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FINANCIAL REPORT

SECOND QUARTER 2017

AUGUST 2017

Index

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1. Summary of Consolidated Results 2nd Quarter 2017………………................................... 3

2. Highlights in the Period…………………………………………………………….…………………………….. 5

3. Consolidated Income Statement………………………………………………................................ 7

4. Analysis of Consolidated Results………………………………………………................................ 9

5. Summary Table of Countries....................................................................................... 18

6. Data by Country and Business..................................................................................... 19

7. Financial and Profitability Ratios…………..................................………………………………… 24

8. Consolidated Financial Statements- IFRS

- Consolidated Balance Sheets…………………………………....…................................. 25

- Consolidates Income Statement…………………………....….................................... 26

Notes:

• All figures in dollars are calculated using the observed dollar exchange rate for July 3rd, 2017:

(Ch$ 664.29 per US$1).

• Symbols for periods in the year: Quarters: 1Q (first quarter), 2Q (second quarter), 3Q (third

quarter) and 4Q (fourth quarter). 1S (First semester) and 9M (first nine months of the year), as

applicable.

• Currency symbols: Ch$ or CLP: Chilean pesos; US$: U.S. dollars; M: millions.

• Other symbols: SSS (Same store sales). SG&A: Selling, General and Administration.

Summary of Consolidated Results 2nd Quarter 2017

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• Consolidated Revenues grew 9.1% to Ch$ 70,570 million (US$ 106.2 million) in the

2Q 2017.

• Gross Profit of Ch$ 40,027 million (US$ 60.3 million) increased 9.3%, obtaining a

gross margin of 56.7% as a percentage of Revenues in 2Q 2017, which is 7 basis

points over the 56.6% reported in 2Q 2016.

• Operating Income of Ch$ 13,919 million (US$ 21.0 million) grew 7.4%. The

Operating margin reached a 19.7% of revenues in 2Q 2017, decreasing 30 basis

points.

• EBITDA of Ch$ 15,404 million (US$ 23.2 million) increased 6.1%, reaching an

EBITDA margin of 21.8% in 2Q 2017, which is 62 basis points lower compared to

the margin of 2Q 2016.

• Net Profit increased 10.0% to Ch$ 10,755 million (US$ 16.2 million). Its represents

15.2% as a percentage of 2Q 2017 net revenues.

• The Revenues from the International Operations in Colombia, Peru and Uruguay

grew 13.7% as a whole, and represented 17.7% of the Consolidated Revenues in

2Q 2017.

Summary of Consolidated Results 1st Semester 2017

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• Consolidated Revenues amounted to Ch$ 131,926 million (US$ 198.6 million),

growing 6.2% as of June 2017.

• Gross Profit was Ch$ 72,844 million (US$ 109.7 million), an increase of 8.4% over

the same period last year. Gross margin was 55.2%, up 113 percentage points

from 54.1% in 1S’16.

• Operating Income of Ch$ 22,406 (US$ 33.7 million) grew 6.1% in 1S’17 as

compared to 1S’16. The Operating margin was 17.0% of revenues.

• EBITDA of Ch $25,281 (US$ 38.1 million) grew 4.1% compared to 1S’16, reaching

an EBITDA margin of 19.2% as of June 2017.

• Net Profit for the year amounted to Ch$ 16,994 million (US$ 25.6 million), an

increase of 13.9% as of June 2017. As a percentage of revenues, they represented

12.9% in 1S’17, which is 87 basis points above the net margin in 1S’16.

• Revenues from international operations in Colombia, Peru and Uruguay grew

7.0% as a whole, and accounted for 17.1% of consolidated revenues as of June

2017.

Highlights of the Period

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Stores Opening

Total of new stores opened in 2Q 2017: 8 stores

During the 2Q 2017 the company opened the following new stores:

Country # Stores Chain Store City Sq. meters

Chile D House La Fábrica Santiago 395

Merrell Mall Sport Santiago 71

Total 2 466

Perú Columbia Plaza Norte Lima 58

Columbia San Miguel Lima 64

Columbia Cayma Arequipa 53,8

3 122

Uruguay Rockford Centro Montevideo 74

Columbia Centro Montevideo 67

CAT Las Piedras Las Piedras 68

Total 3 209

Total 8 851

Ordinary Shareholders Meeting The Ordinary Shareholders' Meeting was held on April 20th, in which:

- The Company's Annual Report, balance sheet and financial statements for the year

ended December 31, 2016 were approved.

- It was agreed to pay a definitive dividend in the total amount of $ 6,939,962,437

charged to the net profits of the year 2016, at a rate of $ 26.85027 per share, in cash,

as of May 19, 2017.

- It was agreed to elect EY EY Servicios Profesionales de Auditoría y Asesorías SPA, as

external auditors for the 2017 financial year.

- It was agreed to choose the firms Feller-Rate Clasificadora de Riesgo Ltda., And Fitch

Chile Clasificadora de Riesgo Ltda., As risk classification companies for the 2017

financial year.

- It was agreed to publish the notices of summons to the Shareholders' Meetings of

the company during the year 2017 in the newspaper Diario Financiero.

Highlights of the Period

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Opening of the 1st Patagonia Store in Peru In July of this year, Forus opened the first store of the brand Patagonia in Peru. This brand

was already sold through the Rockford chain of stores, but today it already has the first

mono-Brand store in the city of Cuzco.

Consolidated Income Statement – IFRS

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2Q'17 % Revenues 2Q'16 % Revenues Var. % 17/16

Th Ch$ Th Ch$

Revenues 70.569.894 64.677.551 9,1%

Cost of Sales (30.542.928) -43,3% (28.039.731) -43,4% 8,9%

Gross Profit 40.026.966 56,7% 36.637.820 56,6% 9,3%- -

Logistic costs (633.079) -0,9% (596.401) -0,9% 6,1%

Administrative Expenses (25.474.590) -36,1% (23.087.195) -35,7% 10,3%

Selling, General and Administrative Expenses (26.107.669) -37,0% (23.683.596) -36,6% 10,2%

Operating Income 13.919.297 19,7% 12.954.224 20,0% 7,4%

Other incomes of total operation 703.280 212.363 231,2%

Other expenses of total operation (233.950) (48.083) 386,6%

Financial Income 388.830 562.145 -30,8%

Financial Expenses (91.234) (84.942) 7,4%

Participation in gains (losses) of joint venture businesses (92.457) (80.412) 15,0%

accounted by using the proportional value of participation

Exchange Differentials 206.962 (524.129) -139,5%

Result of Indexation units (12.183) (16.832) -27,6%

Other gains and losses (147.401) 31.758 -564,1%

Non-Operating Income 721.847 1,0% 51.868 0,1% 1291,7%

Profit before income tax 14.641.144 20,7% 13.006.092 20,1% 12,6%

Income Taxes (3.886.207) (3.224.675) 20,5%

Profit (Loss) 10.754.937 15,2% 9.781.417 15,1% 10,0%

Profit (loss) attributable to equity holders of parent 10.841.971 9.862.933 9,9%

Profit (loss) attributable to minority interest (87.034) (81.516) 6,8%

Profit (loss) 10.754.937 15,2% 9.781.417 15,1% 10,0%

EBITDA 15.403.588 21,8% 14.520.664 22,5% 6,1%

expressed in Thousands of Chilean Pesos from April 1st to June 30th

FORUS S.A. & SUBSIDIARIES

Consolidated Income Statement 2nd Quarter

Consolidated Income Statement – IFRS

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1S 2017 % Revenues 1S 2016 % Revenues Var. % 17/16

Th Ch$ Th Ch$

Revenues 131.926.330 124.192.938 6,2%

Cost of Sales (59.082.378) -44,8% (57.021.388) -45,9% 3,6%

Gross Profit 72.843.952 55,2% 67.171.550 54,1% 8,4%

Logistic costs (1.405.040) -1,1% (1.311.909) -1,1% 7,1%

Administrative Expenses (49.032.686) -37,2% (44.736.936) -36,0% 9,6%

Selling, General and Administrative Expenses (50.437.726) -38,2% (46.048.845) -37,1% 9,5%

Operating Income 22.406.226 17,0% 21.122.705 17,0% 6,1%

Other incomes of total operation 937.737 246.897 279,8%

Other expenses of total operation (368.340) (134.872) 173,1%

Financial Income 703.992 998.088 -29,5%

Financial Expenses (183.730) (173.764) 5,7%

Participation in gains (losses) of joint venture businesses (90.220) (164.536) -45,2%

accounted by using the proportional value of participation

Exchange Differentials 49.621 (2.049.801) -102,4%

Result of Indexation units (18.850) (27.550) -31,6%

Other gains and losses (198.884) 61.548 -423,1%

Non-Operating Income 831.326 0,6% (1.243.990) -1,0% -166,8%

Profit before income tax 23.237.552 17,6% 19.878.715 16,0% 16,9%

Income Taxes (6.243.766) (4.958.776) 25,9%

Profit (Loss) 16.993.786 12,9% 14.919.939 12,0% 13,9%

Profit (loss) attributable to equity holders of parent 17.190.136 15.090.742 13,9%

Profit (loss) attributable to minority interest (196.350) (170.803) 15,0%

Profit (loss) 16.993.786 12,9% 14.919.939 12,0% 13,9%

EBITDA 25.280.809 19,2% 24.278.041 19,5% 4,1%


Consolidated Income Statement

expressed in Thousands of Chilean Pesos accumulated to June 30th

Analysis of Consolidated Results

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Operating Income

• The Consolidated Sales of Forus S.A. and Subsidiaries of Ch$ 70,570 million (US$ 106.2

million), grew 9.1% in the second quarter of 2017.

The increase in sales was mainly explained by the 8.2% increase in sales in Chile, which

accounted for 82.3% of consolidated sales, and to a lesser extent by sales of subsidiaries,

which increased by 13.7% as a whole, driven by growth in Uruguay and Peru during

2Q'17.

In Chile, sales amounted to Ch$ 58,171 million (US$ 87.6 million) during 2Q'17, an

increase of 8.2% over the same period last year, accounted for 88% by the growth in

sales of the Retail business, which grew by 8.4% in 2Q'17, while the remaining 12% is

explained by the wholesale business, which grew 6.8% compared to 2Q'16.

Regarding the Retail business in Chile, sales amounted to Ch$ 49,725 million (US$ 74.9

million) and grew 8.4% over 2Q'16, representing 85% of Chile's total sales. This increase

in sales is mainly explained by the growth in SSS (same equivalent stores) of 7.3%

(nominal value in local currency) during the period, and to a lesser extent by the

maturity of the sales of new stores that do not enter in the SSS base, highlighting the

growth of sales per total square meter of stores of 6.2% in 2Q'17. The square meters of

stores grew only 2.1%, consisting of 6 new net stores (openings minus closures) opened

to June 2017 with respect to the same period of the previous year. As for the Wholesale

business, its revenues of Ch$ 8,446 million (US$ 12.7 million) grew 6.8% compared to

2Q'16 and accounted for 15% of Chile's sales in 2Q'17.

Regarding international subsidiaries, which accounted for 17.7% of total consolidated

revenues in 2Q'17, they grew 13.7% as a whole compared to 2Q'16, explained only by

the growth in sales of Uruguay and Peru during the trimester. The results by country are

as follows:

• In Colombia sales of Ch$ 1,215 million (US$ 1.8 million) decreased -5.5% in 2Q'17.

This decrease was mainly explained by the drop-in sales in the Retail business,

whose sales were affected by the low dynamism of the Colombian market, affected

by the challenging macroeconomic environment in the country, which is reflected

in the decrease in SSS of -9.4%. On the other hand, square meters increased by

17.0%, which consists of 7 new net stores in June 2017 compared to the same

period of the previous year.

• In Peru sales of Ch$ 4,510 million (US$ 6.8 million) grew 4.4% over sales in 2Q'16.

This growth in sales is explained more by the growth of sales of the Wholesale


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business than by the growth of the Retail business, whose SSS growth was 1.1%,

affected by the low dynamism of the market and a maintained economy static.

• In Uruguay, sales of Ch$ 6,756 million (US$ 10.2 million) in 2Q'17 grew by 25.7%

compared to 2Q'16, due to the 4.5% increase in the SSS, as well as to the increase

in store square meters of 10.7%, which consist of 5 new net stores as of June 2017,

and finally, due to the consolidation of sales of the Columbia stores in the country.

Revenues from international operations in Colombia, Peru and Uruguay accounted for

17.7% of consolidated revenues in 2Q'17.

Note: Inter-company sales were excluded in this analysis.

Revenues from international operations in Colombia, Peru and Uruguay accounted for

17.1% of consolidated revenues accumulated in June 2017.

Note: Inter-company sales were excluded in this analysis.

Chile82,3%

Perú6,4%

Uruguay9,6%

Colombia1,7%

Revenues by Subsidiaries 2Q 2017

Chile83,0%

Perú6,7%

Uruguay8,3%

Colombia2,0%

Revenues by Subsidiaries 2Q 2016

Chile82,9%

Perú7,0%

Uruguay8,3%

Colombia1,9%

Revenues by Subsidiaries 1S 2017

Chile83,0%

Perú7,8%

Uruguay7,3%

Colombia2,0%

Revenues by Subsidiaries 1S 2016


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• Gross Profit of Ch$ 40,027 million (US$ 60.3 million) increased 9.3% during 2Q'17,

resulting in a gross margin of 56.7% in 2Q'17.

The increase in the Consolidated Gross Profit is explained to a greater extent by the

growth of Chilean gross profit, which grew by 8.2% and to a lesser extent by the growth

of the gross profit of the subsidiaries of 15.0% as a whole. The Consolidated Gross

Margin of 56.7% grew by 7 basis points compared to 56.6% in 2Q'16, thanks to the

growth of the subsidiaries. This almost flat effect of the gross margin was due to the fact

that during the quarter there was a higher level of inventories than expected, triggered

by higher inventory purchases for this autumn / winter 2017 collection (compared to

the previous year) and less dynamism of the market than that forecasted by the

company. Given the above, the company opted to accelerate inventory rotation and

improve its levels at the expense of taking advantage of the positive exchange rate

effect perceived in 2Q'17 (the fall / winter 2017 collection entered with a decrease in

the US dollar - 6.2% over the previous year).

Chile's gross profit reached Ch$ 33,255 million (US$ 50.1 million) and grew 8.2%

compared to 2Q'16, thanks to both the gross margin of the Retail business and the

wholesale business. The gross margin remained flat compared to 2Q'16, reaching 57.2%

in 2Q'17.

The gross profit of the Retail business of Ch$ 29,346 million (US$ 44.2 million) during

2Q'17 grew 8.1% compared to the same period of the previous year. The gross margin

of 59.0% in 2Q'17 decreased by 20 basis points compared to the margin of 59.2% in

2Q'16, mainly due to the decision not to absorb the favorable exchange rate effect in

favor of a higher turnover of the inventory of the autumn / winter 2017 collection.

The Wholesale business gross profit of Ch$ 3,909 million (US$ 5.9 million) in 2Q'17 grew

8.8% over 2Q'16. The gross margin of 46.3% grew by 85 basis points, explained by the

positive exchange rate effect of the fall / winter 2017 collection.

Regarding the Gross Profit of the international subsidiaries, in 2Q'17 it grew in total

15.0%, reaching the figure of Ch$ 6,772 million (US$ 10.2 million), with a gross margin

of 54.3%, which increased by 62 basis points over the same period of the previous year.

The breakdown by country is as follows:

• Colombia: Gross profit of Ch$ 528 million (US$ 0.8 million) decreased 8.3% in

2Q'17, with gross margin of 43.4%, which decreased by 131 basis points compared

to 2Q'16. This decline is explained by two effects: the challenging market

environment still present in the country, which affected sales, and secondly, the


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strategy of reducing inventories levels, which continued during the quarter, having

managed to reduce them by -33% to June 2017 compared to the same period of

the previous year (in monetary value).

• Peru: Gross profit of Ch$ 2,300 million (US$ 3.5 million) grew 3.1% in 2Q'17, and

gross margin decreased only 65 basis points from 51.6% to 2Q'16 to 51.0% to

2Q'17, as a result of a strategy to reduce inventory excesses, whose levels ended

higher than expected due to the low market dynamism during the first half of the

year, triggered by climatic problems that affected the country in the first quarter

and by stagnation of consumption in the second quarter of this year.

• Uruguay: gross profit of Ch$ 3,945 million (US$ 5.9 million) grew 27.9% over 2Q’16,

and gross margin from 58.4% to 2Q’17 increased by 102 basis points over the

57.4% achieved in 2Q'16, due to a positive exchange rate effect on the fall / winter

2017 collection compared to the previous year.

• Consolidated Operating Income of Ch$ 13,919 million (US$ 21.0 million) grew 7.4 %%

compared to 2Q'16. Operating margin reached 19.7% of revenues.

This growth is mainly explained by the growth in Operating Income in Chile, which grew

by 4.9% and, to a lesser extent, by the subsidiaries, which grew by 85% overall, explained

mainly by Uruguay and by the improvement in the operational loss in Colombia during

the quarter.

Chile's operating income of Ch$ 13,154 million (US$ 19.8 million) grew 4.9% and the

operating margin was 22.6%, or 71 basis points lower than the 23.3% of 2Q'16. This

increase in Operating Income is due only to the growth of consolidated sales and gross

profit of 8.2%, which managed to offset the SG&A increase of 69 basis points as a

percentage of sales compared to the previous year.

Operating Income from the Retail business amounted to Ch$ 11,651 million (US$ 17.5

million), an increase of 5.7% in 2Q'17, and as a percentage of revenues, obtained an

operating margin of 23.4%, which is 62 basis points below the operating margin of 24.0%

obtained in 2Q'16. This growth was due to growth in sales and gross profit, which

managed to partially contain the increase of SG&A of 9.7% in 2Q'17.

Operating Results of the Wholesale Business of Ch$ 1,503 million (US$ 2.3 million)

decreased slightly by 0.8% due to the increase of SG&A by 220 basis points during the

period due to higher administrative and advertising costs, which offset the 8.8%


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increase in gross profit. As a percentage of revenues, it represented 17.8% in 2Q'17,

reducing the operating margin by 135 basis points to 19.1% in 2Q'16.

As for the subsidiaries as a whole, they had an operating income of Ch$ 765 million (US$

1.2 million), an increase of 85% compared to 2Q'16, due to the growth in sales and gross

profit of 13.7% and 15.0%, respectively, and the decrease of SG&A by 174 basis points

as a percentage of sales. The Operational Results by country are as follows:

• Colombia: Loss of Operating Result of Ch$ -193 million (US$ 0.3 million) improved

by -21.4% compared to the loss of Ch$ -246 million (US$ 0.4 million) of 2Q'16. This

is due to the decrease in GAV, which decreased by a remarkable 452 basis points,

from 63.8% of 2Q'16 to 59.3% of 2Q'17, explained by the decrease of GAV of the

Wholesale business, as a result of the strategic restructuring of this business that

has been carried out since 2016, in response to the challenging macroeconomic

and market environment present since the end of 2015.

• Peru: Operating loss of Ch$ -293 million (US$ 0.4 million) in 2Q'17 increased by

5.9% from the operational loss of Ch$ -277 million (US$ 0.4 million) of 2Q'16. This

was mainly due to the fall in gross margin of 65 basis points, explained by the

cleaning of inventories and a complicated macroeconomic environment, despite

the fact that the SG&As decreased by 55 basis points compared to 2Q'16.

• Uruguay: Operating income of Ch$ 1,251 million (US$ 1.9 million) grew 33.8% to

2Q'17. This result is due to a 25.7% increase in sales, a 102 basis point increase in

gross margin and the reduction of SG&As as a percentage of revenues by 10 basis

points. Strong market growth and good internal strategies contributed to the good

performance of the subsidiary during this quarter.

Non-Operating Result

• Non-operating income for 2Q'17 reached a profit of Ch$ 722 million (US$ 1.1 million),

improving 1291.7% compared to 2Q'16 and representing 1.0% of 2Q'17 income.

This increase in Non - Operating Income is mainly explained by the Exchange Differences

account, which presented a gain of Ch$ 207 million (US$ 0.3 million) compared to the

Ch$ -524 million (US$ 0.8 million) of 2Q'16, due to the positive effect of the dollar on

the cash that is reversed In US dollars relative to the negative variation obtained in

2Q'16. On the other hand, and to a lesser extent, the increase is explained by the

account Other Income by function, which grew by 231%, reaching Ch$ 703 million (US$

1.1 million).


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Net Profit and EBITDA

• Consolidated Profit for the year from Ch$ 10,755 million (US$ 16.2 million) to 2Q'17

increased 10.0% over 2Q'16.

Net Income as a percentage of revenues, represented 15.2% to 2Q'17. The increase in

Gain before tax is mainly explained by the improvement in Consolidated Operating

Results of 2Q'17 by 7.4% and, to a lesser extent, by the increase in Non-Operating

Income by 1291.7%. On the other hand, the tax rate negatively affects profit before tax,

increasing from 24.8% in 2Q'16 to 26.5% in 2Q'17.

• EBITDA of Ch$ 15,404 (US$ 23.2 million) grew by 6.1%, reaching an EBITDA margin of

21.8% to 2Q'17, which decreased by 62 basis points compared to 22.5% in 2Q'16.

The increase in Consolidated EBITDA was mainly due to the growth of Chile's EBITDA,

which grew by 4.0% in 2Q'17, reaching a figure of Ch$ 14,092 million (US$ 21.2 million),

and to a lesser extent the EBITDA growth of the international subsidiaries of Ch$ 1,311

million (US$ 2.0 million), which grew 35.2% thanks to EBITDA growth in Uruguay and

Peru, as well as a negative EBITDA recovery in Colombia.


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Consolidated Balance Sheet

• Assets (in millions of Ch$)

Jun-2017 Dec-2016

M Ch$ M Ch$ M Ch$ %

Current Assets 183.182 172.082 11.101 6,5%

Non-Current Assets 45.378 46.283 -906 -2,0%

Total Assets 228.560 218.365 10.195 4,7%

Var.

Current assets show significant variations in trade and other receivables, with an

increase of Ch$ 6,809 million (US$ 10.3 million) and a decrease of inventories of Ch$

6,267 million (US$ 9.4 million), both as a result of the business cycle and higher sales

revenues, especially in the retail business. Cash and cash equivalents also showed a

positive variation of Ch$ 6,991 million (US$ 10.5 million), which is due to the investment

of temporary cash surpluses in time deposits settled before 3 months. One of the main

variations of non-current assets is due to the fact that store openings have been lower

than the depreciation for the period, showing a decrease in properties, plants and

equipment of Ch$ 202 million (US$ 0.3 million). Similarly, intangibles other than

goodwill show a decrease of Ch$ 316 million (US$ 0.5 million).

• Liabilities (in millions of Ch$)

Jun-2017 Dec-2016

M Ch$ M Ch$ M Ch$ %

Current Liabilities 21.810 26.024 -4.214 -16,2%

Non-Current Liabilities 1.773 1.944 -170 -8,8%

Shareholder's Equity 204.977 190.398 14.579 7,7%

Total Liabilities 228.560 218.365 10.195 4,7%

Var.

The decrease in current liabilities of Ch$ -4,214 (US$ -6.3 million) was mainly due to the

payment of obligations with suppliers, which decreased by Ch$ 439 million (US$ 0.7

million) and to the payment of dividends, which were provisioned at the close of fiscal

year 2016. Non-current liabilities basically decreased of a negative change in deferred

tax liabilities of Ch$ 131 million (US$ 0.2 million).


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• Shareholder’s Equity

The balance of Equity as of June 30, 2017 and December 31, 2016 is as follows:

Jun-2017 Dec-2016

M Ch$ M Ch$ M Ch$ %

Paid-in capital 24.243 24.243 0 0,0%

Other reserves 16.873 16.433 440 2,7%

Retained earnings 162.833 148.479 14.354 9,7%

Non-controlling interest 1.028 1.243 -215 -17,3%

Total Patrimonio 204.977 190.398 14.579 7,7%

Var.

Shareholders' equity increased by Ch$ 14,579 million (US$ 21.6 million), mainly due to

Net Profit for the year. The cumulative result for the first half of 2017 shows a positive

variation of 13.9% over the same period of the previous year.

The variation of Other Reserves corresponds to the differences in the conversion of

subsidiaries according to the following detail:

M Ch$

Perú Forus S.A. 282

Uruforus S.A. 324

Elecmetal S.A. -99

Forus Colombia S.A.S. -19

Lyfestyle Brands of Colombia -48

Total Conversion Differentials 440

Consolidated Cash Flow

Jun-2017 Dec-2016 Var.

M Ch$ M Ch$ M Ch$

Cash Flow from Operating Activities 1.238 11.813 -10.575

Cash flows from (used in) investment activities 12.614 -5.442 18.055

Cash flows from (used in) financing activities -6.947 -5.055 -1.892

Flows from Operating activities generated a negative variation with respect to the same

period of the previous year of Ch$ -10,575 million (US$ -15.9 million), which is due, on the

one hand, to a higher collection of sales of goods and/or services of Ch$ 5,539 million (US$


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8.3 million), in line with the increase in revenues and, on the other hand, to the higher

disbursement for payment to suppliers for Ch$ 16,524 million (US$ 24.9 million).

The positive variation in the flows of investment activities is mainly due to the higher return

of funds invested, which is shown as "Other cash inflows" with an income of Ch$ 14,945

million (US$ 22.5 million), as of June 2017, and due to a slight increase in disbursements for

incorporation of fixed assets with a variation of Ch$ 0.1 million (US$ 0.0 million), compared

to the previous half.

Finally, the negative variation in the flows of financing activities is mainly a result of less

use of bank guarantees or letters of credit for the payment of merchandise.

Market Risk Analysis

Regional Risk: Chile remains economically stable with recovery bias, even with high

unemployment figures and still weak consumption, but with better prospects for future

growth. Uruguay continues with a recovery environment during the quarter and for the

second half of the year, with a low inflation and stable consumer confidence, favoring an

environment to continue growing our business. Peru, although maintained with a complex

scenario, is believed to be able to have positive expectations but cautious recovery towards

the end of the year. Finally, Colombia continues to have an unfavorable economic scenario

for growth, although inflation and unemployment data have remained within the estimated

parameters and the confidence index has shown a consistent bias to the recovery.

Foreign exchange risk: Both in Chile and in the subsidiaries, exchange volatility declined

during the quarter, stabilizing local currency fluctuations over previous quarters. An

appreciation of the local currency against the dollar was observed in Uruguay and Colombia.

Financial risk: The Company continues the policy of conservative management of its cash,

increasing its fund volume for investments during 2017 and maintaining a very low level of

indebtedness.

Summary Table of Countries

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Revenues (Millions Ch$)

2Q '17 2Q '16 Var %

Var % Local

Currency 1S 2017 1S 2016 Var %

Var % Local

Currency

Chile 58.171 53.764 8,2% 8,2% 109.485 103.202 6,1% 6,1%

Colombia 1.215 1.286 -5,5% -5,9% 2.490 2.448 1,7% -0,4%

Peru 4.510 4.321 4,4% 4,5% 9.187 9.660 -4,9% -3,9%

Uruguay 6.756 5.374 25,7% 16,2% 10.933 9.020 21,2% 13,7%

Total Filiales 12.480 10.980 13,7% 22.609 21.128 7,0%

Same Store Sales

Data in nominal values (in local currency)

2016 2017

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

Chile -1,8% 9,0% 3,5% 2,9% 3,8% 7,3% 0,0% 0,0% 4,1% 5,8%

Colombia -4,1% 1,5% -1,5% 4,1% 4,3% -9,4% 0,0% 0,0% -1,3% -2,7%

Peru -2,2% 2,7% -4,2% 9,9% -9,1% 1,1% 0,0% 0,0% 0,1% -4,2%

Uruguay 9,5% 12,2% -1,2% 9,9% 3,2% 4,5% 0,0% 0,0% 11,2% 4,0%

2016 2017

1S

Number of stores and surfaces of square meters

# StoresSurface of sqm # StoresSurface of sqm

Chile 325 37.128 319 36.364

Colombia 58 4.007 51 3.424

Perú 75 6.329 76 6.273

Uruguay 53 4.474 48 4.042

Total 511 51.938 494 50.102

June 2016June 2017

Data by Country and Business

19

CHILE

• Retail

(Million Ch$)

P&L 2Q '17 % Revenues 2Q '16 % Revenues Var. %

Revenues 49.725 45.853 8,4%

Cost of Sales -20.379 -18.699 9,0%

Gross Profit 29.346 59,0% 27.154 59,2% 8,1%

SG&A -17.695 -35,6% -16.128 -35,2% 9,7%

Operating Income 11.651 23,4% 11.026 24,0% 5,7% (Million Ch$)

P&L 1S 2017 % Revenues 1S 2016 % Revenues Var. %

Revenues 85.697 80.109 7,0%

Cost of Sales -36.136 -34.192 5,7%

Gross Profit 49.561 57,8% 45.916 57,3% 7,9%

SG&A -33.428 -39,0% -30.487 -38,1% 9,6%

Operating Income 16.133 18,8% 15.429 19,3% 4,6% Same Store Sales Growth Data in nominal values (in local currency)

1Q 2Q 3Q 4Q FY 1Q 2Q 3Q 4Q 2016 2017

SSS -1,8% 9,0% 3,5% 2,9% 3,6% 3,8% 7,3% 4,1% 5,8%

1S20172016

Stores Openings / Closings

Date Chain Store Sq.meters

Opening jun-17 D House La Fábrica 395

Opening jun-17 Merrell Mall Sport 71

Total 466

Change in Total square meters

June 2017 June 2016 Var. 17/16 Var. %

N° Stores 325 319 6 1,9%

Square meters sales area + window 37.128 36.364 764 2,1%


20

• Wholesale

(Million Ch$)


Revenues 8.446 7.911 6,8%

Cost of Sales -4.537 -4.317 5,1%

Gross Profit 3.909 46,3% 3.594 45,4% 8,8%

SG&A -2.406 -28,5% -2.079 -26,3% 15,7%

Operating Income 1.503 17,8% 1.515 19,1% -0,8%

(Million Ch$)


Revenues 23.788 23.093 3,0%

Cost of Sales -12.322 -12.689 -2,9%

Gross Profit 11.465 48,2% 10.404 45,1% 10,2%

SG&A -5.289 -22,2% -4.648 -20,1% 13,8%

Operating Income 6.177 26,0% 5.757 24,9% 7,3%

• Total Chile (Retail + Wholesale)

(Million Ch$)


Revenues 58.171 53.764 8,2%

Cost of Sales -24.916 -23.015 8,3%

Gross Profit 33.255 57,2% 30.748 57,2% 8,2%

SG&A -20.101 -34,6% -18.207 -33,9% 10,4%


(Million Ch$)


Revenues 109.485 103.202 6,1%

Cost of Sales -48.458 -46.881 3,4%

Gross Profit 61.026 55,7% 56.321 54,6% 8,4%

SG&A -38.717 -35,4% -35.135 -34,0% 10,2%



21

COLOMBIA

(Million Ch$)


Revenues 1.215 1.286 -5,5%

Cost of Sales -688 -711 -3,3%

Gross Profit 528 43,4% 575 44,7% -8,3%

SG&A -721 -59,3% -821 -63,8% -12,2%

Operating Income -193 -15,9% -246 -19,1% -21,4%

(Million Ch$)


Revenues 2.490 2.448 1,7%

Cost of Sales -1.424 -1.370 3,9%

Gross Profit 1.066 42,8% 1.078 44,1% -1,1%

SG&A -1.469 -59,0% -1.565 -63,9% -6,1%

Operating Income -403 -16,2% -487 -19,9% -17,1%

Same Store Sales Growth


1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2016 2017

SSS -4,1% 1,5% -1,5% 4,1% 0,5% 4,3% -9,4% 0,0% 0,0% -1,3% -2,7%

1S20172016FY

Store Openings / Closings


Closing may-17 Hush Puppies Santafé 33

Closing jun-17 Hush Puppies Unicentro 44

Total 77


June 2017 June 2016 Var. 17/16 Var. %

N° Stores 58 51 7 13,7%



22

PERÚ

(Million Ch$)


Revenues 4.510 4.321 4,4%

Cost of Sales -2.210 -2.090 5,8%

Gross Profit 2.300 51,0% 2.231 51,6% 3,1%

SG&A -2.593 -57,5% -2.508 -58,1% 3,4%

Operating Income -293 -6,5% -277 -6,4% 5,9%

(Million Ch$)


Revenues 9.187 9.660 -4,9%

Cost of Sales -4.557 -4.828 -5,6%

Gross Profit 4.630 50,4% 4.833 50,0% -4,2%

SG&A -5.256 -57,2% -5.260 -54,5% -0,1%

Operating Income -627 -6,8% -428 -4,4% 46,5%



1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2016 2017

SSS -2,2% 2,7% -4,2% 9,9% 1,7% -9,1% 1,1% 0,0% 0,0% 0,1% -4,2%

1S20172016FY



Opening apr-17 Columbia Plaza Norte 58

Opening apr-17 Columbia San Miguel 64

Opening may-17 Columbia Cayma 54

Closing by reform may-17 Billabong Chiclayo -69

Total 107


June 2017 June 2016 Var. 17/16 Var. %

N° Stores 75 76 -1 -1,3%



23

URUGUAY

(Million Ch$)


Revenues 6.756 5.374 25,7%

Cost of Sales -2.811 -2.291 22,7%

Gross Profit 3.945 58,4% 3.083 57,4% 27,9%

SG&A -2.693 -39,9% -2.148 -40,0% 25,4%

Operating Income 1.251 18,5% 936 17,4% 33,8%

(Million Ch$)


Revenues 10.933 9.020 21,2%

Cost of Sales -4.811 -4.080 17,9%

Gross Profit 6.122 56,0% 4.940 54,8% 23,9%

SG&A -4.995 -45,7% -4.089 -45,3% 22,2%

Operating Income 1.127 10,3% 851 9,4% 32,4%



1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2016 2017

SSS 9,5% 12,2% -1,2% 9,9% 8,0% 3,2% 4,5% 0,0% 0,0% 11,2% 4,0%

1S2017FY

2016



Opening may-17 Rockford Centro 74

Opening may-17 Cat Las Piedras 67

Opening jun-17 Columbia Centro 68

Closing jun-17 Hush Puppies Kids Costa Urbana -48

Closing by Reform jun-17 Hush Puppies Costa Urbana -99

Total 62


June 2017 June 2016 Var. 17/16 Var. %

N° Stores 53 48 5 10,4%


Financial and Profitability Ratios

24

• Liquidity Ratios

Units Jun-17 Dec-16

Current liquidity times 8,4 6,6

Acid ratio times 5,3 3,8

• Financial Ratios

Units Jun-17 Dec-16

Liabilities composition

Current Liabilities % 92,5% 93,1%

Non-Current Liabilities % 7,5% 6,9%

Units Jun-17 Dec-16

Leverage times 0,12 0,15

Interest Coverage times 92,49 71,94

• Profitability Ratios

Units Jun-17 Jun-16

ROA % 7,4% 7,2%

ROS % 12,9% 12,0%

ROE % 8,3% 7,8%

EPS $ 65,75 57,72

92,5% 93,1%

7,5% 6,9%

Jun-17 Dec-16

Non-Current Liabilities

Current Liabilities

Consolidated Balance Sheets

25

June 2017 December 2016

Th Ch$ Th Ch$

ASSETS

Current Assets

Cash and cash equivalents 11.059.261 4.068.088

Other financial assets, current 67.677.652 61.696.758

Other non-financial assets, current 3.201.515 3.765.269

Trade and other account receivables 29.721.311 22.912.020

Accounts receivables from related companies 1.263 102

Inventories 67.722.197 73.989.175

Tax Assets, current 3.799.250 5.650.157 Total Current Assets 183.182.449 172.081.569

Non-Current Assets

Other financial assets, Non-current 25.559 331.554

Other non-financial assets, Non-current 2.600.868 2.482.857

Fees receivables, Non-current 183.421 185.231

Investments in Associated 3.776.171 4.048.426

Net intangibles assets 2.397.735 2.714.059

Goodwill 6.026.310 6.026.310

Property, plant and equipments 28.991.348 29.193.449

Deferred tax Assets 1.376.235 1.301.601 Total Non-Current Assets 45.377.647 46.283.487

TOTAL ASSETS 228.560.096 218.365.056

LIABILITIES

Current Liabilities

Other financial liabilities, current 1.326.671 1.760.920

Current trade and other current accounts payable 11.707.482 12.146.810

Current accounts payable to related companies 734.547 845.467

Other current Provisions 2.361.019 5.789.365

Current Provisions for employees benefits 4.266.090 4.339.128

Other non-financial liabilities, current 1.259.161 1.141.997 Total Current Liabilities 21.810.151 26.023.687

Non-Current Liabilities

Other non-current financial liabilities 1.765.124 1.803.939

Other non-financial non-current liabilities 8.033 7.952 Total Non-Current Liabilities 1.773.157 1.943.513

TOTAL LIABILITIES 23.583.308 27.967.200

SHAREHOLDER'S EQUITY

Paid-in capital 24.242.787 24.242.787

Retained earnings 162.832.992 148.478.839

Issue Premium 17.386.164 17.386.164

Other reserves (513.191) (952.747)

Equity attributable to equity holders of the parent 203.948.752 189.155.043

Non-controlling interest 1.028.036 1.242.813

Total Net Equity 204.976.788 190.397.856

TOTAL NET EQUITY AND LIABILITIES 228.560.096 218.365.056


CONSOLIDATED BALANCE SHEETS

expressed in Thousands of Chilean Pesos, as for

Consolidated Income Statement

26

and for the quarters

June 2017 June 2016 2Q'17 2Q'16

Th Ch$ Th Ch$ Th Ch$ Th Ch$

Revenues 131.926.330 124.192.938 70.569.894 64.677.551

Cost of Sales (59.082.378) (57.021.388) (30.542.928) (28.039.731) Gross Margin 72.843.952 67.171.550 40.026.966 36.637.820

Other incomes of total operation 937.737 246.897 703.280 212.363

Logistic costs (1.405.040) (1.311.909) (633.079) (596.401)

Administrative Expenses (49.032.686) (44.736.936) (25.474.590) (23.087.195)

Other expenses of total operation (368.340) (134.872) (233.950) (48.083)

Other gains or (losses) (198.884) 61.548 (147.401) 31.758

Financial Income 703.992 998.088 388.830 562.145

Financial Expenses (183.730) (173.764) (91.234) (84.942)

Participation in gains (losses) of joint venture businesses accounted (90.220) (164.536) (92.457) (80.412)

by using the proportional value of participation

Exchange Differentials 49.621 (2.049.801) 206.962 (524.129)

Result of Indexation units (18.850) (27.550) (12.183) (16.832) Profit before income tax 23.237.552 19.878.715 14.641.144 13.006.092

Income Taxes (6.243.766) (4.958.776) (3.886.207) (3.224.675) Profit (loss) 16.993.786 14.919.939 10.754.937 9.781.417

Profit (loss) attributable to equity holders of parent 16.993.786 15.090.742 10.841.971 9.862.933

Profit (loss) attributable to minority interest (196.350) (170.803) (87.034) (81.516)

Profit (loss) 16.993.786 14.919.939 10.754.937 9.781.417

Income per Share Commom shares $ 65,7 $ 57,7 $ 41,6 $ 37,8

expressed in Thousands of Chilean Pesos for the end of the periods of


CONSOLIDATED INCOME STATEMENT

Forus S.A.

27

Address:

Av. Departamental Nº 01053

La Florida

Santiago, Chile

Contact:

Macarena Swett / Sebastián Macchiavello

Investor Relations

Telephone: (56 2) 2 923 3035

Email: [email protected]

Website:

www.forus.cl

Go to the Investors menu.

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