annual report empresas aquachile

Transcription

1 annual report empresas aquachile 2013

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3 annual report empresas aquachile

4 memoria empresas aquachile 02

5 I ANNUAL REPORT 1. EMPRESAS AQUACHILE Company information From the south of Chile to the world Message from the Chairman AquaChile at a glance Milestones OUR COMPANY Profile of AquaChile Mission, vision and values History of the Company COMPANY ACTIVITIES Industrial sector Activities and businesses Properties and installations Insurance policies Risk factors Investment plans Financial activities OWNERSHIP AND SHARES Ownership Shares, their characteristics and rights CORPORATE GOVERNANCE Board of Directors Director s Committe Management CORPORATE SOCIAL RESPONSIBILITY Our people The environment Communities INFORMATION ABOUT SUBSIDIARIES, AFFILIATED COMPANIES AND INVESTMENTS IN THE OTHER COMPANIES MATERIAL NEWS SUMMARY OF COMMENTS AND PROPOSALS PUT FORWARD BY SHAREHOLDERS AND THE DIRECTOR S COMMITEE 132 II FINANCIAL INFORMATION 1. MANAGEMENT DISCUSSION AND ANALYSIS

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7 annual report empresas aquachile

8 memoria empresas aquachile EMPRESAS AQUACHILE Annual report AquaChile

9 1.1 Company information From the south of Chile to the world Message from the Chairman AquaChile at a glance Milestones

10 memoria empresas aquachile empresas aquachile cap.01 COMPANY INFORMATION Chapter 1.1 NAME Chilean Tax N (RUT) Type of company Inscription on Securities Register - Empresas AquaChile S.A Public company - N 1.069, 12 April 2011 Legal address Organization Purpose Founding documents - Cardonal s/n Lote B, Puerto Montt - Región de Los Lagos - Telephone: (+56-65) Fax: (+56 65) PO Box: Casilla 30 D, Puerto Montt - The Company has its headquarters in the city of Puerto Montt but may establish branches, agencies or offices in Chile and overseas. - The structure of Empresas AquaChile S.A. envisages exclusively a CEO's office in Puerto Montt. - The Company's purpose is to import, export, produce, breed, grow, process, transform, modify and market, in Chile and overseas, farmed hydrobiological species and, particularly, salmonids. The Company is the result of the merger of the following two original companies: - A. Fischer Hermanos Limitada, founded by public deed of 20 July 1979 extended in Coyhaique by Public Notary Patricio Olate Melo, domiciled in the city of Coyhaique. Inscribed on the Business Register of the Coyhaique Real Estate Registry Office at Folio 38, N 34 of The company, Fischer Hermanos Limitada, moved its domicile to Puerto Montt under public deed of 18 October 1991, extended in Puerto Montt by Public Notary Heriberto Barrientos Bahamondes. 08 Inscribed on the Business Register of the Puerto Montt Real Estate Registry Office at Folio 325 overleaf, N 208 of 1991.

11 DOCUMENTOS CONSTITUTIVOS The company, Fischer Hermanos Limitada, became a public company named Salmones Pacífico Sur S.A. by public deed extended by Public Notary Félix Jara Cadot in Santiago on 29 May Inscribed on the Business Register of the Puerto Montt Real Estate Registry Office at Folio 364, N 228 of B.- Aquachile S.A., founded by public deed of 26 April 1988 extended by Public Notary Ricardo San Martín Urrejola in Santiago. Inscribed on the Business Register of the Santiago Real Estate Registry Office at Folio 9196, N 4888 of C.- Merger: By public deed of 30 June 1999 extended by Public Notary Félix Jara Cadot in Santiago between Salmones Pacífico Sur S.A. and Inmobiliaria Los Robles S.A. absorbed by Salmones Pacífico Sur S.A. Inscribed on the Business Register of the Puerto Montt Real Estate Registry Office at Folio 396 overleaf, N 264 of Salmones Pacífico Sur S.A. changed its name to EMPRESAS AQUACHILE S.A. by public deed of 30 December 2004 extended by Public Notary Humberto Santelices Narducci in Santiago. Address of main management and administrative office Website: External auditors Ticker symbol in Chile Shareholder information Investor relations: - Cardonal s/n Lote B, Puerto Montt - Telephone: (+56-65) Fax: (+56-65) PO Box: Casilla 30 D, Puerto Montt - contactenos@aquachile.com PwC (PricewaterhouseCoopers Consultores Auditores y Compañía Limitada) - AQUACHILE DCV Registros S.A. - atencionaccionistas@dcv.cl - Address: Huérfanos 770, piso 22, Santiago - Telephone: (+56-2) Fax: (+56-2) Website: investor.relations@aquachile.com - Address: Cardonal s/n Lote B, Puerto Montt - Telephone: (+56-65) / Website: Note: A digital version of this Annual Report is available to shareholders, investors and the general public on the Company's website ( 09

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13 empresas aquachile FROM THE SOUTH OF CHILE TO THE WORLD Chapter 1.2 / From the south of Chile, our Company reaches the world's most demanding markets with high-value foods produced from our own salmon and trout farms. / In Costa Rica and Panama, we farm tilapia principally for the North American market. / Each day, close to two million people around the world consume some AquaChile product. / AquaChile is a company born in the south of Chile that today has over 300 clients in 30 countries across five continents. / We have over 25 years' experience in the food industry and are present in its different stages from genetics through to the food on tables in the most demanding international markets. / We appreciate and value our people, our surroundings and our community. With a strong local commitment, we give preference to hiring people who live in the areas where we have our operations and to using the services of local companies. We currently provide work for over 5,900 people in Chile, the United States, Costa Rica and Panama. / We are committed to the development of an industry that is sustainable in the long term. To this end, we have participated actively in discussions about the sector's new sanitary regulation. / At AquaChile, innovation and the incorporation of new technologies are a key tool for ensuring our competitiveness in international markets. 11

14 memoria empresas aquachile empresas aquachile cap.01 MESSAGE FROM THE CHAIRMAN Chapter 1.3 Dear shareholders: In 2013, we saw solid growth of international demand for food and, particularly, for salmon whose characteristics as a healthy food give it an excellent position and have allowed it to penetrate the world's most demanding markets. Our country has recently begun to show important improvements in its level of costs and competitive position. There is room for further progress if we focus on those aspects that have affected the competitiveness of the salmon farming industry and persist in the quest for efficient regulation and better coordination between the sector's producers, effectively addressing the issue of sanitary management. It is important that the production model take into account factors that include biological stocking limits in areas suitable for aquaculture since this will make for a safer and more stable industry. Having a safer industry has two key implications. Firstly, it guarantees highquality employment in the southernmost parts of Chile where this industry has emerged as an important driver of job creation and has, in addition, meant important new employment opportunities for women, with a very positive impact on family income. The connectivity that the industry has brought to remote areas also has an important effect on the development of these regions of the country since salmon farming, with its logistics and operations, has emerged as an industry that connects the people of the south. The recovery of our sector has also been reflected in employment and quality of life in this area. At AquaChile, we are proud of our origin and roots in southern Chile and are, as a result, convinced that ours is an activity we must develop, based on the fundamental principle of sustainability and respect for the environment. 12

15 In its second positive effect, a safer industry means a better reputation in international markets, with the gain to Chile's credibility opening up new commercial opportunities and, in our marketing, allowing us to highlight the healthy nature of our products. Increasing awareness of the industry's values and its concern for sustainability is one of the tasks that, if undertaken by the industry as a whole, can be addressed more successfully. This is the reason for AquaChile's participation in the Global Salmon Initiative (GSI), an organization created in 2013 bringing together 15 salmon producers from different countries that together account for 70% of world output of Atlantic salmon. It seeks to foster the salmon industry's development and sustainable growth. Within Chile, coordination between neighborhoods, the sharing of information among producers and learning from mistakes are the keys to increasing the industry's competitiveness. In this context, AquaChile rejoined SalmonChile, the industry association, in 2013 so as to work together to improve the regulatory framework on which the activity depends in the long term. We are fortunate to live in a country with natural advantages for the development of salmon farming, offering clean waters with the right temperature that allow us to produce a high-value food that is in increasing demand in the world. If, in addition, we consider that internationally the production of wild fish is ever more limited, seawater farming continues to be the great source for feeding the world healthily with salmon. That is why, as a company and a country, we must measure up to this challenge and continue to strive for an industry that is competitive and sustainable in the long term and that helps to feed the world healthily. I would like to highlight the efforts made by our people and to thank them, particularly so in the case of all our workers. During this time of important changes in the way we do things, they have made a great contribution that has allowed us to be more efficient, to recognize with modesty our mistakes and limitations and to learn from them and to identify new opportunities. We want to continue along these same lines and improve together day by day. víctor hugo puchi acuña Chairman of the Board 1 GSI is an initiative launched by the world's leading salmon producers that seeks to achieve significant progress in the industry's sustainability. It constitutes an undertaking to provide a highly sustainable source of healthy food for the world's growing population, contributing to minimize the sector's environmental impact and 13

16 memoria empresas aquachile empresas aquachile cap.01 AQUACHILE AT A GLANCE Chapter 1.4 PRINCIPAL FIGURES ThUS$ current assets 475, ,232 non-current assets 423, ,594 total assets 899, ,826 current liabilities 227, ,554 non-current liabilities 268, ,739 total liabilities 495, ,293 equity 394, ,654 non-controlling interest 9,305 8,879 total liabilities and equity 899, ,826 ThUS$ total revenues 737, ,541 ebit pre fair value adj. (1) -42,974-20,687 ebitda pre fair value adj. (2) -15,501-4,287 earnings -9,454-43,156 ThUS$ financial debt 294, ,816 cash 17,935 12,922 financial leverage (3) Source: AquaChile. 1 EBIT pre FV adj. (henceforward EBIT): Revenues from ordinary activities less sales costs (in other words, gross earnings pre fair value adjustment), less administrative costs, less distribution costs. All these figures are obtained directly from the Company's Income and Cash Flow Statements. 2 EBITDA pre FV adj. (henceforward EBITDA): Revenues from ordinary activities less sales costs (in other words, gross earnings pre fair value adjustment), less administrative costs, less distribution costs, plus adjustment for depreciation and amortization expenses. All these figures are obtained directly from the Company's Income and Cash Flow Statements. 3 (Total current liabilities plus total non-current liabilities less cash and cash equivalents) / total equity. Fuente: AquaChile 14

17 OWNERSHIP STRUCTURE fig % PUCHI FAMILY 3.76% AFPs 30.18% otros 33.94% OTHERS 33.03% FISCHER FAMILY Source: AquaChile AQUACHILE SHARE PRICE (CLP) VS IPSA, 2013 (POINTS) fig. 02 AQUACHILE IPSA 450 4, , ,300 4, , , jan feb mar abr may jun jul aug sep oct nov de0c 3,500 Source: Bolsa de Comercio CONSOLIDATED SALES, 2013 / TOTAL = US$738 MILLION fig % ATLANTIC SALMON 9% TILAPIA 19% TROUT 6% 9% FEED OTHERS 18% PACIFIC SALMON Source: AquaChile 15

18 memoria empresas aquachile CONSOLIDATED SALES, (US$ MILLION) fig. 04 cap Source: AquaChile CONSOLIDATED EBITDA, (US$ MILLION) fig Source: AquaChile CONSOLIDATED EARNINGS, (US$ MILLION) fig Source: AquaChile. 16

19 CONSOLIDATED INVESTMENT, (US$ MILLION) fig Source: AquaChile. CONSOLIDATED WORKFORCE, (N OF EMPLOYEES) fig ,996 5,592 4,813 4,525 4,659 6,483 6,547 Source: AquaChile. 17

20 Verlasso - salmon produced in a more environmentally friendly way - was endorsed as a "good alternative" by the Monterey Bay Aquarium's Seafood Watch program.

21 empresas aquachile MILESTONES 2013 Chapter 1.5 / / / / / Launch of the Global Salmon Initiative (GSI) > AquaChile is one of the 15 salmon companies from different countries, representing some 70% of world Atlantic salmon output, which form part of this initiative. Launched in 2013, its objective is to improve the industry's performance across three pillars of sustainability, reducing its environmental impact, enhancing its social contribution and maintaining economic growth. Alliance between AquaChile and Friosur > The two companies signed an agreement for the joint marketing of their products in the US and Canadian markets. It covers fresh and frozen Atlantic salmon, which accounts for the majority of the two companies' exports. Monterey Bay Aquarium endorsement of Verlasso > After a rigorous evaluation process that lasted 16 months, the Monterey Bay Aquarium's Seafood Watch program, which helps consumers to choose seafood products with lesser impacts on oceans and, thereby contribute to protection of the environment, endorsed Verlasso. As a result, Verlasso - salmon produced in a more environmentally friendly way developed through an alliance between AquaChile and DuPont - was classed as a "good alternative", becoming the first and only farmed salmon in the world to obtain this classification. Return of AquaChile to SalmonChile > At the end of July, the Company rejoined this business association, which represents the Chilean salmon farming sector, and took a seat on its board of directors. AquaChile takes the view that the Chilean industry must work unitedly to improve the regulatory model on which its activity in the long term depends so as to ensure greater long-term competitiveness and sustainability. Start of operation of pet food flavoring plant in Costa Rica > In August 2013, the AquaSea plant in Costa Rica's Guanacaste Province started operation. This initiative, which forms part of AquaChile's association with Grupo Diana, seeks to take advantage of the parts of tilapia not used for human consumption to produce flavorings for pet food. The plant has an annual production capacity of 1,600 tonnes of meal, employs 24 people and its products are for export. 19

22 memoria empresas aquachile cap.01 / / / / Marketing of Verlasso in the United States > This brand of salmon, with its high quality and taste standards, had a good year in As well as strengthening its relations with different distributors, it was launched in important supermarket chains such as Central Market in Texas and Heinens in Ohio. For 2014, its launch is planned in 152 Fresh Market stores across the United States. Increase in sales > In 2013, AquaChile achieved record sales, recovering levels of output of all the species farmed. Recovery of output of Atlantic salmon > Output returned to its level prior to the ISA virus crisis. Production of salmon and trout reached 102,000 gross tonnes harvested, with an important increase in Atlantic salmon which reached 53,000 gross tonnes, up from 17,000 gross tonnes in Record tilapia harvest > At a record 23,800 gross tonnes, the Company's tilapia harvest was up by 7.68% on the previous year, due principally to higher output in Panama. RECOGNITIONS / / Empresas AquaChile S.A. received the Trayectoria Exportadora 2013 (Export Track Record 2013) Prize awarded by the government's ProChile export promotion agency and the Capital business magazine. For the fifth consecutive year, Capital and ProChile together organized southern Chile's largest meeting of exporters, held in Puerto Varas in the Los Lagos Region. In 2013, the Trayectoria Exportadora prize was awarded to Empresas AquaChile S.A. for its sustained success and the constant growth it has experienced since its foundation in the 1980s through to the present day when it is one of the world's leading salmon producers. Alitec Pargua S.A., a subsidiary of Empresas AquaChile S.A., received the Rosalino Fuentes Silva 2012 Prize. In May, in the 51st Annual National Safety Competition organized by Chile's National Safety Council (CNS) 2, Alitec Pargua S.A. received the Rosalino Fuentes Silva 2012 prize for the lowest accident frequency rate in the C Category (production of foodstuffs) 20 2 The CNS is a private non-profit organization created by government decision in 1953 with the basic objective of promoting risk prevention and increasing awareness of the need to prevent accidents and workplace illnesses in the different sectors of the Chilean economy.

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24 our company Annual report AquaChile 2013

25 2.1 Profile of AquaChile Mission, vision and values History of the Company 28

26 AquaChile is active in all the industry's production chain, from fish genetics through to the marketing of its products, directly serving more than 300 clients in over 30 countries and creating jobs for over 5,900 people in the countries where it has its operations.

27 Our company PROFILE OF AQUACHILE Chapter 2.1 Empresas AquaChile S.A. is a Chilean company that produces foods and proteins with an emphasis on the production and marketing of salmon, trout and tilapia. It comprises a group of companies with strategic synergies that farm and market Atlantic and Pacific salmon, trout and tilapia for human consumption, maintaining vertical control and adding value throughout the production chain from genetics through to the marketing of products. AquaChile is Chile's largest salmon company, the world's principal producer of Pacific salmon or coho, one of the world's largest producers of trout and one of the most important suppliers of fresh tilapia to the United States. The Company has operations in Chile, Costa Rica and Panama as well as commercial offices in the United States. Its products reach over 300 clients in more than 30 countries and it employs over 5,900 people in the different countries in which it is present. Through its subsidiaries, the Company is also active in genetic research for the aquaculture industry and the production of salmon and trout eggs and smolts as well as the production of feed for the salmon and tilapia industries. 25

28 memoria empresas aquachile Our company cap.02 MISSION, VISION AND VALUES Chapter 2.2 Mission VISION Corporate Values Principles of Corporate Social Responsibility - To produce healthy aquaculture foods for this and future generations, respecting and valuing the environment and our people. - We seek to be recognized internationally for the quality of our products, the sustainability of our processes and our respect for employees. - To act with respect for people, work and the environment - To feel passion for the work we do - To be creative and show initiative in our daily tasks - To act preventively and safely - To behave austerely. - To produce high-quality, healthy and safe food - To be proactive and respectful as regards the environment - To develop a safe and healthy work environment - To benefit communities and suppliers in the places where the Company has its operations. Objectives - To add value at each stage of the process, taking into account the safety and health of our employees and care for the environment, and to provide each internal and external client with the best product and best service at a convenient price. - To guarantee through all stages of the process, safety, quality and competitiveness in the production and marketing of salmon, trout and tilapia. - To achieve international recognition for the quality and consistency of our products and services which should be reflected in greater preference from clients and greater sustainability of the business. - To constantly improve the way we do things, taking into account the quality of the product and the efficiency of processes, innovating technologically and minimizing workplace risks and environmental impacts. - To foster the professional and personal development of all the people who form part of the value chain, contributing to improve their skills and consolidating their commitment to the welfare of the community and conservation of the environment. - To promote partnerships and integration with other companies. 26

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30 Our History Empresas AquaChile S.A. was born in 1998 as a result of the merger of Salmones Pacífico Sur S.A. (founded in the city of Coyhaique in 1979) and AquaChile S.A. (founded in the city of Santiago in 1988). Initially, each of these companies was geared to different stages of the salmon farming process, with Salmones Pacífico Sur S.A. focusing on the seawater stage while AquaChile S.A. focused on the freshwater stage, with the production of eggs, juveniles and smolts 2. The two companies were fully complementary, with strong strategic positions in their respective lines of business, a quite well developed organizational structure, extensive knowledge of the business and shareholders aware of the unique opportunity to jointly achieve more profitable and solid growth. The principal milestones since the merger have been: Acquisition of the assets of Pesquera BestSalmon S.A Acquisition in two stages of 80.85% of Antarfish S.A., the parent company of Aguas Claras S.A., making AquaChile the country's leading company in sales of salmon and trout. Foundation of Sudmaris Chile S.A. to produce, process and export mussels. Salmones Chiloé, a subsidiary of Empresas AquaChile, has a 50% stake in this company. Implementation of a strategic alliance with Alitec-Provimi, a local subsidiary of Provimi, a leading international animal nutrition company, giving rise to the subsidiary Alitec Pargua S.A. for the production of fish feed Acquisition of Aucar (a freshwater farming facility). Start of operation of the first seawater facility in the Aysén Region Acquisition of Cherquenco (a freshwater farming center). Opening of the office of AquaChile Inc. in the United States for the marketing of salmon in that country. Change of name of the company to Empresas AquaChile S.A Acquisition of a further 19.09% of Antarfish S.A, taking the Company's stake to 99.94%. Acquisition of 60% of Salmones Chiloé S.A. (Salmosan), 100% of Pesquera Palacios S.A. and 100% of Salmones Australes S.A. Acquisition of 60% of the salmon business of Robinson Crusoe S.A. (Salmones Maullín S.A.). Acquisition of 60% of Costa Rica-based Grupo ACI S.A. Creation of AquaInnovo S.A., a company formed as a result of an alliance with the University of Chile and AquaticHealth Chile and the contribution of the Business Innovation Subcommittee of InnovaChile-CORFO. AquaInnovo's objective is the genetic improvement of salmon and other aquaculture species around the world, using latest-generation technology Acquisition of the 40% of Salmones Maullín S.A. not held by Empresas AquaChile. Increase of stake in Grupo ACI S.A. to 72.86%. 3Smolt: the physiological stage in which the fish can be transferred from freshwater to seawater.

31 Approval by Extraordinary Shareholders' Meeting of subjection of Empresas AquaChile S.A. to norms governing public companies. Inscription of the Company on the Securities Register of the Superintendency of Securities and Insurance (SVS) Administrative integration of Salmones Chiloé S.A., centralizing its management in Puerto Montt. Increase of stake in Grupo ACI S.A. from 72.86% to 79.95%. Reopening of processing plant in Puerto Montt. Start of operation of AquaInnovo's Lenca Experimental Center. Start of operation of Salmones Chaicas S.A. recirculation hatchery. Acquisition of remaining 7% of Salmones Chiloé S.A. from minority shareholders and remaining 40% of Procesadora Hueñocoihue Ltda. (now SpA) Sale of all the Company's stake in Sudmaris S.A. Merger of Grupo ACI S.A. with the El Pelón group, an important Costa Rican agribusiness conglomerate with activities including tilapia production. Following the merger, Empresas AquaChile continues to hold a 72.86% stake in the company Request to the SVS for the Company's elimination from the Securities Register. Agreement that the Company will cease to be governed by the norms applying to public companies. Administrative integration with the Antarfish S.A. subsidiary, centralizing management of all the group at its headquarters. Cancellation of capital increase approved in December 2010 and approval of a new capital increase in order to carry out a public offering. Placement of 33.45% of Empresas AquaChile S.A. on the stock market. Alliance with Biomar for the construction of a tilapia feed plant in Costa Rica. Alliance with Spécialités Pet Food S.A.S. and Inversiones Industriales Bauprés Ltd. (Grupo Diana) for the construction of a value-added plant in Costa Rica's Guanacaste Province to take advantage of tilapia waste from the production process Inauguration of fish feed plant in Costa Rica by Grupo ACI and Biomar. Acquisition of remaining 35.48% of Piscicultura Aquasan S.A. from minority shareholders. Alliance between AquaChile and Friosur for joint marketing of their products in the US and Canadian markets. Reincorporation of AquaChile into SalmonChile, the business association bringing together most of Chile's salmon producers. Start of operation of the AquaSea plant for the production of pet food flavorings in Costa Rica. Incorporation of AquaChile into the Global Salmon Initiative (GSI) as one of the 15 companies that form part of this initiative launched in August 2013.

32 COMPANY ACTIVITIES Annual report AquaChile 2013

33 3.1 Industrial sector Activities and businesses Properties and installations Insurance policies Risk factors Investments plans Financial activities 82

34 memoria empresas aquachile company activities cap.03 INDUSTRIAL SECTOR Chapter 3.1 THE SALMON INDUSTRY The world's food consumption has increased over time due to the rise in the population and, particularly, higher consumption in emerging economies where, as income has increased, the quality of people's diets has also improved, with a shift to healthier proteins. fig. 09 / fig. 10 / fig. 11 In recent years, demand for salmonids has grown at rates close to two digits and the long-term outlook is positive with the potential for ongoing growth. The drivers of this demand are: - Growth of the middle class in emerging markets; - Improvements in retail infrastructure in emerging markets; - Growth of the world's population; - Shift in eating habits towards healthier foods; - Contraction of supply of seafood in general. fig. 12 / fig.13 / fig. 14 Opportunity for aquaculture > Over-exploitation has limited the availability of wild fish around the world. In this context, aquaculture has emerged as an alternative with great growth potential for satisfying demand for seafood. fig

35 EMERGING MARKETS DRIVE INCREASE IN FOOD CONSUMPTION (MILLIONS OF TONNES) fig. 09 1,400 1,200 1,000 GLOBAL CONSUMPTION CONSUMPTION IN DEVELOPING COUNTRIES CONSUMPTION IN DEVELOPED COUNTRIES Sources: Kontali Analyse and ABG Sundal Collier GDP GROWTH BY TYPE OF ECONOMY (US$ BILLION) fig G7 BRIC N-11 OTHER DEVELOPED MARKETS G7: Canada, France, Germany, Italy, Japan, United Kingdom and United States. BRIC: Brazil, China, India and Russia. N-11: Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, South Korea, Turkey and Vietnam. Source: Carnegie. OTHER EMERGING MARKETS GROWTH OF EMERGING MARKET DEMAND FOR SALMONIDS, (THOUSANDS OF TONNES WFE 4 ) fig. 11 ktonnes (wfe) cagr % 30% % % 20% 87 16% 18% 54 20% 15% 10% 20 5% 0 0% THE BALTICS AND POLAND RUSSIA AND UKRAINE ASIA, FAR EAST BRAZIL AND ARGENTINA Source: ABG Sundal Collier Whole Fish Equivalent (WFE) is the weight of dead and bled salmon, trout or tilapia.

36 millions of people memoria empresas aquachile GROWTH OF WORLD POPULATION (BILLIONS) fig TOTAL WORLD POPULATION cap.03 6 DEVELOPING COUNTRIES 3 0 DEVELOPED COUNTRIES Source: FAO POPULATION JOINING THE MIDDLE CLASS (MILLIONS) fig BRAZIL RUSSIA INDIA CHINA BRIC`s G7 Source: Carnegie. 34

37 DEMAND FOR SALMON BY TYPE OF MARKET fig % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% EMERGING MARKETS DEVELOPED MARKETS Source: ABG Sundal Collier. WORLD OUTPUT OF SALMON AND TROUT (FARMED AND WILD)(THOUSANDS OF TONNES WFE) fig. 15 4,000 3,500 3,000 2,500 FARMED 2,000 1,500 1, WILD Source: Kontali Analyse. 35

38 memoria empresas aquachile cap.03 CONVERSION FACTORS (KGS) fig. 16 TUNA BEEF PORK POULTRY TILAPIA SALMON Source: Kontali Analyse AS. Efficient in terms of conversion and percentage of usable meat > Salmon and tilapia convert feed more efficiently than other sources of animal protein (the Feed Conversion Rate or FCR is the indicator which measures how many kilos of feed are required to produce one kilo of live animal). This is due to the fact that, because they are cold-blooded, fish spend less energy on maintaining a proper body temperature. fig. 16 At around 60%, the percentage of salmon meat that can be used for human consumption is higher than for other animal proteins in which the percentage of waste is larger. In the case of tilapia, the percentage that is usable for human consumption reaches 33%. fig. 13 / fig. 14 / fig. 15 / fig. 16 Chile offers favorable conditions for aquaculture, particularly as regards the cleanliness and temperature of its waters. Salmon farming is one of the country's main non-copper export industries, accounting for 4.56% of total exports in second place after copper. fig

39 PERCENTAGE OF USABLE MEAT BY TYPE OF PROTEIN EDIBLE FISH MEAT (%) fig. 18 EDIBLE PORK MEAT (%) fig % USABLE 50% USABLE Sources: Bjørkl, J., Norwegian University and Life Sciences, Norway (2002). Sources: Bjørkl, J., Norwegian University and Life Sciences, Norway (2002). EDIBLE CHICKEN MEAT (%) fig. 19 EDIBLE LAMB MEAT (%) fig % USABLE 38% USABLE Sources: Bjørkl, J., Norwegian University and Life Sciences, Norway (2002). Sources: Bjørkl, J., Norwegian University and Life Sciences, Norway (2002). 37

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41 CHILEAN EXPORTS BY VALUE, 2013 fig % COPPER 2.21% GRAPES 2.45% WINE 4.56% SALMON &TROUT 3.62% CELLULOSE 34.80% OTHERS Source: Central Bank of Chile COMPETITION The leading producers of Atlantic salmon in 2013 continued to be Chile and Norway, which together accounted for approximately 80% of world output. fig. 23 The leading producers of Atlantic salmon in 2013 continued to be Chile and Norway, which together accounted for approximately 80% of world output. The salmon industry has historically comprised many small producers. This was the case in Norway and, to a lesser extent, Scotland and Chile. In around 1997, these three countries had 117 salmon companies which accounted for 80% of the total volume of famed salmon produced. Out of these 117 companies, 70% were in Norway. fig. 24 Over the past decade, however, the industry has experienced a period of consolidation and, as of 2012, only 38 companies, down by 68%, accounted for 80% of Atlantic salmon output. Further consolidation is anticipated as small producers find themselves unable to achieve an efficient cost structure. The creation of large companies is expected to be positive for the industry, since, in general, size and integration are more conducive to research and product development. Moreover, large companies will be on a stronger footing to compete on equal terms with the principal players of the food and distribution industries. 39

42 memoria empresas aquachile ATLANTIC SALMON OUTPUT BY COUNTRY (THOUSANDS OF TONNES WFE) fig. 23 growth (y-on-y) cap.03 2,500 2,000 19% 18% 20% 15% 15% 13% 22% 25% others canada 20% United Kingdom 15% chile 1,500 1, % 11% 7% 8% 5% 4% 2% 10% 7% 11% 2% 8% 5% 10% 5% 0 Norway 0-1% -1% -5% E 2015E Source: ABG Sundal Collier INDUSTRY CONSOLIDATION: NUMBER OF SALMON FARMING COMPANIES BY REGION fig canada Scotland chile Norway Source: Kontali Analyse 40

43 MARKET SHARE In 2013, Norwegian-owned companies predominated in world salmon output, led by Marine Harvest, Leroy Seafood Group and Cermaq. Empresas AquaChile S.A. is currently the world's fifth largest producer and has, moreover, consolidated its position as the largest exporter of Chilean salmon, accounting for 12.2% of total net exports. fig. 25 PRINCIPAL EXPORT MARKETS In 2013, the exports of the Chilean salmon industry reached 527,700 net tonnes of which 58% corresponded to Atlantic salmon, 21% to trout and 21% to Pacific salmon. As compared to 2012, the industry's exports were up by 7%. fig. 26 / fig. 27 / fig. 28 CHILEAN SALMON AND TROUT EXPORTS, 2013 fig. 25 company ThUS$ net. tonners price us$/kg ThUS$ (%) net.tonnes (%) Empresas AquaChile 446,369 64, % 12.2% Mainstream (1) 299,989 48, % 9.1% Pesquera Los Fiordos 258,156 41, % 7.8% Multiexport Foods 255,718 31, % 5.9% Salmones Camanchaca 191,278 24, % 4.6% Blumar 171,768 23, % 4.4% Ventisqueros 159,476 24, % 4.6% Marine Harvest Chile (2) 147,414 19, % 3.7% Granja Marina Tornagaleones 142,421 23, % 4.5% Acuinova Chile 133,491 26, % 4.9% Salmones Antártica 129,924 16, % 3.1% Australis Mar 120,955 20, % 3.8% Invertec Pesq. Mar de Chiloé 115,984 14, % 2.8% Others 944, , % 28.5% Total 3.517, , % 100.0% 1 Includes Mainstream Chile S.A. and Cultivos Marinos Chiloé S.A. 2 Includes Marine Harvest Chile S.A. and Delifish Ltda. Source: SalmonChile. CHILEAN EXPORTS BY SPECIES fig. 26 NET TONNES Var. 2013/2012 (%) Atlantic salmon 305, ,646 25% Pacific salmon 111, ,140-5% Trout 110, ,781-28% Chinook % Others % Total 527, ,468 7% Source: SalmonChile. 41

44 memoria empresas aquachile PRINCIPAL CHILEAN SALMON AND TROUT EXPORT MARKETS fig. 27 cap.03 thus$ fob Var. 2013/2012 (%) Japan 839,376 1,140,061-36% United States 1,144, ,182 29% European Union 223, ,279 50% Latin America 657, ,494 32% Others 378, ,015 65% Asia less Japan 273, ,467 9% Total 3,517,403 2,894,498 18% net tonnes Var. 2013/2012 (%) Japan 147, ,259-33% United States 124, ,929 15% European Union 33,899 18,579 45% Latin America 101,240 86,548 15% Others 69,574 28,342 59% Asia less Japan 51,435 52,811-3% Total 527, ,468 7% Source: SalmonChile CHILEAN SALMON AND TROUT EXPORTS BY MARKET, 2013 fig ,772 net tonnes US$ 3,517 million 10% ASIA LESS JAPAN 13% OTHERS 19% LATIN AMERICA 28% JAPAN 24% UNITED STATES 6% EUROPEAN UNION 24% JAPAN 8% ASIA LESS JAPAN 11% OTHERS 32% UNITED STATES 6% EUROPEAN UNION 19% LATIN AMERICA Source: SalmonChile 42

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46 memoria empresas aquachile cap.03 SALMON PRICES In 2013, the lower growth of world salmon supply was reflected in an increase in international export prices which, in the case of Chilean Atlantic salmon 5, rose by 38% from US$3.21/lb to US$4.43/lb. fig. 29 In the case of Pacific salmon, the international price increased by 83% from JPY345/kg to JPY630/kg while, in the case of trout, there was an increase of 86% from JPY430/kg to JPY800/kg. fig. 30 Despite the increases seen in the prices of the different species, the consensus view among industry analysts is that demand will remain firm and in line with its historic rate of growth, led by the recent development of demand for salmon in emerging markets which has shown important potential. SALMON FEED INDUSTRY Feed is an important component of salmon production costs. The FCR 6 is, therefore, key since consumption of feed varies with this conversion factor and efficient management of the biomass 7 can result in FCRs that are less even than 1.3 times. In Chile, the fish feed industry is highly concentrated, with four producers accounting for approximately 85% of total output (Skretting, Ewos, Alitec and Biomar). The cost of this input varies depending on the price of the main raw materials - fish meal, vegetable oils and fish oil - used in its production. Peru, Chile, Argentina and the United States are the main world producers of these inputs. fig. 31 / fig. 32 The salmon industry has sought to optimize use of natural resources and, after years of research, the amount of fish meal used to produce salmon feed has been dropping significantly. Indeed, over the past 15 years, the average percentage of fish meal in the diet has been reduced from 50% to less than 30% whilst maintaining the characteristics required to obtain a high-quality product. fig Trim D 2-3 FOB Miami. 6 Feed Conversion Rate (FCR) measures the number of kilos of feed required to produce one kilo of meat. 7 Kilos of fish at the growth stage. 44

47 PRICE OF CHILEAN AND NORWEGIAN ATLANTIC SALMON (DEC 2006 = 100) fig. 29 CHILEAN SALMON (TRIM D 2-3 LB FOB MIAMI) NORWEGIAN SALMON (HON 3-6 KG FCA OSLO) dec 06 jun 07 dec 07 jun 08 dec 08 jun 09 dec 09 jun 10 dec 10 jun 11 dec 11 jun 12 dec 12 jun 13 dec 13 Source: Urner Barry, Fishpool. PRICE OF PACIFIC SALMON AND TROUT (JPY/KG) fig. 30 TROUT (4-6 KG FOB JAPAN) PACIFIC SALMON (4-6 KG FOB JAPAN) dec06 jun 07 dec 07 jun 08 dec 08 jun 09 dec 09 jun 10 dec 10 jun 11 dec 11 jun 12 dec 12 jun 13 dec 13 Source: FIS 45

48 memoria empresas aquachile WORLD FISH MEAL OUTPUT (THOUSANDS OF TONNES) fig. 31 peru chile thailand us japan scandinavia others cap Source: IFFO WORLD FISH OIL PRODUCTION (THOUSANDS OF TONNES) fig. 32 peru chile scandinavia united states japan others Source: IFFO USE OF FISH MEAL AND OIL IN SALMON DIET fig. 33 fish meal alternative proteins fish oil vegetable oil Source: Biomar, 2012

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50 memoria empresas aquachile cap.03 THE TILAPIA INDUSTRY IN THE WORLD Tilapia comes from tropical Africa and was originally farmed in Kenya in the 1920s. Farming in Asia and the Americas did not begin until after World War II. There are currently some 70 types of tilapia and around 100 hybrids in existence, divided into four groups according to their reproductive habits - Smith tilapia, sarotherodon, danakilia and oreochromis niloticus (or Nile tilapia) of which the latter is the most widely farmed internationally. Tilapia is farmed in most of the world's tropical regions since they offer favorable conditions for its reproduction and growth. Optimum development of this fish occurs at water temperatures of more than 24 C. The principal characteristics of tilapia which make its production and marketing attractive are: - Great physical resistance - Rapid growth - High productivity - Adaptation to captivity - Acceptance of a wide range of feeds - Existence in both fresh and salty water - Tolerance of low oxygen levels - Possibility of genetic improvement - Excellent-quality meat. WORLD OUTPUT At the beginning of the 1970s, 80% of tilapia was produced in Africa where this fish has its origins. However, most tilapia production now takes place in Asia with China as the largest producer, accounting for some 37% of world output. Production of tilapia in the Americas has also experienced important growth, led by Costa Rica, Ecuador and Honduras. Nile tilapia has its origins in the Nile River in Egypt and this country has emerged as the second largest producer after China. Annual international output of tilapia reaches 2.8 million tonnes, equivalent to 2% of total aquaculture and fishing output. Between 2001 and 2011, tilapia output rose at a compound annual growth rate (CAGR) of 10.4%. Supply of tilapia will maintain its expansion in the coming years, reflecting principally strong import demand in Latin America which is heavily influenced by the US market. 48

51 WORLD OUTPUT OF TILAPIA BY CONTINENT, 2011 (WILD AND FARMED) fig % ASIA LESS CHINA 37% CHINA 11% AMERICA 18% AFRICA Source: FAO. WORLD OUTPUT OF WILD AND FARMED TILAPIA (MILLIONS OF TONNES) fig Source: FAO WORLD OUTPUT OF NILE TILAPIA (THOUSANDS OF TONNES) fig. 36 3,000 2,500 2,000 1,500 1,000 1,034 1,116 1,272 1,458 CAGR: 10,4% 1,659 1,891 1,863 2,062 2,241 2,538 2, Source: FAO. 49

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53 UNITED STATES > PRINCIPAL IMPORTER The world's largest tilapia importer is the United States where per capita tilapia consumption rose at a compound annual rate of 14% between 2001 and 2012, positioning this species in fourth place in consumer preferences after prawns, tuna and salmon. Great potential also exists in the European market. Over the past eight years, tilapia has risen from 10th to 4th place in consumption of seafood in the United States. kg. per capita 1- prawns tuna salmon tilapia pollock pangasius 0.33 Source: National Fisheries Institute The United States imports fresh tilapia mainly from Costa Rica, Ecuador and Honduras while much of its frozen tilapia comes from China and other Asian countries such as Taiwan and Indonesia. Development of new markets and growth of demand: - Restaurant chains in the US are incorporating tilapia into their menus. - Europeans are discovering tilapia with the resulting potential for expansion of the consumer market. COMPETITION> Through its subsidiary, Grupo ACI, AquaChile is one of Central America's largest tilapia producers, the largest producer in Costa Rica and one of the leading suppliers of fresh tilapia to the United States with a market share of around 26%. In 2013, Grupo ACI's harvest of tilapia in Costa Rica and Panama reached 23,800 tonnes WFE. PER CAPITA CONSUMPTION OF TILAPIA IN US (KG) fig CAGR: 14% Source: National Fisheries Institute (Latest information available, April 2013). US IMPORTS OF FRESH TILAPIA BY COUNTRY OF ORIGIN, 2013 (THOUSANDS OF POUNDS) fig ,033 10,604 14,387 8,444 3,254 1,818 1, HONDURAS ECUADOR COSTA RICA* COLOMBIA MEXICO OTHERS** CHINA EL SALVADOR BRASIL * Grupo ACI is Costa Rica's only tilapia exporter. ** Includes imports of Grupo ACI from Panama. Source: Urner Barry, Monthly Aquaculture Insider's Report, February

54 memoria empresas aquachile cap.03 LEGAL OR REGULATORY FRAMEWORK Salmon farming is governed principally by the General Fishing and Aquaculture Law of 1989 (Law N ) and its modifications and associated regulation, including in particular Supreme Decree (DS) N 319 (Sanitary Regulation) and DS N 320 (Environmental Regulation), both issued by the Economy Ministry. The rewritten text of the Law was established by DS N 430, issued by the Economy Ministry and published in the Diario Oficial (Official Gazette) of 21 January The industry is also subject to the legal provisions governing productive activities in general of which the most relevant are those that refer to protection of the environment. The principal modifications introduced in the General Fishing and Aquaculture Law as regards aquaculture are contained in Laws N (2006), N (2010) and N (2012). In their main points, these laws established the extension of the rights of availability of aquaculture concessions, permitting their relocation, merger and division; the duration of the new concessions awarded; the regularization of concessions that may have incurred in certain grounds for their termination; new grounds for the termination of a concession; modification of the operating regime of farms with the organization of Groups of Concessions, macrozones, compulsory fallow periods and the setting of densities; an increase in the inspection powers of the National Fishing Service (SERNAPESCA) and the sanctions that can be imposed; an increase in the value of the Patente Única de Acuicultura (Single Aquaculture License); the suspension of submission of new applications for aquaculture concessions; a new regime for the preparation of environmental and sanitary reports and certifications; a new legal regime for fish hatcheries; the creation of the National Aquaculture Commission; and, modifications to the principal government services for the sector - the Undersecretariat for Fishing, which became the Undersecretariat for Fishing and Aquaculture, and the National Fishing Service, which became the National Fishing and Aquaculture Service - thereby putting the country's aquaculture industry on a higher legal-institutional level. The new provisions seek to boost the development of the salmon industry through different mechanisms designed to regulate all its production stages. At the same time, they draw on the experience acquired during the sanitary crisis which began in 2008 seeking to prevent a recurrence of events of this nature. In addition, the new legislation introduced stricter regulation of the processing stage, strengthening biocontainment and bioexclusion measures from the phase of slaughtering through to the packaging of products. CONCESSIONS In Chile, aquaculture concessions are granted through two different permits or administrative decisions. In the first, the Undersecretariat for Fishing and Aquaculture of the Economy, Development and Tourism Ministry authorizes the development of the aquaculture activity subject to certain technical requirements while, in the second, the Undersecretariat for the Armed Forces of the Defense Ministry authorizes the use of the specific geographic area (or part of state-owned waters) for aquaculture in accordance with the first permit. The award and use of a concession is limited to a specific geographic area, duly indicated in the document by which it is established, and it must be used to farm specific salmonid species, subject to specific production and stocking density limits. Production and harvest density are stipulated in the Environmental Regulation and Sanitary Regulation issued by the authorities and must be respected by concession holders. Concessions awarded through to 8 April 2010 have an indefinite duration, although subject to grounds for their termination, while those awarded after this date and those which are relocated geographically have a duration of 25 years, which may be renewed, and are also subject to grounds for their termination. All types of transactions are permitted with aquaculture concessions, including their use as collateral. 52

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56 memoria empresas aquachile cap.03 REGULATORY CHANGES IN 2013 > 54 In 2013, a number of important modifications were made to the regulatory framework for aquaculture. On February 2013, Law Nº was published in the Official Gazette, introducing far-reaching modifications to regulation of artisan and industrial fishing as well as changes to the regulation of aquaculture. In the case of aquaculture, the principal modifications introduced by this law were: (i) the creation of a Register of Aquaculture Concessions held by the Undersecretariat for Fishing and Aquaculture, establishing that only those parties accrediting ownership or rights to exercise aquaculture can request the stamping of documents or the movement of fish; (ii) the elimination of differentiated systems of aquaculture concessions (Articles 80 bis and 80 ter); (iii) an increase in sanctions for the provision of false and/or incomplete information, under-reporting or late reporting on issues relevant to the activity; (iv) the empowerment of the National Fishing and Aquaculture Service to determine minor non-compliances that give rise to objections, providing they do not pose a threat to the environmental and sanitary situation; (v) an increase in the powers of the National Fishing and Aquaculture Service to enforce compliance with regulation; and (vi) the creation of Scientific Technical Aquaculture Committees to advise the authorities on environmental, sanitary and territorial planning matters. In 2013, the National Aquaculture Commission, created under Law Nº published in the Official Gazette of 3 August 2012, was formally established. This is a consultative body on matters such as sanitary and environmental regulation, modification of the General Fishing and Aquaculture Law and of use of the coastline and other aspects of aquaculture regulation. In 2013, this Commission heard a presentation by the Undersecretariat for Fishing and Aquaculture on new territorial planning regulation for aquaculture concessions. Supreme Decree (SD) Nº 3 of 2013, issued by the Economy, Development and Tourism Ministry and published in the Official Gazette of 24 May 2013, modified Regulation of Live Fish Holding Centers (or stockpiling centers) and Slaughtering Centers (contained in SD Nº 49 of 2006) or, in other words, places in the sea to which live fish are transferred before being taken to processing plants. The modifications introduced new conditions for the operation of such centers, for the transport of live fish, the submission of information to the authorities and the registry of operations. These new norms seek to ensure the sanitary protection of the areas where such centers are located by guarding against their contagion and that of navigation routes by the fish that are transferred. Supreme Decree Nº 4, issued by the Economy, Development and Tourism Ministry and published in the Official Gazette of 22 May 2013, modified Regulation of Measures of Protection, Control and Eradication of Diseases of High Risk to Hydrobiological Species, known as Sanitary Regulation (contained in DS Nº 319 of 2001). This modification resolved issues left pending or inadequately worded in the modification introduced in It gave new powers to the Undersecretariat and the National Fishing and Aquaculture Service and introduced new norms on matters relating to High- Risk Diseases, Sanitary Programs, zoning, egg incubation, transport, groupings of concessions and macrozones and, in particular, the establishment of farming densities for Groups of Concessions for salmonids, with density defined as the biomass of fish per area used per farming structure at the end of the growth phase of the production cycle. The procedure for determining the farming density for a Group of Concessions comprises two stages. In the first, the Group of Concessions is classified and a common density is determined and, in the second, the maximum number of fish permitted in the farming structures of each center is set. In the first stage of the procedure, the factors taken into account are environmental behavior (Aquaculture Sanitary and Environmental Reports, INFAs), sanitary behavior (losses at the Group of Concessions) and production behavior (comparison of the Group of Concession's projected stocking for the following period with its sanitary limit). This sanitary limit, or the

57 maximum number of fish to be stocked in the following period, is calculated as a percentage increase or decrease on the number of fish stocked in the previous production period depending on the range of losses observed in the Group of Concessions during this previous period. Each of these factors is weighted separately and a formula incorporating each weighted factor is then used to calculate whether the farming density should decrease, increase or remain the same in the following period. In the second stage of the procedure, the factors considered are the useful volume of the center's structures, the farming density of the Group of Concessions, the harvest weight of fish and the percentage of survival during the growth phase. These factors are used to calculate the number of fish to be stocked per farming structure in each concession. Article 86 bis of the General Fishing and Aquaculture Law stipulates that the Undersecretariat will determine farming densities for each species or group of species in the Groups of Concessions, doing so by issuing a resolution and in accordance with a procedure. Given the importance of protection of the industry's sanitary situation and the effects this has on its activities, it is relevant to refer to the regulatory framework for the diseases that were most prevalent in These were caligidosis, a disease caused by caligus rogercresseyi (more commonly known as sea lice), and SRS or piscirickettsiosis, both of which are classified as High-Risk Diseases. The tools that the authorities can use to implement sanitary measures for the monitoring, control and eradication of each of these high-risk diseases are established in Supreme Decree Nº 319 (Sanitary Regulation) and consist in Specific Sanitary Programs. In the case of caligidosis, the National Fishing and Aquaculture Service issued Resolution Nº 1141 on 18 May 2012, establishing a Specific Sanitary Program for the Monitoring and Control of Caligidosis. This established integrated management of the disease in a bid to ensure its early detection, reduce loads of the parasite and control its spread. This Program is applied in all farming centers with species susceptible to the parasite. Under this norm, the authority can classify centers as High-Monitoring, Low-Monitoring, High-Spread or At-Risk and is empowered to adopt measures in accordance with the situation. For the purposes of controlling the disease, the Program considers the implementation of opportune and coordinated measures in the case of the detection of high-spread centers, including zoning, intensive monitoring, coordinated treatment, control of spread of the disease and early harvesting of the infected biomass. In the case of SRS, the National Fishing and Aquaculture Service issued Resolution Nº 3174 on 28 December 2012, establishing a Specific Sanitary Program for the Monitoring and Control of Piscirickettsiosis in a bid to reduce the disease's impact in the country. It is applied in all farming centers with species susceptible to the disease, with the specific objectives of ensuring early detection and monitoring cases of SRS and the implementation of opportune and gradual measures of control of early and advanced cases. The Program stipulates the classification of all centers with species susceptible to the disease as Monitoring, Alert or High-Spread and the implementation of measures for each category. Groups of Concessions may adopt agreements on measures for the purposes of this control program in areas that include the quality of smolts, the use of vaccines, functional and immunostimulating feeds, transport conditions, farming densities, management and biosecurity. Infringement of measures established by these Programs is subject to sanctions in accordance with the terms of the General Fishing and Aquaculture Law. 55

58 memoria empresas aquachile company activities cap.03 ACTIVITIES AND BUSINESSES Chapter 3.2 Empresas AquaChile S.A. is a Chilean company that produces foods and proteins with an emphasis on the production and marketing of salmon, trout and tilapia. It comprises a group of companies with strategic synergies that farm and market Atlantic and Pacific salmon, trout and tilapia for human consumption, maintaining vertical control and adding value throughout the production chain from genetics through to the marketing of products. AquaChile S.A. is currently the world's fifth largest salmon and trout producer, with a harvest that reached 102,252 tonnes WFE in fig. 39 In addition, Empresas AquaChile is the world's largest producer of Pacific salmon and one of its largest producers of trout, with harvests of 20,994 tonnes WFE of Pacific salmon and 28,139 tonnes WFE of trout in 2013, accounting for 13.9% and 9.4% of international output of these species, respectively. fig. 40 / fig. 41 In 2013 AquaChile was Chile's leading exporter of salmon and trout, with a market share of 12.2% measured in terms of net volume of exports. fig. 42 / fig 42 Through its Costa Rican subsidiary, Grupo ACI S.A., the Company has also farmed and marketed tilapia since 2005, focusing on the North American market. It has established a consolidated position as one of the principal exporters of this product to the United States where it had a market share of 26% in AquaChile's most important markets are Japan and the United States. In the latter, it has had its own distribution company, AquaChile Inc., since It also exports to Europe, Asia, the Middle East and Latin America. AquaChile has over 300 geographically diversified clients in more than 30 countries across five continents. 56

59 PRINCIPAL WORLD SALMON AND TROUT PRODUCERS, 2013 (THOUSANDS OF TONNES WFE) fig MARINE HARVEST GROUP LEROY SEAFOOD GROUP CERMAQ SALMAR EMPRESAS AQUACHILE GRIEG SEAFOOD BAKKAFROST Sources: Reports of listed companies, AquaChile PACIFIC SALMON PRODUCER COUNTRIES, 2013 (THOUSANDS OF TONNES ) TROUT PRODUCER COUNTRIES, 2013 (THOUSANDS OF TONNES) fig CHILE NORWAY OTHERS TOTAL CHILE NORWAY OTHERS TOTAL Sources: Salmon World 2014, Kontali Analyse. CHILEAN PACIFIC SALMON EXPORTERS, 2013 (THOUSANDS OF NET TONNES 8 ) CHILEAN TROUT EXPORTERS, 2013 (THOUSANDS OF NET TONNES) fig AQUACHILE MAINSTREAM ACUINOVA SALMONES AYSÉN AQUACHILE ANTÁRTICA VENTISQUEROS BLUMAR Source: SalmonChile. Information as of December Net tonne refers to the weight of the salmon, trout or tilapia end product, whether with head on or off and gutted, fillets, portions, byproducts, etc. 57

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61 VOLUME OF SALES OF SALMON AND TROUT AND MARKET SHARE OF AQUACHILE (BY VOLUME) fig. 42 1ST 2ND 1ST 1ST 1ST 1ST 1ST 1ST 14.2% 14.1% 14.6% 12.9% 11.5% 11.5% 10.4% 12.2% market share exports (net tonnes) 97,763 90, ,221 73,721 53,604 65,089 64, ,180 volume of sales (tonnes WFE) Sources: AquaChile, Infotrade, SalmonChile MARKET SHARE OF PRINCIPAL CHILEAN SALMON AND TROUT EXPORTERS BY VOLUME fig. 43 empresa Empresas AquaChile 14.2% 14.2% 14.6% 12.9% 11.5% 11.5% 10.4% 12.2% Mainstream 8.9% 7.8% 6.9% 9.2% 7.9% 9.6% 9.5% 9.1% Multiexport 5.8% 6.5% 6.0% 6.3% 7.1% 5.9% 5.5% 5.9% Marine Harvest 13.2% 13.7% 11.1% 6.4% 4.3% 5.3% 6.2% 3.7% Los Fiordos 5.2% 5.1% 5.8% 7.4% 5.5% 7.8% 6.4% 7.8% Acuinova 2.9% 3.5% 2.8% 3.6% 4.1% 5.3% 6.6% 4.9% Blumar % 5.0% 4.4% Camanchaca 5.6% 5.4% 6.0% 4.2% 3.3% 1.8% 3.9% 4.6% Antártica 6.1% 4.7% 4.1% 4.0% 4.7% 4.9% 3.7% 3.1% Invertec 3.2% 2.3% 2.8% 2.2% 1.5% 2.9% 3.9% 2.8% Otros 34.9% 36.8% 40.0% 43.7% 50.1% 41.7% 38.8% 41.4% Total 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% Sources: Infotrade, SalmonChile. 59

62 AquaChile's principal export markets canada 180 canada 224 us 15,885 us 7,256 union europea 1,705 mexico 2,520 costa rica 335 panama chile 6,224 brazil 4,560 argentina 664

63 eastern europe 13,324 japón 25,305 china 2,720 south korea 379 middle east 1,487 hong kong 210 Taiwan 528 southeast asia 1,764 Sale of tilapia end products, 2013 (net tonnes) Sale of salmon and trout end products, 2013 (net tonnes) AquaChile operations

64 We have a team of engineers, biologists and veterinary physicians who are constantly researching and evaluating alternatives for the genetic improvement of the Company's stock and that of its subsidiaries.

65 aquachile is a company with great growth potential because: It has a unique and non-replicable base of concessions in chile, with a presence in 50% of neighborhoods. It has important potential for growth in tilapia. It has proven and successful experience in genetic development through aquainnovo, a subsidiary for genetic aquaculture research and development. Through its subsidiaries, it is self-sufficient in atlantic and pacific salmon and trout eggs and smolts and tilapia juveniles. It has its own processing plants capable of absorbing the growth of output. Its concessions are geographically diversified across the los lagos region (37%) and the aysén region (63%). By farming three different salmonid species in chile (atlantic salmon, pacific salmon and trout) and tilapia in costa rica and panama, it has a diversified range of products. It is an integrated company that adds value to the salmon, trout and tilapia production chain. FROM EGG TO PLATE SALMON AND TROUT > Each activity undertaken by AquaChile's employees is a vital part of the production chain that allows the Company to take healthy foods to the world's most demanding markets. Through its subsidiaries, AquaChile produces its own Pacific salmon (coho) and rainbow trout eggs, supplying 100% of its needs and even producing a surplus for sale to third parties. In addition, 100% of its Atlantic salmon eggs are supplied by Salmones Chaicas S.A., a subsidiary in which it has a 19.7% stake and with which it has a long-term supply contract. These eggs are part of a long process of research and development, carried out through its AquaInnovo S.A. subsidiary, which seeks to produce fish of better quality, with a better growth rate, a color in line with market demand and greater resistance to disease. When the fish reach their commercial size or weight, they are harvested and transported live to holding centers before being taken to the processing plants. AquaChile's five modern processing plants in Chile allow it to process all its output. At the processing plants, the different products offered by AquaChile are prepared and are, finally, marketed around the world, reaching over 300 large clients. We produce fresh and frozen products in different formats including whole fish, head on and off, filleted with and without skin, portions and loins. 71 million eggs produced in 2013 Following the fertilization and incubation of eggs, a new process begins which, depending on the species and the temperature of the eggs, takes between 50 and 80 days. The result of this process is juveniles (fish with a weight of between 0.3 grams and approximately 6 grams) which, after eight to ten months, become smolts (the physiological stage in which the fish is able to live and grow in saltwater) and start their life in the sea. In the case of Atlantic salmon, this process takes place in freshwater tanks and, in the case of trout, in a lake and, for Pacific salmon, in a lake, estuary or freshwater tanks. SALMON SALES BY COUNTRY, 2013 (NET VOLUME) 20% fig. 44 united states 15% russia During this process, the fish are subject to a rigorous program of control and vaccination. 8% chile After reaching the smolt stage, the fish move to the ongrowing phase in seawater centers where they remain for 18 to19 months in the case of Atlantic salmon and between ten and 12 months in the case of Pacific salmon and trout. For the growth phase, AquaChile has 150 seawater concessions located in the Los Lagos and Aysén Regions, where it is present in 29 neighborhoods (50% of the total). AquaChile had 40 seawater centers in operation as of 31 December % brazil 4% china 3% mexico 2% thailand 1% germany 1% israel 1% ukraine 6% cyprus 33% japan In addition, part of its feed requirements are supplied by Alitec Pargua S.A., a company in which AquaChile owns a 50% stake and is partnered by Biomar, one of the world's leading producers of high-yield feed for the aquaculture industry. Source: AquaChile. 63

66 memoria empresas aquachile cap.03 TILAPIA > Grupo ACI produces its own tilapia eggs and has the backing of Empresas AquaChile's AquaInnovo subsidiary which manages a genetic improvement program for this species. Tilapia is a freshwater fish. In Costa Rica, it is farmed in tanks on land, which cover a total area of 362 hectares, while, in Panama, it is farmed in cages - of the same type used in salmon farming - in three aquaculture concession on Lake Bayano, which have a total area of 520 hectares. The farming process begins with the reproduction phase before moving on to the production of juveniles and, subsequently, the pre-growth and growth stages. In total, the cycle has a duration of approximately 270 days before the fish reach a weight of 950 grams and are ready for harvesting. During this period, they receive a balanced soya-based diet and their state of health and growth are subject to constant monitoring. Grupo ACI and Biomar each hold a 50% stake in the Biomar Aquacorporation Products feed plant, which supplies part of Grupo ACI's requirements. On reaching the harvesting stage, fish from both Costa Rica and Panama are transported in trucks with freshwater tanks to the Terrapez processing plant (located in Cañas, Costa Rica). In the case of fish from Costa Rica, it receives the live harvest recently extracted from the farming tanks while, in the case of Panama, the fish are transported in gutted form with strict temperature and innocuity controls. Terrapez has a capacity to process 21,000 gross or WFE tonnes. It prepares different products such as fillets and whole tilapia as well as byproducts such as pieces, loins and bellies for the local market. Products are sold fresh or frozen depending on clients' needs. In partnership with Grupo Diana, the Company also owns the AquaSea plant in Costa Rica, which produces pet food flavorings. In this way, advantage is taken of the tilapia parts not used in the production process. The Company distributes its products in the United States, Costa Rica and Canada. However, its principal market is the United States where it distributes under the Rain Forest brand. In the case of Costa Rica, products are distributed under the St Peter s brand. fig. 45 "Aquachile farms tilapia in Costa Rica and Panama, principally for export to the United States." TILAPIA SALES BY COUNTRY, 2013 (NET VOLUME) fig. 45 4% costa rica 2% canada 94% United States Source: AquaChile. 64

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68 memoria empresas aquachile cap.03 1 / genetics 8 / marketing 2 / reproduction TILAPIA 7 / end product 3 / smolt production production value chain 6 / processing FEEDING 4 / pre-growth 5 / harvesting 66

69 1 / genetics, reproduction and incubation 7 / marketing 2 / hatching and juvenile production 6 / end product SALMON AND TROUT PRODUCTION VALUE CHAIN FEEDING 3 / smolt production 5 / processing 4 / growth stage and harvesting 67

70 memoria empresas aquachile cap.03 PRINCIPAL CONTRACTS There are currently no significant commercial contracts in force. PRINCIPAL CLIENTS The Company has more than 300 diversified clients in over 30 countries across five continents. In the salmon segment, the Company has no clients who individually accounted for at least 10% of the segment's revenues in In the tilapia segment, the Company has two clients who accounted for more than 10% of the segment's revenues. fig. 46 PRINCIPAL SUPPLIERS Empresas AquaChile maintains relations with its suppliers and, with some of them, has established a long-term tie. The Company has three suppliers who individually represented at least 10% of total procurement of goods and services for the salmon segment in fig. 47 In the tilapia segment, it has one supplier who individually accounted for at least 10% of total procurement. BRANDS AND DOMAINS The Company has registrations in force and applications underway for its commercial brands and those of its subsidiaries in the corresponding public registers in accordance with the legislation in force. These registers also include the companies' respective legal names. The Company has also registered the internet domains related to its brands in order to safeguard its interests and intangible assets. Products are marketed under the following brands: Source: AquaChile. 68

71 DISTRIBUTION OF SALMON CLIENTS, 2013 DISTRIBUTION OF SALMON SUPPLIERS, 2013 fig % others 9% client 1 6% client 2 5% client 3 4% client 4 4% client 5 15% supplier 1 15% supplier 2 4% client 6 68% others 12% supplier 3 4% supplier 4 3% supplier 5 Source: AquaChile 2% supplier 6 DISTRIBUTION OF TILAPIA CLIENTS, 2013 DISTRIBUTION OF TILAPIA SUPPLIERS, 2013 fig % others 10% client 1 8% client 2 7% client 3 25% client 1 17% client 2 5% client 4 5% client 5 2% client 6 63% others 5% client 3 4% client 4 4% client 5 3% client 6 Source: AquaChile 69

72 memoria empresas aquachile cap.03 R&D AquaChile has a team of engineers, biologists and veterinary physicians whose task is to improve the genetics of the salmonid species and tilapia which it farms. Their objective is to obtain strains that have the best possible adaptation to the Company's centers, thereby maximizing productivity. In addition, AquaChile has a subsidiary, AquaInnovo S.A., in which its partner is the University of Chile, whose objective is the genetic improvement of salmon and other aquaculture species. PRINCIPAL ASSETS The principal assets of Empresas AquaChile S.A., which are essential for the development of its activities, are listed in the Financial Statements of the Company and its subsidiaries. (See Note 9: Accounts Receivable; Notes 10 and 11: Inventory and Biological Assets; Note 13: Intangibles; Note 14: Goodwill; and Note 15: Property, Plant and Equipment). Fixed assets corresponding to constructions, infrastructure and machinery consist principally in six processing plants with their respective equipment - five in Chile and one in Costa Rica - along with the Company's offices, its freshwater and seawater installations, growth cages, protection equipment, tanks, containers, vehicles and boats. In the case of intangible assets, the Company has water rights and aquaculture concessions. It has 106 water rights for a total volume of 63, liters per second (l/s). SUMMARY OF WATER RIGHTS fig. 48 region Number of rights Santiago Metropolitan 5 Araucanía 12 Los Lagos 68 Aysén 20 Los Ríos 1 Total 106 The Company has 163 Aquaculture Concessions of its own (150 in the sea, one in a river and 12 in lakes) with a total area of 1, hectares (of which 1, hectares correspond to the sea and hectares to lakes). All these concessions have an indefinite duration. fig. 49 As of 31 December 2013, the Company had 44 river and marine aquaculture concessions and five lake aquaculture concessions in use. fig A summary of the principal characteristics of aquaculture concessions and their regulatory treatment can be found in the Regulatory Framework section of this Report.

73 SUMMARY OF AQUACULTURE CONCESSIONS fig. 49 regi0n Number of marine and river concessions (Own) Total Area (hectares) In use as of 31/12/13 Number of lake concessions (Own) Total Area (hectares) In use as of 31/12/13 Los Lagos Aysén Los Ríos Total 151 1, * GEOGRAPHIC LOCATION OF THE COMPANY'S MARINE CONCESSIONS fig. 50 LOS LAGOS REGION A 3B B 17A 1 INDUSTRY Total of 24 neighborhoods AQUACHILE 56 concessions in 12 neighborhoods 10A 9A 9B 9C 16 10B A 13 12C 12B AYSÉN REGION 18A A 18B 20 19C 18C 18D 18B 31A 33 INDUSTRY Total of 34 neighborhoods AQUACHILE 93 concessions in 17 neighborhoods 21A 21B 31B 32 22A 22C 22D 21C 22B 29 23A 30A 30B 28A 26B 28B 23C 23B A 25 71

74 memoria empresas aquachile company activities cap.03 PROPERTIES AND INSTALLATIONS Chapter 3.3 Most of the Company's freshwater and seawater farming centers have adjacent premises with housing for the operational unit's senior technical personnel, canteens for personnel and warehouses for smaller implements. In addition, the Company has floating raft cages in each of its freshwater and seawater farming centers for implementation of the aquaculture production process. Harvested fish are sent to the Company's processing plants which are located on its own land: / Cardonal processing plant (Puerto Montt), geared principally to the production of addedvalue Atlantic salmon and trout products. / Calbuco processing plant (Calbuco), used principally to produce added-value Atlantic salmon and trout products. / Antarfood processing plant (Chonchi), used to process HG (headed and gutted) products and added-value Atlantic salmon, Pacific salmon and trout products. / Hueñocoihue processing plant (Dalcahue), used to process HG Pacific salmon products. / Cailín processing plant (Quellón), used to process HG Pacific salmon products. / Terrapez processing plant (Costa Rica), used to process added-value tilapia products. 72

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77 company activities INSURANCE POLICIES Chapter 3.4 Empresas AquaChile and its subsidiaries have taken out insurance against the principal risks to their physical goods, offices, processing plants and installations as well as for civil liability and other lesser risks to its assets. An important part of the risks have, in other words, been transferred to local insurance companies which have, in turn, reinsured part of these risks on the international market. The operational risks of the Company's businesses are constantly reassessed in order to optimize coverage in line with the competitive offers available in the market. The coverage taken out includes: TYPE OF GOOD RISKS COVERED live, harvested fish Damage as a result of or directly caused by an external agent during transport by sea, air and/ or land. Deterioration of the goods as a result of fire, including earthquake. buildings, installations, machinery and end products Deterioration of the goods as a result of damage caused by natural hazards. Coverage against fire and material damage as a direct result of strikes, pillage or public disturbances. fresh, frozen and smoked fish (salmon and trout) Losses and/or damage during transport by sea, air and/or land. life insurance Accidental or natural death. civil liability insurance General insurance of this type, covering material damage and injury to third parties. 75

78 memoria empresas aquachile company activities cap.03 RISK FACTORS Chapter 3.5 The Company, its assets and the aquaculture industry in which it develops its activities are exposed to a series or risks and contingencies that may eventually have a negative impact on the Company's solvency, its market position or financial situation and must be taken into account when taking an investment decision. If any of these risks or uncertainties were to materialize, the Company's business, operating results and/or financial situation could be materially and adversely affected. The most important risks and contingencies are set out below, notwithstanding the possible existence of other risks and contingencies that could also negatively affect the Company's business and its operating results. OPERATIONAL RISKS Environmental risks > Notwithstanding the geographic diversification of the production facilities of Empresas AquaChile and its subsidiaries in Chile, the salmon industry is exposed to natural hazards such as variations in sea temperature, climatic phenomena, seismic events, algal bloom 9, the existence of natural predators and other factors that can affect the places where its production facilities are located. All these factors can affect the growth of Empresas AquaChile and its subsidiaries, have a negative impact on the quality of its products and even increase mortality rates which would lead to a drop in output and, therefore, the Company's sales and results. Phytosanitary risks > Diseases, parasites and pollutants are a recurrent problem in the aquaculture industry and can result in reduced product quality, increases in mortality and reductions in output. Although Empresas AquaChile and its subsidiaries have invested significant resources in research, genetic improvement studies, mass vaccination programs, systems of administration of independent zones, fish health monitoring, low density cage-use policies and sanitary barriers that help to control and reduce these risks, the appearance of new diseases or pests that affect the production of salmon, trout and/or tilapia cannot be ruled out Natural phenomena, also known as Harmful Algal Bloom (HAB), that occur in aquatic ecosystems and are caused by phytoplankton that, in environmental conditions favorable to their development, multiply explosively and concentrate, causing alterations in marine life and fish mortality.

79 Product quality risks and traceability > The products that the Company farms, produces and markets are for human consumption and there is a risk of contamination due to negligence during production process or improper management during the process of distribution and/or delivery to the end consumer by clients, consumers or third parties, which could affect the Company's sales and results. To guard against this, AquaChile has developed exhaustive quality classification and food safety controls and is constantly monitored internally and externally by the sector authorities. In order to control food innocuity, the Company provides complete fish traceability and, before harvesting, the authorities ensure that fish are analyzed to rule out any trace residues. Processing plants are also subject to sample checks in order to safeguard the innocuity of the process and raw materials. In this way, both the authorities and clients can verify the innocuity of AquaChile's products. Because they are farmed in an open environment like the sea, the fish are exposed to contracting diseases that can have an impact on their health. In order to control these impacts, AquaChile has a health department comprising veterinary physicians responsible for establishing a prevention policy and monitoring sanitary aspects of the fish population and, if a disease is detected, defining the proper treatment for its combat. Not to do this would constitute a risk to the fish population and to the Company's results. Risks of variations in input prices > Inputs of fish meal and fish oil are among the most important costs of salmon production. Sources of fish feed have diversified, now including new vegetable alternatives, and the Company has invested in two feed plants of its own to supply part of its input requirements. However, AquaChile and its subsidiaries can be affected by variations in prices due to circumstances beyond their control since the feed industry is concentrated in the hands of a few international producers and there is not a deep market for futures or other derivatives for the purchase of a number of the inputs that make up the diet of salmon, trout and tilapia. This could negatively affect the Company's results. International price trends > Supply of salmon and trout is determined by the production strategies of each of the industry players and it is, therefore, difficult to forecast and estimate products' equilibrium price. In addition, demand for farmed salmon has shown strong growth in recent years and a difference between supply and demand for salmon products could, therefore, occur, leading to price volatility which could negatively affect the Company's results. However, a dynamic process of consolidation in the salmon industry, both internationally and in Chile, suggests more balanced future growth. Moreover, diversification into other species such as tilapia and the Company's geographic diversification could minimize the negative impact of high volatility, complementing the portfolio it offers the market. Variations in consumption in export markets > Although the international trend suggests a sustained increase in consumption of farmed fish and other aquaculture products over the coming years, the Company cannot assure that this trend will continue or persist over time and a change or reversal could have negative effects for its business and operating results. Changes in the economic performance of export markets > At present, the Company exports principally to the United States, the European Union and Japan and it is not possible to rule out stagnation, crises or economic depressions in these countries, with the consequent drop in demand, which could have negative effects on the Company's business and operating results. FINANCIAL RISKS Concentration of financial liabilities > The Company has signed loan contracts with its financial creditors that, as well as stipulating maturities, interest rates, the financial indicators required and the collateral provided, also contain a series of obligations as to what the Company may and may not do. These contracts also include different mechanisms for the approval of any exception to the obligations stipulated in them by its creditors. In addition, if the Company fails to pay any of the installments of capital and interest at the agreed dates, if it does not comply with the agreed terms as to what it may or may not do and if it maintains this lack of compliance for more than 90 days, its financial creditors may require the forfeiture of the agreed deadlines and advance payment of the total debt and interest, which could negatively affect the Company's financial situation and its results. 77

80 memoria empresas aquachile cap.03 Exchange-rate risk > The performance of AquaChile, as a global company, can be negatively affected by fluctuations in exchange rates since part of its cost (labor and services such as land transport, etc.) are indexed to the Chilean peso while its sales are denominated in foreign currencies such as the US dollar, euro and yen. In addition, since the Company reports its results in US dollars, changes in this currency's value against the other currencies in which the Company operates can negatively affect its financial results. REGULATORY AND ENVIRONMENTAL RISKS Changes in environmental legislation and others > Care for the environment is core to the Company's business policy. However, contamination of natural resources as a result of the externalities of production processes is a matter of increasing concern and awareness among consumers, intermediate groups and the relevant authorities who demand production systems that respect the environment and previously guarantee long-term protection of natural resources. These demands have led to the introduction of more rigorous norms and procedures which seek to ensure environmental sustainability and can mean important increases in production costs and/or restrictions on the Company's productive activities. Changes in aquaculture legislation and concessions > The Company has in place processes and constant monitoring to ensure good management of its farming sites as well as a technical department and legal advice to supervise the good use and management of its aquaculture concessions. However, changes in aquaculture legislation and concessions, improper management of aquaculture concessions and/or failure to comply with the corresponding norms on sustainability and proper operation of the system as a whole and the inactivity of concessions without justified cause or authorization from the authorities could result in sanctions or restrictions that could negatively affect the Company's business and operating results and, where envisaged by the applicable legislation, even lead to the termination of some of its aquaculture concessions by the authorities. OTHER RISKS Risks to assets > Fixed assets such as installations and buildings and civil liability risks are covered by insurance policies on commonly-applied market terms and conditions. However, given the lack of effective insurance options, the high costs prevailing in the market for insuring living assets or biomass and disputes with insurers as regards response to such losses, the Company's biomass is not currently insured against the risks of disease, theft or natural hazards such as storms, high tides, tsunamis, earthquakes, volcanic eruptions, currents, floods, avalanches and/or landslides, submarine currents and/or algal blooms. As a result, any significant damage or loss to these assets can have an adverse effect on the Company's business and financial situation. However, the geographic diversification of the Company's installations on land and of its farms in the sea enables it to at least diversify, if not eliminate, the risk of such events. Subsidiaries and affiliated companies > Empresas AquaChile S.A. is the parent and holding company of a number of companies through which it develops a significant part of its business and on whose operating results and financial situation it depends to a considerable extent. Any significant deterioration in the business and results of its subsidiaries and affiliated companies can, therefore, have an adverse effect on its own business and operating results. 78

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83 company activities INVESTMENT PLANS Chapter 3.6 The Company will implement the investments that are necessary to fulfill its purpose as established in its by-laws. To this end, its management will have the powers to make investments in the business on the basis of expansion plans approved by the Board of Directors and in projects that are profitable according to technical and economic criteria. The sources of financing for investment plans are managed in accordance with the Company's financial plan. Financial resources are obtained from the Company's own sources, traditional borrowing, publicly-traded instruments and equity contributions if financial and strategic conditions so advise and permit. 81

84 memoria empresas aquachile company activities cap.03 FINANCIAL ACTIVITIES Chapter 3.7 The Company uses credit to finance its exports in accordance with the Chilean Central Bank's Compendium of Foreign Exchange Regulations. These credits are paid with currency corresponding to export returns. The Company undertakes the financial activities corresponding to its area of business and export credits are its principal source of financing. Cash surpluses are invested in the local financial market in short-term fixedincome instruments. 82

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86 OWNERSHIP AND SHARES Annual report AquaChile 2013

87 4.1 Ownership Shares, their characteristics and rights 90

88 memoria empresas aquachile ownership and shares cap.04 OWNERSHIP Chapter 4.1 As of 31 December 2013, the Company's subscribed and paid-in capital amounted to five hundred and fourteen million four hundred and sixty two thousand nine hundred and fifty dollars (US$ 514,462,950), divided into one thousand one hundred and fifty seven million shares (1.157,000,000), all of the same series. CONTROL OF THE COMPANY As of 31 December 2013, the Company did not have a controller and no agreement existed among shareholders to act jointly. MAJORITY SHAREHOLDERS As of 31 December 2013, the Company had three shareholders who could on their own appoint at least one member of its Board of Directors and, at the same time, held a stake of a more than 10% stake in the Company. table a fig. 51 name N of shares Stake Fondo de Inversión Privado Patagonia 382,115, % Holding Salmones S.A. 210,000, % Inversiones Acuícolas S.A. 172,215, % The individuals or legal entities that directly or indirectly hold at least a 10% stake in the Company are: A.1 Individuals or legal entities related to the Puchi Acuña and Aguilera Marín families, comprising the brothers Víctor Hugo Puchi Acuña, Chilean Tax N (RUT) ; Mario Puchi Acuña, RUT ; Juan Carlos Puchi Acuña, RUT ; and Pablo Aguilera Marín, RUT The members of the Puchi Acuña family, including Pablo Aguilera Marín, exercise their rights as individuals or through investment companies that are wholly owned by the same family. 86

89 Stake Fondo de Inversión Privado Patagonia, Chile - Chilean Tax N (RUT) % Inversiones VHP Ltda., Chilean Tax N (RUT) % Inversiones MPA Ltda., Chilean Tax N (RUT) % Inversiones Altair Ltda., Chilean Tax N (RUT) % Inversiones JCP SpA, Chilean Tax N (RUT) % Inversiones Santa Cecilia Ltda., Chilean Tax N (RUT) % Pablo Aguilera Marín, Chilean Tax N (RUT) % Mario Puchi Acuña, Chilean Tax N (RUT) % Víctor Hugo Puchi Acuña, Chilean Tax N (RUT) % Juan Carlos Puchi Acuña, Chilean Tax N (RUT) % Fondo de Inversión Privado Patagonia, RUT , is directly or indirectly controlled by Víctor Hugo Puchi Acuña, RUT ; Mario Puchi Acuña, RUT ; Juan Carlos Puchi Acuña, RUT ; and Pablo Aguilera Marín, RUT The members of the Puchi Acuña family and Pablo Aguilera Marín exercise their rights as individuals or through investment companies that are wholly owned by the same family. Inversiones VHP Limitada, RUT , is wholly owned by Víctor Hugo Puchi Acuña, RUT , and the Puchi Reyes family, comprising his wife Myriam Cecilia Reyes Abarca, RUT , and the siblings Rodrigo Alejandro Puchi Reyes, RUT ; Paulina Andrea Puchi Reyes, RUT ; Verónica Puchi Reyes, RUT ; and Cecilia Puchi Reyes, RUT Inversiones Santa Cecilia Limitada, RUT , is wholly owned by Víctor Hugo Puchi Acuña, RUT , and the Puchi Reyes family, comprising his wife Myriam Cecilia Reyes Abarca, RUT , and Rodrigo Alejandro Puchi Reyes, RUT Inversiones MPA Limitada, RUT , is wholly owned by Mario Puchi Acuña, RUT , and the Puchi Germani family, comprising his wife Loreto Esmirna Germani Díaz, RUT , and the brothers Claudio Humberto Puchi Germani, RUT ; Carlos Mauricio Puchi Germani, RUT ; and Gabriel Alejandro Puchi Germani, RUT Inversiones JCP SpA, RUT , is wholly owned by Juan Carlos Puchi Acuña, RUT , and the siblings Juan Carlos Puchi Ramírez, RUT ; Francesca Paz Puchi Ramírez, RUT ; Isidora Fernanda Puchi Rojas, RUT ; and Josefa Catalina Puchi Rojas, RUT Inversiones Altair Ltda., RUT , is wholly owned by Pablo Enrique Aguilera Marín, RUT , and the Aguilera Soto family, comprising his wife Lesdi Margarita Soto Sad, RUT , and the brothers Pablo Alberto Aguilera Soto, RUT K; Enrique Ignacio Aguilera Soto, RUT K; and Fernando Antonio Aguilera Soto, RUT

90 memoria empresas aquachile cap.04 A.2 Individuals or legal entities related to the Fischer Llop family, comprising the brothers Humberto José Fischer Llop, RUT , and Claudio Félix Fischer Llop, RUT The members of the Fischer Llop family exercise their rights as individuals or through investment companies that are wholly owned by the same family. Holding Salmones S.A., RUT , is wholly controlled directly or indirectly by the Fischer Llop family, comprising the brothers Humberto José Fischer Llop, RUT , and Claudio Félix Fischer Llop, RUT The members of the Fischer Llop family exercise their rights as individuals or through investment companies that are wholly owned by the same family. Inversiones Acuícolas S.A., RUT , is wholly controlled directly or indirectly by the Fischer Llop family, comprising the brothers Humberto José Fischer Llop, RUT , and Claudio Félix Fischer Llop, RUT The members of the Fischer Llop family exercise their rights as individuals or through investment companies that are wholly owned by the same family. Stake Holding Salmones S.A. Rut # % Inversiones Salmones Ltda., Chile Rut# % Claudio Félix Fischer Llop Rut # % Humberto José Fischer Llop Rut # % Inversiones Acuícolas S.A., Chile Rut # % Holding Salmones S.A., Rut # % Sociedad de Inversiones Inmobiliarias Ltda. RUT # ,15% 88

91 IDENTIFICATION OF TWELVE PRINCIPAL SHAREHOLDERS Table B shows the 12 principal shareholders of Empresas AquaChile, indicating the number of shares and stake held by each as of 31 December fig. 52 SHAREHOLDERS As of 31 December 2013, the Company had a total of 153 registered shareholders. SIGNIFICANT OWNERSHIP CHANGES IN 2013 In 2013, Fondo de Inversiones Privado Aqua, RUT , related directly or indirectly to the Fischer Llop family as one of the majority shareholders, sold all its stake (210,000,000 shares) to Holding Salmones S.A., RUT , also owned by the same shareholders. As of 31 December 2013, these shares were held in custody by Corredora de Bolsa Larraín Vial S.A. table B name n of shares stake fig. 52 Fondo de Inversión Privado Patagonia 382,115, % Larraín Vial S.A. Corredores de Bolsa* 222,691, % Inversiones Acuícolas S.A. 172,115, % Inversiones Megeve Capital Ltda. 80,776, % IM Trust S.A. Corredores de Bolsa 35,374, % Moneda S.A. AFI para Pionero Fondo de Inversión 21,401, % Fondo de Inversión Privado Aurora I 20,723, % Inversiones Megeve Dos Ltda. 19,375, % Compass Small Cap Chile Fondo de Inversión 17,757, % Banchile Corredores de Bolsa S.A. 15,849, % BTG Pactual Chile S.A. Corredores de Bolsa 15,126, % AFP Hábitat S.A. Fondo Tipo A 7,058, % *Includes Holding Salmones S.A. with 210,000,000 shares that represent 18.5% of the Company. 89

92 memoria empresas aquachile ownership and shares cap.04 SHARES, THEIR CHARACTERISTICS AND RIGHTS Chapter 4.2 DESCRIPTION OF SHARE SERIES > As of 31 December 2013, the subscribed and paid-in capital of Empresas AquaChile S.A. was represented by 1,157,000,000 shares, all of the same series. DIVIDEND POLICY > As of 31 December 2013, the Company did not possess accumulated liquid profits suitable for distribution as dividends. Under its by-laws, the Company must pay at least 30% of each year's liquid profits to its shareholders as dividends pro rata to their stake, unless the respective Shareholders' Meeting decides by the unanimity of the shares issued to distribute a smaller percentage. STATISTICAL INFORMATION > Dividends For the past six years, AquaChile has not distributed dividends to its shareholders. Stock market trading Quarterly trading in the shares of Empresas AquaChile on the Santiago Stock Exchange, the Chilean Electronic Stock Exchange and the Valparaíso Stock Exchange is shown in the table below. fig. 53 The graph below shows AquaChile's share price compared to the IPSA index 10 in fig. 54 Trading in the Company's shares by related shareholders during 2013 is shown in the table below. fig IPSA: Selective Share Price Index of the 40 most heavily traded shares, calculated by the Santiago Stock Exchange 90

93 SHARE TRADING summary 2013 N of shares traded Amount traded (CLP) Average price (CLP) Market presence ** fig. 53 QI 32,135,756 12,063,924, % QII 27,775,853 9,886,640, % QIII 14,355,665 4,010,838, % QIV 236,405,577 62,221,200, % Annual 310,672,851 88,182,604, % Sources: Bolsa de Comercio de Santiago, Bolsa Electrónica de Chile, Bolsa de Valores de Valparaíso. ** On the Santiago Stock Exchange at the end of each quarter. AQUACHILE SHARE PRICE AND IPSA (BASE = 100) fig. 54 AQUACHILE IPSA jan 13 feb 13 mar 13 apr 13 may 13 jun 13 jul 13 aug 13 sep 13 oct 13 nov 13 dec 13 Source: Bloomberg SHARE TRADING BY RELATED SHAREHOLDERS fig. 55 average unit price total amount shareholder relation type of purchase sale purchase sale purchase sale operation $/share $/share th$ th$ Inversiones Megeve Capital Limitada Inversiones Kandel Ltda. Inversiones Acuícolas S.A. José Luis Vial van Wersch Alfonso Márquez de la Plata Cortés Fondo de Inversión Privado Aqua Holding Salmones S.A. Company of director Company of director Majority shareholder Executive- CFO Executive- CEO Majority shareholder Majority shareholder Financial investment Financial investment Financial investment Financial investment Financial investment Financial investment* Financial investment* 7,750, ,945,000 29, , , ,500 60, ,999 41, , ,000, ,650, ,000, ,650,000 91

94 CORPORATE GOVERNANCE Annual report Memoria AquaChile 2013

95 5.1 Board of Directors Director s Committe Management 102

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97 corporate governance BOARD OF DIRECTORS Chapter 5.1 BOARD OF DIRECTORS AquaChile's Board of Directors has seven members elected by the Shareholders' Meeting who, under the Company's by-laws, hold office for three years. The Company does not have deputy directors. The Board's principal functions, which are regulated by Chile's Law N on public companies, consist in the Company's administration. In addition, it represents the Company judicially and extra-judicially in all the acts required for the fulfillment of its purpose and, to this end, has all the powers of administration and decision that the law or the Company's by-laws establish as corresponding to the General Shareholders' Meeting. The Board meets monthly to evaluate and guide the Company's economic, environmental and social development. Directors receive a set fee for attendance at board meetings and are not entitled to variable remuneration depending on the Company's achievement of economic, social or environmental objectives. The Chairman and other directors do not hold executive posts in the Company. 95

98 memoria empresas aquachile cap Víctor Hugo Puchi Acuña humberto fischer llop mario puchi acuña claudio fischer llop alejandro pérez rodríguez - Chairman of the Board - RUT: Date appointed: 17 April Puchi holds an undergraduate degree in economics and business administration from the Universidad Católica de Chile and an MBA from the University of Chicago. After completing his studies, he worked in the finance area of companies that included Iansa, Grupo BHC and Quiñenco. He is a director of Centrovet and Empresas Hidronor and has business activities in the real estate, tourism and cattle farming sectors in the Los Lagos and Aysén Regions. - Director - RUT: Date appointed: 17 April Fischer is a veterinary physician from the Universidad Austral de Chile. He was one of the pioneers of the salmon industry and, in 1985, founded Salmones Pacífico Sur S.A, a company that initially focused on the seawater growth stage and marketing of the product. He has investments in the tourism, agriculture, cattle farming and real estate sectors and is also a director of the Dreams hotel and casino chain which has operations throughout Chile. - Director - RUT: Date appointed: 17 April Puchi holds a technical university degree in fishing from the Universidad Técnica del Estado. He began his professional career in the Aysén Region, working first for the Agricultural Inspection Service (SAG) and then for the National Fishing Service (SERNAPESCA), a post that allowed him to specialize and participate in the project for the introduction of Pacific salmon in Chile. He currently has cattle farming business activities in the Los Lagos and Aysén Regions. - Director - RUT: Date appointed: 17 April Fischer is a cargo pilot and was a founding partner of Salmones Pacífico Sur S.A., established in He currently has investments in sectors that include transport, tourism, real estate, agriculture and cattle farming and is a director of different companies in these sectors. He is also executive president of the Dreams S.A. hotel and casino chain and of the Zona Franca de Punta Arenas. - Director - RUT: Date appointed: 17 April Pérez holds an undergraduate degree in civil industrial engineering from the Universidad de Chile and a master's degree in economics from the piero solari donaggio pilar lamana gaete University of Chicago. He is chairman of the board of the Universidad San Sebastián, vice-chairman of the board of Clínica Indisa and a director of Entel and Inversiones Angelini Ltda. He previously served as general manager of Celulosa Arauco S.A., Soprole S.A. and Watt s Alimentos S.A. - Director - RUT: Date appointed: 17 April Solari holds an undergraduate degree in civil industrial engineering from the Universidad Católica de Chile and an MBA from the Sloan School of Management, MIT. He is executive director of Family Office Megeve Investments and a director of Haldeman Mining Company and Parque del Recuerdo as well as vicechairman of Aptus Chile, a non-profit educational organization. From 2004 to 2009, he was chairman of the Aguas Nuevas S.A. water company. - Director - RUT: K - Date appointed: 17 April Lamana holds an undergraduate degree in economics and business administration from the Universidad de Chile and is a company consultant, a professor at the Universidad Adolfo Ibáñez and director of its Retail Center. She is also a director of Empresas Flores and Empresas Artel and owner of Gelatería Biancolatte. She previously held a number of posts, including senior vice-president for customer management, at Unilever Chile. The Company's directors over the past two years also included Vicente Pérez Fuentes. He was appointed by the General Shareholders' Meeting of 29 April 2011 and ceased to be a director on 17 April 2012 when the General Shareholders' Meeting elected a new Board of which he is not a member. vicente pérez fuentes - RUT: Director - Date appointed: 29 April Date ceased to be a director: 17 April Pérez holds an undergraduate degree in economics and business administration from the Universidad de Tarapacá and has over 20 years' experience in the fishing and salmon industry. He is a director of companies that include Equitas Capital and Empresas Hidronor. He has served as representative of Iceland's Glitnir Bank, general manager of Congelados Pacífico ( ), general manager of Pacific Fisheries S.A., assistant general manager of Pacific Protein ( ) and director of Inversiones Ewos Ltda ( ). In addition, he has participated in various companies related to industrial fishing and the marketing of fish products in both the United States and Europe.

99 The Board meets monthly to evaluate and guide the Company's economic, environmental and social development.

100

101 BOARD EXPENDITURES In 2013, expenditures by the Board of Directors reached US$216,000 and consisted principally of travel and accommodation expenses in Chile and abroad for US$120,000 and miscellaneous general expenses for US$96,000. EXPENDITURE ON ADVISORY SERVICES In 2013, the Board of Directors did not hire advisory services. However, the Company's auditors, PwC, were commissioned to carry out a study of transfer prices for the purposes of the new sworn statements required by Chile's National Tax Service (SII). The fee for this study was not significant with respect to the Board's annual budget. REMUNERATIONS OF MEMBERS OF THE BOARD OF DIRECTORS AND THE DIRECTORS' COMMITTEE In 2013, directors and members of the Directors' Committee received remunerations for their participation in the Board of Empresas AquaChile S.A. as shown in the table below. fig. 56 The fees, remunerations and financial, commercial and management advisory services received by members of the Board of Directors for the year ended on 31 December 2013 amounted to US$708,000 (as compared to US$697,000 for the year ended on 31 December 2012). REMUNERATIONS OF BOARD OF DIRECTORS (US$) fig. 56 Name of director Board (Fee for attendance) Executive Committee (Fixed fee) Directors' Committee (Fee for attendance) total Víctor Hugo Puchi Acuña Chairman 99, ,881 84,000 84, , ,881 Humberto Fischer Llop DIRECTOR 55,284 56,360 84,000 84,000 10,098 10, , ,513 Mario Humberto Puchi Acuña DIRECTOR 55,217 56,641 84, , ,641 Claudio Fischer Llop DIRECTOR 50,370 45, ,370 45,970 Alejandro Pérez Rodriguez DIRECTOR 55,280 51, ,081 10,191 65,361 61,718 Piero Solari Donaggio DIRECTOR 49,998 51, ,998 51,279 María del Pilar Lamana Gaete DIRECTOR 59,998 46, ,005 10,220 70,003 56,470 Vicente Pérez Fuentes (1) EX-DIRECTOR - 10, ,277 Total 426, , , ,000 30,184 30, , ,749 (1) Until April

102 memoria empresas aquachile corporate governance cap.05 ANNUAL REPORT OF THE DIRECTORS' COMMITTEE Chapter 5.2 Under Chilean law, public companies must appoint at least one independent director and a Directors' Committee when they have a market capitalization of at least 1,500,000 unidades de fomento (an inflation-indexed currency unit) and at least 12.5% of the voting shares are held by shareholders who individually control or possess less than 10% of these shares. Empresas AquaChile has established a Directors' Committee in accordance with Article 50 bis of Law N on Public Companies. Three of the seven members of the Board of Directors form the Directors' Committee, which fulfils the role envisaged in the Law The Directors' and Audit Committee has the functions required under Article 50 bis of Law No and other applicable regulation. These functions include: / / / To examine the reports of the Company's external auditors, its statement of financial position and other financial statements that its administrators provide to shareholders and to express an opinion on these reports prior to their presentation for approval by shareholders; To put to the Board proposals as to the external auditors for presentation to the corresponding Shareholders' Meeting; To examine and report on all matters regarding related-party transactions; controlling shareholders. A director is considered independent when he or she does not, in general, have ties, interests or economic, professional, credit or commercial dependence of a significant nature or size with or on the company, the other companies in the group of which it forms part, its controller or principal executives or a family relationship with the latter or any of the other types of ties specified in Law Nº As of 31 December 2013, the Directors' Committee was formed by Mrs. Pilar Lamana Gaete (independent director) and by Messrs. Humberto Fischer Llop (director) and Alejandro Pérez Rodríguez (director and chairman of the Directors' Committee). ESTABLISHMENT OF THE DIRECTORS' COMMITTEE The Directors' Committee of Empresas AquaChile S.A. was established, in accordance with the provisions of the Law on Public Companies which governs this matter and, particularly, Article 50 bis of this Law, by a decision of the Board of Directors at its meeting of 3 May As the Company had only one independent director, it fell to this director to appoint the Committee's other members from among non-independent directors who could not include the Chairman of the Board of Directors. The independent director, Mrs. Pilar Lamana Gaete, selected Messrs. Humberto Fischer Llop and Alejandro Pérez Rodríguez as the other two members of the Directors' Committee. The Committee appointed Mr. Alejandro Pérez Rodríguez as its chairman, Mr. Humberto Fischer Llop as its vice-chairman and Mr. Álvaro Varela Walker as its secretary. / To report to the Board on the convenience or otherwise of hiring the external auditing company for services that do not form part of the external auditing service, when these are not forbidden. The Committee agreed to hold ordinary meetings at least once every three months and extraordinary meetings whenever necessary and as stipulated in the Regulation of the Committee's Operation. The requirements for directors independence are set out in Chile s Law on Public Companies (Nº ) and its subsequent modifications under Law Nº on the relationship between directors and a company s MEETINGS OF THE DIRECTORS' COMMITTEE In compliance with its functions as established by Law Nº , the Directors' Committee met regularly in 2013 in accordance with its powers and duties. During the year, the Committee held four ordinary and two extraordinary sessions. 100

103 1.- Extraordinary Session N 4 31/1/13 > Review of the remunerations systems and compensation plans for the Company's managers and principal executives; Review of the powers of attorney and mandates issued by the Company; Review of information on payment of travel allowances and expenses; Review of procedures for the acquisition of equipment and materials and for tenders for construction work and services. 2.- Ordinary Session N 4 8/3/13 > Preliminary review of Norm of a General Character (NCG) N 341 on Self- Evaluation of Corporate Governance; Annual report on activities of the Directors' Committee; Review of audited Annual Financial Statements as of 31 December 2012; Review of bids and proposals for external auditing in Ordinary Session N 5 27/5/13 > Review of Intermediate Consolidated Financial Statements as of 31 March 2013; Review of loans to related company. 4.- Ordinary Session N 6 29/8/13 > Hiring of advisory services on transfer prices; Reorganization of the company structure of certain subsidiaries and hiring of external auditing services for the reorganization; Review of transactions with related companies. 5.-Extraordinary Session N 5 5/9/13 > Review of Intermediate Consolidated Financial Statements as of 30 June Ordinary Session N 7 20/11/13 > Review and analysis of Auditors' Internal Control Letter; Review of Intermediate Consolidated Financial Statements as of 30 September 2013; Review of transactions with related companies. At each meeting, the Committee approved the Annual and Intermediate Financial Statements presented by the Company's management and agreed to recommend their approval by the next meeting of the Board of Directors at which they were on the agenda. All the members of the Directors' Committee attended each of its meetings in In addition, on the Committee's invitation, they were attended by the Company's CEO and CFO. The minutes of the Committee's meetings in 2013 were signed by all the directors who form this Committee. In 2013, the Directors' Committee did not make use of the annual budget allocated for its expenses by the General Shareholders' Meeting. OTHERS Under Chile s Law on Public Companies, a listed company's operations with a "related" party must take place in market conditions and comply with certain authorization and disclosure requirements that are different from those applying to a non-listed company. This applies to listed companies and all their subsidiaries. AquaChile has carried out different transactions with its subsidiaries. In the normal course of the Company s business, different types of services have been provided to or received from related companies, including the rental of installations, the sale or purchase of inputs and/or medicines for fish and cargo and passenger transport services. AquaChile's policy is not to carry out transactions with or for the benefit of any shareholder or Board member or with any entity controlled by these persons or in which they have a significant economic interest, except when the transaction is related to the Company and the price and other terms are at least as favorable for the Company as those which could be obtained from a third party on equal conditions. These transactions are summarized in the audited consolidated financial statements for the year ended on 31 December EXPENDITURES BY THE DIRECTORS' COMMITTEE In 2013, the Directors' Committee did not incur any expenses. EXPENDITURE ON ADVISORY SERVICES In 2013, the Directors' Committee did not hire advisory services. 101

104 memoria empresas aquachile corporate governance cap.05 MANAGEMENT Chapter 5.3 víctor hugo puchi acuña Chairman of the Board humberto fischer llop Director mario puchi acuña Director claudio fischer llop Director alejandro pérez rodriguez Director piero solari donaggio Director pilar lamana gaete Independent Director alejandro pérez rodriguez Committee Chairman humberto fischer llop Director pilar lamana gaete Independent Director alfonso márquez de la plata CEO agustín ugalde COO josé luis vial CFO franco adam CCO franz schwerter Comptroller francisco serra Technical Manager juan carlos lópez Manager for Freshwater Production juan carlos puchi Manager for Freshwater Production Aysén Region paulino morales Manager for Seawater Production Los Lagos Region manuel muñoz Manager for Seawater Production Aysén Region felipe sandoval Manager for Institutional Affairs ignacio sandoval Manager for Processing Plants juan miguel urdangarín Manager for Freshwater Production Los Lagos Region anton felmer Manager for Development and New Businesses sergio vargas Manager for Infrastructure alejandra cid Human Resources claudio valenzuela Health gastón dupré CEO, AquaChile Inc. jorge manuel riquelme Risk Prevention rodger miranda CEO, AquaInnovo S.A. 102 víctor manuel jiménez CEO, Grupo ACI S.A.

105 PRINCIPAL EXECUTIVES As of 31 December 2013, the principal managers and executives of Empresas AquaChile S.A. and its subsidiaries were: Alfonso Márquez - CEO de la Plata Cortés - Rut: Economist and business administrator - Universidad Católica de Chile - MBA, J.L. Kellogg Graduate School of Management - Date of appointment: August 2005 Agustín Ugalde Preuss Franco Adam Raffo José Luis Vial van Wersch Álvaro Varela Walker - COO - Rut: Agronomist - Universidad Católica de Chile - Date of appointment: June CCO - Rut: Aquaculture engineer - Universidad Andrés Bello - Date of appointment: April CFO - Rut: Economist and business administrator - Universidad Católica de Chile - Date of appointment: December Lawyer - Rut: Universidad de Chile; Universidad de Barcelona, Spain - Date of appointment: October 1995 The Company's management also comprises managers and executives who fulfill important functions within it: Sergio Vargas Paulino Morales Manuel Muñoz Juan Miguel Urdangarín Claudio Valenzuela Juan Carlos Puchi Acuña Jorge Manuel Riquelme - Manager for Infrastructure - Rut: Aquaculture engineer - Universidad de Los Lagos - Manager for Seawater Production Los Lagos Region - Rut: Technical engineer in fishing with specialization in aquaculture - Universidad Arturo Prat (Iquique Campus) - GERENTE PRODUCCIÓN AGUA MAR XI REGIÓN - Rut: Aquaculture engineer - Universidad de Los Lagos (Osorno) - Manager for Freshwater Production Los Lagos Region - Rut: Marine technician - Universidad Católica de Chile - Health - Rut: Veterinary physician - Universidad Austral de Chile - Manager for Freshwater Production Aysén Region - Rut: Mechanical engineer - Instituto Nacional de Capacitación - Risk Prevention - Rut: Engineer in risk prevention - Instituto Nacional de Capacitación - Master in Environmental Management and Zoning - Universidad de Santiago de Chile Franz Schwerter Irribarra - Comptroller - Rut: Economist and business administrator - Universidad de Concepción - MBA, Universidad Católica de Chile Juan Carlos López Sebastián - Manager for Freshwater Production - Rut: Veterinary physician - Master in Veterinary Sciences, Universidad Austral de Chile - MBA, Instituto Directivo de Empresas de Madrid Felipe Sandoval Precht Francisco Javier Serra Freire Alejandra Cid Peña Ignacio Sandoval Gallardo - Manager for Institutional Affairs - Rut: Civil engineer - Universidad de Chile - Technical Manager - Rut: Aquaculture engineer - Universidad Andrés Bello - MBA, Loyola College in Maryland, USA - Human Resources - Rut: Economist and business administrator - accountant - Universidad de Santiago - Universidad Austral de Chile - Manager for Processing Plants - Rut: Civil engineer - Universidad Católica de Chile Anton Felmer Valdivieso MANAGEMENT OF SUBSIDIARIES Víctor Manuel Jiménez Ocampo Gastón Dupré Huidobro Rodger Miranda Stevenson - Manager for Development and New Businesses - Rut: Agronomist - Universidad Católica de Chile - MBA, Instituto Directivo de Empresas de Madrid - CEO, Grupo ACI S.A. - ID: Engineer in industrial production - Instituto Tecnológico de Costa Rica - CEO, AquaChile Inc. - Rut: Economist and business administrator - Universidad de Santiago - CEO, AquaInnovo S.A. - Rut: Technical engineer in aquaculture - Universidad de Los Lagos - Master in Environment, Universidad de Santiago 103

106 memoria empresas aquachile cap.05 REMUNERATIONS OF MANAGERS AND EXECUTIVES The total gross remunerations received by Empresas AquaChile's managers and executives, including bonuses, amounted to US$1,863,000 at 31 December 2013 (as compared to US$2,656,000 in the year ended on 31 December 2012). In 2013, no redundancy payments for years of service were paid to the Company's managers and principal executives (and, similarly, no such payments were made in 2012). Incentives plan > Empresas AquaChile and its subsidiaries have a system of incentives tied to the Company's operating results. This consists in an annual bonus payable to its principal executives and other employees who, in the Company's view, are eligible to participate. This system seeks to motivate and recognize its executives and employees and gain their loyalty through a formal plan that rewards both individual performance and teamwork. As part of the capital increase approved on 11 March 2011, the Company issued 43,000,000 shares (out of a total of 1,200,000,000 shares) for an incentive plan for its employees and those of its subsidiaries. At the date of preparing this Report, this plan was still being designed and no options had so far been allocated and the definitive rules for their allocation had not been established. This compensation plan has not been implemented. WORKFORCE As of 31 December 2013, Empresas AquaChile S.A. and its subsidiaries had a total of 5,996 employees distributed as shown in the table opposite. fig. 57 / fig.58 SHARES HELD BY EXECUTIVES AND DIRECTORS As of 31 December 2013, the Company's principal executives and directors directly or indirectly held shares as shown in the table opposite. fig

107 Workforce - Parent Company and Subsidiaries fig. 57 Managers and Administrative and 2013 principal technical Workers total executives personnel Empresas AquaChile S.A. (parent company) ,409 Subsidiaries ,880 4,587 Total 53 1,065 4,878 5,996 Workforce - Chile and Overseas fig Managers and Administrative and principal technical Workers total executives personnel Parent company and Chilean subsidiaries ,409 Overseas subsidiaries ,880 4,587 Total 53 1,065 4,878 5,996 SHARES HELD BY EXECUTIVES AND DIRECTORS fig principal executives participación accionaria Alfonso Márquez de la Plata Cortés Executive - ceoi 0.25% Agustín Ugalde Preuss Executive - coo 0.08% José Luis Vial Van Wersch Executive - cfo 0.04% Franco Adam Raffo Executive - cco 0.02% Álvaro Varela Walker Lawyer 0.01% 1. directors VÍctor Hugo Puchi Acuña Chairman Majority shareholder 33.74% Mario Puchi Acuña Director Majority shareholder 33.19% Humberto Fischer Llop Director Majority shareholder 33.03% Claudio Fischer Llop Director Majority shareholder 33.14% Alejandro Pérez Rodríguez Director 1.33% Piero Solari Donaggio Director 8.79% María del Pilar Lamana Gaete Director 0.00% 105

108 CORPORATE SOCIAL RESPONSIBILITY Annual report AquaChile 2013

109 6.1 Our people The environment Management 115

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111 corporate social responsibility OUR PEOPLE Chapter 6.1 AquaChile's employees are a crucial part of the organization and it, therefore, strives to improve their working conditions and, for example, provides benefits related to health. Employees with an indefinite contract have complementary health insurance and the Company has also established agreements with opticians in Puerto Montt and Castro and dental clinics in Puerto Montt, Calbuco, Castro, Puerto Varas and Chonchi which, in the latter case, is extensive to all its employees. In May, it also offered free vaccination against influenza in Puerto Montt and Chiloé for all employees who wished to take advantage of it. In order to help the families of its collaborators, the Company has an agreement with a shop in Puerto Montt under which they can acquire school materials at preferential prices. It also gives Christmas presents to employees' children up to the age of 12 as well as a Christmas hamper to all those employees with a contract in force as of 30 November. The economic support provided also included Independence Day and Christmas bonuses. In 2013, as part of its Trabajar con Calidad de Vida (Work with Quality of Life) program, the Company again implemented the Mis Hijos Conocen la Empresa (My Children know the Company) program under which children were able to visit their parents' workplace during the winter holidays. As a result of this initiative, one hundred children visited AquaChile's installations in Puerto Montt where they toured the processing plant and offices. This activity was also replicated at the Antarfood Plant (Chonchi) with the participation of some 80 children. AquaChile takes the view that it is important for its employees to know and understand the different processes that take place in the Company. To this end, it continued to implement the Conoce tu Empresa (Know your Company) program in 2013 under which employees from different centers and hatcheries - specifically, the Serapio, Abtao, Quilque, Chidhuapi and Punta Zenteno-Canutillar centers - were able to visit the Company's processing plants. The social and recreational activities implemented by the Company in 2013 included celebrations to mark Independence Day and Christmas as well as other special dates such as Mother's Day, Father's Day and Women's Day. 109

112 memoria empresas aquachile cap.06 As part of its commitment to the south of Chile, AquaChile gives priority to hiring people from the areas where it has its activities and, in 2013, 91% of its employees worked in the area where they lived. The majority of AquaChile's personnel live in the Los Lagos Region, followed by the Aysén and Araucanía Regions. In the case of contractors, the Company also seeks to maintain ties with the areas where it operates, preferring that people work in their place of origin. One of the most successful examples of these efforts is the Araucanía Region, with almost all contractors from this Region working there. This is also the case in the Aysén Region. In the Los Lagos Region, however, the situation is somewhat different since, although almost 90% of contractors live and work in the Region, a little over 10% have to travel to the Aysén Region to provide services there. TRAINING At AquaChile, training for employees seeks to promote, facilitate, foster and develop skills and knowledge so as to provide them with better opportunities and quality of life and work whilst also contributing to higher productivity and equipping the workforce with the tools needed to adapt to technological processes and their modifications. To this end, training focuses on three key pillars. The first seeks to ensure compliance with sector regulation and includes courses for small boat owners, on sea lice monitoring and the handling of hazardous substances, training and retraining for marine security guards, basic onboard safety courses and courses on fish biosecurity. In the second pillar, the aim is to achieve integral improvements in employees' quality of life through courses that address social, physical and psychological issues, adapted to the situation in the Company. Some courses relate to defensive driving, self-care and health and also include a workshop on excessive borrowing. The third pillar consists in tools to improve employees' performance such as courses on English, accounting, hazard analysis and critical control points (HACCP) and point of sale (POS), customer service techniques and teamwork and diploma courses. In addition, the Company seeks to ensure employees' knowledge and understanding of its Code of Conduct which, together with other internal tools, provides the guidelines for proper and effective conduct. As of 31 December 2013, over 1,084 copies of the Code had been provided to new employees in the Seawater, Freshwater, Administration and Processing Plants areas. In 2013, 5,500 employees received a total of some 68,000 hours of training in different formats that included classroom training and e-learning. In addition to the training provided for its employees, AquaChile also provides financial support for training in different trades in the places where it has its operations. In this way, it seeks to promote entrepreneurship and increase employability. These activities take place in the framework of the Social Scholarships Program of the National Training and Employment Service (SENCE) and seek to increase the employability of young people entering the labor market, housewives and heads of households interested in creating a new enterprise and craftspeople and low-qualified workers who require training in order to improve their labor skills. In 2013, courses were offered on household electricity in Dalcahue and Los Pellines, on plumbing in Chonchi, on basic diving in the Alerces district of Puerto Montt and on the preparation of food and desserts using local ingredients in Quetroleufu. In total, this program benefited 75 people. 110

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114 memoria empresas aquachile corporate social responsibility cap.06 THE ENVIRONMENT Chapter 6.2 One of AquaChile's fundamental commitments is to respect and care for the environment and it is constantly implementing initiatives in this area. Environmental management extends to all the Company's activities through initiatives that include monitoring programs, control of organic and inorganic waste, the treatment of liquid industrial waste and the control of hazardous waste. The activities undertaken by AquaChile in 2013 included its participation in the process of review of sector regulation during which it expressed its views and contributed its experience on the issues debated. In this context, AquaChile participated in review of the draft of Regulation 609/1998, which establishes emissions norms for pollutants related to the discharge of liquid industrial waste into the sewage system. In addition, it participated in review of draft regulation for the handling of sludges generated by hatcheries' effluent treatment systems as well as in presentation of a proposal for modification of Resolution 3612/2009 establishing the methodologies to be used for preliminary site characterization and Aquaculture Sanitary and Environmental Reports (INFAs). Finally, it participated in implementation of the modification of Regulation of the Environmental Evaluation System through Resolution N 40/2012. In 2013, the Company submitted 41 Declarations of Environmental Impact (DIAs) for seawater centers and hatcheries, obtained 28 Environmental Approval Resolutions (RCAs) and prepared 120 Aquaculture Sanitary and Environmental Reports (INFAs). 112

115 WASTE CONTROL Out of the total waste generated by the Company in 2013, 98.3% corresponded to industrial organic waste with its origin in processing plants and fish mortality at salmon and trout farming centers and hatcheries. All this waste was sent to plants for its transformation into raw material for the production of fish meal and fish oil. The other 1.7% of the waste generated corresponded to inorganic waste generated at farming centers, hatcheries and processing plants. This is collected regularly and 0.65% is recycled and 0.4% reused. Waste that can neither be recycled nor reused (0.63%) is sent to industrial landfills with the corresponding sanitary and environmental permits. ENERGY SAVING Energy efficiency is an important issue for AquaChile. At end-2013, 41 pontoons had been equipped with technology that allows them to store surplus energy from their diesel generators. While the generator is in operation, this technology stores energy in batteries which supply electricity for basic lighting, plug, computer and internet functions through to the next day. CARE FOR THE ENVIRONMENT In 2013, AquaChile participated in activities to mark International Beach Cleaning Day, with employees removing trash and solid waste from beaches, rivers and lakes in areas such as Quellón, Castro, Isla Lemuy, Puerto Aguirre, Cherquenco, the Valdivia River, Villarrica and Pucón. CERTIFICATION Through different types of certification, AquaChile seeks to ensure the compliance of all its production process with the highest food management and innocuity, environmental, biosecurity, labor and ethical standards. 98,3% ORGANIC WASTE from production of salmon, trout and tilapia is recycled. 41 PONTOONS technology to store surplus energy from diesel generators CERTIFICATIONS IN FORCE, Processing Plant haccp fda ifs bap globalg.a.p sqf 2000 Cardonal (Puerto Montt) YES YES YES YES NO NO Aguas Claras (Calbuco) YES YES NO YES YES YES Antarfood (Chonchi) YES YES NO NO YES NO Salmones Cailín (Quellón) YES YES NO NO YES NO Hueñocoihue (Dalcahue) YES YES NO NO NO NO Growth Centers > Atlantic salmon: GMP (SERNAPESCA) + GLOBALG.A.P. Trout: GMP (SERNAPESCA) Pacific salmon: GMP (SERNAPESCA) Freshwater Centers > In 2014, the Company has undertaken to start audits to obtain GlobalG.A.P. certification of its Atlantic salmon hatcheries such as Novofish 12, Río Maullín, Aquasan and Salmones Chaicas 13. HACCP: Hazard Analysis and Critical Control Points FDA: Food and Drug Administration IFS: International Food Standard BAP: Best Aquaculture Practices GLOBALG.A.P: Good Agricultural Practices SQF 2000: Safe Quality Food GMP: Good Manufacturing Practices. 11 GLOBALG.A.P. certification implies that AquaChile complies with good environmental, labor, social, food safety, animal welfare and commercial practices. 12 Recirculation hatchery with long-term rental contract. 13 Recirculation hatchery with long-term rental contract in which the Company also holds a 19.7% stake. 113

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117 responsabilidad social empresarial COMMUNITIES Chapter 6.3 Throughout its history, AquaChile has maintained strong roots in the south of Chile, creating high-quality jobs, giving priority to hiring people from the area, implementing initiatives that contribute to the development of the places where it has its operations and improving the quality of life of their inhabitants. In the case of education, AquaChile signed an agreement in 2013 with the Centro de Formación de la Industria Chileno Francés (CFI) which offers training to low-income young people. Under the agreement, it provided the places necessary for the internships of students of administration, electricity and logistics operations. During the year, groups of students from technical schools and universities also visited different processing plants. These visits sought to develop ties between the industry and young people and future professionals by allowing them to become familiar with operations at these plants. In addition, AquaChile's professionals supervised the internships of pupils at technical schools in the communities where the Company has its operations. In the Aysén Region, it also installed a library in the Mañihuales School. AquaChile is also aware of the important role that connectivity plays in quality of life, particularly for those people who live in the remote areas of southern Chile where the Company has its operations. In certain cases, the Company puts the internal logistics systems used normally for its own operations at the disposal of the community, providing people from these places with the access to more heavily populated urban areas that, without this support, would be difficult or take a long time. This support is very much appreciated, especially in the case of medical emergencies. In the Aysén Region, for example, the Company transports the personnel of public and private organizations as well as local inhabitants who need to make the Puerto Cisnes-Isla Gala and Seno Gala sea crossing. It has also provided support for medical visits and the transport of emergency materials to the Toto and Melimoyu areas and has cooperated in the transport of social assistants and authorities who provide services to the community. 115

118 A key part of AquaChile's commitment to local communities is the priority it gives to hiring people from the areas where it has its operations and, whenever possible, acquiring the services they can provide.

119 In 2013, in another example of the use of the Company's logistics for the service of the community, its Skyring II boat supported the transport of materials and machinery for the reconstruction of community infrastructure such as the Melimoyu Medical Center, after it suffered a serious fire, and the repair of the landing strip in the same area and of the household water storage pools on the Toto island. The Company has, in addition, implemented floating docks for general use in the Gala Medio sector and Melimoyu, increasing the safety of loading operations and protecting vessels from storms. The Company has also contributed to the maintenance and repair of roads in the Puerto Octay and Peñaflor areas while, in Quellón, it allows the Folil-Trincao community to use the López dock and makes special flights to assist in the transport of the inhabitants of Melinka and Repollal. AquaChile has constantly sought to build bridges of communication, strengthen ties and learn at first hand about the principal needs of Mapuche communities in the areas where it has operations. In 2013, AquaChile met regularly with the Cumirray Ñanco viuda de Ñanculef and Mariano Millahual indigenous communities. As well as meetings, visits were organized to the Caburga 1 and Codinhue hatcheries, support was provided for the preparation of socio-historical studies and reports and work with the Pucón municipal government is underway on preparation of the project for the construction of the Quetroleufu cultural and community center. In addition, the Company financed preparation of a book on the history of the Mariano Millahual community which will be published in RELATIONS WITH AUTHORITIES As in previous years, AquaChile continued to work in 2013 to strengthen ties with the authorities related to its activities. A meeting took place with then Economy Minister Pablo Longueira and this was followed by another meeting with his successor, Minister Félix de Vicente. In late March, then Labor Minister Evelyn Matthei visited AquaChile's installations in Puerto Montt, touring the Cardonal plant, greeting workers and meeting with the Joint Worker-Management Safety and Health Committee. Meetings also took place with Undersecretary for Fishing Pablo Galilea, Undersecretary for the Armed Forces Alfonso Vargas and the National Director of SERNAPESCA, Juan Luis Ansoleaga. At the local level, meetings were held with regional governors, mayors, the regional directors of Fishing and SERNAPESCA and the regional representatives of the Economy and Labor Ministries. 117

120 INFORMATION ABOUT SUBSIDIARIES, AFFILIATED COMPANIES AND INVESTMENTS IN OTHER COMPANIES Annual report AquaChile 2013

121 7.1 Subsidiaries and affiliated 120

122 memoria empresas aquachile cap.07 information about subsidiaries, affiliated companies and investments in other companies SUBSIDIARIES AND AFFILIATED COMPANIES Chapter 7.1 Empresas AquaChile S.A. is the parent company for the group's different companies. Operationally, it is dedicated to the growth, processing and marketing stages of salmon and trout production. In addition, it produces tilapia through its Grupo ACI subsidiary in Costa Rica and Panama, produces fish feed through its Alitec Pargua S.A. affiliate in Chile and the Biomar Aquacorporartion Products subsidiary of Grupo ACI in Costa Rica and works in genetics applied to aquaculture through its AquaInnovo subsidiary. ORGANIZATIONAL STRUCTURE at 31 December 2013 Empresas AquaChile S.A. develops its businesses both directly and through related companies that belong to the group as shown below: OPERATIONAL STRUCTURE OF EMPRESAS AQUACHILE S.A. AND ITS SUBSIDIARIES fig. 60 empresas aquachile s.a 99.88% % % % % 79.95% 50.00% % Aquainnovo s.a. empresas aquachile s.a. inversiones salmones australes ltda. (1) inversiones antarfish ltda (2) antarfish grupo aci s.a alitec pargua s.a. (4) s.a. (3) aquachile inc. Genetics Freshwater production Seawater production Processing Marketing Feed genetics production of salmonids production of tilapia feed sales 120 (1): Includes: AquaChile S.A.; Salmones Cailín S.A.; Salmones Australes S.A.; Salmones Maullín S.A.; Salmones Maullín LTDA; A cuícola el Volcán LTDA.; Salmones Chiloé S.A.; Piscicultura Aquasan S.A.; Procesadora Hueñocoihue Spa and AquaInnovo S.A. (2): Includes: Aguas Claras S.A. and Antarfood S.A. (3) Includes: Servicios Aguas Claras S.A. and Procesadora Aguas Claras Ltda, (4) Includes: Aquacorporación Internacional S.A.; S.A. Terrapez S.A.; Aquacultura del Pacífico and RFA Inc.

123

124 memoria empresas aquachile cap.07 EMPRESAS AQUACHILE S.A. Parent company of the different companies that make up the group. Operationally, it is dedicated to the growth, processing and marketing stages of salmon and trout production. It carries out the latter stage directly in markets in Asia, Europe, Latin America and the United States. In this last country, it operates through its Miami-based AquaChile Inc. subsidiary. For the growth phase, its AquaChile S.A. subsidiary has the capacity to supply all the Company's smolt requirements. The Company produces Atlantic salmon, Pacific salmon and trout and, for this purpose, has sufficient marine installations and concessions in the Los Lagos and Aysén Regions to cover current and future harvest volumes. Processing of the raw material takes place principally in the Puerto Montt plant and other processing plants belonging to the group. I.- GENETICS AquaInnovo S.A. > Company dedicated to genetic and biotechnological research and development, based on AquaChile's genetic improvement project and carried out jointly with Empresas AquaChile S.A. and the University of Chile, using grants obtained in competitive bids from the Chilean government's Economic Development Agency (CORFO) through the Business Innovation Subcommittee of InnovaChile. AquaInnovo S.A. is a company with an investment project for US$10,000,000 that has its origins in salmon farming but targets all the aquaculture industry as development potential. The project aims to become a reference in genetics for the salmon industry in Chile and internationally. Empresas AquaChile currently owns 99.88% of the company. II.- PRODUCTION OF SALMONIDS As well as through Empresas AquaChile S.A., described above, production of salmonids takes place through a number of its subsidiaries: Inversiones Salmones Australes Ltda. > A subsidiary of Empresas AquaChile S.A. which in turn, controls the following companies: AquaChile S.A. > Company dedicated to the freshwater production of juveniles and smolts, principally for Empresas AquaChile S.A. It has installations on land and in lakes and estuaries in the Santiago Metropolitan Region and the Araucanía and Aysén Regions. Production of juveniles includes the three species marketed by the parent company and its supply of eggs for this process is guaranteed by its own output and that of Salmones Chaicas S.A. Salmones Australes S.A. > Company with installed capacity for the growth phase and production of salmon. Its growth centers are located in the Chacabuco area of the Aysén Region. It participates only in the growth stage and related companies are hired to supply smolts and for the subsequent processing of its salmon. Salmones Cailín S.A. > Processing plant located in Quellón on Isla de Chiloé. This plant was designed to provide services to third parties but most of its processing capacity is currently being used for Empresas AquaChile S.A. for the processing of its Pacific salmon harvest. Salmones Maullín S.A > Company that produces Atlantic salmon through its subsidiary, Salmones Maullín Ltda. 122

125 Salmones Chiloé S.A. > Company that produces and processes Pacific salmon. Its growth stage operations take place principally on Isla de Chiloé and its processing principally through its Procesadora Hueñocoihue SpA subsidiary, located in Dalcahue, Chiloé. The company has expanded vertically into the freshwater stages and is, therefore, able to supply its own requirements through its subsidiary, Piscicultura Aquasan S.A. Antarfish S.A. > Company that provides administrative services. Its subsidiaries are Servicios Aguas Claras S.A. and Procesadora Aguas Claras Ltda, the latter with a processing plant in Calbuco. Its processing capacity is hired principally by subsidiaries of Empresas AquaChile S.A. for the processing of trout. Empresas AquaChile S.A. also develops its activities through its Inversiones Antarfish Limitada subsidiary which, in turn, controls the following companies that are an integral part of the salmon and trout farming process. Aguas Claras S.A. > Company with sufficient seawater resources to sustain its current output and future growth. In the case of freshwater, it also has the necessary resources to supply its requirements, either from its own resources or by subcontracting capacity from AquaChile S.A. and Aquasan S.A. for some of the freshwater production stages. Its processing plant is located in Calbuco area and has sufficient capacity to process is own harvests. Antarfood S.A. > Processing plant in Chonchi on Isla de Chiloé. This plant was designed to provide services to third parties but most of its processing capacity is currently being used by related companies such as Aguas Claras S.A. and Empresas AquaChile S.A. III.- MARKETING AND SALEs IN THE UNITED STATES AquaChile Inc. > Subsidiary established in Miami, United States, and dedicated to the marketing and sale of the products of Empresas AquaChile S.A. and its subsidiaries in the United States. IV.-PRODUCTION OF TILAPIA Grupo ACI S.A. (AquaCorporación Internacional) > Costa Rica-based company that has participated in the tilapia industry for over 20 years. Its commercial strategy focuses on the supply of fresh tilapia to large supermarket chains, distributors and restaurant chains in the United States. The principal activity of Grupo ACI S.A. is the production and sale of tilapia, a farmed freshwater fish. Its installations (tilapia nursery and processing plant) are located in Cañas in Costa Rica's Guanacaste Province. Grupo ACI S.A., in turn, controls the following companies: RFA Inc., a distribution company that operates in Florida, United States; Terrapez S.A., a tilapia processing company; Administración de Acuicultura S.A; and Aquapanamá S.A. These companies' activities are complementary since AquaCorporación Internacional S.A. produces tilapia at its own farms in Cañas while processing is carried out by Terrapez S.A. at its own installations which are also located in Cañas. Most output is sold to RFA Inc. for its marketing throughout the United States and in Canada. Administración de Acuicultura S.A. provides administrative services to the different companies of Grupo ACI S.A. Aquapanamá > Subsidiary of Grupo ACI established in Panama in 2009 to farm and export tilapia. It holds the only three concessions for tilapia farming on Lake Bayano, which have a total area of 516 hectares. V.- FISH FEED PRODUCTION Alitec Pargua S.A. > Company through which AquaChile in partnership with Biomar, a leading international animal nutrition company, produces fish feed in Pargua in Chile's Los Lagos Region. The plant has an annual production capacity of 126,000 tonnes. Biomar Aquacorporation Products > Company through which Grupo ACI, in partnership with Biomar, produces fish feed in Cañas in Costa Rica's Guanacaste Province. The plant has an annual production capacity of 50,000 tonnes. VI.- AFFILIATED COMPANIES Salmones Chaicas S.A. > Advanced-technology recirculation hatchery, located 30 km from Puerto Montt on the Carretera Austral, for the production of Atlantic salmon broodfish, eggs and smolts. It has an initial capacity to produce 120 million eggs and 4.2 million smolts, rising to 12.6 million smolts at full capacity. Empresas AquaChile has invested US$1,300,000 in this company and has an option to purchase the remaining 80.3% of Salmones Chaicas S.A. as from April In addition the other shareholders in Salmones Chaicas S.A. have options to sell all their shares to Empresas AquaChile as from Fiordo Austral S.A. > Fishing company with five facilities, located between the Biobío and Aysén Regions, for processing hydrobiological resources from the salmon and fishing industries. It produces principally salmon meal and oil and meal and oil from pelagic fish. In addition, it has a line of value-added products such as meals and oils with specific treatments, soluble fertilizers and blocks of frozen salmon for human and animal consumption. AquaChile holds a 6.12% stake in this company. 123

126 memoria empresas aquachile cap.07 ORGANIZATIONAL STRUCTURE AT 31 DECEMBER 2013 fondo de inversión privado patagonia holding salmones s.a. empresas aquachile s.a. inversiones salmones australes ltda % 100% % 33.04% % % 18.15% inversiones antarfish ltda % antarfish s.a % % servicios aguas claras s.a % aquachile inc % aquachile s.a % % (*) 6.12% % 8.6% aguas claras s.a % salmones australes s.a % 99.99% % % % procesadora aguas claras s.a % % antarfood s.a % 0.126% 0.126% aquainnovo s.a % 124

127 inversiones acuícolas s.a. otros inversionistas % 93.00% % % 50.00% 19.7% 14.89% 33.92% salmones chiloé s.a. salmones maullín s.a. (*) % grupo aci s.a. alitec pargua s.a. salmones chaicas s.a. salmones cailín s.a % aquacorporación intl s.a. fiordo austral s.a. laboratorio antares s.a. 7.00% 91.40% piscicultura aquasan s.a % cultivos acuícolas el volcán ltda. 0.07% % % terrapez s.a. aquacultura del pacífico s.a. empresas aquachile procesadora % salmones hueñocoihue spa % 0.054% maullín ltda % RFA Inc % aquapanama s.a % biomar aquacorporation products s.a % aquasea de costa rica s.a. 125

128 MATERIAL NEWS Annual report AquaChile 2013

129 8.1 Material news 144

130 memoria empresas aquachile material news cap.08 MATERIAL NEWS Chapter 8.1 / / / On 12 April 2011, Empresas AquaChile S.A. was included on the Securities Register of Chile's Superintendency of Securities and Insurance (SVS) under N On 19 May 2011, Empresas AquaChile S.A. raised US$374 million in its initial public offering. The operation was led by IM Trust and Banchile Inversiones as underwriters. On 24 June 2011, Empresas AquaChile S.A. and some of its subsidiaries prepaid US$163.2 million to their Creditor Banks as stipulated in the Liability Reprogramming Contract of 7 September At the same time, they renegotiated the conditions of the outstanding debt of US$242.5 million. Certain financial covenants were established. These refer to the maintenance of a maximum level of financial leverage, a minimum level of coverage of financial costs and a maximum ratio of net financial debt to EBITDA 14, calculated on the basis of the Consolidated Financial Statements of Empresas AquaChile S.A. at 31 December 2011 and 31 March, 30 June, 30 September and 31 December of the following years. covenants 2011* Financial leverage 1.25x 1.25x 1.20x 1.10x 1.0x 1.0x Coverage of interest 4.5x 4.5x 4.5x 4.5x 4.5x 4.5x Net fin. debt/ebitda 2.5x 2.5x 2.2x 2.2x 2.0x 1.75x * Measured at 31 December Notwithstanding this, the Company has, in view of the low prices faced by the Chilean salmon industry, reached agreement with its creditor banks to suspend measurement of the interest coverage and net financial debt/ EBITDA covenants through to December 2013, inclusive, and in the case of the financial leverage covenant, its suspension in June and September EBITDApre FV adj. (henceforward EBITDA): Revenues from ordinary activities less sales costs (in other words, gross earnings pre fair value adjustment), less administrative costs, less distribution costs, plus adjustment for depreciation and amortization. All these figures are obtained directly from the company's Consolidated Financial Statements and Management Discussion and Analysis.

131

132 memoria empresas aquachile cap.08 On 26 February 2013, an Extraordinary Shareholders' Meeting recognized an increase of US$286,481, in the Company's equity corresponding to the greater value obtained in the share placement, in accordance with Article 26 of Law N Among other decisions, the Meeting also agreed to: 1.- Increase the Company's equity by US$120,000,000 from US$523,062,949.81, divided into 1,200,000,000 ordinary, nominative shares without nominal value, to US$643,062,949.81, divided into 1,350,000,000 ordinary, nominative shares without nominal value, through the issue of 150,000,000 ordinary, nominative shares without nominal value to be totally subscribed and paid in cash within three years as from the date of the Meeting; 2.- Empower the Company's Board of Directors to issue all the 150,000,000 shares corresponding to the said capital increase and to agree the terms of the issue and proceed to their placement on one or more occasions within a period of 180 days as from 26 February 2013, freely setting the final placement price, whether higher or lower than the reference price of 363 Chilean pesos reported to the Meeting and using for this purpose the Order Book Auction mechanism in accordance with Section 2.4. of the Santiago Stock Exchange's Manual of Share Operations; 3.-Offer the new shares preferentially to each of the Company's shareholders during a period of 30 days for the subscription of the corresponding new shares, pro rata to their stake on the fifth working day prior to the start of the right of preferential option to subscribe the shares; 4.- Modify the Company's by-laws to reflect the changes in the articles on equity as a result of the said capital increase; 5.- Empower the Board of Directors, with the possibility of delegating to the CEO or his agents, to materially issue the shares of the new issue and request their inscription in the Securities Register of Chile's Superintendency of Securities and Insurance (SVS), among the other powers required to implement the issue and placement of the shares. In addition, the Meeting approved the modifications to AquaChile's by-laws required as a result of the said capital increase. On 8 March 2013, Empresas AquaChile S.A. obtained a US$30 million line of credit for export financing from Banco DnB Group, Agencia en Chile for an initial period of 60 days, pending the establishment of collateral, and extendable to 360 days at an annual interest rate of 2.74% for the first 60 days and, for its long-term renewal, at 180-day Libor plus a spread. 130

133 The contract permits early voluntary repayments and establishes certain obligations as regards the provision of information and actions and prohibitions that are usual under agreements of this type in favor of creditor banks. In addition, guarantees were established on ten aquaculture concessions held by AquaChile S.A., Salmones Chiloé S.A. and Salmones Cailín S.A. These refer to the maintenance of a maximum level of financial leverage, a minimum level of coverage of financial costs and a maximum ratio of net financial debt to EBITDA, calculated on the basis of the Consolidated Financial Statements of Empresas AquaChile S.A. at 31 December 2011 and 31 March, 30 June, 30 September and 31 December of the following years. covenants Financial leverage 1.20x 1.10x 1.0x 1.0x Interest coverage 4.5x 4.5x 4.5x 4.5x Net fin. debt / EBITDA 2.2x 2.2x 2.0x 1.75x * Measured at 31 December Notwithstanding this, the Company has, in view of the low prices faced by the Chilean salmon industry, reached agreement with its creditor banks to suspend measurement of the interest coverage and net financial debt/ EBITDA covenants through to December 2013, inclusive, and in the case of the financial leverage covenant, its suspension in June and September On 21 March 2013, a meeting of the Board of Directors took place at which it was agreed to call a General Shareholders' Meeting for 18 April On 18 April 2013, a General Shareholders' Meeting took place at which the following agreements were adopted: approval of the Annual Report, Statement of Financial Position, Income Statements and Report of the External Auditors, all for the year ended on 31 December 2012; the setting of fees of members of the Board of Directors for 2013; approval of the expense statement of the Board for 2012; the setting of fees of members of the Directors' Committee and the budget of the Directors' Committee for 2013; appointment of PricewaterhouseCoopers as external auditors for the 2013 financial statements; and use of the El Mostrador newspaper for Company notices. On 25 July 2013, an extraordinary meeting of the Board of Directors took place at which the following agreements were adopted: i) to request the inscription on the Securities Register of the SVS of the 150,000,000 ordinary, nominative shares without nominal value in Empresas AquaChile S.A. corresponding to all the shares which the Extraordinary Shareholders' Meeting agreed to issue to be paid in cash, and to take all the steps required for this purpose; and, ii) to offer all the shares issued preferentially to the shareholders in Empresas AquaChile S.A. who were inscribed on its Shareholder Register as of the fifth working day prior to the publication of the notice marking the start of the preferential option, for a period of 30 days as from the said date of the start of the preferential option, pro rata to their stake in the Company. The shares offered during the 30-day preferential option period will have the same price (henceforward, the Placement Price). The Placement Price will be freely determined by the Board of Directors, which may use the Order Book Auction mechanism as established in Section 2.4.A of the Santiago Stock Exchange's Operations Manual or the Manual in which case it will consider the demand shown by investors. On 10 September 2013, Official Memo N 20366/2013 was received from the SVS. In brief, this indicated that: 1-. Given that more than 180 days had passed since the Shareholders' Meeting which empowered the Board of Directors to set the placement price, inscription of the shares requested by the Company could not take place until a new Shareholders' Meeting had set the placement price or empowered the Board of Directors to do so; 2-. In the case that the "Order Book Auction" mechanism were used to set the placement price, "documentation must be attached showing the express and concrete renouncement of one or more shareholders in order to effectively reconcile stock market requirements with those referring to the price for the exercise of the preferential option". 131

134 SUMMARY OF COMMENTS ANd PROPOSALS PUT FORWARD BY SHAREHOLDERS AND THE DIRECTORS' COMMITTEE Annual report AquaChile 2013

135 9.1 Comments and proposals 151

136

137 Summary of comments and proposals put forward by shareholders and the directors' committee COMMENTS AND PROPOSALS Chapter 9.1 At the General Shareholders' Meeting held on 18 April 2013, AFP Habitat indicated its vote opposing the appointment of PricewaterhouseCoopers as the Company's auditors, arguing that: "In view of the importance of the audit function and because public trust is involved, this company has been sanctioned by the Santiago Appeals Court and the Superintendency of Securities and Insurance (SVS) for infringements of regulation and its duty to exercise care in auditing Empresas La Polar, with the consequences known to all". 135

138 memoria empresas aquachile 136

139 financial information

140 MANAGEMENT DISCUSSION AND ANALYSIS Annual report AquaChile 2013

141