Falabella - BICE Inversiones

Renta Company Variable Update
Local – Informe Empresas Retail
Falabella
Lowering Target Price on conservative D-Stores view
Target Price: CLP4,800 (Dec. 2012)
Current Price: CLP4,662
Financial Summary
Bloomberg FALAB CI
Credit Rating (Feller/Fitch) AA/AA
52 weeks Hi/Lo ($) 5,282-3,716
Current Price ($) 4,662
Upside Potential 3.0%
Stocks (million) 2,404.4
Market Cap (US$ million) 23,110.6
Float (%) 16.5%
Average Daily Volume Traded 6M (US$ million)
Estimates
7.1
2010 2011 2012E 2013E
Revenues 4,430,429 5,163,995 5,675,947 6,534,920
Operating Income 594,942 649,920 733,154 810,358
EBITDA 704,737 778,899 872,772 980,547
Net Income 413,347 423,046 473,190 525,402
EPS (CLP/Share) 171.9 176.0 196.8 218.5
D/E
Ratios
0.9 1.0 0.9 0.9
2010 2011 2012E 2013E
FV/EBITDA 25.8x 17.9x 18.5x 16.8x
FV/Revenue 4.1x 2.7x 2.8x 2.5x
P/E 30.5x 23.0x 23.7x 21.3x
Price/book 5.3x 3.4x 3.7x 3.3x
FCF yield 3.1% 0.5% 1.8% 0.5%
Dividend yield 0.7% 2.5% 1.4% 1.6%
Relative Performance IPSA - Falabella
120
110
100
90
80
70
Jan-11
Mar-11
May-11
Jul-11
Aldo Morales
562 692-3481
amoralese@bice.cl
Rodrigo Jacob
562 692-2576
rjacob@bice.cl
Sep-11
Nov-11
IPSA Falabella
Jan-12
Mar-12
May-12
Sell
We are updating our year-end 2012 target price of Falabella, reducing it
from CLP5,000 to CLP4,800 and downgrading from Hold to Sell.
Considering an estimated dividend yield of 1.4% and an upside potential
of 3.0%, we arrive at a total return of 4.4% per share. This compares to a
10.2% estimated upside for the IPSA index over the same period.
Investment thesis. We are basing our view on the following key factors:
� New organic CAPEX. We are factoring in US$3,307 million in
investments in fixed assets over the 2012-2015 period, destined to
open 204 new Stores and 16 new Shopping Centers in the Region.
This is in line with the company’s new announcement made in
January 2012 (US$3,411 million) and will allow the company to
reach 4,522,000 m 2 of sales space in 2015, a 67.2% increase
compared to 2011.
� A more conservative view on Chilean D-Store margins. After
disappointing industry-wide results in Chilean Department stores in
2H11 and 1Q12, we are lowering our EBITDA margin estimates for
2012 and 2013 by 70bp and 90bp, respectively.
� Postponing the expected reduction of the interest rate ceiling.
In our last report, we considered the implementation of this
regulatory change during 2012. After 5 months in Congress, there
have been no new developments on this bill. We now see it coming
into effect in 1Q13.
� Pension Funds no longer overinvested. Last March, the pension
funds eliminated their excess investments in Falabella. As of May
2012 Pension Funds had a margin of US$250.7 million to invest in
Falabella.
� Limited impact from Argentine operations. As of December 2011,
Falabella’s Argentine operations represented 7.4% of the company’s
consolidated revenues and 3.4% of its EBITDA. In our view, the
difficult outlook for retail companies in Argentina does not represent
a serious threat to a diversified company like Falabella, given that, in
terms of valuation, Argentina represents only a 0.6% of our
estimated value of the shares.
� Fair valuations. Falabella is currently trading at 2012E FV/EBITDA
and 2012E P/E of 18.5x and 23.7x, which is 9.4% and 10.3% below
its historical levels, respectively, being the lowest discount of our
Chilean Retail sample. We think the market fairly values Falabella’s
shares.
Risk factors. The main risks related to our recommendation are: (i) a
slowdown in global economic growth impacting Chilean consumer
confidence; (ii) execution risks, including delays in store openings and
lower-than-expected margin improvements; and (iii) larger-thananticipated
effects on the interest ceiling reduction in Chile.
BICE Inversiones – Equities Report – Falabella June 20, 2012

We are factoring in
14 new stores and
1 additional
Shopping Center
when compared to
our last report.
We are forecasting
the entire CAPEX
for the next four
years, in line with
the announces
made by the
company.
Investment Thesis
BICE Inversiones – Equities Report – Falabella
We are updating our year-end 2012 target price of Falabella from CLP5,000 to CLP4,800 and
downgrading from Hold to Sell. Our investment thesis has changed essentially introducing a
more conservative view on Chilean Department Store margins, an updated CAPEX and a delay
in the implementation of a new, lower interest rate ceiling in Chile. We illustrate this with the
following points:
Introducing new organic CAPEX. We are factoring in US$3.307 million in fixed assets
investments over the 2012-2015 period, to open 204 new stores and 16 new Shopping Centers in
the Region. This is in line with the investment plan update announced by Falabella in January
2012, which should allow the company to reach 4,522,000 m 2 in total space by 2015, an
impressive 67.2% increase when compared to 2011. This CAPEX implies 14 new stores and 1
additional Shopping Center with regard to our last report as of October 19 th , 2011.
� Re-arranging CAPEX. After a weak investment performance through the last three
years (2009-2011), when the company announced a total CAPEX of US$1,683 million,
but only executing 49.4% of it, we are factoring in the company’s entire CAPEX for the
next four years, given that management explained that the worsening in the
macroeconomic environment observed in 2H11 forced them to be more cautious in the
near-term investment program, thus deciding to re-arrange the CAPEX program. In
particular, if we analyze Falabella’s track record over a longer time period, since 2006
we see that over the entire period the company announced investments of US$2,794
million, executing total investments of US$2,609 million, so we think there would
probably be an accelerated process of store-openings.
� Chile: focus on supermarkets and home Improvement. We are introducing a 141.5%
and 40.5% increase in total square meters in the supermarket and home improvement
formats in Chile for the 2012-2015 period. Regarding supermarkets (Tottus), we still
have a cautious opinion about SMU’s acquisition of Supermercados del Sur, which
would put pressure on Falabella’s growth intentions. In particular, we are increasing
Tottus’s EBITDA margin from the current 2.5% (2011) to 3.6% in 2015, still below
average industry levels (4.5%). On the other hand, we share the company’s view about
the possibility of expanding the home improvement operations to the extreme north and
south regions in Chile.
Figure 1. Expected Number of Store by Country
2012 2013 2014 2015 Total %
Expected Openings
New Stores 45 56 53 50 204
Malls 2 6 6 2 16
Department Stores 10 12 11 10 43 19.5%
Home Improvement 17 18 16 16 67 30.5%
Supermarkets 18 26 26 24 94 42.7%
Malls 2 6 6 2 16 7.3%
Total 47 62 59 52 220 100%
Chile 20 28 25 21 94 42.7%
Argentina 2 2 2 2 8 3.6%
Peru 19 24 25 22 90 40.9%
Colombia 6 8 7 7 28 12.7%
Total 47 62 59 52 220 100%
2

BICE Inversiones – Equities Report – Falabella
Figure 2. Mall Plaza’s announced Projects
Mall Plaza m2 US$ Ex.Opening Date US$/m2
Announced projects
Chile
Mall Plaza Bio Bio 30,000 80 3T12 2,667
Mall Plaza Egaña 80,000 175 1T13 2,188
Mall Plaza Copiapó 37,000 75 1S13 2,027
Mall Plaza Los Domínicos 87,000 218 2S14 2,506
Peru
Mall Plaza Sta. Anita (1) 57,000 69 2S12 1,211
Colom bia
Mall Plaza El Castillo (2) 26,000 80 1S12 3,077
(1) Perú is a related company w ith a 20% share.
(2) Colombia is a subsidiary w here Plaza S.A. controlls 70% of the shares.
Figure 3. Expected m 2 Growth
m 2 Grow th 2011 2012E 2013E 2014E 2015E
M2 Retail 1,643,397 1,932,697 2,271,897 2,588,097 2,888,797
M2 Malls 1,061,000 1,166,000 1,465,000 1,558,000 1,633,000
Retail m2 Grow th 17.6% 17.6% 13.9% 11.6%
Malls m2 Grow th 9.9% 25.6% 6.3% 4.8%
Accum. grow th Retail 17.6% 38.2% 57.5% 75.8%
Accum. grow th Malls 9.9% 38.1% 46.8% 53.9%
Source: Company Reports, BICE Inversiones Estimates.
� Foreign operations: taking advantage of good consumption perspectives in Peru
and Colombia. We continue to have a positive view on the consumption outlook in
Peru and Colombia. We think lower penetration levels compared to Chile, give the
company an attractive environment to expand its current operations. In this way, we
forecast a 141.6% and an 87.3% expansion in total m 2 for the 2012-2015 period in
Peru and Colombia, respectively.
Figure 4. Falabella’s expected EBITDA
Breakdown
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
2011 2012E 2013E 2014E 2015E
Chile Plaza Perú
Argentina Colombia Banco Chile
Source: Company Reports, BICE Inversiones Estimates.
3

We are lowering
by 50bp and 70bp
the gross margin
of Chilean
Department
Stores in 2012
and 2013
compared to our
previous
estimate,
reaching EBITDA
margin of 7.3% in
each year.
We quantify the
impact of this
likely regulatory
change in
approximately
CLP156 per share
As of May,
Pension Funds
had a US$207.7
million room to
invest in Falabella.
BICE Inversiones – Equities Report – Falabella
A more conservative view on performance of Chilean Department Stores. We are including
a more conservative view of the Chilean Department Store margins given the disappointing
results showed by local companies in 2H11 and 1Q12. In particular, we are lowering the gross
margin by 50bp and 70bp in 2012 and 2013 when compared to our previous estimates, reaching
an EBITDA margin of 7.3% in each year. Our forecast still represents a 40bp improvement
versus year-end 2011 levels, when the company reached a 6.9%. This is because we still see the
recent performance as a baseline to the industry, as a result of a deficient inventory
management, made with a six-month anticipation, considering higher consumption perspectives
for 2H11, which did not materialize causing excess inventory liquidation. In addition, higher
competence in Electronics and climate disturbance affected the Department Stores performance.
Figure 5. Chilean D-Stores gross margin
evolution
32.0%
31.0%
30.0%
29.0%
28.0%
27.0%
26.0%
25.0%
24.0%
23.0%
22.0%
21.0%
20.0%
2006 2007 2008 2009 2010 2011 1T12
Falabella Paris Ripley
Source: Company Reports, BICE Inversiones Estimates.
Postponing the reduction of the interest rate ceiling in Chile. We consider a CLP156 per
share value erosion due to the implementation of this regulatory change in 1Q13.
To quantify the impact of this bill on Falabella we considered the following:
� 7.6% of CMR’s (Falabella’s Branch Credit) 2011 revenues came from charges not linked
to the interest rate. Therefore, they should remain unaffected by the new bill.
� We estimate that 70.4% of CMR’s 2011 revenues came from all loans excepting those
that were less than 90 days overdue. We estimate that these loans charge an average
interest rate of 23.5%, significantly below the reduced ceiling contemplated in the new
bill.
� Falabella charges the interest rate ceiling on loans that have been subject to loans that
were less than 90 days overdue (before they are eventually written off). We estimate
that this group of loans accounted for 22.1% of CMR’s 2011 revenues, and should be
affected by the lowered interest rate ceiling.
We are estimating a 140bp interest rate drop in 2013 on loans that were less than 90 days
overdue, and further 50bp drop in progressive fashion. In addition, we apply a 5% decrease in
loans in 2013. We quantify the impact of this likely regulatory change in approximately CLP156
per share.
Investment flows have also something to say. After particular non recurring events in the near
term, we think it is important to highlight some additional pressures to the stock, produced by
investment flows.
� After the excess reduction, Pension Funds have room to invest. Last March,
the pension funds reduced their excess investment in Falabella, after a regulatory
change in March 2011 forced them to divest US$372.0 million over a 12-month
period. In spite of that, pension funds now have room to invest in the company. In
this regard, by May 2012 pension funds jointly held US$1,164.1 million in Falabella
shares, a 0.8% of their combined funds. Thus, as of May, Pension Funds had a
US$250.7 million room to invest in the company
4

BICE Inversiones – Equities Report – Falabella
Figure 6. Pension Fund’s Room to invest in Falabella (May 2012)
US$ million A B C D E Total
AFP Falabella Holding 249.8 250.0 518.8 134.9 10.6 1,164.1
AFP AUM 25,178.5 25,779.5 56,781.5 21,235.7 12,510.9 141,486.1
% of Fund 1.0% 1.0% 0.9% 0.6% 0.1% 0.8%
AFP posible Investment 2.0 7.8 49.0 77.5 114.5 250.7
Source: SAFP, BICE Inversiones Estimates.
� Additional pressure given the Cencosud capital increase. In our opinion, the
large capital increase of approximately US$1,500 million announced by Cencosud
will probably put additional pressure on Falabella’s shares, due to the important
amount of cash that investors will need in order to finance its participation. Finally, it
is important to mention that last April, the Bethia Holding, one of Falabella’s
controllers, part of the Solari family, made an important sell of 25,333,333 shares or
1.05% of the company, which would put pressure on Falabella’s investment flows in
the short term too.
A note about Argentine operation. We consider that further deterioration of the Argentine
economic climate would not have important effects on Falabella’s shares.
� Limited impact in terms of valuation. As of December 2011, the Argentine operations
represented 7.4% of the consolidated revenues and 3.4% of EBITDA. In addition, given
the internal restrictions and difficulties, the Argentine government limited the ability of
international companies to take the cash flows out of Argentina. According to
management, at this time cash flow generation in Argentina is not transferred to Chile,
and will be reinvested domestically to finance the conservative investment plan. In this
regard, we are estimating that only 3.3% of Falabella’s total CAPEX is destined to
Argentina (US$100 million in the 2012-2015 period). In our model, Argentina accounts
for only 0.6% of the company’s fair value, given the 19.4% WACC used to discount
Argentine flows, compared to 10.8% in Chile.
� Devaluation exercise. We are forecasting an exchange rate of AR$4.5 per one US
dollar in 2012, and reaching AR$6.8 in the long term. In this regard, as an exercise, if
we assume a devaluation from current AR$4.5 per US dollar to AR$7.0 from then on,
we would have a negative impact of CLP5, reflecting the Argentine’s lower importance
in our valuation.
Potential changes to Chilean corporate tax rate. For a couple of years now, the idea of an
increase in corporate tax rate has grown strong in Chilean politics. In particular, the government
is proposing a comprehensive reform to the Chilean tax system, including a permanent increase
in corporate taxes from the current 18.5%, to 20%. According to our estimates, an increase of
150bp in the tax rate would have a negative impact of 0.6% in Falabella’s target price.
Figure 7. Target Price’s sensitivity to Corporate Tax rate
Tax Chile
15.5% 4,855
17.0% 4,827
18.5% 4,800
20.0% 4,772
21.5% 4,743
Source: SAFP, BICE Inversiones Estimates.
5

Shares would offer
an expected 4.4%
total return.
Valuation
BICE Inversiones – Equities Report – Falabella
To value Falabella’s shares we used a DCF model, in which we calculated the value of its
different operations in Chile, Argentina, Peru and Colombia, discounting each operating cash
flow between 2013 and 2022 and making adjustments for investments in fixed assets and
working capital requirements. In this way, we reached a 2012 year-end target price of CLP4,800.
Our calculation considers a nominal WACC rate of 10.8% for operations in Chile, based on a
debt rate of 7.4% (using an unleveraged beta of 0.9) and a perpetuity growth of 4.0%. For the
Argentinean operations we discounted the flows at a nominal WACC rate of 19.4%, with a
nominal perpetuity growth of 11.1%, while Peruvian and Colombian operations were discounted
at a nominal WACC rate of 10.7% and 10.6%, respectively, with perpetuity growth rates of 5.3%
and 6.3%, respectively. Finally we valued Banco Falabella’s flows at a 12.9% rate with a
dividend discount model. Our target price reflects a 3.0% upside over the current price, which in
addition to the shares’ estimated dividend yield, results in a total return of 4.4% until December
2012.
Using a similar DCF model, but discounting cash flows between 2012 and 2021, we arrive at the
current fair value of the shares of CLP4,500. This suggests that at current levels, the market
fairly values the shares.
Figure 8. Free Cash Flow
$ millions 2010 2011 2012E 2013E 2014E 2015E
Operating Revenues 4,430,429 5,163,995 5,675,947 6,534,920 7,708,081 9,115,351
Total Expenses -3,835,487 -4,514,075 -4,942,793 -5,724,561 -6,799,448 -8,047,564
Net Operating Income 594,942 649,920 733,154 810,358 908,633 1,067,787
Tax -93,482 -114,155 -152,532 -172,093 -197,788 -236,786
Depreciation 109,796 128,978 139,618 170,189 221,469 269,547
EBITDA 704,737 778,899 872,772 980,547 1,130,101 1,337,334
Change in Working Capital -72,432 -286,606 -127,428 -143,412 -425,197 -512,425
Capex -148,688 -177,483 -386,507 -604,835 -609,140 -441,070
Free Cash Flow 363,663 35,833 206,304 60,208 -102,025 147,053
Source: BICE Inversiones Estimates
Figure 9. Valuation
Falabella Chile Mall Plaza Peru Argentina Colombia Total
VNA FC 2,700,876 201,140 478,352 -53,607 -165,429 3,161,332
Perpetuity 4,566,928 578,295 3,407,834 130,651 1,729,704 10,413,412
Cost of Equity 12.9% 12.9% 13.1% 22.9% 13.0%
Cost of Debt 7.4% 7.4% 7.5% 17.3% 7.5%
WACC 10.8% 10.8% 10.7% 19.4% 10.6% 11.1%
Nominal Perpetuity Growth 4.0% 4.0% 5.3% 11.1% 6.3%
Banco Falabella Chile 221,951
Related Companies* 452,785
Cash and Equivalents 181,618
Financial Debt 2,464,171
Minority Interes t 426,735
Total Equity Value 11,540,193
Shares Outstanding (million) 2,404
Target Price Falabella (Dec-12) 4,800
Source: BICE Inversiones Estimates
6

Falabella
currently
trades at
18.5x 2012E
FV/EBITDA
and at 23.7x
2012E P/E.
Looking at valuation multiples, we note that Falabella currently trades at 18.5x 2012E FV/EBITDA
and at 23.7x 2012E P/E, which represents discounts of 9.4% and 10.3% respectively, compared to
the company’s historical averages (20.4x FV/EBITDA and 26.4x P/E). In this regard, Falabella’s
discount is the lowest of our Chilean Retail sample.
In addition, compared with our 2012E target IPSA P/E ratio of 15.2x, which is 17.3% below the
historical average, we can observe that again Falabella trades with a lower discount.
Furthermore, the share’s average premium over its large cap Chilean peers is currently at 23.0% in
FV/EBITDA 2012E, which is higher than the historical level of 17.1%. This, combined with the fact
that the shares have outperformed the IPSA index by 11.6% YTD, are clear signs that Falabella’s
expansion plan and its positive growth outlook in the Region have already been priced in by the
market, thus leaving little room for any further upsides. This is consistent with our DCF valuation and
target price as Falabella’s target multiples are already fair valued in this scenario.
Figure 10. Retail Comparison Table
Mkt Cap
P/E FV/EBITDA
Name MMUS$ Country LTM 2012E 2013E LTM 2012E 2013E
Falabella Department Stores 22,631 Chile 28.1x 23.7x 21.3x 19.0x 18.5x 16.8x
Cencosud Hypermarkets & Super Centers 14,307 Chile 22.3x 19.0x 15.4x 14.2x 11.5x 9.7x
Ripley Department Stores 1,818 Chile 18.5x 14.3x 10.9x - 10.5x 8.8x
Forus Footwear 1,019 Chile 17.7x 16.5x 13.9x 11.8x 11.9x 10.6x
Hites Department Stores 274 Chile 11.0x 9.4x 8.3x 7.8x 6.9x 7.2x
Chile Average 3,687 19.5x 16.4x 13.9x 12.8x 11.5x 9.9x
Walmex Hypermarkets & Super Centers 47,618 Mexico 29.3x 25.9x 22.0x 17.2x 15.1x 13.0x
Pao Acucar Hypermarkets & Super Centers 9,990 Brazil 26.6x 20.2x 16.2x 0.0x 7.7x 6.9x
Liverpool Department Stores 10,333 Mexico 20.6x 20.0x 17.5x 14.2x 13.1x 11.8x
Almacenes Éxito Hypermarkets & Super Centers 7,326 Colombia 27.5x 28.9x 24.8x 0.0x 12.2x 10.6x
Lojas Americanas General Merchandise Stores 5,881 Brazil 37.3x 27.0x 19.4x 0.0x 9.3x 7.5x
Soriana Hypermarkets & Super Centers 4,969 Mexico 21.1x 17.9x 15.6x 10.3x 9.4x 8.6x
Lojas Renner Department Stores 3,665 Brazil 22.7x 19.5x 16.3x 13.8x 11.3x 9.3x
Cia. Hering Apparel Retail 3,428 Brazil 21.8x 18.9x 15.5x 0.0x 13.4x 10.8x
Famsa Department Stores 380 Mexico 15.3x 16.2x 12.0x 11.6x 10.2x 9.1x
LatAm Average 10,399 24.7x 21.6x 17.7x 13.4x 11.3x 9.7x
Walmart Hypermarkets & Super Centers 229,438 EE.UU. 14.7x 13.8x 12.7x 8.0x 7.7x 7.4x
Home Depot Home Improvement Retail 81,079 EE.UU. 20.3x 18.0x 15.9x 10.3x 9.7x 9.1x
Target General Merchandise Stores 38,813 EE.UU. 13.3x 13.5x 12.0x 7.4x 7.4x 7.0x
Lowe's Home Improvement Retail 33,584 EE.UU. 16.3x 15.6x 12.8x 8.0x 7.4x 6.9x
TJX Apparel Retail 32,217 EE.UU. 20.2x 18.0x 16.1x 9.8x 9.0x 8.4x
Macy's Department Stores 15,357 EE.UU. 12.3x 11.0x 9.7x 5.8x 5.5x 5.2x
Kohls Corp Department Stores 10,654 EE.UU. 10.3x 9.5x 8.5x 4.8x 4.7x 4.6x
J.C. Penney Department Stores 4,864 EE.UU. - 18.1x 8.9x 11.5x 6.6x 4.6x
EE.UU. Average 55,751 15.3x 14.7x 12.1x 8.2x 7.2x 6.7x
Golden Eagle Retail-Regnl Dept Store 3,958 China 20.8x 17.9x 14.5x 13.7x 11.4x 9.1x
Intime Retail-Major Dept Store 1,959 China 14.5x 12.9x 11.3x 14.6x 10.2x 8.3x
Parkson Retail-Major Dept Store 2,550 China 14.4x 13.1x 11.2x 8.1x 7.5x 6.4x
Shoprite Food-Retail 10,695 South Africa 27.9x 24.9x 21.0x 15.2x 15.4x 13.2x
Asia & Africa Average
Source: Bloomberg and BICE Inversiones Estimates.
4,791 19.4x 17.2x 14.5x 12.9x 11.1x 9.3x
BICE Inversiones – Equities Report – Falabella
7

Falabella – Financial Statements
Income Statement
$ m illions 2011 2012E 2013E 2014E 2015E 2016E
Operating Revenues 5,163,995 5,675,947 6,534,920 7,708,081 9,115,351 10,394,846
Total Expenses -4,514,075 -4,942,793 -5,724,561 -6,799,448 -8,047,564 -9,151,996
Net Operating Income 649,920 733,154 810,358 908,633 1,067,787 1,242,849
Net Operating Margin 12.6% 12.9% 12.4% 11.8% 11.7% 12.0%
Non Operational Results -68,093 -68,123 -69,218 -70,668 -80,587 -79,895
Income before taxes 581,827 665,031 741,140 837,965 987,199 1,162,954
Tax -114,155 -152,532 -172,093 -197,788 -236,786 -282,152
Minority Interest -44,626 -39,309 -43,646 -49,102 -57,557 -67,558
Net Incom e 423,046 473,190 525,402 591,075 692,857 813,245
Net Margin 8.2% 8.3% 8.0% 7.7% 7.6% 7.8%
EBITDA 778,899 872,772 980,547 1,130,101 1,337,334 1,539,431
EBITDA Margin 15.1% 15.4% 15.0% 14.7% 14.7% 14.8%
Source: Company Reports and BICE Inversiones estimates.
Balance Sheet
$ millions 2011 2012E 2013E 2014E 2015E 2016E
Current Assets 2,451,316 2,592,932 2,720,167 3,018,616 3,263,145 3,438,640
Non Current Assets 1,647,793 1,939,420 2,428,601 2,887,238 3,145,133 3,258,783
Total Assets 7,764,096 8,359,951 9,030,767 10,021,641 10,648,208 10,995,799
Current Liabilities 2,267,951 2,398,974 2,516,691 2,792,815 3,019,053 3,181,421
Financial Liabilities 3,306,108 3,422,704 3,567,810 4,040,301 4,110,634 3,933,978
Total Liabilities 4,465,203 4,714,782 5,002,153 5,664,653 5,953,008 5,972,355
Minority Interest 579,916 579,916 579,916 579,916 579,916 579,916
Total Equity 2,718,976 3,065,253 3,448,697 3,777,072 4,115,284 4,443,528
Total Liabilities + Equity 7,764,096 8,359,951 9,030,767 10,021,641 10,648,208 10,995,799
Source: Company Reports and BICE Inversiones estimates
Cash Flow
$ m illions 2011 2012E 2013E 2014E 2015E 2016E
Operating Revenues 5,163,995 5,675,947 6,534,920 7,708,081 9,115,351 10,394,846
Total Expenses -4,514,075 -4,942,793 -5,724,561 -6,799,448 -8,047,564 -9,151,996
Net Operating Income 649,920 733,154 810,358 908,633 1,067,787 1,242,849
Depreciation and Amortization 128,978 139,618 170,189 221,469 269,547 296,582
EBITDA 778,899 872,772 980,547 1,130,101 1,337,334 1,539,431
Net Income 423,046 473,190 525,402 591,075 692,857 813,245
+ Depreciation and Amortization 128,978 139,618 170,189 221,469 269,547 296,582
+ Financial Expenses 68,774 88,606 91,731 95,620 108,283 110,168
- Financial Income -6,729 -7,396 -8,516 -10,044 -11,878 -13,545
+ Monetary Adjustments 35,590 0 0 0 0 0
- Profit/Loss Related Companies -13,087 -13,087 -13,997 -14,907 -15,817 -16,727
- Minoritary Interest 44,626 39,309 43,646 49,102 57,557 67,558
- Investment in Fixed Assets -177,483 -386,507 -604,835 -609,140 -441,070 -315,197
- Change in Working Capital* -286,606 66,377 11,249 14,662 16,683 15,171
- Financial Working Capital 0 -193,805 -154,661 -439,860 -529,109 -499,117
- Investment in Other Assets -164,823 0 0 0 0 0
Free Cash Flow 52,287 206,304 60,208 -102,025 147,053 458,135
* No n Financial
Source: Company Reports and BICE Inversiones estimates
BICE Inversiones – Equities Report – Falabella
8

Research Team
DISCLAIMER
Rodrigo Jacob G.
Head of Research
rjacob@bice.cl
Mabel Weber A.
Senior Analyst
mweber@bice.cl
Aldo Morales E.
Analyst
amoralese@bice.cl
BICE Inversiones – Equities Report – Falabella
Cristóbal Doberti D.
Chief Economist
cdoberti@bice.cl
Sebastián Senzacqua B.
Economist
ssenzacqua@bice.cl
Claudia Cavada S.
Analyst
ccavada@bice.cl
The analyst or analysts involved in the creation of this document hereby certify that the views expressed in this document
accurately reflect their personal opinions and that they have not and will not receive direct or indirect compensation for
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employees shall not in any way be liable for related claims. The information and analyses contained herein are not intended
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