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San Miguel Industrias PET Announces Consolidated

Results for First Quarter of 2017

Lima, Peru, June 22nd, 2017 San Miguel Industrias PET (The company or SMI), a leading Peruvian rigid
plastic company with injection, blowing and cap molding operations in Peru, Colombia, Ecuador, El Salvador,
Panama, Guatemala and Mexico, and recycling operations in Peru and Colombia, announces today consolidated
results for the first quarter (1Q 2017), stated in nominal US dollars (US$).

Financial Highlights

1Q 2017 versus 1Q 20161

- Total container volume sold was 2,046 million units, increasing by ~710 million units (53.1% YoY).
- Consolidated adjusted EBITDA reached ~US$ 22.1 million, increasing by ~US$ 5.8 million
(35% YoY).
- Shift in product mix, with share of bottles decreasing from 27% to 19% YoY in volume, mainly due
to a recent regional supply agreement, which is mainly concentrated in preforms.

Financial Results

The following table shows a summary of SMIs consolidated financial results:

Consolidated Financial Results

Financial and operating results (US$ 000)


1Q 2017 1Q 2016 % Var Abs. Var
Million units
Preforms 1,660 975 70.2% 684
Bottles 386 361 7.0% 25
Total containers 2,046 1,336 53.1% 710
Closures 692 7 10489.7% 686
Gross profit 19,411 15,792 22.9% 3,619
Consolidated adjusted EBITDA 22,109 16,342 35.3% 5,766
Gross margin 19.7% 23.8%
Consolidated EBITDA margin 22.5% 24.6%

1 For comparison purposes, figures include Plastiglas sales and results for 1Q 2016.

For more information please visit: http://www.smi.com.pe or contact:


Jose Beya, CFO
Giacomo Sissa, Deputy CFO
Guillermo Cabrera, Investor Relations
San Miguel Industrias PET
Tel: (511) 336 5100 ext: 1278
E Mail: gcabrera@smi.com.pe
Earnings Report
First Quarter 2017

1. Volumes sold

Sales (million units)


1Q 2017 1Q 2016 % Var Abs. Var
Preforms 1,660 975 70.2% 684
Bottles 386 361 7.0% 25
Total containers 2,046 1,336 53.1% 710
Closures 692 7 10489.7% 686

Volumes maintained a growth trend in the first quarter with over 710 additional million units sold vs 1Q 2016
(+53% YoY). This was mainly explained by (i) the contribution of a recently signed supply agreement with a
regional client (~611 additional million units sold), (ii) the full potential contribution of a contract signed by the
end of 2015 with a leading bottler in both Peru and Ecuador (~30 million units in both countries) and (iii)
organic growth within our contracted, spot, and export clients throughout the Andean Region, Central America
& the Caribbean.

In addition to preform and bottle growth, SMI sold 692 million units of closures in Peru, Colombia, Ecuador,
Mexico and Central America in the first quarter of 2017. This is the result of a contract signed at the end of 4Q
2016.

2. Gross Profit

In absolute terms, gross profit increased in ~US$ 3.6 million in 1Q 2017 when compared to 1Q 2016 (+23%
YoY). Gross profit margins decreased from 23.8% to 19.7%, mainly because of changes in the product mix with
the contribution of the recently signed preform concentrated contract with a regional bottler, as well as the start
of the new closures business unit, which accounts for 25% of the total consolidated volume.

3. Operating Profit

a. Administrative expenses (US$ 000s):

Administrative Expenses (US$ 000)


1Q 2017 1Q 2016 % Var Abs. Var
Personnel Expenses 1,426 1,124 26.8% 302
Travel & business expenses 154 180 -14.6% (26)
Third - party services 994 482 106.2% 512
Depreciation & Amortization 2,506 2,274 10.2% 232
Other 1,374 709 93.7% 665
Total 6,453 4,769 35.3% 1,684

Administrative expenses increased in ~US$ 1.7 million in 1Q 2017 vs 1Q 2016 (35% YoY), and represented
~6.6% of the total revenues. Increases were mainly driven by the strengthening of the administrative team to
prepare for the new contracts signed on 2H of 2016 and their expected growth, and due to SAP developments,
and legal and tax advisory services related to the new closed businesses. The implementation of an ERP solution
is our first step to capture synergies with Plastiglas after the recent merger, and will start to show savings in the
2H of 2017.

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Earnings Report
First Quarter 2017

b. Selling and distribution expenses (US$):

Selling Expenses (US$ 000)


1Q 2017 1Q 2016 % Var Abs. Var
Personnel Expenses 595 504 18.0% 91
Travel & business expenses 55 55 0.1% 0
Third - party services 948 877 8.2% 72
Depreciation & Amortization 360 346 4.1% 14
Other 382 229 66.6% 153
Total 2,340 2,011 16.4% 329

Selling and distribution expenses increased in ~US$ 0.3 million in 1Q 2017, compared to 1Q 2016 (16% YoY).
This was mainly a result of (i) the strengthening of the commercial team to support the new consolidated
operations and our efforts to increase spot and export sales, and (ii) increases in variable selling expenses such
as transport and third-party services, associated directly to volume growth.

4. Financial income and expense

Net Financial Expenses (US$ 000)


1Q 2017 1Q 2016 Abs. Var
Finacial Expenses (6,088) (4,568) (1,519)
Financial Income 824 46 778
Net financial expenses (5,263) (4,522) (741)

Financial expenses increased in ~US$ 1.5 million in 1Q 2017 vs 1Q 2016. Most expenses can be explained by
the US$ 200 million bond coupons (November 2013 issuance), interests paid for outstanding leasings and some
short-term loans, and a stock of debt in Plastiglas.

5. EBITDA Reconciliation

Consolidated adjusted EBITDA (US$ 000s)

Selling Expenses (US$ 000)


1Q 2017 1Q 2016 % Var Abs. Var
Operating profit 12,779 9,806 30.3% 2,972
+ Depreciation & Amortization 8,367 6,382 31.1% 1,985

Adjustments to EBITDA:
Advisory services 650 -
Extraordinary Bonus to employees - 130
Others 313 24
Total Adjustments 963 154
Adjusted EBITDA 22,109 16,342 35.3% 5,766
Adjusted EBITDA Margin 22.5% 24.6%

Consolidated adjusted EBITDA reached ~US$ 22.1 million in 1Q 2017, compared to ~US$ 16.3 million generated
in 1Q 2016 (+35% YoY). This was mainly because of the volume contribution of the recently signed regional
contracts and the organic growth of SMIs consolidated operation. On this first quarter, SMI has surpassed its
aggressive internal budget, and LTM EBITDA reached USD 67.3 mm (vs. USD 61.4 mm of FY 2016).

EBITDA Margins remained strong closing at 22.5% in 1Q 2017, although they were partially affected by recent
changes in product mix. We continue to focus on capturing efficiency opportunities to maintain SMI margins
above 20%, as well as manage our suppliers and lever on our growing scale.

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Earnings Report
First Quarter 2017

6. Cash flows, liquidity and balance sheet, as of December 31, 2016

a. Cash flows (US$ 000s)

Cash Flow (US$ 000)


For the 3 months ended March 31
FY 2017
Net Income 3,850
Depreciation & Amortization 8,367
Net Financial expenses 5,263
Changes in WK accounts (14,319)
Operational cash flow 3,161
Capex (14,231)
Investment cash flow (14,231)
Financial Expenses (5,263)
Amortization (2,106)
Debt incurred 6,778
Financial Cash Flow (591)
BoP Cash 27,501
Increase / Decrease in Cash (11,661)
EoP Cash 15,840

Net cash flows provided by operating activities

Operating cash flow generated in 1Q 2017 was ~US$ 3.2 million, mainly explained by a temporary
negative impact in working capital accounts, which were affected by an increase in trade accounts
receivable (~US$ 34 million) and inventories (~US$ 12 million). This effect, however, is strictly related
to the growth requirements of the consolidated operation, which increase our working capital needs.
This effect should be reverted starting on 2H 2017, mainly by the impact from our accounts payable.

Net cash flows provided by (used in) investing activities

In 1Q 2017, investment cash outflow was ~US$ 14.2 million. Most of the outflow was related to Capex
required to attend recently signed contracts with two of our regional clients.

Net cash flows provided by (used in) financing activities

Financial cash outflows (US$ 7.4 million) were mainly related to (i) bond coupons and (ii) interests and
amortization other outstanding obligations, which were offset by new debt incurred of US$ 6.8 million.
This resulted in a negative net financial cash flow of US$ 0.6 million.

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Earnings Report
First Quarter 2017

b. Balance Sheet

San Miguel Industrias PETs total assets were US$ 672 million as of the end of March, 2017. Currents assets
increased to ~US$ 250 million, mainly explained by an increase in trade accounts receivable
(+US$ 34 million), inventories (+US$ 12 million) and prepaid taxes (+US$ 1 million), due to the growth of the
consolidated operation.

Non-current assets increased to ~US$ 422 million, mainly explained by (i) a ~US$ 7 million increase in property,
machinery and equipment due to Capex investments; and (ii) a ~US$ 2 million decrease in intangibles.

Total liabilities increased to ~US$ 477 million, mainly as a result of (i) an ~US$ 8 million increase in financial
debt, explained by a mid-term loan for Capex and some short-term debt, and (ii) a
~US$ 31 million increase in accounts payable, explained by the growth of the consolidated operation.

Capital Expenditures (US$ 000s)

CAPEX (US$ 000)


FY 2017
Peru 5,030
Colombia 1,583
Ecuador 7,061
El Salvador 484
Panama -
Mexico 74
Guatemala -
Total 14,231

Our main capital expenditures include:

- Capex investments made to attend an extended regional agreement in Peru and Ecuador.
- Capex investments made for the asset purchase associated with a regional contract to supply preforms and
closures in Peru, Ecuador, Colombia, Mexico and Central America.
- Expansion of our injection, blowing and warehouse facilities in Peru and Ecuador

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Earnings Report
First Quarter 2017

Consolidated Statement of financial position


As of March 31, 2017 and December 31, 2016

Balance sheet (US$ 000)


As of March 31, 2017 As of December 31, 2016
Assets
Current assets
Cash and banks 15,840 27,501
Trade accounts receivable, net 122,345 88,511
Inventories, net 93,651 81,342
Prepaid taxes and expenses 18,167 17,372
250,003 214,726
Assets
Non - current assets
Property, machinery and equipment, net 257,365 250,533
Investment properties - -
Intangible assets and other 165,057 167,307
422,422 417,840

Total assets 672,424 632,566

Liabilities and equity


Current liabilities
Trade accounts payable 101,734 77,356
Other accounts payable 24,827 17,535
Provisions - 4,150
Current portion of long-term debt 37,002 37,658
163,563 136,699
Liabilities and equity
Non - current liability
Long-term debt 276,483 268,074
Other accounts payable - -
Deferred income tax liability 36,600 36,141
313,083 304,215

Total liabilities 476,646 440,914

Equity
Capital stock 189,264 189,264
Higher value of investment properties - -
Other reserve - -
Legal reserve 851 851
Retained earnings 4,309 1,294
Minority Interest 1,112 -
Translation result 243 243
Investment valuation - -

Total equity 195,779 191,652

Total liabilities and equity 672,424 632,566

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Earnings Report
First Quarter 2017

Consolidated income statements

For the three month period ended March 31, 2017 and 2016

Financial Results (US$ 000)


1Q 2017 1Q 2016

Continuing operations
Revenue 98,335 66,350
Cost of sales (78,924) (50,558)

Gross profit 19,411 15,792

Administrative expenses (6,453) (4,769)


Selling expenses (2,340) (2,011)
Other, net 2,161 795

Operating profit 12,779 9,806

Other operations - -
Financial income 824 46
Financial expense (6,088) (4,568)
Exchange difference, net 594 478

Profit before income tax from continuing


8,109 5,762
operations

Income tax expense (4,260) (1,266)


Legal reserve - -

Net profit from continuing operations 3,850 4,497

* Information for 1Q 2016 considers Plastiglas results, although the merger took place in June 2016.