Standard & Poor's Ratings Services said today that Compania Cervecerias Unidas S.A.'s announcement of its entrance in the "Pisco" (domestic spirits) business, does not have an impact on the outlook or rating. Based on preliminary estimates, while the new segment will contribute to better absorb fixed cost, the effect on sales will be only marginal in the first stages. Additionally, and in spite of the continuous weakening of relatively small operations in Argentina and the weakened domestic demand in the local Chilean market, CCU's operational performance has been adequate, with EBITDA margin in fiscal 2002 at levels similar to those of the former fiscal year, in the range of 23%. Over this period, CCU reported operating income of $52.3 million, which was 16.4% below the $62.6 million reported in 2001. However, the company reported net income of US$30.7 million, significantly below the $55 million of 2001, that included a $21.8 million gain from the sale of the Peruvian subsidiary Backus & Johnston. Operationally, consolidated volumes in 2002 reached a record high 1 billion liters.

In Standard & Poor's view, CCU's strength in the Chilean beer market, coupled with the development of relatively newer products, is expected to continue to support adequate performance for the rating category.

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