		ThCh$		ThCh$	ThCh$
Construction in progress	45,741,696	49,986,111	—		—		45,741,696	49,986,111
Land	99,396,107	91,961,876	—		—		99,396,107	91,961,876
Buildings	232,480,111	230,355,844	(59,334,365	)	(57,282,683	)	173,145,746	173,073,161
Plant and equipment	453,061,761	453,359,655	(273,640,873	)	(262,957,030	)	179,420,888	190,402,625
Information technology	19,982,065	19,683,777	(14,559,666	)	(13,560,865	)	5,422,399	6,122,912
Fixed facilities and accessories	33,378,862	32,616,284	(13,011,518	)	(12,150,171	)	20,367,344	20,466,113
Vehicles	55,802,787	44,629,827	(22,762,146	)	(20,733,402	)	33,040,641	23,896,425
Leasehold improvements	698,310	734,100	(589,775	)	(543,577	)	108,535	190,523
Other Property, plant and equipment (1)	405,237,672	397,539,405	(299,469,443	)	(287,488,266	)	105,768,229	110,051,139
Total	1,345,779.371	1,320,866,879	(683,367,786	)	(654,715,994	)	662,411,585	666,150,885

(1)Other Property, plant and equipment is composed of bottles, market assets, furniture and other minor assets.

42

The net balance of each of these categories is detailed as follows:

Other Property, plant and equipment	06.30.2017	12.31.2016
	ThCh$	ThCh$
Bottles	57,270,215	64,020,146
Marketing and promotional assets	41,598,001	38,834,104
Other Property, plant and equipment	6,900,013	7,196,889
Total	105,768,229	110,051,139

The Company has insurance to protect its Property, plant and equipment and its inventory from potential losses. The geographic distribution of those assets is detailed as follows:

Chile	:	Santiago, Puente Alto, Maipú, Renca, Rancagua y San Antonio, Antofagasta, Coquimbo and Punta Arenas.
Argentina	:	Buenos Aires, Mendoza, Córdoba y Rosario, Bahía Blanca, Chacabuco, La Pampa, Neuqén, Comodoro Rivadavia, Trelew, and Tierra del Fuego
Brazil	:	Río de Janeiro, Niteroi, Campos, Cabo Frío, Nova Iguazú, Espirito Santo, Vitoria, part of Sao Paulo and Minas Gerais.
Paraguay	:	Asunción, Coronel Oviedo, Ciudad del Este and Encarnación.

43

10.2        Movements

Movements in Property, plant and equipment are detailed as follows:

	Construction in progress		Land	Buildings, net		Plant and equipment, net		IT Equipment, net		Fixed facilities and accessories, net		Vehicles, net		Leasehold improvements, net Leasehold improvements, net		Other, net		Property, plant and equipment, net
	ThCh$		ThCh$	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Opening balance at January 1, 2017	49,986,111		91,961,876	173,073,161		190,402,625		6,122,912		20,466,113		23,896,425		190,523		110,051,139		666,150,885
Additions	26,795,866		3,620,176	387,060		3,200,593		96,367		—		515,876		—		17,137,275		51,753,213
Disposals	—		—	(273,260	)	(637,840	)	—		(391,871	)	(51,169	)	—		(439,082	)	(1,793,222	)
Transfers between items of Property, plant and equipment	(26,157,543	)	—	4,499,665		13,862,084		279,708		1,671,020		1,901,059		—		3,944,007		—
Depreciation expense	—		—	(2,887,917	)	(18,437,206	)	(1,091,338	)	(1,044,577	)	(2,627,783	)	(58,321	)	(22,863,487	)	(49,010,629	)
Increase (decrease) due to foreign currency translation differences	(4,900,676	)	3,792,233	(1,652,963	)	(7,464,233	)	15,014		(333,340	)	9,464,394		(23,674	)	(2,531,424	)	(3,634,669	)
Other increase (decrease) (1)	17,938		21,822	—		(1,505,135	)	(264	)	(1	)	(58,161	)	7		469,801		(1,053,993	)
Total movements	(4,244,415	)	7,434,231	72,585		(10,981,737	)	(700,513	)	(98,769	)	9,144,216		(81,988	)	(4,282,910	)	(3,739,300	)
Ending balance at June 30, 2017	45,741,696		99,396,107	173,145,746		179,420,888		5,422,399		20,367,344		33,040,641		108,535		105,768,229		662,411,585

(1)Mainly correspond to property, plant & equipment write-offs.

44

	Construction in progress		Land	Buildings, net		Plant and equipment, net		IT Equipment, net		Fixed facilities and accessories, net		Vehicles, net		Leasehold improvements, net		Other, net		Property, plant and equipment, net
	ThCh$		ThCh$	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Opening balance at January 1, 2016	34,625,004		86,898,529	159,474,930		203,379,934		4,320,656		22,306,759		18,106,705		274,945		111,142,410		640,529,872
Additions	70,421,863		1,248,433	1,201,903		9,833,490		2,666,593		161,395		338,986		—		38,923,620		124,796,283
Disposals	—		—	(4,598	)	(601,444	)	—		—		(3,473	)	—		(54,861	)	(664,376	)
Transfers between items of Property, plant and equipment	(53,824,861	)	1,643,038	15,471,645		16,202,982		1,062,653		1,709,635		9,015,390		—		8,719,518		—
Depreciation expense	—		—	(5,335,475	)	(35,568,436	)	(1,910,731	)	(2,456,511	)	(4,622,348	)	(112,805	)	(44,120,837	)	(94,127,143	)
Increase (decrease) due to foreign currency translation differences	(1,235,895	)	2,171,876	2,792,916		(1,266,728	)	29,148		(1,254,915	)	1,783,041		28,383		(3,322,005	)	(274,179	)
Other increase (decrease) (1)	—		—	(528,160	)	(1,577,173	)	(45,407	)	(250	)	(721,876	)	—		(1,236,706	)	(4,109,572	)
Total movements	15,361,107		5,063,347	13,598,231		(12,977,309	)	1,802,256		(1,840,646	)	5,789,720		(84,422	)	(1,091,271	)	25,621,013
Ending balance at December 31, 2016	49,986,111		91,961,876	173,073,161		190,402,625		6,122,912		20,466,113		23,896,425		190,523		110,051,139		666,150,885

(1)Mainly correspond to property, plant & equipment write-offs.

45

NOTE 11 —  RELATED PARTY DISCLOSURES

Balances and main transactions with related parties are detailed as follows:

11.1           Accounts receivable:

11.1.1       Current:

Taxpayer ID	Company	Relationship	Country of origin	Currency	06.30.2017	12.31.2016
					ThCh$	ThCh$
96.891.720-K	Embonor S.A.	Related to Shareholder	Chile	Chilean pesos	2,326,285	5,283,410
96.517.210-2	Embotelladora Iquique S.A.	Related to Shareholder	Chile	Chilean pesos	140,198	307,848
76.572.588-7	Coca Cola del Valle New Ventures S.A.	Associate	Chile	Chilean pesos	461.681	180,000
96.919.980-7	Cervecería Austral S.A.	Related to director	Chile	Dollars	21,290	13,827
77.755.610-k	Comercial Patagona Ltda.	Related to director	Chile	Chilean pesos	2,926	3,598
Foreign	Alimentos de Soja SAU	Related to director	Chile	Argentinean pesos	242,414	—
Total					3,194,794	5,788,683

11.1.2       Non-current:

Taxpayer ID	Company	Relationship	Country of origin	Currency	06.30.2017	12.31.2016
					ThCh$	ThCh$
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Chilean pesos	112,224	147,682
Total					112,224	147,682

46

11.2           Accounts payable:

11.2.1       Current:

Taxpayer ID	Company	Relationship	Country of origin	Currency	06.30.2017	12.31.2016
					ThCh$	ThCh$
Foreign	Recofarma do Industrias Amazonas Ltda.	Related to Shareholder	Brazil	Brazilian real	14,251,065	17,345,806
Foreign	Servicio y Productos para Bebidas Refrescantes S.R.L.	Shareholder	Argentina	Argentine pesos	993,197	10,275,931
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Chilean pesos	4,067,394	7,284,499
Foreign	Leao Alimentos e Bebidas Ltda.	Associate	Brazil	Brazilian real	2,098,172	3,571,514
86.881.400-4	Envases CMF S.A.	Associate	Chile	Chilean pesos	2,662,706	5,338,180
89.996.200-1	Envases del Pacífico S.A.	Related to director	Chile	Chilean pesos	217,880	304,405
		Total			24,290,414	44,120,335

47

11.3           Transactions:

			Country of			Cumulative
Taxpayer ID	Company	Relationship	origin	Description of transaction	Currency	06.30.2017
						ThCh$
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Purchase of concentrates	Chilean pesos	69,180,217
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Purchase of advertising services	Chilean pesos	1,759,822
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Lease of water fountain	Chilean pesos	1,873,667
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Sale of raw materials and others	Chilean pesos	389,262
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase of bottles	Chilean pesos	9,603,948
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase of raw materials	Chilean pesos	6,338,699
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase of caps	Chilean pesos	221,400
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase services and others	Chilean pesos	105,228
86.881.400-4	Envases CMF S.A.	Associate	Chile	Sale services and others	Chilean pesos	84,757
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase of packaging	Chilean pesos	1,429,936
86.881.400-4	Envases CMF S.A.	Associate	Chile	Sale of packaging and raw materials	Chilean pesos	1,368,271
96.891.720-K	Embonor S.A.	Related to Shareholder	Chile	Sale of finished products	Chilean pesos	21,121,860
96.517.310-2	Embotelladora Iquique S.A.	Related to Shareholder	Chile	Sale of finished products	Chilean pesos	1,311,215
89.996.200-1	Envases del Pacífico S.A.	Related to director	Chile	Purchase of raw materials and materials	Chilean pesos	963,999
94.627.000-8	Parque Arauco S.A	Related to director	Chile	Rent of spaces	Chilean pesos	90,032
99.279.000-8	Euroamerica Seguros de Vida S.A.	Related to director	Chile	Purchase of insurance policies	Chilean pesos	135,915
Foreign	Recofarma do Industrias Amazonas Ltda.	Related to Shareholder	Brazil	Purchase of concentrates	Chilean pesos	56,800,939
Foreign	Recofarma do Industrias Amazonas Ltda.	Related to Shareholder	Brazil	Refund and other purchases	Chilean pesos	1,088,097
Foreign	Servicio y Productos para Bebidas Refrescantes S.R.L.	Shareholder	Argentina	Purchase of concentrates	Argentine pesos	63,106,297
Foreign	Servicio y Productos para Bebidas Refrescantes S.R.L.	Shareholder	Argentina	Advertising participation payment	Argentine pesos	7,727,581
Foreign	KAIK Participações	Associate	Brazil	Refund and other purchases	Brazilian real	51,341
Foreign	Leao Alimentos e Bebidas Ltda.	Associate	Brazil	Purchase of products	Brazilian real	229,949
Foreign	Coca-Cola Perú	Related to Shareholder	Perú	Purchase of concentrates and marketing recovery	Dollar	203,101
Foreign	Sorocaba Refrescos S.A.	Associate	Brazil	Purchase of products	Brazilian real	103,822
89.862.200-2	Latam Airlines Group S.A.	Related to director	Chile	Sale of products	Chilean pesos	353,100
76.572.588-7	Coca Cola Del Valle New Ventures SA	Shareholder	Chile	Sale of services and others	Chilean pesos	1,247,653

48

			Country			Cumulative
Taxpayer ID	Company	Relationship	of origin	Description of transaction	Currency	12.31.2016
						ThCh$
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Purchase of concentrates	Chilean pesos	129,660,611
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Purchase of advertising services	Chilean pesos	7,154,023
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Lease of water fountain	Chilean pesos	3,740,351
96.714.870-9	Coca-Cola de Chile S.A.	Shareholder	Chile	Sale of services and others	Chilean pesos	2,299,634
86.881.400-4	Envases CMF S.A.	Associate	Chile	Purchase of bottles	Chilean pesos	34,144,348
76.572.588.7	Coca-Cola del Valle New Ventures S.A.	Associate	Chile	Administrative and commercial services	Chilean pesos	180,000
96.891.720-K	Embonor S.A.	Associate	Chile	Sale of packaging materials	Chilean pesos	44,310,169
96.517.310-2	Embotelladora Iquique S.A.	Related to Shareholder	Chile	Sale of finished products	Chilean pesos	2,749,506
Foreign	Recofarma do Industrias Amazonas Ltda.	Related to Shareholder	Brazil	Sale of finished products	Chilean pesos	115,706,386
Foreign	Recofarma do Industrias Amazonas Ltda.	Related to Shareholder	Brazil	Purchase of concentrates	Brazilian real	25,675,184
Foreign	Leao Alimentos e Bebidas Ltda.	Related to Shareholder	Brazil	Advertising participation payment	Brazilian real	11,658,142
Foreign	Servicio y Productos para Bebidas Refrescantes S.R.L.	Associate	Argentina	Purchase of concentrates	Brazilian real	114,427,713
Foreign	Servicio y Productos para Bebidas Refrescantes S.R.L.	Shareholder	Argentina	Purchase of concentrates	Argentine pesos	14,680,603
89.996.200-1	Envases del Pacífico S.A.	Related to director	Chile	Advertising participation payment	Argentine pesos	1,751,011
Foreign	Coca-Cola Perú	Related to director	Perú	Purchase of raw materials	Chilean pesos	4,188,812

49

11.4Key management compensation

Salaries and benefits paid to the Company’s key management personnel including directors and managers are detailed as follows:

Description	06.30.2017	06.30.2016
	ThCh$	ThCh$
Executive wages, salaries and benefits	3,176,984	3,448,108
Director allowances	757,100	620,088
Termination of employment contracts benefits	—	79,027
Total	3,934,084	4,147,223

NOTE 12 —  CURRENT AND NON-CURRENT EMPLOYEE BENEFITS

Employee benefits are detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Accrued vacations	18,936,033	19,828,622
Employee remuneration payable	8,716,097	15,824,809
Indemnities for years of service	8,467,892	8,157,745
Total	36,120,022	43,811,176

	ThCh$	ThCh$
Current	27,652,130	35,653,431
Non-current	8,467,892	8,157,745
Total	36,120,022	43,811,176

12.1Indemnities for years of service

The movements of post-employment benefits that are determined as stated in Note 2 are detailed as follows:

Movements	06.30.2017		12.31.2016
	ThCh$		ThCh$
Opening balance	8,157,745		8,230,030
Service costs	775,847		2,059,799
Interest costs	112,208		182,328
Net actuarial losses	5,472		536,105
Benefits paid	(583,380	)	(2,850,517	)
Total	8,467,892		8,157,745

50

12.1.1Assumptions

The actuarial assumptions used are detailed as follows:

Assumptions	06.30.2017	12.31.2016
Discount rate	2.7%	2.7%
Expected salary increase rate	2.0%	2.0%
Turnover rate	5.4%	5.4%
Mortality rate (1)	RV-2009	RV-2009
Retirement age of women	60 years	60 years
Retirement age of men	65 years	65 years

(1) Mortality assumption tables prescribed for use by the Chilean Superintendence of Securities and Insurance.

12.2Personnel expenses

Personnel expenses included in the consolidated interim statement of income are as follows:

Description	06.30.2017	06.30.2016
	ThCh$	ThCh$
Wages and salaries	114,805,284	108,395,932
Employee benefits	24,797,021	24,020,896
Severance and post-employment benefits	2,967,670	2,876,045
Other personnel expenses	7,003,037	5,636,920
Total	149,573,012	140,929,793

12.3Number of Employees

	06.30.2017	06.30.2016
Number of employees	14,744	15,440
Number of average employees	15,199	15,820

51

NOTE 13 —  INVESTMENTS IN ASSOCIATES ACCOUNTED FOR USING THE EQUITY METHOD

13.1Balances

Investments in associates using equity method of accounting are detailed as follows:

Taxpayer		Country of	Functional	Carrying Value		Percentage interest
ID	Name	Incorporation	Currency	06.30.2017	12.31.2016	06.30.2017		12.31.2016
				ThCh$	ThCh$	%		%
86.881.400-4	Envases CMF S.A. (1)	Chile	Chilean peso	19,609,278	18,693,851	50.00	%	50.00	%
Foreign	Leao Alimentos e Bebidas Ltda. (2)	Brazil	Brazilian real	19,205,824	19,559,114	8.82	%	8.82	%
Foreign	Kaik Participacoes Ltda. (2)	Brazil	Brazilian real	1,383,455	1,364,444	11.32	%	11.32	%
Foreign	SRSA Participacoes Ltda.	Brazil	Brazilian real	234,655	258,928	40.00	%	40.00	%
Foreign	Sorocaba Refrescos S.A.	Brazil	Brazilian real	25,405,125	26,091,690	40.00	%	40.00	%
Foreign	Trop Frutas do Brasil Ltda. (2)	Brazil	Brazilian real	6,358,029	6,069,003	7.52	%	7.52	%
76.572.588-7	Coca Cola del Valle New Ventures S.A. (3)	Chile	Chilean peso	10,363,571	5,160,751	35.00	%	35.00	%
Foreign	Alimentos de Soya S.A. (4)	Argentina	Argentine Pesos	9,661,284	—	13.00	%	—
Foreign	UBI 3 Participacoes Ltda. (4)	Brazil	Brazilian real	4,304,083	—	8.50	%	—
Total				96,525,304	77,197,781

(1)In these company, regardless of the percentage of ownership interest, it was determined that no controlling interest was held, only a significant influence, given that there was not a majority vote of the Board of Directors to make strategic business decisions.

(2)In these companies, regardless of the percentage of ownership interest held, the Company has significant influence, given that it has a representative on each entity’s Board of Directors.

(3)On January 28, 2016, Embotelladora Andina S.A along with Coca-Cola de Chile S.A. and Coca-Cola Embonor S.A., formed the company Coca-Cola del Valle New Ventures S.A., whose main purpose will be the development and production of juices, waters and non-carbonated beverages under trade names of The Coca-Cola Company, that Andina and Coca-Cola Embonor S.A. are authorized to market and distribute in their respective franchise territories.

(4)Figures correspond to acquisition of ownership interest in companies producing “AdeS” products. These acquisitions are part of the “AdeS” business in accordance with the agreements established by The Coca Cola Company.

52

13.2Movement

The movement of investments in associates accounted for using the equity method is shown below:

Details	30.06.2017		12.31.2016
	ThCh$		ThCh$
Opening Balance	77,197,781		54,190,546
Other investment increases in associates (Capital Contribution Leão Alimentos e Bebidas Ltda.).	19.403.111		17,586,575
Dividends received			(750,806	)
Share in operating income	1,241,622		396,764
Unrealized income	82,843		85,266
Increase (Decrease) due to foreign currency translation differences	(1,400,053	)	5,689,436
Ending Balance	96,525,304		77,197,781

The main movements for the six months ended June 2017 and fiscal year ended December 31, 2016, are the following:

·On December 27, 2016, Coca-Cola Andina confirmed its decision to The Coca-Cola Company to participate in the “AdeS” business and commercialize said products in all of its franchised territories.  Consequently, on March 28, 2017, this operation materialized and pursuant to the agreements implied disbursing US$39 million, ThCh$14,153,111 assigned to purchasing rights in “AdeS” producing companies and ThCh$11,923,342 assigned to distribution rights of “AdeS” products. The rights acquired in the companies are distributed as follows:

·Purchase of a 13.0% ownership interest in the Argentinean company Alimentos de Soya S.A. for ThCh$9,661,283.

·Purchase of an 8.5% ownership interest in the Brazilian company UBI 3 Participacoes Ltda. for ThCh$4,491,828.

·During fiscal year 2016, Leão Alimentos e Bebidas Ltda. carried out a capital increase.  Rio de Janeiro Refrescos Ltda. participated in this capital increase regarding its ownership interest for an amount of ThCh$6,105,732.

·During fiscal year 2016, because of corporate restructuring, the Brazilian company Trop Frutas do Brasil Ltda., became part of bottler group of the Coca-Cola system in Brazil.  As a result, Rio de Janeiro Refrescos Ltda. holds a 7.52% direct ownership interest in that company through a capital contribution of ThCh$ 6,157,150.

·During 1H2017, Embotelladora Andina S.A. has made capital contributions to Coca-Cola del Valle New Ventures S.A. in the amount of ThCh$5,250,000 (ThCh$ 5,323,693 as of December 31, 2016).

·During the fiscal year 2016, Envases CMF S.A. distributed ThCh$750,806 in dividends.

·During 1H2017 and fiscal year ended December 2016, Sorocaba Refrescos S.A. did not distribute dividends.

53

13.3Reconciliation of share of profit in investments in associates:

Details	06.30.2017		06.30.2016
	ThCh$		ThCh$
Share of profit of investment accounted for using the equity method	1,241,622		546,329
Unrealized earnings in inventory acquired from associates and not sold at the end of period, presented as a discount in the respective asset account (containers and/or inventories)	(387,910	)	(359,518	)
Amortization of Fair Value in Vital Jugos S. A	82,843		42,633
Income Statement Balance	936,555		247,444

13.4Summary financial information of associates:

The attached table presents summarized information regarding the Company´s equity investees as of June 30, 2017:

	Envases CMF S.A.	Sorocaba Refrescos S.A.		Kaik Participacoes Ltda.	SRSA Participacoes Ltda.	Leao Alimentos e Bebidas Ltda.		Trop Frutas do Brasil Ltda.	Coca Cola del Valle New Ventures S.A.
	ThCh$	ThCh$		ThCh$	ThCh$	ThCh$		ThCh$	ThCh$
Total assets	62,594,756	116,894,998		12,221,686	586,637	292,116,490		85,016,051	29,609,302
Total liabilities	22,793,543	53,382,245		38	—	79,966,742		2,232,332	—
Total revenue	24,446,727	24,665,997		348,430	582,621	96,201,114		1,593,478	—
Net income (loss) of associate	1,665,167	(496,791	)	348,430	582,621	(614,358	)	1,752,874	(465,138	)
Reporting date	06/30/2017	06/30/2017		06/30/2017	06/30/2017	06/30/2017		06/30/2017	05/31/2017

54

NOTE 14 —  INTANGIBLE ASSETS AND GOODWILL

14.1Intangible assets other than goodwill

Intangible assets other than goodwill as of the end of each reporting period are detailed as follows:

	06-30-2017				12-31-2016
	Gross	Cumulative		Net	Gross	Cumulative		Net
Detail	Amount	Amortization		Amount	Amount	Amortization		Amount
	ThCh$	ThCh$		ThCh$	ThCh$	ThCh$		ThCh$
Distribution rights (1)	686,565,022	(75,309	)	686,489,713	674,920,063	—		674,920,063
Software	25,953,865	(20,441,758	)	5,512,107	24,954,998	(19,349,917	)	5,605,081
Water rights	520,060	(47,912	)	472,148	522,748	(51,830	)	470,918
Total	713,038,947	(20,564,979	)	692,473,968	700,397,809	(19,401,747	)	680,996,062

(1)Correspond to the contractual rights to produce and distribute Coca-Cola products in certain parts of Argentina, Brazil, Chile and Paraguay. Distribution rights result from the valuation process at fair value of the assets and liabilities of the companies acquired in business combinations. Production and distribution contracts are renewable for periods of 5 years with Coca-Cola. The nature of the business and renewals that Coca-Cola has permanently done on these rights, allow qualifying them as indefinite contracts. These production and distribution rights, and in conjunction with the assets that are part of the cash-generating units, are annually subjected to the impairment test. Such distribution rights are composed in the following manner and are not subject to amortization: except for the Monster rights that are amortized in the term of the agreement which is 4 years.

Distribution rights	06.30.2017	12.31.2016
	ThCh$	ThCh$
Chile (excluding Metropolitan Region, Rancagua and San Antonio)	305,011,417	301,127,305
Brazil (Rio de Janeiro, Espirito Santo, Riberao Preto and the investments in Sorocaba and Leão Alimentos e Bebidas Ltda.)	202,809,050	207,469,759
Paraguay	177,038,623	165,295,516
Argentina (North and South)	1,630,623	1,027,483
Total	686,489,713	674,920,063

The movement and balances of identifiable intangible assets are detailed as follows:

	01-01-2017 to 06-30-2017								01-01-2016 to 12-31-2016
	Distribution								Distribution
Details	Rights		Rights		Software		Total		Rights		Rights		Software		Total
	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Opening balance	674,920,063		470,918		5,605,081		680,996,062		658,625,624		476,643		6,564,388		665,666,655
Additions (1)	11,332,879		5,148		1,146,276		12,484,303		821,577	(2)	975		2,842,314		3,664,866
Amortization	(75,309	)	(3,918	)	(1,309,716	)	(1,388,943	)	—		(4,575	)	(3,207,309	)	(3,211,884	)
Other increases (decreases) (3)	312,000		—		70,466		382,546		15,472,862		(2,125	)	(594,312	)	14,876,425
Total	686,489,713		472,148		5,512,107		692,473,968		674,920,063		470,918		5,605,081		680,996,062

(1)Corresponds to distribution rights paid in Argentina, Paraguay and Chile resulting from the transaction in which The Coca-Cola Company acquired the “AdeS” business described in previous notes.

(2)During the second quarter of 2016 Embotelladora Andina S.A. began distributing of Monster products

(3)Mainly corresponds to the foreign currency effect of converting foreign subsidiaries’ distribution rights into the presentation currency.

55

14.2Goodwill

Goodwill is considered as the excess acquisition cost over fair value of the group´s ownership interest in identifiable net assets of the acquired subsidiary at the acquisition date.

14.2.1Measurement of recoverable goodwill value

Goodwill is annually reviewed but its recoverable value is checked during anticipated periods, if there are facts indicating a possible impairment. These signs may include new legal dispositions, changes in the economic environment affecting business operating performance indicators, movements in the competition, or the sale of a significant part of the cash-generating unit (CGU).

Management reviews business performance based on geographic segments.  Goodwill is monitored by operating segment that includes different cash generating units of the operations in Chile, Brazil, Argentina and Paraguay.  Impairment of distribution rights is geographically monitored at the CGU or group of cash generating units that correspond to specific territories for which Coca-Cola distribution rights have been acquired.  These cash generating units or groups of cash generating units are composed by:

·Regions in Chile (excluding Metropolitan Region, province of Rancagua and province of San Antonio)

·Argentina North

·Argentina South

·Brazil (state of Rio de Janeiro and Espirito Santo)

·Brazil (Ipiranga territories)

·Brazil: (investment in the associate Sorocaba)

·Brazil: (investment in the associate Leão Alimentos S.A.)

·Paraguay

In order to check if goodwill has suffered an impairment loss, the company compares its book value with its recoverable value, and an impairment loss is recognized for the excess of the book value amount of the asset over its recoverable amount. To determine the recoverable values of the CGU, management considers the discounted cash flow method as the most appropriate method.

56

14.2.2Main assumptions used in the annual test:

a.Discount rate:

The real discount rate applied in the annual test carried out in December 2016 was estimated with the Capital Asset Pricing Model, which allows estimating a discount rate according to the risk level of the CGU in the country where it operates.  A nominal discount rate before taxes is used according to the following table:

	Discount Rate
	2016
Argentina	20.5	%
Chile	7.9	%
Brazil	11.9	%
Paraguay	10.7	%

Management carries out the annual goodwill impairment test as of December 31 of each year for each CGU.

b.Other assumptions

Financial projections to determine the net value of future cash flows are modelled considering the main variables of the historical flows of the CGU, and approved budgets. In this sense, a conservative growth rate is used, which reach 3% for the soft drinks category and up to 7% for the less developed categories such as juices and water. Perpetuity growth rates between 2% and 2.5% depending on the level of per capita consumption of the products at each operation are set beyond the fifth year of projection. In this sense, the variables of greater sensitivity in these projections correspond to discount rates applied in order to determine the net present value of projected flows.

For the purpose of the impairment test, sensitivities were conducted in these critical variables according to the following:

·EBITDA Margin: corresponds to an increase or decrease of up to 150 bps of the EBITDA margin of the operations.

·Discount rate: corresponds to an increase or decrease of 150 bps in the discount rate of future cash flows

57

14.2.3Conclusions

As a result of the annual test for 2016, no impairments have been identified in any of the CGUs assuming conservative EBITDA margin projections and in line with the markets’ history.  As of June 30, 2017, there have been no signs of impairment.

Despite the deterioration of the macroeconomic conditions experienced by the economies of the countries where the cash generating units develop their operations, recovery values from the impairment test were higher than the book values of assets.

14.2.4Goodwill by business segment and country

Movement in Goodwill as of June 30, 2017 and December 31, 2016 is detailed as follows:

Operating segment	01.01.2017	Additions	Disposals or impairments	Foreign currency translation differences where functional currency is different from presentation currency		06.30.2017
	ThCh$	ThCh$	ThCh$	ThCh$		ThCh$
Chilean operation	8,503,023	—	—	—		8,503,023
Brazilian operation	81,145,834	—	—	(1,799,973	)	79,345,861
Argentine operation	5,972,515	—	—	(309,920	)	5,662,595
Paraguayan operation	7,298,133	—	—	213,495		7,511,628
Total	102,919,505	—	—	(1,896,398	)	101,023,107

Operating segment	01.01.2016	Additions	Disposals or impairments	Foreign currency translation differences where functional currency is different from presentation currency		12.31.2016
	ThCh$	ThCh$	ThCh$	ThCh$		ThCh$
Chilean operation	8,503,023	—	—	—		8,503,023
Brazilian operation	71,960,960	—	—	9,184,874		81,145,834
Argentine operation	7,720,202	—	—	(1,747,687	)	5,972,515
Paraguayan operation	7,651,751	—	—	(353,618	)	7,298,133
Total	95,835,936	—	—	7,083,569		102,919,505

58

NOTE 15 —  OTHER CURRENT AND NON-CURRENT FINANCIAL LIABILITIES

Liabilities are detailed as follows:

Current	06.30.2017	12.31.2016
	ThCh$	ThCh$
Bank loans	33,806,201	20,609,887
Bonds payable	23,654,283	26,729,828
Deposits in guarantee	13,713,301	13,446,077
Derivative contract obligations (see note 20)	138,068	1,229,354
Leasing agreements	2,344,436	2,785,424
Total	73,656,289	64,800,570

Non-current	06.30.2017	12.31.2016
	ThCh$	ThCh$
Bank loans	15,181,977	17,736,697
Bonds payable	680,764,590	685,684,184
Leasing agreements	16,721,905	18,149,706
Total	712,668,472	721,570,587

59

The fair value of financial assets and liabilities is presented below:

Current	Book Value 06.30.2017	Fair Value 06.30.2017	Book Value 12.31.2016	Fair Value 12.31.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Cash and cash equivalents (3)	132,214,537	132,214,537	141,263,880	141,263,880
Other financial assets (3)	23,274,264	23,274,264	60,152,627	60,152,627
Trade and other accounts receivable (3)	129,674,187	129,674,187	190,524,354	190,524,354
Accounts receivable from related companies (3)	3,194,794	3,194,794	5,788,683	5,788,683
Bank loans (1)	33,806,201	33,510,765	20,609,887	20,932,073
Bonds payable (2)	23,654,283	26,262,575	26,729,828	29,338,170
Deposits in guarantee (3)	13,713,301	13,713,301	13,446,077	13,446,077
Derivative contract obligations (see note 20)	138,068	138,068	1,229,354	1,229,354
Leasing agreements (3)	2,344,436	2,344,436	2,785,424	2,785,424
Trade and other accounts payable (3)	188,061,146	188,061,146	242,836,536	242,836,356
Accounts payable from related companies (3)	24,290,414	24,290,414	44,120,335	44,120,335

Non-current	06.30.2017	06.30.2017	12.31.2016	12.31.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Other financial assets (3)	75,426,997	75,426,997	80,180,880	80,180,880
Accounts receivable from related companies (3)	112,224	112,224	147,682	147,682
Bank loans (1)	15,181,977	12,519,610	17,736,697	14,365,502
Bonds payable (2)	680,764,590	754,916,043	685,684,184	752,078,561
Leasing agreements (3)	16,721,905	16,721,905	18,149,706	18,149,706

(1)The fair values are based on discounted cash flows using market-based discount rates as of the first half and year-end and are Level 2 fair value measurements.

(2)The fair value of corporate bonds are classified as a Level 1 fair value measurements based on quoted prices for the Company’s obligations.

(3)The fair value approximates book value considering the nature and term of the obligations.

60

15.1.1  Bank obligations, current

												Maturity		Total
Indebted Entity			Creditor Entity				Type	Effective		Nominal		Up to	90 days	at	at
Tax ID,	Name	Country	Tax ID,	Name	Country	Currency	Amortization	Rate		Rate		90 days	To 1 year	06.30.2017	12.31.2016
												ThCh$	ThCh$	ThCh$	ThCh$
96.705.990-0	Envases Central S.A.	Chile	97.006.000-6	Banco BCI	Chile	Unidad de fomento	Semiannually	3.43	%	3.43	%	—	663,050	663,050	655,752
96.705.990-0	Envases Central S.A.	Chile	97.006.000-6	Banco BCI	Chile	Chilean pesos	Monthly	7.20	%	7.20	%	192,280	—	192,280
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Banco de la Nación Argentina	Argentina	Argentine pesos	Monthly	20.00	%	20.00	%	65,663	11,983,584	12,049,247	—
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Banco Galicia y Bs. As.	Argentina	Argentine pesos	Monthly	20.00	%	20.00	%	65,663	3,994,528	4,060,191	—
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Banco de la Nación Argentina	Argentina	Argentine pesos	Monthly	20.00	%	20.00	%	22,982	2,796,170	2,819,152	—
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Banco Galicia y Bs. As.	Argentina	Argentine pesos	Quarterly	15.25	%	15.25	%	—	—	—	340
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Banco Macro Bansud	Argentina	Argentine pesos	Monthly	15.25	%	15.25	%	—	—	—	39,942
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	BBVA Banco Francés	Argentina	Argentine pesos	Monthly	15.25	%	15.25	%	—	—	—	34,861
Foreign	Andina Empaques S.A.	Argentina	Foreign	Banco Galicia y Bs. As.	Argentina	Argentine pesos	Monthly	15.25	%	15.25	%	1,407,905	—	1,407,905	335,722
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Alfa	Brazil	Brazilian real	Monthly	7.48	%	7.48	%	20,829	77,465	98,294	—
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Monthly	6.63	%	6.63	%	866,608	1,811,523	2,678,131	3,731,059
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Santander	Brazil	Brazilian real	Monthly	7.15	%	7.15	%	225,263	885,450	1,110,713	954,556
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Quarterly	4.50	%	4.50	%	2,078,936	686,405	2,765,341	2,839,713
Foreign	Sorocaba	Brazil	Foreign	Banco Itaú	Brazil	Dollars	Semiannually	2.99	%	2.99	%	—	5,961,897	5,961,897	12,017,942
Total														33,806,201	20,609,897

61

15.1.2  Bank obligations, non-current June 30, 2017

												Maturity
Indebted Entity			Creditor Entity				Type	Effective		Nominal		1 year up to	More 2 years	More 3 years	More 4 years Up to 5	More 5	at
Tx ID	Name	Country	Tx ID	Name	Country	Currency	Amortization	Rate		Rate		2 years	Up to 3 years	Up to 4 years	years	Years	06.30.2017
												ThCh$	ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Monthly	6.63	%	6.63	%	723,079	433,267	48,234	163,382	—	1,367,962
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Santander	Brazil	Brazilian real	Monthly	7.15	%	7.15	%	1,573,225	1,405,877	907,543	3,191,529	—	7,078,174
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Alfa	Brazil	Brazilian real	Monthly	7.48	%	7.48	%	164,612	164,612	164,612	823,061	—	1,316,897
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Quarterly	4.50	%	4.50	%	4,804,834	—	—	—	—	4,804,834
96.705.990-0	Envases Central S.A.	Chile	97.080.000-K	Banco Bice	Chile	Chilean pesos	Semiannually	3.43	%	3.43	%	614,110	—	—	—	—	614,110
Total																	15,181,977

62

15.1.2  Bank obligations, non-current December 31, 2016

Maturity

Indebted Entity

Creditor Entity

Type

Effective

Nominal

1 year up to

More than 2 years

More than 3 years

More than 4 years Up to 5

More than 5

at

Tax ID

Name

Country

Tax ID

Name

Country

Currency

Amortization

Rate

Rate

2 years

Up to 3 years

Up to 4 years

years

Years

12.31.2016

ThCh$

ThCh$

ThCh$

ThCh$

ThCh$

ThCh$

Foreign

Rio de Janeiro Refrescos Ltda.

Brazil

Foreign

Banco Itaú

Brazil

Brazilian real

Monthly

6.63

%

6.63

%

1,485,327

547,219

431,726

—

—

2,464,272

Foreign

Rio de Janeiro Refrescos Ltda.

Brazil

Foreign

Banco Santander

Brazil

Brazilian real

Monthly

7.15

%

7.15

%

1,985,981

3,042,278

2,832,515

158,490

—

8,019,264

Foreign

Rio de Janeiro Refrescos Ltda.

Brazil

Foreign

Banco Itaú

Brazil

Brazilian real

Quarterly

4.50

%

4.50

%

4,213,075

2,106,537

—

—

—

6,319,612

96.705.990-0

Envases Central S.A.

Chile

97.080.000-K

Banco Bice

Chile

Chilean pesos

Semiannually

3.43

%

3.43

%

933,549

—

—

—

—

933,549

Total

17,736,697

63

15.1.3  Restrictions

In general, the Company’s bank obligations are not subject to the fulfilment of covenants, with the exception of debt kept by the subsidiary Rio de Janeiro Refrescos Ltda. with Banco Itaú with maturity in 2017 at a 2.992% annual rate, which is primarily recorded under other current liabilities. The covenant associated with this debt is that: the gross debt deducting available cash must not exceed 2.5 times EBITDA at the annual closing date. As of December 31, 2016, the debt of Rio de Janeiro Refrescos Ltda reaches 2.35 times EBITDA according to the following details:

Items included in the indicator to the date of the last annual closing are:	ThR$
Borrowings with various third the Andina group	1,396,699
Cash and cash equivalents	127,029
EBITDA	540,227

64

15.2.1        Bonds payable

	Current				Non-current				Total
Composition of bonds payable	06.30.2017		12.31.2016		06.30.2017		12.31.2016		06.30.2017		12.31.2016
	ThCh$		ThCh$		ThCh$		ThCh$		ThCh$		ThCh$
Bonds (face value)	24,084,485		27,112,986		684,700,824		690,150,930		708,785,309		717,263,916
Expenses of bond issuance and discounts on placement	(430,202	)	(383,158	)	(3,936,234	)	(4,466,746	)	(4,366,436	)	(4,849,904	)
Net balance presented in statement of financial position	23,654,283		26,729,828		680,764,590		685,684,184		704,418,873		712,414,012

15.2.2     Current and non-current balances

Obligations with the public correspond to bonds in UF issued by the parent company on the Chilean market and bonds in US dollars issued by the parent company on the international market:

		Face	Unit of	Interest		final	Interest	Date Amortization of
	Series	amount	Adjustment	rate		Maturity	Payment	capital	06.30.2017	12.31.2016
									ThCh$	ThCh$
Bonds, current portion
SVS Registration N°640 SVS 08.23.2010	A	125,000	UF	3.0	%	08.15.2017	Semiannually	02.15.2017	3,370,154	6,660,552
SVS Registration N°254 SVS 06.13.2001	B	2,435,824	UF	6.5	%	06.01.2026	Semiannually	06.01.2016	5,882,616	5,656,992
SVS Registration N°641 08.23.2010	C	1,500,000	UF	4.0	%	08.15.2031	Semiannually	02.15.2021	590,803	587,020
SVS Registration N°759 08.20.2013	C	875,000	UF	3.5	%	08.16.2020	Semiannually	08.16.2017	6,969,862	6,929,828
SVS Registration N°760 08.20.2013	D	4,000,000	UF	3.8	%	08.16.2034	Semiannually	02.16.2032	1,505,751	1,487,844
SVS Registration N°760 04.02.2014	E	3,000,000	UF	3.75	%	03.01.2035	Semiannually	09.01.2032	990,715	978,933
Bonds USA	—	575,000,000	US$	5.0	%	10.01.2023	Semiannually	10.01.2023	4,774,584	4,811,817
Total current portion									24,084,485	27,112,986
Bonds non-current portion
SVS Registration N°254 SVS 06.13.2001	B	2,435,824	UF	6.5	%	06.01.2026	Semiannually	06.01.2017	59,415,128	61,486,857
SVS Registration N°641 08.23.2010	C	1,500,000	UF	4.0	%	08.15.2031	Semiannually	02.15.2021	39,997,635	39,521,970
SVS Registration N°759 08.20.2013	C	875,000	UF	3.5	%	08.16.2020	Semiannually	08.16.2017	16,665,681	19,760,985
SVS Registration N°760 08.20.2013	D	4,000,000	UF	3.8	%	08.16.2034	Semiannually	02.16.2032	106,660,360	105,391,920
SVS Registration N°760 04.02.2014	E	3,000,000	UF	3.75	%	03.01.2035	Semiannually	09.01.2032	79,995,270	79,043,948
Bonds USA	—	575,000,000	US$	5.0	%	10.01.2023	Semiannually	10.01.2023	381,966,750	384,945,250
Bonds non-current portion									684,700,824	690,150,930

Accrued interest included in the current portion of bonds totaled ThCh$8,548,735 and ThCh$8,646,270 at June 30, 2017 and December 31, 2016, respectively.

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15.2.3Non-current maturities

		Year of maturity				Total non- current
	Series	2017	2018	2019	After	6/30/2017
		ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
SVS Registration N°254 06.13.2001	B	5,896,197	6,279,449	6,687,614	40,551,868	59,415,128
SVS Registration N°641 08.23.2010	C	—		1,818,074	38,179,561	39,997,635
SVS Registration N°759 08.20.2013	C	6,666,273	6,666,273	3,333,135	—	16,665,681
SVS Registration N°760 08.20.2013	D	—	—	—	106,660,360	106,660,360
SVS Registration N°760 04.02.2014	E	—	—	—	79,995,270	79,995,270
Bonds USA	—	—	—	—	381,966,750	381,966,750
Total		12,562,470	12,945,722	11,838,823	647,353,809	684,700,824

15.2.4Market rating

The bonds issued on the Chilean market had the following rating as of June 30, 2017:

AA:ICR Compañía Clasificadora de Riesgo Ltda. rating

AA:Fitch Chile Clasificadora de Riesgo Limitada rating

The rating of bonds issued on the international market as of June 30, 2017, is the following:

BBB:Standard&Poors rating

BBB+:Fitch Chile Clasificadora de Riesgo Limitada rating.

15.2.5Restrictions

15.2.5.1Restrictions regarding bonds placed abroad.

On September 26, 2013, Andina issued a bond in the U.S. Market (Bonds USA) for US$575 million at a coupon rate of 5.0% maturing on October 1, 2023.  These bonds do not have financial restrictions.

15.2.5.2Restrictions regarding bonds placed in the local market.

For purposes of the calculation of the covenants, the amount of EBITDA that was agreed on each bond issue is included.

Restrictions regarding the issuance of bonds for a fixed amount registered under number 254.

The outstanding series as of June 30, 2017, is Series B for a nominal amount of up to UF 4 million, of which amount UF 3.7 million in bonds were placed with final maturity in the year 2026 at a 6.50%  annual interest rate. The balance of outstanding capital as of June 30, 2017 is UF 2.436 million.

Series B was issued with charge to the bonds line registered with the Securities Registered under number 254 dated June 13, 2001.

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Regarding Series B, the Issuer is subject to the following restrictions:

·Maintain an indebtedness level where Consolidated Financial Liabilities to Consolidated Equity does not exceed 1.20 times. For these purposes Consolidated Financial Liabilities shall be regarded as Liabilities Receivables accruing interest, namely: (i) other current financial liabilities, plus (ii) other non-current financial liabilities, less (iii) asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Interim Financial Statements. Consolidated Equity will be regarded as total equity including non-controlling interest.

As of June 30, 2017, indebtedness level is 0.83 times of Consolidated Equity.

The breakdown of accounts with the respective amounts used for the previous calculation is detailed as follows (in thousand Chilean pesos):

As of June 30, 2017, the values of items included in this indicator are the following:	ThCh$
Other current financial liabilities	73,656,289
Other non-current financial liabilities	712,668,472
(-) Other non-current financial assets (hedge derivatives)	(77,710,922	)
Consolidated Equity	849,290,949

·Maintain, and in no manner lose, sell, assign or transfer to a third party, the geographical area currently denominated as the “Metropolitan Region” (Región Metropolitana) as a territory in Chile in which we have been authorized by The Coca-Cola Company for the development, production, sale and distribution of products and brands of the licensor, in accordance to the respective bottler or license agreement, renewable from time to time.

·Not lose, sell, assign, or transfer to a third party any other territory of Argentina or Brazil, which as of this date is franchised by TCCC to the Company for the development, production, sale and distribution of products and brands of such licensor, as long as any of these territories account for more than 40% of the Issuer’s Adjusted Consolidated Operating Cash Flow.

·Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.30 times of the issuer’s unsecured consolidated liabilities.

Unsecured consolidated liabilities payable shall be regarded as the total liabilities, obligations and debts of the issuer that are not secured by real guarantees on goods and assets of the latter, voluntarily and conventionally constituted by the issuer less the asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Statement of Financial Position.

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The following will be considered in determining Consolidated Assets:  assets free of any pledge, mortgage or other lien, as well as those assets having a pledge, mortgage or real encumbrances that operate solely by law, less asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Statement of Financial Position. Therefore, Consolidated Assets free of any pledge, mortgage or other lien will only be regarded as those assets free of any pledge, mortgage or other real lien voluntarily and conventionally constituted by the issuer less asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities and under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Statement of Financial Position.

As of June 30, 2017, this index is 1.67 times.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this restriction are the following:	ThCh$
Consolidated assets free of collateral, mortgages or other liens	2,068,340,986
(-)Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Consolidated Assets free of pledges, mortgages or other liens (adjusted)	1,990,630,064
Consolidated liabilities payable not guaranteed	1,269,361,053
(-) Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Unsecured Consolidated Liabilities Payable (adjusted)	1,191,650,131

Restrictions regarding bond lines registered in the Securities Registered under numbers 640 and 641.

Because of our merger with Coca-Cola Polar S.A., Andina became a debtor of the following two bonds placed in the Chilean market in 2010:

·UF 1.0 million of Series A bonds due 2017, bearing an annual interest of 3.00%. As of June 30, 2017, the balance of outstanding capital is UF 0.125 million.

·UF 1.5 million of Series C bonds due 2031, bearing an annual interest rate of 4.00%. As of June 30, 2017, the balance of outstanding capital is UF 1.5 million.

Series A and Series C were issued with charge to the Bond Lines registered with the Securities Registrar, under numbers 640 and 641, respectively, both on August 23, 2010.

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Regarding Series A and Series C, the Issuer is subject to the following restrictions:

·Maintain a level of “Net Financial Debt” within its quarterly financial statements that may not exceed 1.5 times, measured over figures included in its consolidated statement of financial position.   To this end, net financial debt shall be defined as the ratio between net financial debt and total equity of the issuer (equity attributable to controlling owners plus non-controlling interest). On its part, net financial debt will be the difference between the Issuer’s financial debt and cash.

As of June 30, 2017, Net Financial Debt was 0.65 times.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this restriction are the following:	ThCh$
Other current financial liabilities	73,656,289
Other non-current financial liabilities	712,668,472
(-) Cash and cash equivalent	(132,214,537	)
(-) Other current financial assets	(23,274,264	)
(-) Other non-current financial assets (hedge derivatives)	(75,426,075	)
Consolidated Equity	849,290,949

·Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.30 times of the issuer’s unsecured consolidated liabilities.

Unencumbered assets refer to the assets that meet the following conditions: are the property of the issuer; classified under Total Assets of the Issuer’s Financial Statements; and that are free of any pledge, mortgage or other liens constituted in favor of third parties, less “Other Current Financial Assets” and “Other Non-Current Financial Assets” of the Issuer’s Financial Statements (to the extent they correspond to asset balances of derivative financial instruments, taken to hedge exchange rate and interest rate risk of the financial liabilities).

Unsecured total liabilities corresponds to: liabilities from Total Current Liabilities and Total Non-Current Liabilities of Issuer’s Financial Statement which do not benefit from preferences or privileges, less “Other Current Financial Assets” and “Other Non-Current Financial Assets” of the Issuer’s Financial Statements (to the extent they correspond to asset balances of derivative financial instruments, taken to hedge exchange rate and interest rate risk of the financial liabilities).

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As of June 30, 2017, this index is 1.67 times.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this restriction are the following:	ThCh$
Consolidated assets free of collateral, mortgages or other liens	2,068,340,986
(-)Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Consolidated Assets free of pledges, mortgages or other liens (adjusted)	1,990,630,064
Consolidated liabilities payable not guaranteed	1,269,361,053
(-) Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Unsecured Consolidated Liabilities Payable (adjusted	1,191,650,131

·Maintain a level of “Financial net coverage” in its quarterly financial statements of more than 3 times. Net financial coverage means the ratio between the Issuer’s Ebitda for the past 12 months and net financial expenses (financial income less financial expenses) of the issuer for the past 12 months. However, this restriction will be considered breached when the mentioned net financial coverage level is lower than the level previously indicated during two consecutive quarters.

As of June 30, 2017 Net Financial Coverage level is 7.07 times.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this indicator are the following:	ThCh$
(+) Consolidated Ebitda between January 1 and June 30, 2017	153,305,153
(+) Consolidated Ebitda between January 1 and December 31, 2016	288,238,888
(-) Consolidated Ebitda between January 1 and June 30, 2016	136,362,988
Consolidated Ebitda twelve months (between July 1, 2016 and June 30, 2017) (1)	305,181,053
(+) Consolidated Financial income between January 1 and June 30, 2017	6,048,873
(+) Consolidated Financial income between January 1 and December 31, 2016	9,661,692
(-) Consolidated Financial income between January 1 and June 30, 2016	5,417,202
Consolidated Financial income twelve months (between July 1, 2016 and June 30, 2017)	10,293,363
(+) Consolidated Financial expenses between January 1 and June 30, 2017	27,248,142
(+) Consolidated Financial expenses between January 1 and December 31, 2016	51,374,971
(-) Consolidated Financial expenses between January 1 and June 30 , 2016	25,149,409
Consolidated Financial expenses twelve months (between July 1, 2016 and June 30, 2017)	53,473,704

(1)For the purpose of calculating the covenant, EBITDA was calculated as agreed in the bond issue.

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Restrictions regarding bond lines registered in the Securities Registrar under numbers 759 and 760.

During 2013 and 2014, Andina placed local bonds in the Chilean market. The issuances were structured into three series.

·Series C outstanding as of June 30, 2017, for a nominal value of up to UF 3 million, of which bonds were placed for a nominal amount of UF1.0 million with final maturity during year 2020 at an annual interest rate of 3.50% issued against line number 759.  Outstanding capital as of June 30, 2017, is UF 0.875 million.

·Series D and E outstanding as of June 30, 2017, for a total nominal value of UF 8 million, of which UF 4 million were placed in bonds during August, 2013 (series D) and UF 3 million during April, 2014 (series E), with final maturity in 2034 and 2035, respectively, issued with charge against line number 760.  The annual interest rates are 3.8% for Series D and 3.75% for Series E. The outstanding capital balance as of June 30, 2017, of both series amounts to UF 7.0 million.

Regarding Series C, D and E, the Issuer is subject to the following restrictions:

·Maintain an indebtedness level where Consolidated Financial Liabilities to Consolidated Equity does not exceed 1.20 times. For these purposes Consolidated Financial Liabilities shall be regarded as Liabilities Receivables accruing interest, namely: (i) other current financial liabilities, plus (ii) other non-current financial liabilities, less (iii) cash and cash equivalent and (iv) other current financial assets, and (v) other non-current financial assets (to the extent they are asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities). Consolidated Equity will be regarded as total equity including non-controlling interest.

As of June 30, 2017, Indebtedness Level is 0.65 times of Consolidated Equity.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this restriction are the following:	ThCh$
Other current financial liabilities	73,656,289
Other non-current financial liabilities	712,668,472
(-) Cash and cash equivalent	(132,214,537	)
(-) Other current financial assets	(23,274,264	)
(-) Other non-current financial assets (hedge derivatives)	(75,426,075	)
Consolidated Equity	849,290,949

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·Maintain consolidated assets free of any pledge, mortgage or other encumbrances for an amount at least equal to 1.30 times of the issuer’s unsecured consolidated liabilities payable.

Unsecured Consolidated Liabilities Payable shall be regarded as the total liabilities, obligations and debts of the issuer that are not secured by real guarantees on goods and assets of the latter, voluntarily and conventionally constituted by the issuer less the asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Statement of Financial Position.

The following will be considered in determining Consolidated Assets:  assets free of any pledge, mortgage or other lien, as well as those assets having a pledge, mortgage or real encumbrances that operate solely by law, less asset balances of derivative financial instruments, taken to hedge exchange rate or interest rate risks on financial liabilities under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Interim Financial Statements. Therefore, Consolidated Assets free of any pledge, mortgage or other lien will only be regarded as those assets free of any pledge, mortgage or other real lien voluntarily and conventionally constituted by the issuer less asset balances of derivative financial instruments, taken to cover exchange rate or interest rate risks on financial liabilities and under “Other Current Financial Assets” and “Other non-current Financial Assets” of the Issuer’s Consolidated Statement of Financial Position.

As of June 30, 2017, this index is 1.67 times.

The accounts with the respective amounts used for the previous calculation are detailed as follows:

As of June 30, 2017, the values of items included in this restriction are the following:	ThCh$
Consolidated assets free of collateral, mortgages or other liens	2,068,340,986
(-)Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Consolidated Assets free of pledges, mortgages or other liens (adjusted)	1,990,630,064
Consolidated liabilities payable not guaranteed	1,269,361,053
(-) Other current and non-current financial assets (hedge derivatives)	(77,710,922	)
Unsecured Consolidated Liabilities Payable (adjusted)	1,191,650,131

·Maintain, and in no manner lose, sell, assign or transfer to a third party, the geographical area currently denominated as the “Metropolitan Region” as a territory franchised to the Issuer in Chile by The Coca-Cola Company, hereinafter also referred to as “TCCC” or the “Licensor” for the development, production, sale and distribution of products and brands of said licensor, in accordance to the respective bottler or license agreement, renewable from time to time. Losing said territory, means the non-renewal, early termination or cancellation of this license agreement by TCCC, for the geographical area today called “Metropolitan Region”. This reason shall not apply if, as a result of the loss, sale, transfer or disposition, of that licensed territory is purchased or acquired by a subsidiary or an entity that consolidates in terms of accounting with the Issuer.

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·Not lose, sell, assign, or transfer to a third party any other territory of Argentina or Brazil, which as of the issuance date of these instruments is franchised by TCCC to the Issuer for the development, production, sale and distribution of products and brands of such licensor, as long as any of these territories account for more than 40% of the Issuer’s Adjusted Consolidated Operating Cash Flow of the audited period immediately before the moment of loss, sale, assignment or transfer.  For these purposes, the term “Adjusted Consolidated Operating Cash Flow” shall mean the addition of the following accounting accounts of the Issuer’s Consolidated Statement of Financial Position: (i) “Gross Profit” which includes regular activities and cost of sales; less (ii) “Distribution Costs”; less (iii) “Administrative Expenses”; plus (iv) “Participation in profits (losses) of associates and joint ventures that are accounted for using the equity method”; plus (v) “Depreciation”; plus (vi) “Intangibles Amortization”.

As of June 30, 2017 and December 31, 2016, the Company complies with all financial collaterals.

15.2.6Repurchased bonds

In addition to UF bonds, the Company holds bonds that it has repurchased in full through companies that are included in the consolidation:

Through its subsidiaries, Abisa Corp S.A. (formerly Pacific Sterling), Embotelladora Andina S.A. repurchased its Bonds USA issued on the U.S. Market during the years 2000, 2001, 2002, 2007 and 2008. The entire placement amounted to US$350 million, of which US$200 million are outstanding as of December 31, 2013. On December 15, 2014, Embotelladora Andina S.A. rescued US$200 million in outstanding bonds from its subsidiary Abisa Corp S.A., thus since legally debtor and creditor are joined in a single entity, the mentioned bond liability becomes extinguished.

The subsidiary Rio de Janeiro Refrescos Ltda. maintains a liability corresponding to a bond issuance for US $75 million due in December 2020 and semi-annual interest payments. As of June 30, 2017, these issues are held by Andina. On January 1, 2013, Abisa Corp S.A. transferred the totality of this asset to Embotelladora are Andina S.A., the latter becoming the creditor of the above-mentioned Brazilian subsidiary. Consequently, the assets and liabilities related to the transaction have been eliminated from these consolidated interim financial statements. In addition, the transaction has been treated as a net investment of the group in the Brazilian subsidiary; consequently, the effects of exchange rate differences between the dollar and the functional currency of each one have been recorded in other comprehensive income.

15.3.1Derivative contract obligations

Please see details in Note 20.

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15.4.1Current liabilities for leasing agreements

											Maturity		Total
Indebted Entity		Creditor Entity				Amortization	Effective		Nominal		Up to	90 days to	at	At
Name	Country	Tax ID	type	Type	Currency	Type	rate		rate		90 days	1 year	06.30.2017	12.31.2016
											ThCh$	ThCh$	ThCh$	ThCh$
Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Monthly	10.215	%	10.227	%	27,496	43,849	71,345	110,732
Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Santander	Brazil	Brazilian real	Monthly	9.65	%	9.47	%	170,782	626,086	796,868	1,016,705
Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Citibank	Brazil	Brazilian real	Monthly	8.54	%	8.52	%	184,102	514,860	698,962	872,247
Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Cogeracao Light Esco	Brazil	Brazilian real	Monthly	1.00	%	12.28	%	159,531	508,909	668,440	674,127
Embotelladora del Atlántico S.A.	Argentina	Foreign	Tetra Pak SRL	Argentina	Dollars	Monthly	12.00	%	12.00	%	26,000	82,821	108,821	103,314
Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Bradesco	Brazil	Brazilian real	Monthly	9.39	%	9.38	%	—	—	—	8,299
Total													2,344,436	2,785,424

15.4.2Non-current liabilities for leasing agreements June 30, 2017

												Maturity
Indebted Entity			Creditor Entity				Amortization	Effective		Nominal		1 year to	2 years to	3 years to	4 years to	More	at
Tx ID	Name	Country	Tax ID	Name	type	Currency	Type	rate		Rate		2 years	3 years	4 years	5 years	5 years	06.30.2017
												ThCh$	ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Monthly	10.21	%	10.22	%	34,136	—	—	—	—	34,136
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Santander	Brazil	Brazilian real	Monthly	9.65	%	9.47	%	219,476	—	—	—	—	219,476
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Citibank	Brazil	Brazilian real	Monthly	8.54	%	8.52	%	363,851	—	—	—	—	363,851
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Cogeracao Light Esco	Brazil	Brazilian real	Monthly	13.00	%	12.28	%	755,414	853,605	964,447	1,089,948	12,143,028	15,806,442
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Tetra Pak SRL	Argentima	Dollars	Monthly	12.00	%	12.00	%	298,000	—	—	—	—	298,000
Total																	16,721,905

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15.4.2  Non-current liabilities for leasing agreements December 31, 2016

												Maturity
Indebted Entity			Creditor Entity				Amortization	Effective		Nominal		1 year to	2 years to	3 years to	4 years to	More	at
Tax ID	Name	Country	Tax ,ID	Name	type	Currency	Type	rate		Rate		2 years	3 years	4 years	5 years	5 years	12.31.2016
												ThCh$	ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Cogeracao Light Esco	Brazil	Brazilian real	Monthly	13.00	%	12.28	%	2,476,445	2,234,004	2,138,183	2,138,183	7,535,257	16,522,072
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Santander	Brazil	Brazilian real	Monthly	9.65	%	9.47	%	591,576	—	—	—	—	591,576
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Itaú	Brazil	Brazilian real	Monthly	10.21	%	10.22	%	54,327	—	—	—	—	54,327
Foreign	Rio de Janeiro Refrescos Ltda.	Brazil	Foreign	Banco Citibank	Brazil	Brazilian real	Monthly	8.54	%	8.52	%	624,937	—	—	—	—	624,937
Foreign	Embotelladora del Atlántico S.A.	Argentina	Foreign	Tetra Pak SRL	Argentina	Dollars	Monthly	12.00	%	12.00	%	356,794	—	—	—	—	356,794
Total																	18,149,706

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NOTE 16 —   TRADE AND OTHER CURRENT ACCOUNTS PAYABLE

Trade and other current accounts payable are detailed as follows:

Item	06.30.2017	12.31.2016
	ThCh$	ThCh$
Trade accounts payable	139,746,477	179,246,672
Withholdings tax	32,859,921	45,504,119
Accounts payable Inamar Ltda. (1)	8,099,521	8,312,403
Others	16,785,371	19,282,989
Total	197,491,290	252,346,183
Current	188,061,146	242,836,356
Non-current	9,430,144	9,509,827
Total	197,491,290	252,346,183

The Company maintains commercial lease agreements for forklifts, vehicles, properties and machinery.  These lease agreements have an average duration of one to eight years excluding renewal options. No restrictions exist with respect to the lessee by virtue of these lease agreements.

Accruable liabilities pursuant to the Company’s operating leasing agreements are detailed as follows:

	ThCh$
Maturity within one year	961,968
Maturity long-term	8,133,019
Total	9,094,987

Total expenses related to operating leases maintained by the Company as of June 30, 2017 and 2016, amounted to ThCh$1,557,848 and ThCh$1,617,806 respectively.

(1)On December 3, 2015, a land was purchased from Industrias Metalurgicas Inamar Ltda. for an amount of ThCh$17,292,040 equivalent to UF 675,000, of which there is an approximate balance of ThUF 303. To guarantee the payment of this obligation the land has been mortgaged to in favor of Industrias Metalurgicas Inamar Ltda.

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NOTE 17 —  CURRENT AND NON-CURRENT PROVISIONS

17.1           Balances

This account is detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Litigation (1)	74,203,527	73,081,893
Total	74,203,527	73,081,893

(1)Corresponds to the provision for probable fiscal, labor and trade contingency losses based on the opinion of our legal advisors, detailed as follows:

Detail (see note 21.1)	06.30.2017	12.31.2016
	ThCh$	ThCh$
Tax Contingencies	60,792,789	63,543,782
Labor Contingencies	9,411,321	7,940,428
Civil Contingencies	3,999,417	1,597,683
Total	74,203,527	73,081,893

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17.2           Movements

Movement of provisions is detailed as follows:

	06.30.2017					12.31.2016
Description	Litigation		Others	Total		Litigation		Others	Total
	ThCh$		ThCh$	ThCh$		ThCh$		ThCh$	ThCh$
Opening Balance as of January 01	73,081,893		—	73,081,893		64,301,817		—	64,301,817
Additional provisions	605,252		—	605,252		1,047,308		—	1,047,308
Increase (decrease) in existing provisions	(4,608,144	)	—	(4,608,144	)	(1,519,800	)	—	(1,519,800	)
Payments	6,654,531		—	6,654,531		4,276,851		—	4,276,851
Reverse unused provision(*)	144,189		—	144,189		(2,774,703	)	—	(2,774,703	)
Increase (decrease) due to foreign exchange differences	(1,674,194	)	—	(1,674,194	)	7,750,420		—	7,750,420
Total	74,203,527		—	74,203,527		73,081,893		—	73,081,893

(*) Corresponds to reversal of provisions for fines requested from the Brazilian Tax authorities on the use of fiscal credits IPI in the free zone of Manaus, since during September 2016 there was favorable ruling on the subject for Rio de Janeiro Refrescos Ltda. from Brazil’s Superior Chamber of Fiscal Resources (CSFR).

NOTE 18 —   OTHER CURRENT AND NON-CURRENT NON-FINANCIAL LIABILITIES

Other current and non-current liabilities at each reporting period end are detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Minimal Dividend		—
Dividend payable	19,379,426	19,358,263
Other	2,809,439	1,413,318
Total	22,188,865	20,771,581
Current	22,188,865	20,612,791
Non-current	—	158,790
Total	22,188,865	20,771,581

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NOTE 19 —   EQUITY

19.1Number of shares:

	Number of shares subscribed		Number of shares paid in		Number of voting shares
Series	2017	2016	2017	2016	2017	2016
A	473,289,301	473,289,301	473,289,301	473,289,301	473,289,301	473,289,301
B	473,281,303	473,281,303	473,281,303	473,281,303	473,281,303	473,281,303

19.1.1Equity:

	Subscribed Capital		Paid-in capital
Series	2017	2016	2017	2013
	ThCh$	ThCh$	ThCh$	ThCh$
A	135,379,504	135,379,504	135,379,504	135,379,504
B	135,358,070	135,358,070	135,358,070	135,358,070
Total	270,737,574	270,737,574	270,737,574	270,737,574

19.1.2Rights of each series:

·Series A : Elect 12 of the 14 Directors

·Series B : Receives an additional 10% of dividends distributed to Series A and elects 2 of the 14 Directors.

19.2Dividend policy

According to Chilean law, cash dividends must be paid equal to at least 30% of annual net profit, barring a unanimous vote by shareholders to the contrary. If there is no net profit in a given year, the Company will not be legally obligated to pay dividends from retained earnings. At the ordinary Shareholders’ Meeting held in April 2017, the shareholders agreed to pay out of the 2016 earnings are final dividend to complete the 30% required by the Law 18,046 which was paid in May 2017, and an additional dividend will be paid in August 2017.

Pursuant to Circular Letter N° 1,945 of the Chilean Superintendence of Securities and Insurance dated September 29, 2009, the Company’s Board of Directors decided to maintain the initial adjustments from adopting IFRS as retained earnings for future distribution.

Accumulated earnings at the date of IFRS adoption as of January 1, 2009, amounted to ThCh$ 19,260,703, of which ThCh$ 8,533,065 have been realized as of June 30, 2017, and are available for distribution as dividends in accordance with the following:

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Description	Event when amount is realized	Amount of accumulated earnings at 01.01.2009		Realized at 06.30.2017		Amount of accumulated earnings at 06.30.2017
		ThCh$		ThCh$		ThCh$
Revaluation of assets parent Company	Sale or impairment	14,800,384		(11,904,595	)	2,895,789
Foreign currency translation differences of investments in related companies and subsidiaries	Sale or impairment	4,653,301		2,866,222		7,519,523
Full absorption cost accounting parent Company	Sale of products	305,175		(305,175	)	—
Post-employment benefits actuarial calculation parent Company	Termination of employees	946,803		(634,477	)	312,326
Deferred taxes complementary accounts parent Company	Amortization	(1,444,960	)	1,444,960		—
Total		19,260,703		(8,533,065	)	10,727,638

The dividends declared and paid per share are presented below:

Dividend payment date		Dividend type	Profits imputable to dividends	Ch$ per Series A Share	Ch$ per Series B Share
2015	January	Interim	2014	9.00	9.90
2015	May	Final	2014	15.00	16.50
2015	August	Additional	Retained Earnings	15.00	16.50
2015	October	Interim	2015	15.00	16.50
2016	January	Interim	2015	17.00	18.70
2016	May	Final	2015	17.00	18.70
2016	August	Additional	Retained Earnings	17.00	18.70
2016	October	Interim	2016	17.00	18.70
2017	January	Interim	2016	19.00	20.90
2017	May	Final	2016	19.00	20.90

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19.3           Reserves

The balance of other reserves include the following:

Description	06.30.2017		12.31.2016
	ThCh$		ThCh$
Polar acquisition	421,701,520		421,701,520
Foreign currency translation reserves	(174,050,858	)	(168,744,355	)
Cash flow hedge reserve	(4,569,261	)	(2,448,175	)
Reserve for employee benefit actuarial gains or losses	(1,896,877	)	(1,785,032	)
Legal and statutory reserves	5,435,538		5,435,538
Total	246,620,062		254,159,496

19.3.1        Polar acquisition

This amount corresponds to the fair value of the issuance of shares of Embotelladora Andina S.A., used to acquire Embotelladoras Coca-Cola Polar S.A., which was the value of the capital increase notarized in legal terms.

19.3.2        Cash flow hedge reserve

They arise from the fair value of the existing derivative contracts that have been qualified for hedge accounting at the end of each financial period. When contracts are expired, these reserves are adjusted and recognized in the income statement in the corresponding period (see Note 20).

19.3.3        Reserve for employee benefit actuarial gains or losses

Corresponds to the restatement effect of employee benefits actuarial losses that according to IAS 19 amendments must be carried to other comprehensive income.

19.3.4        Legal and statutory reserves

The balance of other reserves is established throught he following concept:

In accordance with Official Circular No. 456 issued by the Chilean Superintendence of Securities and Insurance, the legally required price-level restatement of paid-in capital for 2009 is presented as part of other equity reserves and is accounted for as a capitalization from Other Reserves with no impact on net income or retained earnings under IFRS. This amount totaled ThCh$ 5,435,538 as of December 31, 2009

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19.3.5        Foreign currency translation reserves

This corresponds to the conversion of the financial statements of foreign subsidiaries whose functional currency is different from the presentation currency of the consolidated interim financial statements. Additionally exchange differences between accounts receivable kept by the companies in Chile with foreign subsidiaries are presented in this account, which have been treated as investment equivalents accounted for using the equity method. Translation reserves are detailed as follows:

Details	06.30.2017		12.31.2016
	ThCh$		ThCh$
Brazil	(64,780,518	)	(58,306,230	)
Argentina	(113,692,691	)	(108,386,213	)
Paraguay	17,807,799		10,545,453
Exchange rate differences in related companies	(13,385,448	)	(12,597,365	)
Total	(174,050,858	)	(168,744,355	)

The movement of this reserve for the fiscal years ended June 30, 2017 and December 31, 2016, is detailed as follows:

Details	06.30.2017		12.31.2016
	ThCh$		ThCh$
Brazil	(6,474,288	)	30,138,065
Argentina	(5,306,478	)	(23,472,215	)
Paraguay	7,262,346		(11,183,004	)
Exchange rate differences in related companies	(788,083	)	3,219,956
Total	(5,306,503	)	(1,297,198	)

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19.4           Non-controlling interests

This is the recognition of the portion of equity and income from subsidiaries owned by third parties. As of June 30, 2017 and December 31, 2016, this account is detailed as follows:

	Non-controlling Interests
	Ownership %		Shareholders’ Equity		Income
Details	2017	2016	June 30, 2017	December 31, 2016	June 30, 2017	December 31, 2016
			ThCh$	ThCh$	ThCh $	ThCh $
Embotelladora del Atlántico S.A.	0.0171	0.0171	14,911	12,209	2,907	1,823
Andina Empaques Argentina S.A.	0.0209	0.0209	2,292	2,062	355	277
Paraguay Refrescos S.A.	2.1697	2.1697	5,200,191	5,337,687	230,898	153,210
Vital S.A.	35.0000	35.0000	9,218,851	9,054,947	128,917	80,894
Vital Aguas S.A.	33.5000	33.5000	2,165,149	2,027,879	129,449	91,670
Envases Central S.A.	40.7300	40.7300	5,518,424	5,129,661	179,154	195,796
Total			22,119,818	21,564,445	671,680	523,670

19.5           Earnings per share

The basic earnings per share presented in the statement of comprehensive income is calculated as the quotient between income for the period and the average number of shares outstanding during the same period.

Earnings per share used to calculate basic and diluted earnings per share is detailed as follows:

	06.30.2017
Earnings per share	SERIES A	SERIES B	TOTAL
Earnings attributable to shareholders (ThCh$)	25,001,701	27,501,428	52,503,129
Average weighted number of shares	473,289,301	473,281,303	946,570,604
Earnings per basic and diluted share (in Chilean pesos)	52.83	58.11	55.47

	03.31.2016
Earnings per share	SERIES A	SERIES B	TOTAL
Earnings attributable to shareholders (ThCh$)	18,266,299	20,092,605	38,858,904
Average weighted number of shares	473,289,301	473,281,303	946,570,604
Earnings per basic and diluted share (in Chilean pesos)	38.59	42.45	40.52

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NOTE 20 —   DERIVATIVE ASSETS AND LIABILITIES

Embotelladora Andina currently maintains “Cross Currency Swaps” and “Currency Forward” agreements as Derivative Financial Assets.

Cross Currency Swaps, also known as interest rate and currency swaps, are valued by the method of discounted future cash flows at a rate corresponding to the risk of the operation. The basis of the information used in the calculations is obtained in the market by using the Bloomberg terminal. Currently Embotelladora Andina maintains Cross Currency Swap for UF/USD and BRL/USD, for which it is necessary to discount future cash flows in UFs, in Brazilian Reais and in U.S. Dollars. For this calculation, the Company uses as discount curves, the UF Zero-Coupon, the Brazilian Real Zero-Coupon and the U.S. Dollar Zero-Coupon.

On the other hand, the fair value of forward currency contracts is calculated in reference to current forward exchange rates for contracts with similar maturity profiles. To perform the above calculation, the Company uses market information available on the Bloomberg terminal.

As of the closing dates as of June 30, 2017 and December 31, 2016, the Company held the following derivative instruments :

20.1     Derivatives accounted for as cash flow hedges:

a)Cross Currency Swap Itau Credit.

As of June 30, 2017, the Company maintained derivative contracts to ensure U.S. dollar denominated bank liabilities in Brazil amounting to ThUS$8,975, to convert them to liabilities in Brazilian Real. The valuation of these contracts was performed at their fair values, yielding a receivable value of ThCh$ 2,283,925 as of June 30, 2017, which is presented in other financial assets non-current. These swap contracts have the same terms of the underlying bond obligation and expire in November 2017. In addition, fair value exceeding the hedged items of ThCh$ 7,229 (ThCh$ 138,039 as of December 31, 2016) has been recognized within other equity reserves as of June 30, 2017. The amount of exchange differences recognized in the statement of income related to financial liabilities in U.S. dollars that were absorbed by the amounts recognized under Comprehensive Income amounted to ThCh$ 3,460 as of June 30, 2017.

b)Cross Currency Swaps associated with US Bonds

At June 30, 2017, the Company entered into cross currency swap derivative contracts to convert US Dollar public bond obligations of US$570 million into UF and Real liabilities to hedge the Company’s exposure to variations in foreign exchange rates. Said contracts are valued at their value and the net value to be received as of June 30, 2017 amounted to ThCh$75,426,967. These swap contracts have the same terms of the underlying bond obligation and expire in 2023.  Additionally, the fair value of these derivatives which is lower than the hedged items amounted to ThCh$4,544,095 and has been recognized within other equity reserves as of June 30, 2017. The ineffective portion for ThCh$1,488,230 in losses associated with this hedge was recorded in other gains and losses as of June 30, 2017.

The amount of exchange differences recognized in the statement of income related to financial liabilities in U.S. dollars and the identified effective portion that was absorbed by the amounts recognized under comprehensive income amounted to ThCh$ 2,480,996 as of June 30, 2017.

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20.2. Forward currency transactions expected to be very likely:

During 2016 and 2017, the Company entered into foreign currency forward contracts to hedge its exposure to expected future raw materials purchases in US Dollars during these years. The total amount of outstanding forward contracts were US$80.9 million as of June 30, 2017 (US$61.1 million as of December 31, 2016). These agreements were recorded at fair value, resulting in a net loss due to hedge recycling of ThCh$2,608,431 for the period ended June 30, 2017, and a hedge liability of ThCh$138,068 and an asset for the same concept of ThCh$ 1,091,803 as of June 30, 2017 (liability of ThCh$1,229,354 as of December 31, 2016). The agreements that ensure future flows of foreign currency have been designated as hedge as of June 30, 2017; there is a balance of ThCh$32,995 to be recycled to income statement.

Futures contracts that ensure prices of future raw materials have not been designated as hedge agreements, since they do not fulfill IFRS documentation requirements, whereby its effects on variations in fair value are accounted for directly under statements of income in the “other gains and losses” account.

Fair value hierarchy

The Company had total assets related to its foreign exchange derivative contracts for ThCh$78,804,725 (ThCh$84,859,223 as of December 31, 2016) and liabilities related to its foreign exchange derivative contracts for ThCh$138,068 (ThCh$1,229,354 as of December 31, 2016). Those contracts covering existing items have been classified in the same category of hedged, the net amount of derivative contracts by concepts covering forecasted items have been classified in financial assets and financial liabilities, All the derivative contracts are carried at fair value in the consolidated statement of financial position. The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique:

Level 1:    quoted (unadjusted) prices in active markets for identical assets or liabilities

Level 2:Inputs other than quoted prices included in level 1 that are observable for the assets and liabilities, either directly (that is, as prices) or indirectly (that is, derived from prices)

Level 3:Inputs for assets and liabilities that are not based on observable market data.

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During the reporting period, there were no transfers of items between fair value measurement categories; all of which were valued during the period using level 2.

	Fair Value Measurements at June 30, 2017
	Quoted prices in active markets for identical assets or liabilities	Observable market data	Unobservable market data
	(Level 1)	(Level 2)	(Level 3)	Total
	ThCh$	ThCh$	ThCh$	ThCh$
Assets
Current assets
Other current financial assets
Current financial assets	—	3,375,728		3,375,728
Other non-current financial assets	—	75,426,997	—	75,426,997
Total assets	—	78,802,725	—	78,802,725
Liabilities
Current liabilities
Other current financial liabilities	—	138,068	—	138,068
Total liabilities	—	138,068	—	138,068

	Fair Value Measurements at December 31, 2016
	Quoted prices in active markets for identical assets or liabilities	Observable market data	Unobservable market data
	(Level 1)	(Level 2)	(Level 3)	Total
	ThCh$	ThCh$	ThCh$	ThCh$
Assets
Current assets
Other current financial assets	—	4,678,343	—	4,678,343
Other non-current financial assets	—	80,180,880	—	80,180,880
Total assets	—	84,859,223	—	84,859,223
Liabilities
Current liabilities
Other current financial liabilities	—	1,229,354	—	1,229,354
Total liabilities	—	1,229,354	—	1,229,354

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NOTE 21 —   CONTINGENCIES AND COMMITMENTS

21.1                        Lawsuits and other legal actions:

In the opinion of the Company’s legal counsel, the Parent Company and its subsidiaries do not face judicial or extra-judicial contingencies that might result in material or significant losses or gains, except for the following:

1) Embotelladora del Atlántico S.A. faces labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling ThCh$1,428,050. Management considers it unlikely that non-provisioned contingencies will affect the Company’s income and equity, based on the opinion of its legal counsel.  Additionally Embotelladora del Atlántico S.A. maintains time deposits for an amount of ThCh$996,363 to guaranty judicial liabilities

2) Rio de Janeiro Refrescos Ltda. faces labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling ThCh$71,945,339. Management considers it unlikely that non-provisioned contingencies will affect the Company’s income and equity, based on the opinion of its legal counsel. As it is customary in Brazil, Rio de Janeiro Refrescos Ltda. maintains judicial deposits and assets given in pledge to secure the compliance of certain processes, irrespective of whether these have been classified as a possible, probable or remote. The amounts deposited or pledged as a legal guarantees as of June 30, 2017 and December 31, 2016, amounted to ThCh$31,506,059 and ThCh$103,351,097 respectively.

To ensure fulfillment of the obligations arising from judicial proceedings faced in Brazil, Rio de Janeiro Refrescos Ltda., has taken guarantee insurance and guarantee letters amounting to R$560,223,986 with different financial institutions and insurance companies in Brazil, through which these entities after a 0.6% commission, become responsible of fulfilling obligations with the Brazilian tax authorities should any trial result against Rio de Janeiro Refrescos Ltda.  Additionally, if the warranty and bail letters are executed, Rio de Janeiro Refrescos Ltda. promises to reimburse to the financial institutions and Insurance Companies any amounts disbursed by them to the Brazilian government.

Main contingencies faced by Rio de Janeiro Refrescos are as follows:

a)Tax contingencies resulting from credits on tax on industrialized products (IPI).

Rio de Janeiro Refrescos is a party to a series of proceedings under way, in which the Brazilian federal tax authorities demand payment of value-added tax on industrialized products (Imposto sobre Produtos Industrializados, or IPI) allegedly owed by ex-Companhia de Bebidas Ipiranga. The initial amount demanded reached R$1,330,473,161 (historical amount without adjustments), corresponding to different trials related to the same cause. In June 2014, one of these trials for R$598,745,218, was resolved in favor of the Company, however, there are new lawsuits arising after the purchase of ex-Companhia de Bebidas Ipiranga (October 2013) that amount to R$322,375,039.

87

The Company rejects the position of the Brazilian tax authority in these procedures, and considers that Companhia de Bebidas Ipiranga was entitled to claim IPI tax credits in connection with purchases of certain exempt raw materials from suppliers located in the Manaus free trade zone.

Based on the opinion of its advisers, and judicial outcomes to date, Management estimates that these procedures do not represent probable losses, and has not recorded a provision on these matters.

Notwithstanding the above, the IFRS related to business combination in terms of distribution of the purchase price establish that contingencies must be measured one by one according to their probability of occurrence and discounted at fair value from the date on which it is deemed the loss can be generated. According to this criteria, from a total of identified contingencies amounting R$916,729,291 (including readjustments of current lawsuits), the Company recorded a provision R$194,668,719 equivalent to ThCh$39,089,681.

b)Tax contingencies on ICMS and IPI causes.

They refer mainly to tax settlements issued by advance appropriation of ICMS credits on fixed assets, payment of the replacement of ICMS tax to the operations, untimely IPI credits calculated on bonuses, among other claims.

The Company does not consider that these judgments will result in significant losses, given that their loss, according to its legal counsel, is considered unlikely. However, the accounting standards of financial information related to business combination in terms of distribution of the purchase price, establish contingencies must be valued one by one according to their probability of occurrence and discounted to fair value from the date on which it is deemed that the loss can be generated. According to this criteria, an initial provision has been made in the business combination accounting for an amount of R$ 43.1 million equivalent to ThCh$ 8,661,920.

3)Embotelladora Andina S.A. and its Chilean subsidiaries face labor, tax, civil and trade lawsuits. Accounting provisions have been made for the contingency of a probable loss because of these lawsuits, totaling ThCh$768,404. Management considers it is unlikely that non-provisioned contingencies will affect income and equity of the Company, in the opinion of its legal advisors.

4)Paraguay Refrescos S.A. faces tax, trade, labor and other lawsuits. Accounting provisions have been made for the contingency of any loss because of these lawsuits amounting to ThCh$ 61,435. Management considers it is unlikely that non-provisioned contingencies will affect income and equity of the Company, in the opinion of its legal advisors.

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21.2           Direct guarantees and restricted assets:

Guarantees and restricted assets are detailed as follows:

Guarantees that compromise assets including in the financial statements:

	Provided by	Committed assets			Balance pending payment on the closing date of the financial statements
Guarantee in favor of	Name	Relationship	Guarantee	Type	06.30.2017	12.31.2016
					ThCh$	ThCh$
Industria Metalúrgica Inamar Ltda.	Embotelladora Andina S.A.	Parent Company	Land	Property, plant and equipment	17,991,202	17,777,078
Gas licuado Lipigas S.A.	Embotelladora Andina S.A.	Parent Company	Cash and cash equivalents	Trade and other receivables	1,140	1,140
Nazira Tala	Embotelladora Andina S.A.	Parent Company	Cash and cash equivalents	Trade and other receivables	3,416	3,416
Nazira Tala	Embotelladora Andina S.A.	Parent Company	Cash and cash equivalents	Trade and other receivables	3,508	3,508
Perfo Equipos S.A.	Transportes Polar S.A.	Subsidiary	Cash and cash equivalents	Trade and other receivables	4,579	4,579
Fernnadi Herma nn Lobos	Transportes Polar S.A.	Subsidiary	Cash and cash equivalents	Trade and other receivables	2,565	2,565
Hospital Militar	Servicio Multivending Ltda.	Subsidiary	Cash and cash equivalents	Trade and other receivables	4,704	4,648
Parque Arauco	Servicio Multivending Ltda.	Subsidiary	Cash and cash equivalents	Trade and other receivables	3,534	—
Workers’ claims	Rio de Janeiro Refrescos Ltda.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	4,353,271	3,833,788
Civil and tax claims	Rio de Janeiro Refrescos Ltda.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	14,363,174	14,304,401
Government institutions	Rio de Janeiro Refrescos Ltda.	Subsidiary	Property, plant and equipment	Property, plant and equipment	12,789,614	85,212,908
Distribuidora Baraldo S.H.	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	799	843
Acuña Gomez	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	1,198	1,264
Municipalidad San Martin Mza	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	14,380	15,167
Nicanor López	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	857	904
Labarda	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	14	15
Municipalidad Bariloche	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	218,633	230,599
Municipalidad San Antonio Oeste	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	88,179	93,005
Municipalidad Carlos Casares	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	3,566	3,761
Municipalidad Chivilcoy	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	551,485	510,803
Others	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	170	179
Granada Maximiliano	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	7,190	7,584
CICSA	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	22,250	23,468
Various dealers	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	45,118	47,397
Aduana de EZEIZA	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other current, non-financial assets	10,463	11,226
Municipalidad de Junin	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	6,974	7,356
Almada Jorge	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	10,728	11,315
Municipalidad de Picun Leufu	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	155	163
Fima fund Ahorro Plus C	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other current, financial assets	237,735	588,485
Guarante finance operations - Rofex	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other current, financial assets	167,757	70,865
Farias Matias Luis	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	24,103	20,367
Gomez Alejandra Raquel	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	75	79
Lopez Gustavo Gerardo/Inti Saic y otro	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other non-current, non-financial assets	489	516
Fima fund Premium B	Embotelladora del Atlántico S.A.	Subsidiary	Judicial deposit	Other current, financial assets	—	407,792
Marcus A.Peña	Paraguay Refrescos	Subsidiary	Property, plant and equipment	Property, plant and equipment	4,002	4,017
Mauricio J Cordero C	Paraguay Refrescos	Subsidiary	Property, plant and equipment	Property, plant and equipment	868	871
Jorge Ruoti Maltese	Paraguay Refrescos	Subsidiary	Property, plant and equipment	Property, plant and equipment	777	755
Alejandro Galeano	Paraguay Refrescos	Subsidiary	Property, plant and equipment	Property, plant and equipment	1,201	—
Jorge Ruoti Maltese	Paraguay Refrescos	Subsidiary	Property, plant and equipment	Property, plant and equipment	1,143	—
Total					50,941,016	123,206,827

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Guarantees provided without obligation of assets included in the financial statements:

	Provided by	Committed assets			Amounts involved
Warranty creditor	Name	Relationship	Guarantee	Type	6.30.2017	12.31.2016
					ThCh$	ThCh$
Importadora Casa y Regalos	Trans-Heca S.A.	Subsidiary	Guarantee insurance	Compliance lease contract	2,050	2,050
Inmobiliaria e Inversiones Gestion Activa Ltda	Red de Transportes comerciales Ltda.	Subsidiary	Guarantee insurance	Compliance lease contract	4,585	4,585
Inmobiliaria Portofino	Red de Transportes comerciales Ltda.	Subsidiary	Guarantee insurance	Guarantee bond	900	900
Teléfonica Chile S.A.	Red de Transportes comerciales Ltda.	Subsidiary	Guarantee insurance	Guarantee bond	1,000	1,000
Inmobiliaria San Martin Logista S.A	Red de Transportes comerciales Ltda.	Subsidiary	Guarantee insurance	Guarantee bond	3,461	3,461
Procesos trabajadores	Rio de Janeiro Refrescos Ltda.	Subsidiary	Guarantee insurance	Judicial action	1,208,663	1,236,439
Procesos administrativos	Rio de Janeiro Refrescos Ltda.	Subsidiary	Guarantee insurance	Judicial action	4,557,247	4,885,075
Gobierno Federal	Rio de Janeiro Refrescos Ltda.	Subsidiary	Guarantee insurance	Judicial action	85,802,056	87,773,855
Gobierno Estadual	Rio de Janeiro Refrescos Ltda.	Subsidiary	Guarantee insurance	Judicial action	14,344,594	14,674,244
HSBC	Sorocaba Refescos S.A.	Associate	Loan	co-signers	4,016,021	4,108,312
Otros	Rio de Janeiro Refrescos Ltda.	Subsidiary	Guarantee insurance	Judicial action	2,630,179	2,682,170
Aduana de Ezeiza	Andina Empaques S.A.	Subsidiary	Bond insurance	Faithful fulfillment of contract	7,770,762	369,963
Aduana de Ezeiza	Embotelladora del Atlántico S.A.	Subsidiary	Bond insurance	Faithful fulfillment of contract	47,094	1,142,642

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NOTE 22 —  FINANCIAL RISK MANAGEMENT

The Company’s businesses are exposed to a variety of financial and market risks (including foreign exchange risk, interest rate risk and price risk). The Company’s global risk management program focuses on the uncertainty of financial markets and seeks to minimize potential adverse effects on the performance of the Company. The Company uses derivatives to hedge certain risks. A description of the primary policies established by the Company to manage financial risks are provided below:

Interest Rate Risk

As of June 30, 2017, the Company maintains all of its debt liabilities at a fixed rate as to avoid fluctuations in financial expenses resulting from tax rate increases.

The Company’s greatest indebtedness corresponds to own issued Chilean local bonds at a fixed rate in the amount of UF11.94 million denominated in UF (“UF”), a currency indexed to inflation in Chile (the Company’s sales are correlated with the UF variation).

There is also the Company’s indebtedness on the international market through a 144A/RegS Bond at a fixed rate for US$575 million, denominated in dollars, and practically 100% of which has been re-denominated to UF and BRL through Cross Currency Swaps.

Credit risk

The credit risk to which the Company is exposed comes mainly from trade accounts receivable maintained with retailers, wholesalers and supermarket chains in domestic markets; and the financial investments held with banks and financial institutions, such as time deposits, mutual funds and derivative financial instruments.

91

a.Trade accounts receivable and other current accounts receivable

Credit risk related to trade accounts receivable is managed and monitored by the area of Finance and Administration of each business unit. The Company has a wide base of more than 100 thousand clients implying a high level of atomization of accounts receivable, which are subject to policies, procedures and controls established by the Company. In accordance with such policies, credits must be based objectively, non-discretionary and uniformly granted to all clients of a same segment and channel, provided these will allow generating economic benefits to the Company. The credit limit is checked periodically considering payment behavior. Trade accounts receivable pending of payment are monitored on a monthly basis.

i.Sale Interruption:

In accordance with Corporate Credit Policy, the interruption of sale must be within the following framework: when a customer has outstanding debts for an amount greater than US$ 250,000, and over 60 days expired, sale is suspended.  The General Manager in conjunction with the Finance and Administration Manager authorize exceptions to this rule, and if the outstanding debt should exceed US$1,000,000, and in order to continue operating with that client, the authorization of the Chief Financial Officer is required. Notwithstanding the foregoing, each operation can define an amount lower than US$250,000 according to the country’s reality.

ii.Impairment

The impairment recognition policy establishes the following criteria for provisions: 30% is provisioned for 31 to 60 days overdue, 60%between 60 and 91 days, 90%between 91 and 120 days overdue and 100% for more than 120 days.  Exemption of the calculation of global impairment is given to credits whose delays in the payment correspond to accounts disputed with the customer whose nature is known and where all necessary documentation for collection is available, therefore, there is no uncertainty on recovering them. However, these accounts also have an impairment provision as follows: 40% for 91 to 120 days overdue, 80% between 120 and 170, and 100% for more than 170 days.

iii.Prepayment to suppliers

The Policy establishes that US$25,000 prepayments can only be granted to suppliers if its value is properly and fully provisioned.  The Treasurer of each subsidiary must approve supplier warranties that the Company receives for prepayments before signing the respective service contract. In the case of domestic suppliers, a warranty ballot (or the instrument existing in the country) shall be required, in favor of Andina executable in the respective country, non-endorsable, payable on demand or upon presentation and its validity will depend on the term of the contract. In the case of foreign suppliers, a stand-by credit letter will be required which shall be issued by a first line bank; in the event that this document is not issued in the country where the transaction is done, a direct bank warranty will be required.  Subsidiaries can define the best way of safeguarding the Company’s assets for prepayments under US$25,000.

iv.Guarantees

In the case of Chile, we have insurance with Compañìa de Seguros de Crédito Continental S.A.  (AA rating —according to Fitch Chile and Humphreys rating agencies) covering the credit risk regarding trade debtors in Chile for 89% both for the existing as well as the expired debt, total amount of the trade debtors in Chile reached ThCh$52,813,989. A provision of ThCh$1,069,544 has been made for the portion of past due outstanding debt portfolio not covered by the insurance.

92

The rest of the operations do not have credit insurance, instead mortgage guarantees are required for volume operations of wholesalers and distributors in the case of trade accounts receivables. In the case of other debtors, different types of guarantees are required according to the nature of the credit granted.

Historically, uncollectible trade accounts have been lower than 0.5% of the Company’s total sales.

b.Financial investments

The Company has a Policy that is applicable to all of the companies of the group in order to cover credit risks for financial investments, restricting both the types of instruments as well as the institutions and degree of concentration.  The companies of the group can invest in:

a.Time deposits: only in banks or financial institutions that have a risk rating equal or higher than Level 1  (Fitch) or equivalent for deposits of less than 1 year and rated A (S&P) or equivalent for deposits of more than 1 year.

b.Mutual funds: investments with immediate liquidity and no risk of capital (funds composed of investments at a fixed-term, current account, fixed rate Tit BCRA, negotiable obligations, Over Night, etc.) in all those counter-parties that have a rating greater than or equal to AA-(S&P) or equivalent, Type 1 Pacts and Mutual Funds, with AA+ rating (S&P) or equivalent.

c.Other investment alternatives must be evaluated and authorized by the office of the Chief Financial Officer.

Exchange Rate Risk

The company is exposed to three types of risk caused by exchange rate volatility:

a)Exposure of foreign investment: this risk originates from the translation of net investment from the functional currency of each country (Brazilian Real, Paraguayan Guaraní, and Argentine Peso) to the Parent Company’s reporting currency (Chilean Peso). Appreciation or devaluation of the Chilean Peso with respect to each of the functional currencies of each country, originates decreases and increases in equity, respectively. The Company does not hedge this risk.

a.1 Investment in Argentina

As of June 30, 2017, the Company maintains a net investment of ThCh$94,304,937 in Argentina, composed by the recognition of assets amounting to ThCh$188,977,573 and liabilities amounting to Ch$94,672,636. These investments accounted for 29.8% of the Company’s consolidated sales revenues

As of June 30, 2017, the Argentine peso devalued by 5.2% with respect to the Chilean peso.

During 2015, exchange restrictions existed in Argentina and until mid-December, there was a parallel foreign exchange market with a higher than the official exchange rate. With the arrival of the new Argentine Government, fixing exchange rate is lightened by increasing parity of the Argentine peso versus dollar at the close to values similar to those that kept the parallel market.

93

If the exchange rate of the Argentinean Peso devalued an additional 5% with respect to the Chilean Peso, the Company would have lower income from the operation in Argentina of ThCh$865,473 and an decrease in equity for ThCh$3,677,218, originated by lower asset recognition of ThCh$9,665,788 and by lower liabilities recognition of ThCh$5,988,570.

a.2 Investment in Brazil

As of June 30, 2017, the Company maintains a net investment of ThCh$270,174,692 in Brazil, composed by the recognition of assets amounting to ThCh$802,592,833 and liabilities amounting to ThCh$532,418,141. These investments accounted for 33.3% of the Company’s consolidated sales revenues.

As of June 30, 2017, the Brazilian Real devalued by 2.2% with respect to the Chilean peso.

If the exchange rate of the Brazilian Real devalued an additional 5% with respect to the Chilean Peso, the Company would have lower income from the operation in Brazil of ThCh$959,215 and a decrease in equity of ThCh$12,378,177, originated by lower asset recognition of ThCh$37,702,350  and by lower liabilities recognition of ThCh$25,324,173.

a.3 Investment in Paraguay

As of June 30, 2017, the Company maintains a net investment of ThCh$239,669,044 in Paraguay, composed by the recognition of assets amounting to ThCh$279,473,569 and liabilities amounting to ThCh$39,804,525. These investments accounted for 7.2% of the Company’s consolidated sales revenues.

As of June 30, 2017, the Paraguayan Guarani appreciated by 2.9% with respect to the Chilean peso.

If the exchange rate of the Paraguayan Guaraní devalued by 5% with respect to the Chilean Peso, the Company would have lower income from the operations in Paraguay of ThCh$506,750 and  a decrease in equity of ThCh$12,042,045 originated by lower asset recognition of ThCh$13,669,433and lower liabilities recognition of ThCh$1,627,388.

b)Net exposure of assets and liabilities in foreign currency: the risk stems mostly from carrying liabilities in US dollar, so the volatility of the US dollar with respect to the functional currency of each country generates a variation in the valuation of these obligations, with consequent effect on results.

As of June 30, 2017, the Company maintains a net liability position totaling ThCh$385,902,483, basically composed of bonds payable and bank liabilities for ThCh$392,703,231 offset partially by financial assets denominated in dollars for ThCh$6,800,748.

Of total financial liabilities denominated in US dollars, ThCh$5,961,897 come from debts taken by the Brazilian operation and are exposed to the volatility of the Brazilian Real against the US dollar. On the other hand, ThCh$ 386,741,334 of US dollar liabilities correspond to Chilean operations, which are exposed to the volatility of the Chilean Peso against the US dollar.

In order to protect the Company from the effects on income resulting from the volatility of the Brazilian Real and the Chilean Peso against the U.S. dollar, the Company maintains derivative contracts (cross currency swaps) to cover almost 100% of US dollar-denominated financial liabilities.

94

By designating such contracts as hedging derivatives, the effects on income for variations in the Chilean Peso and the Brazilian Real against the US dollar, are mitigated annulling its exposure to exchange rates.

The Company’s net exposure as of June 30, 2017, to foreign currency over existing assets and liabilities, discounting the derivatives contracts, is an asset position of ThCh$3,479,298.

c) Assets purchased or indexed to foreign currency exposure: this risk originates from purchases of raw materials and investments in Property, plant and equipment, whose values are expressed in a currency other than the functional currency of the subsidiary. Changes in the value of costs or investments can be generated through time, depending on the volatility of the exchange rate.

Annual purchases of raw materials denominated or indexed in U.S. dollars, amounts to 19% of our cost of sales or approximately US$340 million.

In order to minimize this risk, the Company maintains a currency hedging policy stipulating that it is necessary to enter into foreign currency derivatives contracts to lessen the effect of the exchange rate over cash expenditures expressed in US dollars, corresponding mainly to payment to suppliers of raw materials in each of the operations.  This policy stipulates a 12-month forward horizon.  As of June 30, 2017, US$80.9 million for future purchases have been hedged-for the following 12 months.

According to the percentage of purchases of raw materials which are carried out or indexed to U.S. dollars, a possible change in the value of the US dollar by 5% in the four countries where the Company operates, and excluding derivatives contracts taken to mitigate the effect of currency volatility, keeping everything constant, would lead to a lower accumulated result amounting to ThCh$1,699,017 as of June 30, 2017. Currently, the Company has contracts to hedge this effect in Chile, Argentina, Paraguay and Brazil.

Commodities risk

The Company is subject to a risk of price fluctuations in the international markets mainly for sugar, aluminum and PET resin, which are inputs required to produce beverages and, as a whole, account for 35% to 40% of operating costs. Procurement and anticipated purchase contracts are made frequently to minimize and/or stabilize this risk. The possible effects in these consolidated interim financial statements, in case of a 5% increase in prices of its main raw materials, would be a reduction of ThCh$5,524,364 in earnings for the period ended June 30, 2017. To minimize this risk or stabilize often supply contracts and anticipated purchases are made when market conditions warrant.

95

Liquidity risk

The products we sell are mainly paid for in cash and short-term credit; therefore, the Company´s main source of financing comes from the cash flow of our operations. This cash flow has historically been sufficient to cover the investments necessary for the normal course of our business, as well as the distribution of dividends approved by the General Shareholders’ Meeting. Should additional funding be required for future geographic expansion or other needs, the main sources of financing to consider are: (i) debt offerings in the Chilean and foreign capital markets  (ii) borrowings from commercial banks, both internationally and in the local markets where the Company operates; and (iii) public equity offerings

The following table presents an analysis of the Company’s committed maturities for liability payments throughout the coming years:

	Maturity
Item	1 year	More 1 year up to 2	More 2 years up to 3	More 3 up to 4	More 4 years
	ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
Bank debt	19,426,119	24,313,092	2,292,107	1,120,389	4,177,971
Bond payable	54,633,566	44,461,317	44,230,012	42,483,645	784,390,278
Operating lease obligations	1,426,370	5,785,991	4,260,675	5,267,415	22,784,637
Purchase obligations	139,205,252	121,986,166	118,062,050	166,123	326,468
Total	214,691,307	196,546,566	168,844,844	49,037,572	811,679,354

NOTE 23 —  EXPENSES BY NATURE

Other expenses by nature are:

	01.01.2017	01.01.2016	04.01.2017	04.01.2016
Details	06.30.2017	06.30.2016	06.30.2017	06.30.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Direct production costs	400,623,344	368,616,736	179,986,976	163,316,340
Payroll and employee benefits	149,573,012	140,929,793	75,596,715	74,704,459
Transportation and distribution	73,370,726	72,310,439	31,265,040	31,794,201
Marketing	18,492,837	18,565,886	6,500,926	8,784,127
Depreciation and amortization	50,320,345	47,082,293	25,495,169	23,821,915
Repairs and maintenance	16,305,298	17,989,396	9,998,389	10,984,213
Other expenses	85,217,180	70,610,884	41,814,372	30,000,653
Total	793,902,742	736,105,427	370,657,587	343,405,908

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NOTE 24 —  OTHER INCOME

Other income by function is detailed as follows:

	01.01.2017	01.01.2016	04.01.2017	04.01.2016
Details	06.30.2017	06.30.2016	06.30.2017	06.30.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Gain on disposal of Property, plant and equipment	175,411	153,775	134,328	59,552
PIS/CONFINS Leasing tax recovery	37,955	—	—	—
Others	174,662	290,816	169,245	264,351
Total	388,028	444,591	303,573	323,903

NOTE 25 — OTHER EXPENSES

Other expenses are detailed as follows:

	01.01.2017	01.01.2016	04.01.2017	04.01.2016
Detalle	06.30.2017	06.30.2016	06.30.2017	06.30.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Contingencies and Non-operating fees	5,417,307	4,743,015	2,494,504	3,207,151
Tax on bank debits	3,938,074	3,416,109	1,811,968	1,407,346
Disposal and write-off of Property, plant and equipment	58,486	1,263,269	27,956	1,214,720
Others	377,229	709,416	267,322	527,609
Total	9,791,096	10,131,809	4,601,750	6,356,826

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NOTE 26 —  FINANCIAL INCOME AND EXPENSES

Financial income and expenses are detailed as follows:

a)Finance income

	01.01.2017	01.01.2016	04.01.2017	04.01.2016
Detalle	06.30.2017	06.30.2016	06.30.2017	06.30.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Interest income	5,046,219	4,647,854	1,801,691	2,200,177
Other interest income	1,002,654	769,348	769,129	458,854
Total	6,048,873	5,417,202	2,570,820	2,659,031

b)Finance expenses

	01.01.2017	01.01.2016	04.01.2017	04.01.2016
Detalle	06.30.2017	06.30.2016	06.30.2017	06.30.2016
	ThCh$	ThCh$	ThCh$	ThCh$
Bond interest	21,381,247	20,563,733	10,424,856	10,472,057
Bank loan interest	3,044,180	1,982,885	1,704,269	987,286
Other interest costs	2,822,715	2,612,791	1,311,857	1,336,229
Total	27,248,142	25,159,409	13,440,982	12,795,572

NOTE 27 —  OTHER (LOSSES) AND GAIN

Other (losses) and gains are detailed as follows:

	01.01.2017		01.01.2016		04.01.2017		04.01.2016
Details	06.30.2017		06.30.2016		06.30.2017		06.30.2016
	ThCh$		ThCh$		ThCh$		ThCh$
Gains (loss) on derivative transactions	—		8,927		—		12,989
(Losses) gains on ineffective portion of hedge derivatives (see note 20 b)	(1,488,230	)	(1,989,397	)	(901,593	)	(1,124,444	)
Other income and (expenses)	(1,189	)	5,082		—		(4	)
Total	(1,489,419	)	(1,975,388	)	(901,593	)	(1,111,459	)

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NOTE 28 — LOCAL AND FOREIGN CURRENCY

Local and foreign currency balances as of June 30, 2017 and December 31, 2016, are the following:

CURRENT ASSETS	06.30.2017	12.31.2016
	ThCh$	ThCh$
Cash and cash equivalents	132,214,537	141,263,880
US Dollars	6,783,915	53,073,628
Euros	17,838	4,926
Chilean pesos	75,136,330	48,891,546
Brazilian Real	43,433,637	26,072,201
Argentine Pesos	1,189,539	5,105,633
Paraguayan Guarani	5,653,278	8,115,946
Other financial assets	23,274,264	60,152,627
Unidad de Fomento	19,440,429	53,868,075
Chilean pesos	503,598	—
Brazilian Real	2,743,921	4,699,975
Argentine Pesos	405,492	—
Paraguayan Guarani	180,824	1,584,577
Other non-financial assets	7,189,458	8,601,209
US Dollars	266,148	37,052
Chilean pesos	3,848,934	5,830,276
Brazilean Real	2,053,303	1,773,583
Argentine Pesos	430,465	370,574
Paraguayan Guarani	590,608	589,724
Trade and other accounts receivable, net	129,674,187	190,524,354
US Dollars	942,657	1,265,303
Euros	239,637	308,578
Unidad de Fomento	1,961,309	2,354,310
Chilean pesos	49,865,017	71,977,019
Brazilian Real	54,765,728	74,902,213
Argentine Pesos	17,939,646	33,859,436
Paraguayan Guarani	3,960,193	5,857,495
Accounts receivable from related companies	3,194,794	5,788,683
Chilean pesos	3,194,794	5,788,683
Inventory	150,500,675	144,709,348
US$Dollars	4,773,775	5,469,362
Euros	—	6,634
Chilean pesos	39,479,249	34,276,101
Brazilian Real	36,126,420	41,670,656
Argentine Pesos	60,215,566	51,163,685
Paraguayan Guarani	9,905,665	12,122,910
Current tax assets	1,291,804	1,702,296
Brazilian Real	1,291,804	1,702,296
Total Current Assets	447,339,719	552,742,397
US Dollars	12,766,495	59,845,345
Euros	257,475	320,138
Unidad de Fomento	21,401,738	56,222,385
Chilean pesos	172,027,922	166,763,625
Brazilian Real	140,414,813	150,820,924
Argentine Pesos	80,180,708	90,449,328
Paraguayan Guarani	20,290,568	28,270,652

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NON-CURRENT ASSETS	06.30.2017	12.31.2016
	ThCh$	ThCh$
Other financial assets	75,426,997	80,180,880
Chilean pesos	14,435,418	16,697,871
Brazilian Real	60,991,579	63,483,009
Other non-financial assets	41,002,075	35,246,823
Unidad de Fomento	270,987	269,333
Chilean pesos	157,058	188,472
Brazilian Real	38,535,231	32,660,854
Argentine Pesos	1,997,688	2,079,079
Paraguayan Guarani	41,111	49,085
Trade and other receivables	2,967,023	3,527,732
Unidad de Fomento	2,902,940	3,436,831
Chilean pesos	—	7,021
Argentine Pesos	279	5,425
Paraguayan Guarani	63,804	78,455
Accounts receivable from related parties	112,224	147,682
Chilean pesos	112,224	147,682
Investments accounted for under the equity method	96,525,304	77,197,781
Chilean pesos	29,972,850	23,854,602
Brazilian Real	56,891,171	53,343,179
Argentine Pesos	9,661,283	—
Intangible assets other than goodwill	692,473,968	680,996,062
Chilean pesos	310,056,198	306,067,525
Brazilian Real	203,601,884	208,399,580
Argentine Pesos	1,777,263	1,233,441
Paraguayan Guarani	177,038,623	165,295,516
Goodwill	101,023,107	102,919,505
Chilean pesos	9,523,767	9,523,767
Brazilian Real	78,325,117	80,125,090
Argentine Pesos	5,662,595	5,972,515
Paraguayan Guarani	7,511,628	7,298,133
Property, plant and equipment	662,411,585	666,150,885
US Dollars	1,422,878	1,038,400
Euros	6,171,321	5,787,857
Chilean pesos	273,966,641	277,939,125
Brazilian Real	223,833,040	221,111,732
Argentine Pesos	85,733,168	89,379,062
Paraguayan Guarani	71,284,537	70,894,709
Total Non-Current Assets	1,671,942,283	1,646,367,350
US Dollars	1,422,878	1,038,400
Euros	6,171,321	5,787,857
Unidad de Fomento	3,173,927	3,706,164
Chilean pesos	638,224,156	634,426,065
Brazilian Real	662,178,022	659,123,444
Argentine Pesos	104,832,276	98,669,522
Paraguayan Guarani	255,939,703	243,615,898

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	As of June 30, 2017				As of December 31, 2016
CURRENT LIABILITIES	Until 90 days		More 90 days until 1 year	Total	Until 90 days	More 90 days until 1 year	Total
	ThCh$		ThCh$	ThCh$	ThCh$	ThCh$	ThCh$
Other financial liabilities	15.631.043		58.025.246	73.656.289	12,287,632	52,512,938	64,800,570
US Dollars	26.000		10.625.094	10.651.094	24,684	6,020,277	6,044,961
Unidad de Fomento	10.117.003		9.619.954	19.736.957	10,035,543	12,637,744	22,673,287
Chilean peso	192.280		9.453.581	9.645.861	—	9,148,589	9,148,589
Brazilian real	3.733.547		7.101.234	10.834.781	1,816,540	22,376,912	24,193,452
Argentine peso	1.562.213		20.379.589	21.941.802	410,865	1,590,238	2,001,103
Paraguayan Guaraní	—		845.794	845.794	—	739,178	739,178
Trade and other accounts payable	186.041.616		2.019.530	188.061.146	240,350,658	2,485,698	242,836,356
US Dollars	13.974.167		—	13.974.167	8,331,196	—	8,331,196
Euros	2.509.060		—	2.509.060	4,958,363	—	4,958,363
Unidad de Fomento	1.295.168		—	1.295.168	8,312,403	—	8,312,403
Chilean peso	57.344.590		2.004.761	59.349.351	68,190,344	2,466,116	70,656,460
Brazilian real	46.126.935		—	46.126.935	58,354,740	—	58,354,740
Argentine peso	57.219.843		14.769	57.234.612	85,051,314	19,582	85,070,896
Paraguayan Guaraní	7.571.853		—	7.571.853	7,152,298	—	7,152,298
Trade and other accounts payable to related companies	24.290.414		—	24.290.414	44,120,335	—	44,120,335
Chilean peso	6.947.980		—	6.947.980	12,927,085	—	12,927,085
Brazilian real	16.349.237		—	16.349.237	20,917,319	—	20,917,319
Argentine peso	993.197		—	993.197	10,275,931	—	10,275,931
Provisions	768.404		61.534	829.938	622,993	59,785	682,778
Chilean peso	768.404		—	768.404	622,993	—	622,993
Paraguayan Guaraní	—		61.534	61.534	—	59,785	59,785
Income taxes payable	(13.549	)	4.460.253	4.446.704	—	10,828,593	10,828,593
Chilean peso	(13.549	)	888.062	874.513	—	2,785,425	2,785,425
Argentine peso	—		2.915.158	2.915.158	—	7,613,012	7,613,012
Paraguayan Guaraní	—		657.033	657.033	—	430,156	430,156
Employee benefits current provisions	—		27.652.130	27.652.130	—	35,653,431	35,653,431
Chilean peso	—		4.876.753	4.876.753	—	6,177,733	6,177,733
Brazilian real	—		12.397.654	12.397.654	—	17,117,494	17,117,494
Argentine peso	—		9.677.842	9.677.842	—	11,640,535	11,640,535
Paraguayan Guaraní	—		699.881	699.881	—	717,669	717,669
Other non-financial liabilities	1.463.788		20.725.077	22.188.865	1,705,768	18,907,023	20,612,791
Unidad de Fomento	—		—	—	204,724	—	204,724
Chilean peso	1.330.291		20.077.585	21.407.876	1,198,755	18,729,079	19,927,834
Argentine peso	133.497		217.086	350.583	302,289	—	302,289
Paraguayan Guaraní	—		430.406	430.406	—	177,944	177,944
Total current liabilities	228,181,716		112,043,770	341.125.486	299,087,386	120,447,468	419,534,854
US Dollars	14.000.167		10.625.094	24.625.261	8,355,880	6,020,277	14,376,157
Euros	2.509.060		—	2.509.060	4,958,363	—	4,958,363
Unidad de Fomento	11.412.171		9.619.954	21.032.125	18,552,670	12,637,744	31,190,414
Chilean peso	66.569.996		37.300.742	103.870.738	82,939,177	39,306,942	122,246,119
Brazilian real	66.209.719		19,498.888	85.708.607	81,088,599	39,494,406	120,583,005
Argentine peso	59.908.750		33.204.444	93.113.194	96,040,399	20,863,367	116,903,766
Paraguayan Guaraní	7.571.853		2.694.648	10.266.501	7,152,298	2,124,732	9,277,030

101

	As of June 30, 2017						As of December 31, 2016
NON-CURRENT LIABILITIES	More than 1 until 3 years	More than 3 years until 5 years		More than 5 years	Total		More than 1 until 3 years		More than 3 years until 5 years	More than 5 years	Total
	ThCh$	ThCh$		ThCh$	ThCh$		ThCh$		ThCh$	ThCh$	ThCh$
Other financial liabilities	37,494,853	29,748,449		645,425,170	712,668,472		45,118,483		30,672,918	645,779,186	721,570,587
US$ Dollars	298,000	—		377,305,755	377,603,755		—		—	379,760,266	379,760,266
Unidad de Fomento	25,700,865	22,395,693		255,976,387	304,072,945		25,399,983		23,132,311	258,325,173	306,857,467
Brazilian real	11,495,988	7,352,756		12,143,028	30,991,772		19,361,706		7,540,607	7,693,747	34,596,060
Argentine peso	—	—		—	—		356,794		—	—	356,794
Trade and other payables	9,430,144	—		—	9,430,144		9,509,827		—	—	9,509,827
US$ Dollars	1,090,690	—		—	1,090,690		1,200,187		—	—	1,200,187
Unidad de Fomento	8,033,071	—		—	8,033,071		8,003,199		—	—	8,003,199
Chilean peso	299,903	—		—	299,903		304,124		—	—	304,124
Argentine peso	6,480	—		—	6,480		2,317		—	—	2,317
Provisions	1,428,250	71,945,339		—	73,373,589		72,399,115		—	—	72,399,115
Brazilian real	—	71,945,339		—	71,945,339		71,115,841		—	—	71,115,841
Argentine peso	1,428,250	—		—	1,428,250		1,283,274		—	—	1,283,274
Deferred income tax liabilities	129,751	(3,755,440	)	127,921,159	124,295,470		13,035,795		14,627,908	97,945,099	125,608,802
Chilean peso		37,226		98,551,467	98,588,693		—		—	97,945,099	97,945,099
Brazilian real	—	—		14,427,035	14,427,035		16,659,246		—	—	16,659,246
Argentine peso	129,751	(3,792,666	)	—	(3,662,915	)	(3,623,451	)	—	—	(3,623,451	)
Paraguayan Guaraní	—	—		14,942,657	14,942,657		—		14,627,908	—	14,627,908
Post-employment benefit liabilities	174,754	224,265		8,068,873	8,467,892		364,502		—	7,793,243	8,157,745
Chilean peso	—	224,265		8,068,873	8,293,138		181,257		—	7,793,243	7,974,500
Paraguayan Guaraní	174,754	—		—	174,754		183,245		—	—	183,245
Other non-financial liabilities	—	—		—	—		158,790		—	—	158,790
Brazilian real	—	—		—	—		158,790		—	—	158,790
Total non-current liabilities	48,657,752	98,162,613		781,415,202	928,235,567		140,586,512		45,300,826	751,517,528	937,404,866
US$ Dollars	1,388,690	—		377,305,755	378,694,445		1,200,187		—	379,760,266	380,960,453
Unidad de Fomento	33,733,936	22,395,693		255,976,387	312,106,016		33,403,182		23,132,311	258,325,173	314,860,666
Chilean peso	299,903	261,491		106,620,340	107,181,734		485,381			105,738,342	106,223,723
Brazilian real	11,495,988	79,298,095		26,570,063	117,364,146		107,295,583		7,540,607	7,693,747	122,529,937
Argentine peso	1,564,481	(3,792,666	)	—	(2,228,185	)	(1,981,066	)	—	—	(1,981,066	)
Paraguayan Guaraní	174,754	—		14,942,657	15,117,411		183,245		14,627,908	—	14,811,153

102

NOTE 29 —  THE ENVIRONMENT

The Company has made disbursements totaling ThCh$ 789,152 for improvements in industrial processes, equipment to measure industrial waste flows, laboratory analysis, consulting on environmental impacts and others.

These disbursements by country are detailed as follows:

	Period ended 2017		Future commitments
Country	Recorded as expenses	Capitalized to Property, plant and equipment	To be Recorded as expenses	To be capitalized to Property, plant and equipment
	ThCh$	ThCh$	ThCh$	ThCh$
Chile	350,298	—	—	—
Argentina	120,737	—	—	—
Brazil	221,835	41,161	252,664	18,699,399
Paraguay	36,041	19,080	—	—
Total	728,911	60,241	252,664	18,699,399

NOTE 30 -  AUDITORS’ FEES

Details of the fees paid to the external auditors are detailed as follows:

Description	06.30.2017	12.31.2016
	ThCh$	ThCh$
Remuneration of the Auditor for auditing services	805,632	845,770

103

NOTE 31 — SUBSEQUENT EVENTS

There are no subsequent events that may significantly affect the Company’s consolidated financial position.

104

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Santiago, Chile.

	EMBOTELLADORA ANDINA S.A.
	By:	/s/ Andrés Wainer
	Name:	Andrés Wainer
	Title:	Chief Financial Officer
Santiago, September 21, 2017