GRUPO MÉXICO ANNUAL REPORT 2017 ANNUAL REPORT ANNUAL REPORT

GRUPO MÉXICO S.A.B. DE C.V.

EDIFICIO PARQUE REFORMA CAMPOS ELÍSEOS 400 COL. LOMAS DE CHAPULTEPEC C.P. 11000 MÉXICO, D.F. TE.: 52 (55) 1103 5000

www.gmexico.com

00 01s o l i d i t y 02 dy n a m i s m

04 LETTER TO THE SHAREHOLDERS 28 GEOGRAPHIC LOCATION 70 GEOGRAPHIC LOCATION 10 OUTSTANDING DATA 31 RELEVANT FIGURES 72 TRANSPORTATION DIVISION 12 ANALYSIS AND DISCUSSION OF GRUPO 32 AMERICAS MINING CORPORATION 75 RELEVANT FIGURES ’S CONSOLIDATED RESULTS 38 BYPRODUCTS 49 PROJECTS AND INVESTMENTS

INDEX INDEX 52 EXPLORATIONS 62 OCCUPATIONAL HEALTH AND SAFETY

03 s t r at e g y 04 f o u n dat i o n 05 a wa r e n e s s 00

88 GEOGRAPHIC LOCATION 102 HEALTH TRAIN 128 ENVIRONMENTAL AND SOCIAL ACTIONS 138 MANAGEMENT BOARD 90 INFRASTRUCTURE DIVISION 106 EDUCATION AND MAIN OFFICIALS 90 RELEVANT FIGURES 111 ENVIRONMENT 114 CINEMEX AWARENESS 118 SUPPORT TO INSTITUTIONS 120 NETWORK OF ASSOCIATIONS AND BUSINESS FOUNDATIONS 121 SOCIAL LIAISON LETTER TO THE SHAREHOLDERS

LETTER TO THE SHAREHOLDERS

Throughout the years, we have proven our ability to generate value On the other hand, EBITDA settled at USD$4.53 billion, and growth through the various divisions of the Group, and 2017 that is, 35% higher than a year earlier. was no exception. Once again, we can rely on Grupo México to become a more competitive organization every year, in every In the Mining Division, we continue to strengthen our segment where it participates. position making our company much more competitive in terms of costs, even as we retain a sound financial We take pride in being able to say that Grupo México is the fourth position that enables us to take advantage of what we largest company in the country in terms of market capitaliza- believe will be a very positive copper market in the long tion and marketability, as well as the second with the highest run, and to maintain our commitment to continue with tax payments, and the Company that pays the highest EPS in our aggressive expansion program and the analysis of Mexico. Grupo México remains the leading company in copper ex- possible opportunities that may arise in the market. traction, with the greatest reserves worldwide, the lowest extraction costs in the world, and the best organic growth portfolio in the Min- ing Division. In addition to having world-class assets in countries with investment grade, we are the largest, most profitable trans- portation company with the broadest coverage and connectiv- ity in Mexico, and presence in the most important states of the . In our Infrastructure Division, we are backed by over 80 years of experience and enjoy a unique position to benefit from the opportunities in the American continent and Spain.

During 2017, our company had a sound performance and obtained outstanding results in all three divisions. Moreover, we proved our dynamism and constant search for value creation by acquiring the Florida East Coast Railway (FEC), as well as through the successful Initial Public Offering of GMXT, the Group’s Transportation Division.

4

Consolidated sales in 2017 reached USD$9.78 billion, 20% Panoramic view greater than in 2016. of Buenavista del Cobre, . 6 begin the Buenavista Zinc project, which will dou- thismine.tons—a 69%increaseat Moreover, wewill copper production by 100,000 tons to 250,000 pansion oftheToquepala mine, increasing annual US$2.58 billion, tocompleteourex- whichwillserve The budgetforcapitalinvestmentsin2018is projects. growth andtheexecution ofourstrategic the newoperations commitment tovaluegeneration, thanthestartupof investments,the resultsofourgreat aswellofour onit.we remainfocused betterproofof Nothingoffers is permanent,But theevolutionofourcompany and ments inthelastfiveyears. vs. 2016, accruing over USD$13.80 billionininvest- vision; thus, thetotal investmentsin2017rose125% USD$27 million were investedin the InfrastructureDi- US$2.10 billionand for of Florida East Coast Railway which includetheacquisitionof100%shares billion, division, inthetransportation US$2.38billion, growth. Intheminingdivision, weinvestedUSD$1.18 lion, outofwhichUSD$1.5billioncamefromorganic During 2017, investmentsreached USD$3.6bil- soundness, andimportantinvestmentprojectportfolio. inthevariousprojectsthankstoourfinancialsistently years, andcon- theGrouphasinvestedcontinuously not dependonmetalpriceincreases. Throughout the We ourinvestmentphilosophydoes mustnotethat this transactionisthelargest MexicanIPOinthelastfiveyears. in theLATAM offer as thelargesttransportation region. Inaddition, in offer IPO isthelargestrailway America inthelast22years, aswell in localcapitalmarkets . GrupoMexico’s Transportation Division’s growth strategy andstrengthendrive itslong-term itspresence tion Division, which becameakey milestone, asitwillhelpto We alsocarriedouttheInitialPublicOfferingof Transporta- scale ofourservices. our clients,to offer improvethe scope and and it will significantly presence,in termsofgeographic wewillbeable andtheservice America. GMXT strength for greater This transactiongenerates inNorthto GMXTfortheprovision of transportation services tions. We thisis an important strategic believethat addition We FEC’s andconsolidating arethrilledtokeepgrowing opera- inMexico. boost fromtheresultsofoperations itsacquisitioninthesecond quarteroftheyear,following andthe theresultsofFloridaEastCoast (FEC),idating twoquarters, for vs.implies 13.5%growth 2016. This waspossibleafterconsol- trend, achieving arecord EBITDAofUSD$880million, which During 2017, our Transportation Divisioncontinueditsgrowth ments inprojectsforfuelstorage terminals. efficiencies, operating greater andweare consideringinvest- ofthe to investintheoperations Transportation Division, providing LaCaridadmine.which willincreaseproductionat We willcontinue 160,000 tons, andthePilaresmineproject, withhighoregrades, from80,000tons to atotalofble ourzincproductioncapacity LETTER TO THE SHAREHOLDERSLETTER TOTHE

ANNUAL REPORT 2017 7 vicios de Ingeniería increased by 13 and 8%,vicios deIngenieríaincreasedby respectively. sales fromMéxicoCompañíaConstructoraandGrupoSer and ofCommunication try Transportation (SCT). Ontheotherhand, agreed withtheMinis- surpassing the39%equivalenttrafficflow 2016, trafficreached11,970units, daily whileweightedaverage million pesos, intoa23%increasein sales vs. whichtranslated achieved anewsalesandtrafficrecord: Revenuesreached$656 14% increasefrom2016. OntheSalamanca-LeonHighway, we Division, 3,800,073MWh, wegenerated intoa whichtranslates EBITDA, goodresultsin 2017. reportedvery Through theEnergy Infrastructure Division, which achieved USD$233 million in We thevariousbusinessunitsof toannouncethat arehappy - Sujo, Culiacan. Bulk hoppers, ourinvestors. value for to increase our productivity and control costs, generate to always We remain committedtoensure sustainedgrowth , striving achievements, bothin 2018andinfutureyears. in2017,progress factorinour will continuetobeakey andthey ico’s toour morethan30,000employeescontributedsignificantly Undoubtedly, ofeachGrupoMex- thehardworkanddedication where weoperate. apositiveimpactonthecommunities tohave managed we have andindirectly.opment directly Through ourinvestmentprogram, in time, allowingustokeepcontributingthecountry’s devel- of the organization the sustainability and aim for interest groups ofour willconsidertheexpectations that environmental matters intermsofsocial,ever moreresponsibleoperation economic, and line with thegoalsofour business. Thereby, we strivetoachievean valueintheenvironmentswherewearepresent,bet oncreating in performance. operating beyond This iswhy, GrupoMéxico, at we A successfulyear, however, go that mustbemeasuredinways CHAIRMAN OFTHEBOARD GERMÁN LARREAMOTAVELASCO LETTER TO THE SHAREHOLDERSLETTER TOTHE

ANNUAL REPORT 2017 9 10 Silver (COMEX) Silver Cash flowafter investmentsandFinancial Activities Investments Used for Zinc (LME) Zinc Molybdenum (MW DEALER OXIDE) OXIDE) DEALER (MW Molybdenum Copper s e m u l o v Tons-km net lway i a r (COMEX) Copper e g a r e v a Taxes Paid Dividends Paid fromOperations Generated h s ca Net Profit EBITDA Current Taxes Cost ofSales Total Sales s lt u s e r Total Equity Total liabilities Bank liabilities Total assets Fixed assets Current assets e c n a l a b Applied toFinancial Activities Gold (LF) Gold Silver Molybdenum Gold Zinc Cars loaded

w o l f

n o i s i v i d e c i r p t e e h s d l o s

* ( s r a l l o d

a s c i t s i tat s )

(tons.) (tons.) (million tons) (lb) (oz.) (oz.) (lb) (lb) (tons.) (ounces) (thousands oz.) (million dollars) (million dollars) (million dollars) (thousands ofunits) OUTSTANDING DATA 1,266.19 826,839 2014 1,164.4 (1,324) (2,433) 91,387 23,301 59,498 14,554 51,704 11,607 20,651 12,938 19.04 11.30 2,468 1,705 3,833 5,095 9,286 9,044 5,913 4,332 (752) (607) 0.98 3.12 954 991 1,160.11 100,769 154,757 903,259 1,210.1 2015 (1,689) 23,233 14,802 54,221 10,493 11,101 21,593 13,622 15.68 1,647 3,017 4,824 8,179 7,560 4,161 (548) 0.88 2.51 6.59 (38) 866 943 921 576 1,032,347 1,248.34 105,415 165,587 2016 1,423.8 21,731 17,255 54,445 10,147 11,798 21,945 13,922 (1,590) 1,102 3,366 4,601 8,173 17.10 1,773 7,332 4,104 0.95 2.20 6.42 883 (292) (212) 198 879 1,024,952 1,257.13 107,572 2017 1,729.8 12,008 13,560 25,568 16,077 (1,500) (1,669) 54,223 21,358 16,843 59,078 1,522 2,836 4,531 5,010 9,786 8,550 4,859 1,591 1,239 17.03 (673) 422 2.80 1.31 8.21 real 2017/2016 (113)

130 889 var 38 18 61 35 20 15 17 17 15 18 80 41 (67) 38 28 27 (6) 21 9 (0) (2) (2) (1) 2 9 1 .% ** ** Throughout thereport, tons are metricandouncestroy. Book Value EBITDA /Interest Earnings perShare Debt / Total Equity+Debt Cash FlowperShare Peru Current Assets toCurrentLiabilities Total Liabilities to TotalTotal Liabilities Assets Employees EBITDA perShare Peru (pesos/dollar) Peru (pesos/dollar) USA EBITDA Margin Mexico (pesos/dollar) e g a r e v a Mexico (pesos/dollar) e g n a h c x e Mexico l a u n n a Margin Operating l a i c n a n i f Total Outstanding Shares s e r u g i f Regarding7,785,000,000 shares. ExpressedperUSGenerally Accepted Accounting Principles(USGAAP).

tion o i at l f n i

r e p e g n a h c x e

te at r tios o i at r

e r a h s

at

** h c a e te at r

d n e r a e y

((times)) ((times)) (thousands) 7,785,000 29,998 2014 13.30 14.72 10.84 1.26 0.22 0.32 0.49 2.84 2.99 34% 44% 41% 32% 3% 1% 4% 2.4 7,785,000 30,271 2015 15.85 17.21 1.25 0.11 0.23 0.39 3.18 3.41 7.15 41% 49% 37% 26% 4% 1% 2% 3.0 7,785,000 7,785,000 30,657 2016 18.66 20.66 1.32 0.14 0.23 0.43 3.38 3.40 7.37 38% 46% 41% 28% 3% 2% 3% 2.8 7,785,000 7,785,000 30,477 2017 18.93 19.74 1.49 0.20 0.36 0.58 3.26 3.25 8.91 39% 47% 46% 34% 2% 2% 7% 2.0 OUTSTANDING DATA real 2017/2016 133 (33) (27)

13 38 60 35 12 21 22 (1) (4) (4) (4) 1 2 1 var - - .% 11 ANNUAL REPORT 2017

ANALYSIS AND DISCUSSION OF RESULTS ANALYSIS AND DISCUSSION OF RESULTS

In 2017, Grupo México maintained a solid balance sheet with low leverage and a net debt to EBITDA ratio of 1.4x, as well as a comfortable schedule of debt maturities.

12 29 INFORME ANUAL 2017 ANALYSIS AND DISCUSSION OF RESULTS

RELEVANT CONSOLIDATED FIGURES Cost leader in the global 2017 EBITDA was USD$4.53 billion; that is, 35% higher than in OF Grupo México industry: We have the the previous year. The Mining Division reached US$3.45 billion, a lowest cash cost, at Accrued revenues in 2017 reached USD$9.78 billion; that is, 20% USD$1.11 per lb. of 51% increase vs. 2016. The Transportation Division achieved record higher than in 2016. In the Mining Division, revenues grew 22% copper. EBITDA of US$880 million, 14% above the figure for 2016. And the given higher metal prices: copper +28%, zinc +38%, and molyb- Infrastructure Division reported US$233 million in EBITDA. denum +28%. In the Transportation Division, volumes grew 7% and revenues 16% vs. 2016. In Infrastructure, total sales decreased 4% Consolidated net profit reached US$1.52 billion in 2017 , translating due to a reduction in the number of contracts with PEMEX. into 38% growth, despite the accounting charge from taxes due to the US fiscal reform, totaling USD$516 million, which have no bea- ring on cash flow. Excluding this effect, net profit would have totaled US$2.05 billion –USD$949 million higher than in 2016– translating 2017 EBITDA settled at into an 86% increase. USD$4.53 billion.

Bulk hoppers, Braskem Idesa La Caridad Mine, Plant, , . Sonora, Mexico.

14 SALES SHARE OF SALES BY COUNTRY 2017

5 p r o d u c t v o l u m e i n t o n s t h o u s a n d s o f d o l l a r s 2017 2016 2017 va r .% 2016 2017 va r .% 4 1 Mexico 35% 1 2 United States 25% m i n i n g d i v i s i o n 3 Asia 18% Copper 1,032,347 1,024,952 (1) $ 5,032,227 $ 6,359,280 26 4 Europe 14% Silver (thousand ounces) 17,255 16,843 (2) 294,797 285,789 (3) 5 Latin America 8% Molybdenum 21,731 21,358 (2) 268,050 353,426 32 3 Zinc 105,415 107,572 2 234,348 326,641 39 Sulfuric Acid 1,934,927 2,094,409 8 95,390 83,231 (13) Gold (ounces) 165,587 54,223 (67) 207,364 68,100 (67)

Lead 23,706 21,494 (9) 43,124 49,249 14 2 Others 34,657 28,795 (17) Total Mining Division 6,209,957 7,554,512 (17)

transportation division Cars 1,423,847 1,729,818 21* 1,722,507 2,005,769 16 Total Transportation Division 1,767,303 2,049,200

transportation division SHARE OF SALES BY PRODUCT 2017 241,028 226,126 (6) 7 Total Infrastructure Division 608,265 582,338 6 5 1 4 t ota l s a l e s $ 8,173,492 $ 9,786,406 20 3

2 2 * Loaded cars (thousands of units) 1

TOTAL SALES (Millions of Dollars)

2017 2017 9,286 2014 1 Copper 65% 1 Transportation Division 20% 8,179 2015 2 Molybdenum 4% 2 Infrastructure Division 2% 16 3 Silver 3% 8,173 2016 4 Zinc 3% 9,786 2017 5 Sulfuric Acid 1% 6 Gold 1%

0 7 Lead 1% 2,000 4,000 6,000 8,000 10,000 San LuisPotosi, Mexico. Waste confinement, 1,000.0 1,200.0 1,400.0 1,600.0 200.00 400.00 600.00 800.00 Grupo MéxicoMATURITIES AS AT DECEMBER31, 2017 five years. have beenmadeinthelast US$13.80billionover Capital investmentsworth 0 MINING DIVISION 2018

2019 2020

2021 2022 2023 2024 TRANSPORTATION DIVISION 2025 2026 2027 2028 2029 2030 2031 tunities that may arise in the market. gressive expansion program and analyze possible oppor enables it to be well positioned to continue with its ag This proves that the company’s financial soundness schedule. dition, Grupo México has acomfortable debt payment are in pesos. of 78% the debt has afixed rate. In ad 87% of the debt contracts are in dollars, US and 14% low leverage and ratio anet debt of 1.4x. to EBITDA with sheet balance solid a maintains México Grupo CONSOLIDATED DEBT 2032 INFRASTRUCTURE DIVISION 2033 2034 2035

2036 ANALYSIS AND DISCUSSIONOFRESULTS 2037 2038 2039

2040 2041 2042 2043 2044 - - - 2045 19 ANNUAL REPORT 2017 ANALYSIS AND DISCUSSION OF RESULTS

PERFORMANCE OF GRUPO Grupo México is the fourth Grupo México has great and energy), which are dollarized; thus, 89% of our revenues are in MEXICO’S STOCK largest company in stability, as 89% of its terms of market cap and revenues are in US dollars. dollars. With operations in Mexico and Peru, only 47% of our costs Year after year, Grupo México becomes a more competitive organi- marketability in Mexico. are in dollars. Therefore, our company has a natural US dollar hedge zation in every segment where it participates. We remain committed with a positive impact on results, given the current dollar appreciation. to ensure sustained growth, striving to increase our productivity and control costs, to always generate greater value for our investors. This is why we feel proud to see that the stock’s price in USD terms has increased by over 625% since 2000 (IPC return of +295% in s a l e s c o s t o f s a l e s the same period). u s d m x n u s d m x n s o l e s Mining Division 100% - 59% 30% 11% Transportation Division 42% 58% 26% 74% - Infrastructure Division 60% 40% 38% 62% -

GMEXICO HISTORICAL STOCK PRICE w e i g h t e d t ota l 89% 11% 47% 44% 9% 70 4.5 GMÉXICO MXN

4.0 GMÉXICO USD 60

3.5 50 3.0

40 2.5

30 2.0

1.5 20 1.0

10 0.5

MXN 0 0.0 USD ENE-00 ENE-02 ENE-04 ENE-06 ENE-08 ENE-10 ENE-12 ENE-14 ENE-16 ENE-18

20 NATURAL DOLLAR HEDGE In a year of high volatility in the currency market, it is important to note that Grupo México holds a privileged position to face F/X Dome for ore storage and fluctuations. Our revenues are related to commodity prices (metals tailings thickener in Cuajone, Peru. 22 FXE-4831Locomotive. Fitch andS&P BBB ratings, Grupo Mexico’s BBB+and During 2017, Issuer rating Issuer Bond Covered rating Issuer Local long-term rating long-term Local x e m o r r e f Rating International rating long-term Local o c i x é m g Rating International o c i x é m Rating International a r e n i m Rating International n r e h t u o s Rating International s a c i r e m a Rating International o p u r g

o c i x é m

a r o d a r e n e g o c i x é m

s e t r o p s n a r t

g n i n i m r e p p o c

rating agencies

tion o i at r o p r o c tion o i at r o p r o c respectively.

e d confirmed

a í g r e n e assets inassets the Infrastructure Division. of productionstart of the Buenavista del Cobre expansion and our the by created flows cash additional the and reserves, long-lasting fourth copper producer in the world, its vertical integration and positives were the geographic diversification, positioningits as the as well as its solid balance sheet with low leverage levels. Other The rating agencies highlighted the company’s low-cost structure, co’s ratings, and BBB BBB+ respectively, with astable outlook. During 2017, rating confirmed agenciesGrupo Mexi Fitch and S&P CREDIT PROFILE dy o o m Baa2 Baa2 Baa2 Baa2 Baa2 Baa2 – – – – - ´ s and d r da n ta s MXAA+ AAAmx BBB BBB BBB BBB BBB BBB BBB BBB – ANALYSIS AND DISCUSSIONOFRESULTS & & r o o p ’ s AA+(Mex) mxAAA h c t i f BBB+ BBB+ BBB+ BBB+ BBB+ BBB+ BBB+ – – - 23 ANNUAL REPORT 2017 24 molybdenum andsilver With thelargest copper CORPORATE STRUCTURE reserves inthe world. reserves and zincintheworld. producers ofcopper, Corporation Among thelargest Southern Copper México Minera 88.9 Público Inversionista Público CORPORATION (AMC) CORPORATION AMERICAS MINING AMERICAS 11.1% Southern ASARCO 100% 100% (EUA) Perú Los Frailes Los (España) Minera 97.3 The leading TransportationThe the greatestcoverage and Company inMexico with 74% 26% GRUPO TRANSPORTES MÉXICO 16.6%

100% Pacífico connectivity.

FERROSUR (GMXT) 100% 70% 100% Florida Coast East Inversionista Público 13.4% 100% IMEX Perforadora 100% México Construction projects. Infrastructure and y D 100% Energía M of experience in México Grupo Grupo Over 80years P éxico (MPD) esarrollo Constructora Compañía 100% 100% México México SINCE 1996. BEEN LISTED HAS STOCK MEXICO’S GRUPO ro

y Autopistas ectos 100% México Grupo Grupo Grupo México Servicio de Servicio

Ingeniería 100% platform. 25 ANNUAL REPORT 2017

SOLIDITY solidity

The Mining Division consolidated once again with the lowest cash cost of USD$1.11 per lb. of copper.

Fine Ore Storage - Buenavista del Cobre, Sonora. 1

2 3 4 5 6 8 7 9 11 10 12 13

14 15

16 SPAIN

18 19 17 24 AMC 20 GULF OF 24 AZNALCOLLAR, SPAIN - POLYMETALLIC UNDERGROUND MINE GEOGRAPHIC LOCATION MEXICO 21 SPCC MINING DIVISION−GRUPO MÉXICO 23 22 25 CHAUCHA - COPPER PROJECT 26 TANTAHUATAY - GOLD MINE 27 LIMA - CORPORATE OFFICES PACIFIC 28 LOS CHANCAS - COPPER PROJECT OCEAN 29 TIA MARIA - SX/EW COPPER PROJECT 30 CUAJONE - COPPER MINE 31 TOQUEPALA - SX/EW AND COPPER MINE 32 ILO - METALLURGIC COMPLEX 33 CATANAVE - COPPER PROJECT LOCATION LEGEND ASARCO MINERA MÉXICO MINES 1 RAY - SX/EW COPPER MINE 7 AGUA PRIETA - LIME PLANT PLANTS 2 HAYDEN - COPPER SMELTER 8 EL PILAR - SX/EW COPPER PROJECT OFFICES 3 AMARILLO - COPPER REFINERY 9 BUENAVISTA DEL COBRE - SX/EW AND MINE FUTURE MINE PROJECTS 4 SILVER BELL - SX/EW AND MINE 10 BUENAVISTA ZINC - MINE 5 TUCSON - US OFFICE 11 LA CARIDAD - MINE, SX/EW METALLURGIC COMPLEX 25 *SX/EW (Copper Solvent Extraction and Electrowinning plant) 6 MISSION - COPPER MINE 12 PILARES - COPPER PROJECT 13 SANTA EULALIA - POLYMETALLIC UNDERGROUND MINE 26 14 EL ARCO - SX/EW AND COPPER MINE PROJECT 15 SANTA BARBARA - POLYMETALLIC UNDERGROUND MINE PERU

16 NUEVA ROSITA - COAL AND COKE 27 17 CHALCHIUITES - UNDERGROUND MINE PROJECT 18 SAN MARTIN - POLYMETALLIC UNDERGROUND MINE 28 19 CHARCAS - POLYMETALLIC UNDERGROUND MINE 20 SAN LUIS POTOSI - ZINC REFINERY 29 30 31 21 ANGANGUEO - UNDERGROUND MINE PROJECT 32 22 - POLYMETALLIC UNDERGROUND MINE 23 - CORPORATE OFFICES CHILE 33 30 del Cobre, Sonora, Mexico. Inside ofSX/EWIII,Buenavista RELEVANT FIGURESANDBYPRODUCTS cost in the world. USD$1.11, withthelowestcash placingusasthemining company cashcostperlb.The operating of copper, net of byproducts, was ducts, wasUSD$1.61. During 2017, cashcostperlb. operating ofcopper,- excludingbypro worldwide.the lowestcashcostinindustry In theMiningDivision, with ourplaceastheCompany wereiterated “Cash-Cost” ourinvestors. returns for the metalsmarket, willfurtherimprove our investmentprogram project portfolio. We believethat, withthecurrentupwardcycle of financial soundness, andtheMiningDivision’s importantinvestment inthevariousprojectsthankstoour andconsistently continuously metal priceincreases. Throughout theyears, theGrouphasinvested We ourinvestmentphilosophydoesnotdependon mustnotethat Ecuador,and Argentina. mines, projectsinMexico, aswellexploration Peru, theUS, Chile, AMC hasworld-classassetsincountrieswithInvestmentGrade: 14 portfolio. best organicgrowth worldwide,reserves thelowestextractioncostsinworld, andthe incopperextraction,AMC istheleadingcompany withthe greatest (SCC)and Copper Corporation ASARCO intheUS. AMC, whose main subsidiaries in Mexico and Peru are Southern Grupo Mexico’s itssubsidiary MiningDivisionisrepresentedby MINING CORPORATION (AMC) CORPORATION MINING FOR AMERICAS FIGURES RELEVANT SOLIDITY 31 ANNUAL REPORT 2017 32 efficiencies achieved, aswellbettercopperprices. year, thelow-cost productionandoperating given sales, from the previous and represents51%growth EBITDA totaled US$3.45 billion, equivalent to 46% of metal prices. in 2017, 22%higher thanin2016, thankstolower Sales in the Mining Divisionreached USD$7.55 billion 51% EBITDA

Operating Profit Operating NetProfit CostofSales Investments/Capex Net Profit before USFiscalReform NetProfitbefore Sales ( t i f o r p da t i b e s u $

s d n a s u o h t

n i g r a m n i g r a m AMERICAS MININGCORPORATION(AMC) ( ( ) % % ): ): ): ): growth EBITDA 2,292,120 1,526,055 3,761,066 1,215,386 6,209,957 835,404 835,404 ry a u n a j 2016 13.5% 36.9% - - r e b m e c e d 3,455,301 2,675,923 1,193,382 3,960,946 1,186,453 1,709,356 7,554,512 2017 15.8% 45.7% USD$000 1,163,480 1,149,869 1,344,554 357,978 179,422 873,952 (28,933) ariance c n a i r va 105 % 51 75 43 22 (2) 5 In 2017, to US$7.55million. sales increased22% chemical products. Likewise, andvarious itisusedtomanufacturefungicides with tin, itmakesbronzeandotherconsumerproducts. applications, suchasplumbingandroofing. Alloyed non-electrical for Copper isalsoanimportantmaterial construction, transportation, andindustrialmachinery. energy, telecommunications, computers, cellphones, toelectric industriesrelated for it anoptimalmaterial resistance, andductility, andexcellentmalleability making properties, suchas high electricconductivity, corrosion worldwide. Ithasexceptional chemicalandphysical infrastructure andgrowth an essentialcomponentfor Copper is the third most used metal worldwide, and COPPER La Caridad,Sonora,Mexico. Metallurgical complexin Copper wirerodin SOLIDITY 33 ANNUAL REPORT 2017 34 El PilarandBuena Vista Zinc. our Toquepala projectinMexico: expansionandourgrowth Pilares, production to surpass 1,300,000 oftons with the start of operations However, theMiningDivisioncontinuestogrow. By2021, weexpect orehardness. andgreater result oflowermineraloregrades production decreased 4%in2017vs. 2016, to 1,010,630 tons as a ofUS$2.20/lb.higher thantheaverage seenin2016. Copper US$2.80/lb.Copper pricesaveraged is, duringtheyear;that 28% Copper represented 65% of Grupo Mexico’s total revenues in 2017. PRODUCTION Sonora, Mexico. La CaridadSmelterComplexin The SmelterPlantispartofthe 1,000 1,100 100 200 300 400 500 600 700 800 900 100 200 300 400 500 600 700 800 900 0 0 s d n a s u o h t (Refineries andSX/EWs) REFINED COPPER (Concentrates andSX/EWs) RAW MINEDCOPPER

221,3 605,2 2014 Refineries SX/EWS 191,8 655,6 2014

s d n a s u o h t

221,3 619,2 2015 221,3 684,4 2015 f o

224,4 625,9 2016 s n o t 224,4 830,0 2016

f o

198,9 643,1 2017 198,9 811,8 2017 s n o t SX/EWs Concentrators

Cents of Dollar / Pound 100.00 150.00 200.00 250.00 300.00 350.00 400.00 50.00 0 INVENTORIES PRICES AND COPPER 200,0 400,0 600,0 800,0 COMEX N.Y. Prices COMEX N.Y. StocksplusLMELondon 312.00 228.0 2014 0 s d n a s u o h t CAST COPPER

250.81 369.0 2015 705,2 2014

721,6 2015 f o

219.73 402.0 2016 s n o t 716,5 2016

742,6 2017 280.42 393.3 2017 100.0 200.0 300.0 400.0 500.0 0

Thousands of Metric Tons 35 ANNUAL REPORT 2017 36 SMELTERS2017 YEAR PRODUCTION ATCOPPER YEAR 2017 SEMI-FINISHED PRODUCTS COPPER PRODUCTIONIN Hayden Ilo u r e p LaCaridad o c i x e m Amarillo b a l s Amarillo u LaCaridad e r i w o c i x e m e u . . . s u s . . . a a

a . d o r . . Total Total Total d n a s u o h t d n a s u o h t 282.2 269.8 136.7 270.2 133.1 742.6 124.8 347.6 12.4

s n o t s n o t million tonsofcopper. worldwide: No. 1in copperreserves REFINERIES YEAR 2017 REFINERIES YEAR PRODUCTION ATCOPPER SX/EW Ref. Amarillo SX/EW Ref. Ilo u r e p SX/EW Ref. LaCaridad o c i x e m u . s . a . Sub-Total Sub-Total Total Sub-Total over 75 75 d n a s u o h t 842.1 157.3 123.7 316.5 291.4 368.3 140.2 228.1 33.6 25.1

s n o t **The reserves are valued at $2.90dollarsper lb. arevaluedat **The reserves ofcopper. Note:grand totalof75.2millioninreserves. theSECtotal16.9milliontonsofcopperanda ofminingproductsbefore Certifiedreserves Buenavista delCobre Buenavista LaCaridad SX/EWs: Toquepala SX/EWs: Ray SX/EWs: Underground Mines Underground delCobre Buenavista LaCaridad Concentrator: o c i x e m u r e p Cuajone Cuajone Toquepala Concentrator:

Grand Total Total SX/EWs: Total Concentrator SilverBell Ray Mission Concentrator: u primaryMININGPRODUCTIONANDCOPPERRESERVESYEAR2017 . s . a . Sub-Total Sub-Total Sub-Total Sub-Total Sub-Total Sub-Total d e s s e c o r p 194,342 157,802 106,714 489,070 301,872 187,198 l a r e n i m 36,540 69,295 34,548 85,048 85,048 50,143 29,751 20,392 22,482 11,069 11,413 30,341 12,956 17,385 2,871 d n a s u o h t n o i t c u d o r p -

content 1,010.7 copper s n o t 140.2 111.8 430.7 318.9 106.3 281.0 158.1 122.9 198.9 811.8 100.1 28.4 25.1 25.1 33.6 18.6 15.0 38.2 61.9 5.5 - 10,385.8 16,582.5 3,927.0 3,057.9 5,756.0 3,459.7 2,249.5 1,738.7 1,735.6 3,796.7 1,782.0 2,014.7 6,196.7 869.1 531.0 176.4 354.6 456.6 376.5 833.1 e r o 46.8 n o i l l i m 3.1

s n o t t n e t n o c r e p p o c 22.73 16.81 20.22 11.04 11.66 46.68 58.34 1.47 7.16 5.69 0.23 5.67 0.02 3.14 3.11 9.18 1.37 0.48 0.88 2.33 1.41 3.75 e r o

s e v r e s e r ore 0.17 0.19 0.50 0.49 0.25 0.75 0.18 0.52 0.55 0.27 0.25 0.51 0.37

% grade

tion o i at r e p o s r a e y SOLIDITY 24 19 15 50 65 20 60 99 16 31 35 22 21 55

-

n i 37 ANNUAL REPORT 2017 tion at tion at Toquepala (-5%)duetoaloweroregrade. 21,327 tons, comparedtothepreviousyear, lowerproduc- given vs. 28%growth plying 2016. Ourproductiondecreased2%to in2017wasUSD$8.21/lb, priceofmolybdenum The average im- tance toalloys. itaddshardnessandcorrosionresis- propertyisthat remarkable and infertilizers, dyes, glazes, reagents, andlubricants. Itsmost steels. in the oil and gasindustry, It is alsoused as a catalyst used to manufacture stainless and is specialmainly Molybdenum MOLYBDENUM Sonora Mexico. in BuenavistadelCobre, Aerial viewofConcentratorII BYPRODUCTS operation. 34yearsoffor over We have molybdenumreserves Note: willlast34years. reserves Operations 10.0 15.0 20.0 25.0 Cuajone delCobre Buenavista n o i t c u d o r p Toquepala u r e p LaCaridad o c i x e m g n i n i m 5.0 0 MININGPRODUCTIONANDMOLYBDENUMRESERVESYEAR2017 (Thousands of Tons)(Thousands molybdenum primary mining

23.3 2014 Total Sub-Total Sub-Total

23.4 2015

21.7 2016

21.3 2017

d e s s e c o r p 153,986 103,843 50,143 29,751 69,295 20,392 34,548 e r o s d n a s u o h t

10.00 12.00 ybdenum u n e d b ly o m 2.00 4.00 6.00 8.00

s n o t t n e t n o c 0 21.3 13.4 6.9 3.7 3.5 4.2 9.9 (Thousands of Tons)(Thousands AND INVENTORIES MOLYBDENUM PRICES

11.30 2014

s n o i l l i m 6.59 2015 3,796.7 9,882.4 5,709.2 1,782.0 3,459.7 2,014.7 2,249.5

2016 6.42 e r o s n o t

8.21 2017 s e v r e s e r e d a r g Oxide Prices MW Dealer 0.018 0.007 0.032 0.027 SOLIDITY %

39 ANNUAL REPORT 2017 SOLIDITY

primary MINED ZINC REFINED ZINC (Thousands of Tons) (Thousands of Tons)

80,00 120,0 Zinc Zinc is used in a wide range of applications. Its high po- 100,0 60,00 sition in the galvanic chart provides excellent resistance 80,0 to atmospheric corrosion; thus, its main use is galvani- zation. Given its low melting point, malleability, and high 40,00 60,0 resistance, it is greatly used in pressure casting, as well 40,0 as brass. It is also the base to obtain zinc oxide, used 20,00 to manufacture tires, paint, and cattle fodder, among 20,0 other products. 0 0 During 2017, zinc prices averaged USD$1.31/lb., 38% 2014 2015 2016 2017 2014 2015 2016 2017 World-class assets higher than the average in 2016. Production in the year 92,1 61,9 74,0 68,7 in countries with 66,6

100,6 106,1 104,4 decreased 7% to 68,665 tons, compared to 73,984 Investment Grade. tons in 2016. ZINC PRICES AND INVENTORIES

140,00 1,400.0

120,00 1,200.0

100,00 1,000.0

80,00 800.0

60,00 600.0

40,00 400.0

20,00 200.0

0 0 Thousands of Metric Tons 40 2014 2015 2016 2017 Molding at Electrolytic LME London Inventories

692,0 464,0 427,9 182,0 Zinc Refinery in San LME London Prices Luis Potosi, Mexico. 98,07 87,66 94,83 131,27 SOLIDITY 2016

PRIMARY MINING PRODUCTION AND ZINC RESERVES YEAR 2017 PRECIOUS METALS SILVER p r o c e s s e d c o p p e r o r e r e s e r v e s Silver is used to manufacture electric, electronic, and o r e c o n t e n t p r o d u c t i o n photographic products. To a smaller extent, it is used m i l l i o n s y e a r s i n t h o u s a n d s t o n s grade % t o n s o p e r at i o n in alloys for soldering, jewelry, coin minting, silverware, m i n i n g u n i t s and catalysts. m e x i c o Charcas 1,249.5 30.1 4.9 3.34 4 than greater 38% Santa Barbara 1,337.4 24.4 24.0 2.54 18 In 2017, the average price of silver was USD$17.03/oz. San Marin - - 13.2 2.15 28 On the other hand, silver production fell 1% to 17,657 Santa Eulalia 283.9 14.2 1.7 6.21 6 thousand ounces compared to 2016, mainly due to low- Total 2,870.8 68.7 43.8 15 er production at IMMSA, countered by higher production zinc at the open pits. price GOLD Gold has been used to make ornamental objects and jew- elry for thousands of years. Among its industrial uses, it is worth noting the manufacture of electronic products, including cell phones, GPS units, TV sets, and PCs or lap- tops, among others.

The average price of gold reached USD$1,257.13/oz., in line with 2016. Our production dropped 3% to 66,893 oz., particularly due to lower production in IMMSA.

43

Panoramic view of our Buenavista del Cobre mine in Cananea, Sonora, Mexico. USD$1.31 ANNUAL REPORT 2017 ANNUAL REPORT 44 REFINED SILVER AND GOLDPRODUCTION YEAR 2017 MINING PRODUCTION AND RESERVESOFSILVER AND GOLD YEAR 2017 s e i r e n i f e r Ray Mission e Cuajone Toquepala u r e p Mines Underground delCobre Buenavista LaCaridad o c i x e m s e n i m Ilo LaCaridad n o i t c u d o r p LaCaridad Ilo Hayden PRODUCTION AT SILVER AND GOLDSMELTERS YEAR 2017 . u . n i a .

tes e at r t n e c n o c Total Sub-Total Sub-Total Sub-Total Total Total

: 43,193 50,835 66,863 60,079 45,662 38,288 10,100 54,571 d l o g d l o g d l o g 7,642 6,784 4,518 2,266 5,428 8,989 6,183 s t n e t n o c - - - s e c n u o s e c n u o 13,688,184 17,657,006 11,756,309

3,952,730 9,735,454 1,731,044 1,429,001 4,169,653 2,390,309 1,779,344 4,759,922 4,987,819 2,008,568 13,388,773 z o 6,707,211 4,953,316 1,728,246 ver e lv i s ver e lv i s ver e lv i s 302,043 n o i l l i m 10,385.8 5,756.0 3,796.7 1,782.0 2,014.7 3,459.7 2,249.5 ver e lv i s 833.1 376.5 456.6 46.8

s n o t

e r o

e v r e s e r ore grs 91.0

/ / grade 3.9 4.1 3.3 4.0 2.8 1.5 ton

10,0 20,0 30,0 40,0 50,0 60,0 70,0 0 (Thousand ounces) primary mined gold

Dollars / Ounce 36,6 2014 1,050.00 1,200.00 1,350.00 150.00 300.00 450.00 600.00 750.00 900.00 41,0 2015

0 68,7 2016 GOLD PRICES AND INVENTORIES

1,266.19 7,895.0 2014 66,9 2017

1,160.11 6,353.0 2015

1,248.34 9,158.9 2016 100,0 120,0 140,0 160,0 180,0 20,0 40,0 60,0 80,0 1,257.13 9,142.8 2017 0 (Thousand ounces) REFINED GOLD 10,000.0 1,000.0 2,000.0 3,000.0 4,000.0 5,000.0 6,000.0 7,000.0 8,000.0 9,000.0

COMEX N.Y. Prices COMEX N.YInventories 59,3 2014 0 155,2 2015 Thousands of troy ounces 164,9 2016

50,8 2017 45 ANNUAL REPORT 2017 12,0 16,0 20,0 4,0 8,0 0 (Million ounces) primary mined silver

14,5 2014

14,9 2015 Dollars/oz.

12.00 15.00 18.00 17,9 2016 3.00 6.00 9.00

0 17,7 2017 SILVER PRICES AND INVENTORIES

15.68 176.0 2014

15.68 161.0 2015

17.10 183.5 2016 10,0 12,0 14,0 16,0 2,0 4,0 6,0 8,0 0

17.03 243.4 2017 (Million ounces) REFINED SILVER 13,3 2014 120.0 150.0 180.0 210.0 240.0 270.0 30.0 60.0 90.0

COMEX N.Y. Prices COMEX N.YInventories 13,6 2015 0

15,2 Million troy oz. 2016

13,7 2017 Coal Molybdenum contentinconcentrates Molybdenum silver(ounces) Refinery (ounces) Silver contentinconcentrates Refinery gold(ounces) Refinery Gold content in concentrates (ounces) Gold contentinconcentrates Lead contentinconcentrates Lead concentrates Refinery Zinc Refinery Zinc contentinconcentrates Zinc concentrates Refined copperturnedintoslab Refined copperturnedintorod Refined copper(refineries+SX/EWs) Refinery copper Refinery Copper contentofsmelter Lime Total coppercontentofmine Cadmium Copper contentSX/EWs(Cathode) Sulfuric acid Copper contentinconcentrates Copper concentrates Copper s n o t 2017 Coke n o i t u b i r t s i d

17,657,006 13,688,184 2,717,210 1,010,630 3,285,846 132,688 104,402 129,230 269,834 841,981 643,122 742,620 275,683 2017 198,859 811,771 21,328 50,835 66,863 20,246 33,581 68,665 12,431 45,383 608 15,195,756 17,855,211 1,054,413 2,691,371 3,341,903 MINING PRODUCTIONSUMMARY* 194,285 164,864 106,093 139,697 295,800 850,290 625,924 716,541 271,560 224,366 830,047 2016 21,736 68,651 24,385 40,737 73,984 11,202 71,701 664 13,637,723 14,912,611 2,703,588 2,770,966 2,770,966 248,527 155,180 100,576 115,031 286,635 840,424 619,163 721,610 251,928 905,691 221,261 684,430 2015 23,368 40,995 20,693 32,769 61,905 16,210 97,544 637 13,348,048 14,542,464 2,650,031 2,653,044 2,653,044 2014 276,082 123,955 280,996 797,009 605,197 705,187 165,698 847,388 191,812 655,576 23,290 59,332 36,593 22,286 36,105 92,133 66,614 11,345 96,086 607 15,572,552 14,933,798 2,365,051 2,529,015 2,529,015 2013 291,505 185,254 276,326 753,571 586,207 669,240 133,568 792,469 167,364 625,105 19,897 51,718 35,544 23,918 40,077 97,692 99,372 11,494 93,214 SOLIDITY 584 47 ANNUAL REPORT 2017 48 Toquepala, Peru. tailings thickenersin Construction ofthenew billion, expansion is investmentThe for Toquepala's increase. by 100,000 tons, a69% production annual copper which will which PROJECTS ANDINVESTMENTS US$1.25 increase increase PROJECTS INMEXICO metallic copperwithaninvestmentofUS$1.4billion. projectworth120,000annualtonsofSX/EW thisgrowth 1H18 for with the government of Peru to obtain the construction permit in the EnvironmentalImpact Assessment. We areworkingtogether plied withall environmental regulation, of thusobtaining approval Tía María.We com- andhave completedalltheengineering have operational.and isfully We investedatotalofUS$226million. ofUS$35millionperyear.savings The projecthasbeen completed belt system,an orecrushingandconveying leadingtooperating systemwith conveyance project consistedinreplacingtherailway Project to Convey and Crush Ore in Cuajone, Moquegua. June2018. productionby andexpectingittobegin 87% progress December 31, 2017, invested US$893million, wehave achieving tons ofproductionin2019, intoa69%increase. translating Upto 100,000tonstototal250,000expand annualcopperproductionby ect includesanew, will that copperconcentrator state-of-the-art Toquepala ExpansionprojectinTacna.ThisUS$1.25billionproj- been invested. investment ofUS$2.90billion, US$1.62billionofwhichhasalready We continuetoworkonvariousprojectsinPeru, withatotalcapital PROJECTS INPERU engineering hasbeen completed,engineering andthe purchaseofthemain and 20,000 additional tons of copper annually. To date, the basic of80,000tonszinc withaproductioncapacity a concentrator depositinSonora,Buenavista andcomprisestheconstructionof withintheBuenavista Zinc,Sonora.Thisprojectislocated SOLIDITY The 49 ANNUAL REPORT 2017 SOLIDITY

Toquepala Expansion project in Peru. PROJECTS IN THE US Asarco, . The project to modernize the Hayden smelter in Arizona to comply 100% with the authori- ties’ new environmental regulation, with an investment of US$229 million, has reached 73% progress and

year will be completed in April 2018. The smelter will have

state-of-the-art technology in converter furnaces and in the collection and management of gases and dust. This will provide greater efficiency, and we estimate a the

potential production of an additional 15,000 tons of copper annually. in

invested PROJECTS IN SPAIN Aznalcollar, Andalucia. This project is located only 35 km from the city of Seville in Spain. After the project was awarded to Grupo México in an international pub- billion lic bidding process in 2015, in mid-2016 the regional equipment has begun. The budget for this investment is US$413 authorities granted us permission to begin exploration million, and it should be operational by 2020. Once the project is activities. From July 2016 to April 2017, we carried completed, the Mining Division’s zinc production will double. out an ambitious exploration campaign. The results obtained to date confirm the project’s initial informa- Pilares, Sonora. This project is 6 km away from La Caridad and tion and suggest a promising potential to eventually in- has an open pit mine with an annual production capacity of 35,000 crease the initial size of the ore bodies. We are working tons of copper concentrates. The high ore grade mineral will be on an updated feasibility study to be completed by the transported by the same mine cars to feed the main crushers of end of this year. The permitting process will continue, the La Caridad copper concentrator, thus improving the average and the detailed engineering is expected to begin by 50 ore grade (0.78% expected at Pilares vs. 0.34% at La Caridad). To late 2018, with operations starting in 2021. The proj- 51 date, the mine plan is being designed, and the new road layout has ect’s investment is estimated at US$290 million, and already been completed. The investment budget is US$159 million, will expand zinc production by an additional 102,000 and it should begin operations in 2019. tons of zinc equivalent per year. USD$1.17 ANNUAL REPORT 2017 ANNUAL REPORT 52 ing adrilling campaign of 20,000 meters. of gold, and 1.59 of silver. g/t In 2018, we are consider of 0.403% of copper, of 0.008% molybdenum, 0.11 g/t billion 2.55 to gradesore increase reserves tons with the sults obtained in this campaign have made it possible to program was carried out to define the deposit.The re- Peninsula. From July 2015 to February 2016, adrilling posit located in the middle area of the Baja El is Arco acopper, gold, molybdenum, and silver de- EL ARCO MEXICO hectares in Ecuador. for exploration, 36,097 hectares in Chile, and 2,543 In Argentina, we have 58,138 hectares of concessions which are in Peru and 154,937 hectares are in Mexico. exploration, for concessions ares of of 80,979 hectares We currently have direct control over 332,694 hect in exploration expenses. programs during 2018, translating into a164% increase we expect to spend around $81.1 million in exploration $40.1 million in 2016, million and $48.8 in 2015, and invested million $30.7 in exploration programs in 2017, plorations in areas of our current mining operations. We uador, the and US, Spain. We have also carried out ex of new deposits in Peru, Mexico, Chile, Argentina, Ec discovery ongoing the on focus our maintaining sions, greatestthe mineral resources in current our conces We have carried out broad exploration activities to locate EXPLORATIONS - - - - - million tonsofcopper. to aproductionof projects thatcouldlead us growth portfolio. W e havethebestorganic over 1.7over With

California Peninsula. El Arco,intheBaja 53 ANNUAL REPORT 2017 54 and reserves to define the potential of theBella Union project. Once the drilling has been completed, we will estimate the resources average ore grade of 0.43% of copper and 0.04% of molybdenum. geometry. The results defined reserves63.3 of million tons with an dad Pit. In 2016, 21,730 meters were drilled to define the deposit’s located less than away 1km from the current final limit of theCari Bella Union is amineralized breccia with copper and molybdenum, BELLA UNION(LACARIDAD) 2018. in pleted reviewing the final on thereport mining plan, which should be com completed the results of the metallurgical research. We are currently In 2017, we revised the deposit’s geological model. In addition, we eral ores of 1.88% of zinc, 0.47% of copper, and 17 gr/ton of silver. and copper. contains It 102 million tons of ore reserves, with min consisting deposit in sulfide mineralizationtype zinc, with lead, silver, Cobre porphiric deposit, at the northeast end of the pit. is It aSkarn- Buenavista del Zinc is a project located within the Buenavista del BUENAVISTA ZINC(BUENAVISTADELCOBRE) 2018. We will continue with the metallurgical testing. sponding report, which should be completed in the first quarter of drilling program. We are awaiting the results to prepare the corre- available at the time of acquisition. During 2017, a20,000 kilometer 69.7 million tons in the reserves, compared to the initial information million tons with ore which grades means of 0.286%, an increase of exploration campaign made it possible to confirm reserves of 328.2 project was acquired by Southern Copper in 2015. The results of the meters to the northeast of our Buenavista del Cobre operations. This El Pilar is acopper project comprising copper oxides, located kilo 45 EL PILAR - - - - CHALCHIHUITES gical research.gical copper. In 2018, we plan to continue with the metallur silver, of 2.66% zinc, 0.37% of lead, and 0.67% of million tons of reserves, with ore grades of 110 of g/t out between 1980 and 2014, we have estimated 12.6 tion obtained in different exploration campaigns carried close to Mining Unit Martin. San Based on the informa isIt located in the of north the State of , very phide mineralization zinc, with lead, silver, and copper. Chalchihuites is aSkarn-type deposit consisting in sul At theElArcoproject. Geologist analyzingtheore SOLIDITY - - - 55 ANNUAL REPORT 2017 SOLIDITY

CAMPO MEDIO PROJECT (SANTA EULALIA) perU Campo Medio is located to the west of the Santa Eulalia los chancas Mine. There is evidence in the area of the possible pres- This property is a copper and molybdenum porphyry de- ence of replacement bodies in limestone, similar to those posit located in the Apurimac department, in southern currently exploited in Santa Eulalia. During 2016, we Peru. Current estimates indicate the presence of 545 completed the geological and geochemical survey of We are currently working on several million tons of mineralized material with average con- 800 hectares, which are located between the two oper- copper projects in Peru, with a tents of 0.59% of copper, 0.04% of molybdenum, and capital investment of ational mines in the District, and from which over 25 181 million tons of leachable mineralized material with a US$2.9 billion. million tons of ore have historically been extracted. The total copper content of 0.357%. promising results show the presence of 5 different areas with potential. In November 2017, we began a geophys- ical survey using Orion 3D technology of an 800-hectare surface, in order to define drilling targets and confirm their possible existence through a 10,000-meter explo- ration campaign to be carried out in 2018.

ALFAREÑA PROJECT (SANTA BARBARA) Geologist analyzing the mineral. Alfareña is a silver, gold, lead, zinc, and copper veins project within the Santa Barbara District, located 6 km away from the concentrator plant. It has 21.1 million tons of ore in reserves, with average contents of 3.46% of zinc, 0.38% of copper, 2.44% of lead, and 101 gr/ton of silver.

56 58 del CobreMine,inSonora. Panoramic viewofBuenavista 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 0 Million tons COPPER RESERVESBYCOMPANY 75.2 Grupo México / AMC

74.3 Codelco

49.6 Freeport Mc Moran

In 2017, we carried out a12,980-meter diamond drilling, which has system. mineralization of Guayaquil. The deposit has acopper and molybdenum porphyry delRuta Cobre is to the west of the of city Cuenca and to the south Chaucha –Rutadel Cobre ECUADOR determine the profile of the project and begin its prefeasibility. In 2017, a9,939-meter diamond drilling program was carried out to This is acopper-gold project, located in the Atacama region of Chile. el salado chile 35.9 BHP

26.9 Glencore/ Xstrata

23.5 Fisrt Quantum

23.3 Anglo American

22.1 Río Tinto

16.2 Antofagasta

13.1 Vale SOLIDITY 59 ANNUAL REPORT 2017 SOLIDITY

enabled us to consolidate the information to begin a A geological mapping and sample collection is being conceptual study for an initial economic assessment of carried out with favorable results so far. In 2017 we the project. During this process, we have fulfilled the We are constantly performing continued these studies. For 2018, we are consider- socio-environmental management plan. In 2018, we exploration activities to locate ing a 10,000-meter drilling to create a resource block the most mineral resources will continue with the conceptual study. model. The permits and timeframes required for the and discover new deposits. mining plan will be reviewed. ARGENTINA In 2017, we completed the geological exploratory and geological evaluation works in the provinces of San Juan and Rio Negro, in order to find porphyry Cu- Mo systems and epithermal gold and silver deposits, respectively.

For 2018, we plan to continue with the exploration of the epithermal gold and silver deposits known as Caldera Project, in the Rio Negro province. We are considering a 10,000-meter diamond drilling.

Likewise, we will carry out exploration activities at Marisa I, located in the San Juan province.

CHILITO (ARIZONA) Chilito is located in Gila, Arizona, US. Only 6 km away from our Hayden concentrator. In 2016, we acquired 62 mining concessions, covering the north part of the project, in order to research certain geophysical 60 anomalies that could increase the mineral resources.

Cuajone Mine in Peru. SOLIDITY

OCCUPATIONAL HEALTH AND SAFETY—MINING DIVISION

For Grupo México, caring for the lives, health, and wellbeing of our • Mexico’s Mining Chamber (CAMIMEX) awarded the • In Peru, we have managed to reduce our accident collaborators and their families is the number one priority in all our Silver Helmet, a “Jorge Rangel Zamorano” Trophy, to rate by 33% in the last 5 years, through the imple- operations. No task is more important than this. Mexicana del Cobre’s La Caridad mining unit, as well mentation of programs that enable us to enrich our as to our Santa Eulalia Unit, as they reported the lowest prevention culture among our collaborators. Our main commitment is to create optimal and safe work incident rates in the industry, as well as for their efforts environments for our collaborators, which we achieve through the in accident prevention. Thanks to the work and commitment of our collabo- highest occupational health and safety standards. Our goal: ZERO rators, we have managed to reduce the accident rate accidents. • Our mining operations in the US once again achieved over the last 5 years by 27% and their severity by 33%, the lowest accident rates in their history, settling 59% evidencing that our risk identification and attention The Mining Division’s Integrated System of Labor Health and safety below the national average. activities have served to significantly reduce the inci- Management allows us to implement effective processes and dence and severity of accidents within our operations. provide our collaborators with the necessary knowledge and abilities • Our accident rates at our Mexican and Peruvian op-

to identify, control, and mitigate risks, prioritizing the necessary accidents erations are 53% and 5% below the averages for the measures and care to prevent accidents. fewer mining industries of each country.

In 2017, we maintained 11 units in Mexico and Peru with the Occupational Health and Safety Advisory Services certification, pursuant to the OHSAS 18001:2007 standard. In addition, in Mexico, Collaborators at underground we have 17 units accredited by the Ministry of Labor’s Health and mine Santa Eulalia in Safety at Work program (PASST for its Spanish acronym), thus , Mexico. endorsing our commitment to follow the best practices in health and safety at the workplace.

Among the achievements that we should note regarding health and safety during 2017, we can mention the following: 42%

62 • The occupational accident rate throughout our Mining Division’s operations has remained 42% below the average for the min- ing industry in the US, as defined by the Mine Health and safety Administration. 64 in general. their families,contractors, suppliers,institutions,andthepublic programs areprovidedto our collaboratorsand,insomecases, and riskcontrolprograms, aswellbytreatingillnesses.These al illnesses by 31%, as a result of various education, prevention, Over thelast5years,wehavemanagedtoreduceour occupation- ties whereweoperate. quality of life of our collaborators, their families, and the communi- to generate better health conditions that lead to an increase in the tablishes acultureofinvolvement,participation,andcommitment, management system,asaresponsibilityofthecompany,whiches- Healthy environmentsarepartoftheorganizationalcultureand OCCUPATIONAL HEALTH IR = IR Mining Division, 2013-2017 INCIDENT RATE (IR),

0.94 2013 No. accidents ofincapacitating

Total man-hoursworked 0.84 2014

0.69 2015

0.75 2016

0.78 2017 x 200,000 GR = Mining Division, 2013-2017 SEVERITY RATE (SR),

0.19 2013

Total man-hoursworked 0.49 2014 No. lost ofdays 0.23 2015

0.30 2016

0.32 2017 x 1.00 PERSONNEL INTHEWORKENVIRONMENT ACTIVITIES DESIGNEDFOR: ZERO ACCIDENTS • Awards toworkers ordepartmentswith • Healthrace • Healthcarefair • Internalsecuritycellsforum • Securityexpo • Securitycoursesandconferences ODR = Mining Division, 2013-2017 RATE (ODR), OCCUPATIONAL DISEASE

0.47 2013 Number of cases of occupational diseases Number ofcasesoccupational

0.32 2014 Total man-hoursworked 0.12 2015

0.37 2016 WORKERS’ FAMILIESANDCOMMUNITY:

• Healthcarefair get-togethersandparades • Family • Fire-fightingcourses • Value contests promotionfamily • Healthrace • Guidedtours company”“Meet my 0.30 2017 x 200,000

SOLIDITY 65 ANNUAL REPORT 2017 66 (Millions ofDollars) INVESTMENT AND EXPENSESIN WORKPLACE HEALTH (Millions ofDollars) INVESTMENT AND EXPENSESIN WORKPLACE SAFETY treatment, andrehabilitation. awareness, promotionandhealthprotection,earlydetection, hygiene studies.Asforoccupationalhealth,weinvestedinraising works, purchasing personal protective gear, training, and industrial and safety.Theseinvestmentsweremadeprimarilyinengineering During 2017,weinvestedoverUS$126millioninoccupationalhealth INVESTMENT INHEALTHANDSAFETY Total Rehabilitation Treatment Detection andprevention protection and promotion, awareness, Health Total works Engineering studies Industrial hygiene Personal protectivegear Training Administrative costs g n i n i m g n i n i m $ 6.16 $ 0.04 $ 2.60 $ 2.58 $ 0.94 $ 120.36 $ 97.85 $ 2.45 $ 12.14 $ 1.02 $ 6.90

n o i s i v i d n o i s i v i d Sonora, Mexico. del CobreinCananea, operators atBuenavista Female miningtruck 67 ANNUAL REPORT 2017 , . Locomotive shop,

02 DYNAMISM DYNAMISM higher thanin2016. of US$880million,13.5% We achievedarecordEBITDA 1 5 Pascualitos Ft. Worth Dallas Sweetwater 2 3 Rustler Gorman Cresson Nogales El Paso Springs Comanche Cleburne Granbury Longview Coleman Dublin 8 Cd. Juarez Sierra Blanca San Angelo J.C.T. 4 Ricker Brownwood Pensacola Jacksonville San Angelo College 7 Benjamin Hill Ft. Stockton Station Titusville Alpine Austin Houston Ojinaga Presidio Spofford San Orlando Antonio Canaveral Galveston Chihuahua 6 Tampa Piedras Negras Eagle Pass West Palm Palm Beach Guaymas Corpus Christi Beach Laredo Everglades Miami Sufragio Cd. Frontera Topolobampo Cd. Frontera Paredon Torreon Culiacan R. Arizpe GEOGRAPHIC LOCATION TRANSPORTATION DIVISION−GRUPO MÉXICO Cd. Victoria Rail Ferry Mazatlan Zacatecas Altamira Connections: Ferromex Silao 1 UP Guadalajara 2 UP Penjamo

3 Mexico Veracruz Texas Pacífico BNSF / UP Ajuno City Coatzacoalcos 4 BNSF / FWWR Manzanillo Florida East Coast 5 BNSF / FWWR BNSF / UP Sanchez Kansas City Southern 6 BNSF / UP 7 BNSF / CN / CSX / NS Trackage rights 8 CSX / NS Salina Cruz 72 expectations. our clients’ surpass that services way transportation its operating efficiency, improve security, and offer rail sively in our railroad system, we continue to increase inten investing By Forum. Transportation International and productive railroad in Latin America in the OECD’s in 2013 we were acknowledged as the most competitive and highly efficientAs a result network. of our efforts, more than doubled our capacity, becoming amodern Since the beginning of our operations in 1999, we have way system in the European Union, except for Germany. network hauls more cargo than any rail privatization of the railway system in the country. The provements since 1999. Traffic has doubled since the im- constant shown has railway industry Mexican The at the . well as at four on the Pacific ports Coast, and four more Our lines connect at five border points withUS, theas in Mexico, and the states of Texas and Florida in the US. a network of over 11,136 of km rails through 24 states coverage. We have extensive most the offering Mexico, We are the leading company in ground transportation in and Intermodal México,Inc. de C. V. S. A. (TXP) (IMEX). TexasV. PacíficoLP, Florida (FEC), Coast East (Ferrosur), cano, de C. Ferrosur, V. S. A. (“Ferromex”), de C. S. A. and its main subsidiaries are Ferrocarril(GMXT), Mexi by its subsidiary GMéxico Transportes, B. de C. S. A. V. Mexico’sGrupo Transportation represented Divisionis TRANSPORTATION DIVISION TRANSPORTATION - - - - CARS

they moved1,729,818 In 2017, wehauled AUTOMOTIVE SEGMENT throughout the year. 61% 1.9 millionvehicles. railway carstransporting over transporter inthecountry, hauling as thelargest automobile Transportation Division remains Agricultural Train. of the vehicles exported ofthevehiclesexported 159,126 The The the segment. achieving arecord highin supply inthecountry, and hauled, thus guaranteeing the highestgrowth. Division’s with services segment asoneofthe positioning theintermodal 283,975 products, withover tons ofagricultural We transported 25million AGRICULTURE SEGMENT 610,808 In 2017, wehauled INTERMODAL SEGMENT thousandcars containers,

DYNAMISM 73 ANNUAL REPORT 2017 74 segments. Minerals and Intermodal 2016, the by driven mainly During 2017, we achieved record sales. Revenues grew 16% vs. chandise and essential products for the country to their destination. supply chains in the industrial sector, as it gets most of the mer The railway sector is the backbone of the development of efficient growth. economic to essential is performance railway sector’s The goods. sumer mining, con automobiles, energy, and cement, steel, chemicals, We offer railway cargo services in the segments of agriculture, for unitcoupling. Garrotero preparingcoupling - - and growth. company’s soundness 2017, reflecting the in the Initial PublicOffering GMXT madeasuccessful BMV inNovember

RELEVANT FIGURESGrupoMéxicoTRANSPORTES Investments/FECacquisition EBITDA Profit Operating CostofSales Sales Carshauled Vol. Transported (Milliontons-km) ( Investments/Capex NetProfit t i f o r p da t i b e s d n a s u o h t

n i g r a m n i g r a m

f o

(%): (%): (%): (%): d s u ) 1,032,752 1,767,303 1,423,847 774,961 521,192 359,830 357,020 2016 ry a u n a j 55,215 20.2% 43.8% - - - r e b m e c e d 2,100,000 1,202,069 2,049,200 1,729,818 879,813 554,905 286,112 319,338 2017 59,105 15.6% 42.9%

Aerial viewoftouristtrain. 2,100,000 US$000 169,317 281,897 305,971 104,852 (73,718) (37,682) 33,713 3,890 ariance c n a i r va DYNAMISM % (20) (11) 16 16 21 13 - 6 7 75 ANNUAL REPORT 2017 76 DINAMISMO Trinviel automotive trolley. we have invested Transportation USD$8.6 billioninthe In 19yearsofconcession, greater operating efficiencies. expand ourcapacity andfind which hasenabled us to Division,

IPO inIPO the last five years. ica in the last years, 22 as well as the largest Mexican is theThe IPO largest transportation offer in Latin Amer fundamentals. and potential, growth sheet, balance Company’s sound The offer was successful, reflecting the (“GMXT*”). the Mexican Stock Exchange under the ticker GMXT On November 9, 2017, we announced our on IPO into a13.5% growth vs. 2016. million,achieved translating of US$880 arecord EBITDA well as the sound results of the rest of its operations, we as quarters, two for results FEC’s consolidating After operations. ucts and the consolidation of volumes from the Florida hauled, mainly in the domestic of consumer traffic prod duegrowth of to 54% agreater number of containers revenue accrued showed segment Intermodal The tion and of FEC higher volumes in its Mexican operations. 2016, while cars hauled grew 21.5%, given the acquisi increasedvs. 7% in ton-km net Volumes transported DYNAMISM - - - 77 ANNUAL REPORT 2017 DYNAMISM

INVESTMENTS the service we will be able to offer our clients, and it will In 2017, we invested US$2.38 billion. The investments were destined We completed the significantly improve the scope and scale of our services. to infrastructure improvements, to increase our operating capacity and acquisition of FEC, which efficiency, As well as to gain access to new, high-potential markets. positions us as a relevant With a view to streamline our future growth, we have player in . identified unique opportunities to make investments On June 30, we completed the acquisition of Florida East Coast Rail- in key areas of our network, including signaling way Holdings Corp. for USD$2.1 billion; the railroad that hauls cargo infrastructure, investments in workshops and terminals, along the Florida coast. This acquisition positions our Transportation developing double tracks, improving the capacity of Division as a relevant player in North America, since it adds to the the Pacific-North railroad line, building the Celaya and current operations in Mexico and the state of Texas. Monterrey bypasses, and overhauling the Texas-Pacific railroad, as well as acquiring locomotives and railroad FEC’s acquisition is an important strategic addition for the offer of cars. We hope that these investments will enable us to transportation services in North America. This transaction gener- keep increasing our operating efficiency, reducing our ates greater strength for us in terms of geographic presence, and medium-term maintenance costs, and improving our competitive position compared to other transportation segments, such as road transport. Likewise, we will gain an advantage over the rest of the transportation industry, and our service offer will continue to stand FEC’s engines have innovative out, based on service quality and productivity. technology to use 60% of liquid natural gas and 40% diesel, leading to significant savings and a positive effect on the environment. In the last few years, Mexico has undergone a transformation of the railway system, 78 going from operations that 79 were dependent on large government subsidies to becoming a highly productive, profitable, and autonomous system. ANNUAL REPORT 2017 ANNUAL REPORT 80 35% atthestartofouroperationsto65%by2017. industry hasundergone,ourmarketsharewentfrom Throughout this periodof expansion thatthe railway wing from18.8%in1999to25.2%by2016. increased itsshareagainstroadtransportation,gro- has increasedsignificantly.Railwaytransportation Demand servedthroughtherailroadnetworkinMexico 1999 81% 35% 19% GMXT 65% OTHERS economic growth. among otherfactors,willdrivethisstate’ssustained structure, flexibletaxes,andgovernmentincentives, 20 million inhabitants. We expect that a strong infra- US, andthethirdmost-populatedstate,withroughly clients, asitisthefourthlargeststateeconomyin Florida offers a dynamic and appealing market to our Besides, webelievethatourpresenceinthestateof 2017 75% 35% OTHERS 25% GMXT 65% remain the Mexican in allofLatin America. 9Industrial 8 Automotive 7Cement 6Energy 5Steel 4Chemicals 3Intermodal 2Minerals Agriculture 1 10 Cement 9Steel 8Others 7Industrial 6Energy 5Chemicals 4 Automotive 3Minerals 2Intermodal Agriculture 1 freight trains most productive 21,081

2017 2017 2,275 2,678 3,458 3,996 4,865 5,058 5,731 9,964 11% 11% 12% 27% 4% 5% 6% 8% 8% 8% 6 31, 2017,isshownbelow: Each segment’s revenue contribution up to December SALES DIVERSIFICATIONBYSEGMENT 6 7 7 5 5 REVENUES PERSEGMENT 8 8 4 9 9 TONS PERKILOMETER 4 10 3 DYNAMISM 3 1

2 1 2 81 ANNUAL REPORT 2017 82 company’s operations personnel. practices togeneratean accident preventioncultureamongthe behavioral system that seeks to establish the bestsafeworkplace we begantheimplementation oftheZeroToleranceProgram,a In additiontotheoperationofthesecommittees,at endof2017, 100% ofourcollaborators. in thesecommitteesthroughtheirrepresentatives,who represent provement ofallworkareas.9%ourpersonnelparticipate directly the variouslevelsoforganization,bodiestoguarantee theim- As part of this strategy, we have Health and Safety Committees at generating safeworkenvironmentsforour11,305collaborators. constantly committochannelingresourcesandfocusingeffortson ture of accident prevention and leadership in workplace safety. We One of the main challenges in our industry is to consolidate a cul- OCCUPATIONAL SAFETY ciency ofeachourprocesses. linked to the goal of becoming more productive, maximizing the effi- vice andoutdoingtheirexpectationsdaily.Thisconvictionisdirectly axis, weworkundertheconvictionofimprovingourcustomerser- level, withtheaimofoperatingzeroincidents.Asforservice and productivity.Operationalsecurityisarulingpremiseatevery The TransportationDivisionhasthreeguidingaxes:safety,service, HEALTH ANDSAFETYINTHEWORKPLACE Railroad transportation accidents. the numberofroad automotive traffic and pollution, to considerablyreduce network. Italso trucks drivingalongtheroad is equivalent toover 300 asasingletrain reduces helps 0.00 1.00 2.00 3.00 4.00 IR = Transportation Division, 2015-2017 Incident Rate (IR)

No. accidents ofincapacitating 3.35 2015 Total man-hoursworked

2.97 2016

2.06 2017 0.00 0.50 1.00 1.50 x 200,000 Transportation Division, 2015-2017 SeVRITY RATe (SR)

1.30 2015

1.09 2016 ODR = 1.22 2017 0.00 0.20 0.40 0.60 0.80 1.00 1.20 1.40 Number of cases of occupational diseases Number ofcasesoccupational SR = Tranportation Division, 2015 - 2017 dISeAS RATe OCCUPATIOnAL Total man-hoursworked 0.33 2015

Total man-hoursworked 0.56 2016 No. lost ofdays 1.26 2017

diseases. of occupational 10% intherate a decreaseof is toachieve 2018 Our goalfor Goals 2018. x 200,000 x 1,000 83 ANNUAL REPORT 2017 84 disease rate. Our goalfor2018istoachieve a10%decreaseintheoccupational performance oftheactivities, thuspreventinghealthrisks. encourage theproperuseofpersonalprotectivegearand theproper We arealsoworkingonstrengtheningtheinternalcampaigns to to detectanytypeofhealthissueearlyonandprevent itontime. quency ofmedicalcheckupsforouractivecollaborators, inorder to theincidenceofretiredcollaborators.Wewillincrease thefre- filed with the Mexican Institute of Social Security (IMSS), mainly due In 2017,wesawanincreaseinoccupationaldiseasesthereports our indicatorsrelatedtothisissue. developed occupationalhealthprogramsandpermanentlymonitor havior andconductsobservedamongourcollaborators,wehave In ordertoensureahealthyworkenvironmentandmodifyriskybe- OCCUPATIONAL HEALTH man-hours oftraininginthesubject. ters ofoccupationalhealthandsafety,achievingatotal34,594 We shouldalsonotethat3,683collaboratorsweretrainedinmat- In 2017,theaccidentratedecreasedby25%vs.2016. with a increase inborder crossings, traffic, n° 1railroadininternational In 2017, weremained asthe with the US. railway exchange traffic 56% shareofthe thankstothesharp

Ferromex locomotives. 85 ANNUAL REPORT 2017

STRATEGY STRATEGY 03 The Infrastructure Division reported net sales of US$582 million, with an EBITDA of US$233 million.

View of our “La Caridad” Combined Cycle Plant In Sonora, Mexico. 1

2

3

GEOGRAPHIC LOCATION INFRASTRUCTURE DIVISION−GRUPO MÉXICO

PACIFIC GULF OF OCEAN MEXICO ASSETS 1 CANANEA 7 2 500 MW COMBINED CYCLE PLANTS 5 4 6 16 3 MONTERREY 4 GUADALAJARA 15 5 LEON-SALAMANCA HIGHWAY 14 156 IRAPUATO 13 8 12 7 ONSHORE DRILLING , VERACRUZ 11 17 10 8 CORPORATE OFFICES, MEXICO CITY 9 EL RETIRO, WIND FARM, 74 MW 10 “” RIG 11 “VERACRUZ” RIG 12 “SONORA” RIG 9 1113 “” RIG LEGEND 14 “ZACATECAS” RIG PEMSA 1315 “CAMPECHE” RIG MGE 16 “CHIHUAHUA” RIG MCC CENTRAL AMERICA 17 OFFSHORE DRILLING CD. DEL CARMEN, CAMPECHE HIGHWAY STRATEGY

INFRASTRUCTURE DIVISION

GMexico’s Infrastructure Division is represented by its subsidiary Méx- During 2017, the Infrastructure Division’s sales totaled In 2017, we invested USD$27 million in the Infrastructure ico Proyectos y Desarrollos, S.A. de C.V. (“MPD”). Its main subsidiaries USD$582 million; that is, 4% less than in 2016. Division. Moreover, we are considering investments in are México Compañía Constructora, S.A. de C.V. A. de C. V. (MCC) y fuel storage terminal projects in ports and cities. Grupo México Servicios de Ingeniería, S.A. de C.V. (“GMSI”), Controla- EBITDA in the Division reached US$233 million, trans- dora de Infraestructura Petrolera México, S.A. de C.V. (PEMSA), Con- lating into a 16% decrease from the previous year, troladora de Infraestructura Energética México, S. A. de C. V. (“CIEM”), mainly due to a lower utilization of PEMSA’s equipment, and Concesionaria de Infraestructura del Bajío, S.A. de C.V. (CIBSA). given the suspension of some contracts, and PEMEX’s reduction in platform rates. The Salamanca-Leon Highway MPD, PEMSA, MCC, GMSI, and CIEM are controlled 100% by Grupo achieved a weighted México. MPD and MCC participate in engineering, procuring, and Net profit was affected, particularly, by the Peso appre- average daily traffic rate of 11,970 units, surpassing by construction activities for infrastructure works. GMSI’s business line ciation, which had a negative impact of USD$10 million, 39% the traffic equivalent is integrated project engineering. PEMSA offers drilling services for and inflationary effects that generated a negative impact agreed with the SCT. oil and water exploration, and related value-added services, such as of USD$15 million. cementation engineering, and directional drilling. CIEM’s business line is energy generation through two combined cycle plants and a wind farm. CIBSA operates and maintains a highway concession joining Salamanca and Leon. Salamanca-Leon Highway, , Mexico. RELEVANT FIGURES FOR MÉXICO PROYECTOS Y DESARROLLOS (MPD)

j a n u a ry - d e c e m b e r va r i a n c e

( t h o u s a n d s o f d o l l a r s ) 2016 2017 US$000 % Sales 608,265 582,338 (25,936) (4) Cost of Sales 315,374 330,166 14,791 5 Operating profit 167,644 127,688 (39,956) (24) EBITDA 277,707 233,048 (44,659) (16)

90 e b i t da m a r g i n (%): 45.7% 40.0% Result before taxes 98,397 62,780 (35,617) (36) Tax due 5,898 16,513 10,615 180 Deferred tax (1,790) 23,733 25,523 (1,426) Net profit 94,287 22,510 (71,777) (76)

p r o f i t m a r g i n (%) 15.5% 3.9% 92 some otherthirdparty. for leasingtoPemexor andbesuitable itsclasscertificate preserve 95.8%. isundergoingmajormaintenanceto The Sonoraplatform efficiencyin2017 reached weighted operating The platforms’ isunder nocontract.nora platform end ofthefirstquarter2018(Tamaulipas platform). theSo- Only the at operations processtobegin completion ofthemobilization platforms),suspended (Chihuahua and Zacatecas and one awaiting (Campeche,ation Tabasco, and Veracruz platforms), twotemporarily As aresultofsixactivecontracts, threeofthemincontinuousoper MARINE DRILLING USD$111 millioninrevenues, andUSD$47millioninEBITDA. In 2017, ControladoradeInfraestructuraPetroleraMéxicoaccrued MÉXICO, S.A.DEC.V.(CIPEME) CONTROLADORA DE INFRAESTRUCTURA PETROLERA OIL ANDGASSECTOR

- the Infrastructure Divisionhave All thecompaniesin awarded byCEMEFI.awarded Company” certificate, “Socially Responsible “Socially Responsible "Veracruz". Modular Platform platforms platforms Throughout 2017, ouroffshore average efficiency of95.8%. maintained an for saleto thewholesalemarketandotherclients. for eral hydroelectric, solar, wind, and geothermal projects of Grupo sev- México Energía carried out an analysis USD$108 million. 17.8% increasevs. 2016. Moreover, EBITDAreached USD$302 millioninrevenues. intoaThis translates partners,higher demandfromourself-supply ledto plant,Nacozari generation inSonora, resultingfrom Division. theEnergy for increaseintheThe operating productionandsales,As for 2017wasarecordyear ENERGÉTICA MXICO,S.A.DEC.V.(CIEM) CONTROLADORA DEINFRAESTRUCTURA ENERGÍA operations inthefirstquarterof2018. operations 6,tract endingonJanuary 2021, anditshouldbegin The Tamaulipas hasanactivecon- modularplatform 5, 2020. ductivity withanactivecontractendingonSeptember The Veracruz achieved84.63%pro- modularplatform 16, 2022. 97.62% andhasanactivecontractendingonMarch The Tabasco increaseditsproductivityto platform It hasanactivecontractendingon August 11, 2021. among our platforms.reporting the best performance reached98.32%productivity,The Campecheplatform

STRATEGY 93 ANNUAL REPORT 2017 STRATEGY

MÉXICO GENERADORA DE ENERGÍA (MGE) MAIN WORKS The generation plant increased its production by 14% For the railroad industry, we mainly continued with the works vs. 2016, equivalent to 3,629 GWh, given the higher to expand the gauges of the “Plan de Barrancas” tunnels, which consumption by the Buenavista del Cobre mine. This will enable double-stacked trains to pass along the Guadalajara- translated into a record USD$290 million and USD$103 Tepic segment. We completed construction of the expansion of the 14% million in EBITDA. increase automotive terminal in Monterrey, which included the reconfiguration of the railway in the main yard, and the construction of the fuel We should note that, in terms of safety, 2017 ended MWh charging and supply zone in Rio Escondido, . with a report of 1,557 days accrued without accidents. We have an energy generation capacity of 574 For the New Mexico City Airport, we built the 14km access railway megawatts (MW) with state- EL RETIRO WIND FARM (ERSA) to haul construction materials and part of the basic infrastructure for of-the-art technology. The wind farm reported production of 170,923 mega- this huge work. watts-hora (MWh), translating into USD$11.8 million in revenues and a 1% increase vs. 2017. This was pos- sible even though the wind farm was out of service for 40 days, due to the earthquakes reported in the area of Juchitan, . EBITDA reached USD$3.5 million. Sunset at combined cycle energy plant "La Caridad” in Nacozari, Sonora, Mexico. During 2017, 37 locations were added, translating into a portfolio of 432 points of sale.

CONSTRUCTION MÉXICO COMPAÑÍA CONSTRUCTORA, S.A. DE C.V. (MCC) During 2017, México Compañía Constructora’s sales reached USD$138 million, translating into a 13% in- 94 crease vs. 2016.

3,800,073 96 by stated those below rates accident achieved we • Additionally, direct 3,362 of workforce monthly a had we operations, our • In inworkplacesafetyandhealthisfulllegalcom- The performance until2019.company hasbeenheldsince2007. This certification 18001:2007, and Environmental ISO 14001:2015, which backs the dards: QualityISO9001:2015, Workplace HealthandSafetyOHSAS tems, stan- andinternational incompliance withcurrentnational sys- ofitscomprehensive management MCC hasthecertification AND ENVIRONMENTALCARE MANAGEMENT OFQUALITY,OCCUPATIONALSAFETY certified withiSO9001-2015. radora deInfraestructuradelBajío, theSCTand before registered oftheGroup: throughasubsidiary isoperated The Highway Ope- Spanish). and ofCommunications with theMinistry Transportation (SCTin the equivalent agreed 39% the traffic surpassed by flow traffic units. This meansa23%increaseinsalesfrom2016. Moreover, intoover18,33011,970 vehicles;thetrafficequivalenttranslates traffic (ADT) of daily pesos in revenues and a weighted average During 2017, reported$656 million theSalamanca-LeonHighway Grupo MéxicoAUTOPISTAS (CMIC), aswelltheoilindustry. OSHA (US)andtheMexican ChamberofConstructionIndustry collaborators, andover4,000subcontractors. pliance, andwecannotethat:

without acciden generation plant. have accrued By theendof2017, we 1,557 days 1,557 days ts atour Juchitan, Oaxaca, Mexico. El RetiroWindFarmin 97 ANNUAL REPORT 2017 STRATEGY

ENGINEERING GRUPO MÉXICO SERVICIOS DE INGENIERÍA, S. A. DE C. V. (GMSI) During 2017, GMSI’s revenues totaled USD$18 million, translating into an 8% increase vs. 2016. In the last few weeks, we won the bidding to manage the Celaya Bypass Project, for a two-year period.

Throughout the year, we also successfully completed the detail engineering of Toquepala in Peru, and worked with various clients in Mexico, such as Nestlé, North- land Power, Industrias Químicas Falcón, and Protama, Salamanca-Leon Highway, among others. Guanajuato, Mexico.

Environmental and quality performance audited and certified by third parties is in compliance with all regulation and specifications of the company’s construction projects.

POSSIBLE PROJECTS 2018 • Possible construction of fuel storage terminals at ports and cities. • Construction of the Celaya railway bypass. • Construction of railways and supply zone of the new Rio Escondido yard, km 21, R Line, Piedras Negras-Ramos Arizpe. • Construction of energy and industrial plants. 98 • Possibility of obtaining a state concession for a 12.5-kilometer Our México Compañía 99 road stretch, from the Silao road junction of the Salamanca-Leon México Compañía Constructora’s operations had an highway to connect with highway 45. Constructora’s sales totaled average monthly workforce of USD$138 million, translating 2,136 collaborators, with annual into a 13% increase vs. 2016. 5,639,040 man-hours accrued. ANNUAL REPORT 2017 ANNUAL REPORT programs. Community benefited by FGM’s

04 FOUNDATION FOUNDATION of 787%. with annualincreases people throughitsprograms, has benefitedover134million Fundación GrupoMéxico Since itsinception, FOUNDATION

HEALTH TRAIN

Dr. Vagon, the Health Train, achieved three years of operation Since 2015, with the collaboration of ESSILOR, through • Teen pregnancy in 2017, during which it has provided 647,571 comprehensive the Optometry service, 49,992 visual checkups and di- • Sex education medical services free of charge to 156,951 patients in 122 com- agnoses were carried out, benefiting18,506 people who • Healthy lifestyles munities throughout 22 states of the Mexican Republic, along were provided eyeglasses suited to their needs. In 2017, • Oral hygiene 50,896 km. the Optometry Service performed 25,506 visual check- • Birth control ups and diagnose, benefiting8,502 people who were • Vaccination During 2017 alone, it provided 266,440 comprehensive medi- provided with 6,604 eyeglasses. • Respiratory diseases

cal services free of charge to 61,212 patients in 30 communities free • Sanitary emergencies throughout 15 states of the Mexican Republic, along 15,443 km. medical Simultaneously, in those 3 years of operation, 2,759 Health Education workshops were provided to 95,685 In February 2017, we incorporated the Chiropractic and The states visited were: Sonora, , Chihuahua, Coa- services attendees, while in 2017, we provided 1,028 Health Ed- Physical Rehabilitation service, which benefited5,760 pa- huila, Tamaulipas, , Nuevo Leon, Zacatecas, , Jalis- ucation workshops to 45,806 attendees, offering the tients, who received 40,000 services, including neurolog- co, Michoacan, Guanajuato, Veracruz, Queretaro, , State following topics: ical, chiropractic, and orthopedic checkups, diagnoses of Mexico, Puebla, Tlaxcala, Oaxaca, Colima, and Aguascalientes.

Since 2015, Fundación Farmacias del Ahorro has been a key ally for the free delivery of 358,103 medicines, aimed mainly to chron- ic degenerative, infectious or contagious, and dermatological dis- eases, aiming to begin medical treatment early on.

In 2017, we delivered 79,013 free medications.

In June 2016, we began an alliance with Fundación MVS Radio and its "Ponte Oreja" program, through which 37,175 audiology services were provided, including otoscopies, tympanometries, hearing tests, and speech audiometries, thus benefiting 600 peo- 102 ple with hearing aids.

Medical staff working In 2017, we carried out 25,747 audiology services, and 300 peo- on Dr. Vagon, the ple were adapted with hearing aids. Health Train. 266,440 FOUNDATION

in the state of Oaxaca, where it remained for 12 days providing 18,795 emergency services and medical care to 5,200 affected individuals.

Thanks to the alliance with the Metropolitan Autonomous University (UAM), it was possible to carry out a training program on topics re- lated to the incidence of the diseases detected in the states visited by We have general the Health Train, in order to ncrease the curricular value of each of the practitioners and doctors providing service on Dr. Vagon. specialists to provide quality medical care. As a result of the demand from Health Train patients for assistance and psychological counseling, we created the 01800 DRVAGON (3782466) hotline.

With the support of Cinemex and Ferromex, we created Cine Vagon, of the musculoskeletal system, manual and mechanical a free, one-of-a-kind entertainment program, consisting of a train car chiropractic adjustments, and physiotherapy. adapted with: screens, the best audio equipment, hi-definition projec- tors, comfortable seats, and a candy store. Its goal was to bring the In March 2017, we created an alliance with Laborato- magic of movies to the same communities that Dr. Vagon, the Health rios LAPI, through which we were able to include the Train, visits. X-ray service, taking 18,822 radiographic projections. We complemented the cinema experience giving away fresh pop- This year, we added the cervical cancer prevention corn and beverages, as well as healthy candy and snacks to the service through an alliance with ONKO SOLUTIONS, kids who join us. With the support of allied distributors Sony and performing cervical screenings and colposcopies for Videocine, we show movies with universal values and encourage the early detection of cervical cancer in 5,760 women. families to share.

104 105

Following the earthquake from September 7, 2017, Dr. During 2017, we held 108 shows, visited 30 communities, delivered Vagon visited the communities of Ixtepec and Juchitan 12,960 bags of popcorn to 22,680 people who enjoyed the Magic of Movies in the new Cine Vagon. ANNUAL REPORT 2017 ANNUAL REPORT FOUNDATION

EDUCATION

EDUCATIONAL MATERIALS: 3. To eat better 4,851 downloads We have trained 4,278 teachers in the proper use of the HEALTH AND LIFE EDUCATION 4. Regarding my body, I decide! 6,201 downloads platform and of the materials within the classroom. The educational materials provided by FGM are and have been the only ones authorized by the National Education Workers Union (SNTE in General We have provided 1,381 legal and psychological counsel- Spanish), which positions us as the only NGO to implement social topics 1. I eat, enjoy, and nourish myself 4,848 downloads ing sessions in the two discussion forums we have, where in the country’s basic education, thus succeeding in making children’s our users can share experiences with violence, sexuality, and teenagers’ education a comprehensive one. 220 thousand basic This year, we visited 134 public and private basic educa- addictions, and nutrition. education schools nationwide have these materials following the guide- tion schools (81 elementary and 53 middle schools) in or- lines of the Ministry of Education (SEP in Spanish). der to train and include our educational materials as tools We have the collaboration of various experts on these for support in schools that do not belong to the National matters, who provided us with 22 articles for our edu- Our educational platform, www.educacionsaludyvida.org was created to Education Workers’ Union. cational platform. provide greater coverage, so that the materials, expert collaborations, le- gal and psychological counseling, and statistics of the issues discussed (violence, sexuality, nutrition, and addictions) could be read and used by more people. We should note that the content of the materials may be viewed online and/or downloaded for free anywhere in the world. We currently have 20,128 active users on the platform, including 16,579 teachers and 3,549 parents and students.

We have recorded 58,053 downloads of our materials:

Elementary 1. I eat, nourish myself, and have fun 5,284 downloads 2. I learn to protect myself from violence 8,657 downloads 3. What are addictions? How can I decide? 7,566 downloads 4. My body is to be respected! 8,789 downloads

106

Middle school We are present 1. I identify violence and protect myself 5,622 downloads nationwide through our educational 2. Addictions? Maximum alert! 6,235 downloads materials. FOUNDATION

Family benefited through the invitation to "World Food Day"

EDUCATION WORKSHOPS: , Oaxaca, and . Thanks to this action, At Fundación Grupo México, we are aware that any we were able to assist 59,781 people. person’s education must be comprehensive. This is why we have worked with Fundación Nemi over the In the state of Chihuahua, we destined 311 tons of last four years, providing various education workshops groceries, benefiting 24,412 people in four Tarahu- to over 69 thousand middle and high school students mara communities: Creel, Temoris, Cuauhtemoc, and since the beginning of the project. This year, we began Bahuichivo. operations in Chihuahua and San Luis Potosi, in addi- tion to continuing in the states where we have worked Due to the disasters caused by the earthquake of Sep- before: Sonora, Zacatecas, and Baja California Sur. tember, and for the first time, we transported over 243 During 2017, we provided 261 workshops in 43 middle tons of foodstuffs and personal care products to states and high schools to counsel 19,846 students regard- other than Chihuahua, managing to directly benefit ing the main social issues they experience in adoles- 35,369 people. cence, and the topics we focused on were: WORLD FOOD DAY INVITATION 1. Violence In Mexico, there are currently one and a half million 2. Food bank Mazatlan 2. Sexuality children under five chronically undernourished, trans- Distribution of food with high nutritional value (50 children benefit- 3. Nutrition lating into 13.6% of the total population in that age ed in Sinaloa) 4. Addictions group (UNICEF). Thus, we have found it essential 3. Peace Fund 5. Financial Education to form an alliance with HSBC and Fundacion CMR, Construction of a community kitchen (294 children benefited in 6. Life Plan through the “World Food Day” Invitation, which des- Chiapas) 7. Intelligent communication tines the funds to various NGOs to eliminate child 4. AMEXTRA (Mexican Association for Rural and Urban 8. Self-esteem malnutrition. In 2017, thanks to this invitation, we Transformation) 9. Entrepreneurship were able to benefit 2,300 children in nine institu- Training in the production of traditional foods of the region; back- tions throughout six states. yard gardens (100 children benefited in Chiapas) HUMANITARIAN AID 5. FAE (Foundation for Educational Support) 108 With the assistance of Ferromex, we transported 554.5 1. Mundo Unitatis Food for trash collectors’ children who live and work at the city dump known 109 tons of groceries, free of charge, to five states of the Purchase of nutritional supplements with high biologic as Bordo de Xochiaca (300 children benefited in the State of Mexico) Mexican Republic: Chihuahua, Mexico City, value proteins (250 children benefited in Chiapas) 6. Niños de Santa Fe (Children of Santa Fe) Medical supervision for children with advanced malnutrition, pur- chase of nutritional supplements (100 children in Michoacan) ANNUAL REPORT 2017 ANNUAL REPORT 110 get their middle school certificate. educationtary and 27 continue to take lessons in the “Plaza Movil” to elemen their completed students 73 where Parral, of communities 40 During 2017, basic education 543 certification exams were given in education. their their communities the opportunity to get certified and thus complete Chihuahua who had no access to any of education, type bringing to ed to raise the education level of adults over 15 years old in Parral, Thanks to this bus, adapted as amobile school, we have contribut then. since education operations in 2016 and has aided 1,823 adults to complete their basic in Spanish) and the Ministry of began Public (ICHEA Education (SEP), This project, backed by the Chihuahua Adult Education Institute PLAZA MOVILPARRAL Chiapas) in mission, from birth until 18 months children of age (90 benefited Formula feeding for babies exposed through to HIV perinatal trans 9. W National of Foundation Chihuahua) in children benefited (816 munities Delivery of fortified milk and nutritional supplements Raramuriin com Tarahumara8. Llaguno Foundation A. Jose Jalisco) in children benefited (300 supplement nutritional of deliveries Monthly 7. Organization) Nutrition ONI (Child omen for Community H Community for omen ealth - - - - ENVIRONMENT 19 18 17 16 15 5 14 4 13 9 3 12 8 2 7 11 10 6 1 N o . The reforested states were: states reforested The 8,524,762benefit people. states where we are present. With these actions, we were able to lies, and participated in the tree-planting days that we held in some the 2,702 volunteers, who are mainly our employees and their fami was largely possible thanks to the collaboration and commitment of 839,247 trees throughout 19 states of the Mexican Republic. This this year we succeeded in the reforestation hectares of 839 with protection, environmental to devoted institutions and governments, Thanks to the alliances formed with various municipal and state REFORESTATION TOTAL San LuisPotosi Baja California Sur Baja California Chihuahua Queretaro State ofMexico State Sonora Guanajuato Oaxaca Michoacan Aguascalientes Jalisco Zacatecas Puebla Tlaxcala Hidalgo Tamaulipas CDMX Veracruz STATE PLANTED 196,088 TREES 839,247 150,000 76,541 20,000 11,238 50,000 60,000 23,000 68,907 45,450 17,500 50,000 20,000 20,000 4,523 5,000 7,000 7,000 7,000 REFORESTED HECTARES 196 839 150 77 20 11 50 60 23 69 45 17 50 20 20 FOUNDATION 5 5 7 7 7 - 111 ANNUAL REPORT 2017 FOUNDATION

During our 7th FGM Tree Planting Day, held in Huixquilu- MADE IN MEXICO can, State of Mexico, 16,000 pine trees were planted in For the fifth consecutive year, we supported the “Mex- 16 hectares of woodlands. 1,502 volunteers participa- ico in 1 image, 1 Photo=1 Tree” Contest, whose goal ted, including employees and family members of Grupo is for participants to express, through one photo, the México, Intermodal, Ferromex, Ferrosur, Cinemex, Sura, reason why they fell proud of being Mexican. This con- Fundación Posadas, Hogan Lovells, KPMG, Laborato- test is divided into three categories: Professional, am- rios Lapi, Coparmex, ManPower, and Nestlé, favoring ateurs, and a special look, designed for people with PACIFIC GULF OF 443,000 inhabitants of the area adjacent to the “Las Down syndrome. OCEAN MEXICO Cruces” reforested land. It is important to note that more and more companies are joining our tree-planting, seek- In 2017, 19,889 photos were entered on the website, ing to create awareness in their employees regarding the with over 1.7 million likes for the participating photo- CENTRAL AMERICA importance of caring for the environment, and generating graphs. The 50 photos with the most votes are pre- family and labor unity through these actions. sented in a tour through various spaces internationally throughout the year. Another 1,200 volunteers joined this initiative for our op- erations reforesting, where we planted 12,400 trees in 12 This exhibit tour began in the Soumaya Museum in hectares of grasslands in the Negro, Esqueda, Mexico City, then went on to Tlaxcala, the State of Nacozari, Charcas, and San Luis Potosi communities. Mexico, Colima, Hidalgo, Nuevo Leon and Atlanta, and it is currently in Toronto. This tour has been presented Alongside the work we have done with our volunteers, we abroad thanks to the collaboration of the Mexican con- have collaborated in coordination with Ferromex on an sulates in the US and Canada. unprecedented project called “Vagon Verde”, whose main goal is to carry out massive tree-planting days in vari- ous communities close to the railroad tracks to improve the physical appearance of public areas, but especial- ly to create awareness in children and teenagers about 112 the deterioration of the environment that we are currently 113 Volunteers participating in witnessing. The trees used for planting are produced in the seventh FGM our greenhouses, donated by Fundación Grupo México tree-planting day. Carried out in the State of Mexico. and transported thanks to the railway network of both Ferromex and Ferrosur. ANNUAL REPORT 2017 ANNUAL REPORT FOUNDATION

CINEMEX AWARENESS

PREMIERE FOR CHARITY 2. La alegría de los niños I.A.P. 70 children benefited organizations that we support through this program. In This is the program through which we provide a fundraising tool for Cause: Education 2017, 3,445 Cineminutes were released in 265 com- the participating organizations. We encourage their active work, as 3. Animal Defense Heroes. 1,550 people benefited plexes, reaching over 32 million viewers. they sell the tickets for the premiere assigned, and FGM doubles the Cause: Animal abuse sum raised so they may continue with their social work. CINEMEX RACE SOCIAL MESSAGING For the 8th consecutive year, this race with a cause In 2017, FGM doubled 1 million 932 thousand 248 pesos through “CINEMINUTO” brings the magic of movies to the streets of Mexico 31 premieres granted to 24 different organizations, thus benefiting To FGM, it is essential to showcase the work of those City. Over 6,000 runners participated with the goal of 541,806 people. who take care of the most vulnerable groups; this is why aiding an Organization, which we carefully select, to be we donate air time on the Cinemex screens nationwide. benefited with the donation of funds raised through the We wish to thank film distributors such as Videocine, Mantarraya, The main goal is to educate in generosity and create payments of race entries. Diamond, Corazón, Amarok, Zima, Conciencia Films, and Casa de social awareness regarding the work of the various Arte, who support this initiative unconditionally by loaning the films. We continue to search for new alliances to increase the number of titles and be able to offer more presentations. The trust the distrib- utors have placed in us is a consequence of the excellent handling of their titles, as well as the transparency and constancy with which Eighth Cinemex race held in we report the results of each of the projects that the benefited or- Mexico City. ganizations carry out.

SOCIAL MARKETING / FUNDRAISING CAMPAIGNS During 2017, we developed three fundraising campaigns through the candy stores of the various Cinemex complexes nationwide. The sum raised is donated to the chosen organizations so they can con- tinue their social aid programs.

114

2017 campaigns: 1. Fundacion CMR 1,000 children benefited Cause: Nutrition FOUNDATION

In 2017, Alegría de los Niños I.A.P. was chosen as the 6. Marina Trinitaria Congregation 1X1 AND 1X3 FUNDRAISING beneficiary of the race to continue with its project, Run- Aid for low-income minors CAMPAIGNS FOR THE SEPTEMBER ning for Education, where children who are victims of 7. Lorena Ochoa Foundation EARTHQUAKES neglect and abuse receive quality education under a Education for low-income children In response to the earthquakes suffered in September, we launched a model of comprehensive care going from physical and 8. Museo Memoria y Tolerancia A.C. fundraising campaign in Cinemex and FGM to destine the resources psychological rehabilitation to remedial school, shelter Fostering tolerance and respect obtained to assist the most affected areas of the country. In the first and worthy care within the shelter, until they can be 9. Jugueton stage, every peso that the public donated was doubled by FGM; how- reintegrated into a family. Campaign to collect toys for low-income children ever, given the size of the disaster before us, we launched a second stage where FGM trebled each peso donated, thus raising over 37 SOCIAL CAMPAIGN THROUGH million pesos. BILLBOARDS This program, which in 2017 has achieved 2 years in Committed to all those who donated and placed their trust in us, FGM operation, consists in offering spaces on the billboards of took on the task of seeking for a far-reaching program to benefit the Social marketing campaign our movie theaters so that the organizations can broad- largest number of people possible; thus, we decided to build a Spe- to benefit La Alegría de los cast their social message, gain visibility, and showcase Niños I. A. P. cialty Hospital in the Juchitan de Zaragoza Municipality in Oaxaca. their work. In 2017, we carried out 11 campaigns in Given the size of this project, it was necessary for FGM to complement 220 complexes nationwide. Thus, we were able to place the investment contributing an excess 140 million pesos to carry it out. 2,420 posters throughout the year, reaching roughly 30 In the end, the total investment in this project will end up at 178 million million people. pesos, and it will benefit 255,315 inhabitants of the Oaxaca Isthmus.

The benefited organizations were: 1. ORT de México Education in social responsibility 2. Animal Defense Heroes Animal abuse Donations received FGM donation 3. Foundation and Congress Expo from the public 116 Professionalization of SCOs First stage: Doubling $1,306,585 $1,306,585 117 4. La Alegría de los Niños Second stage: Trebling $8,778,982 $26,336,947 Subtotals $10,085,567 $27,643,532 Education for neglected children Total Fundraising Campaign $ 37,729,099 5. Apoyo, Salud y Asistencia GIN Additional FGM investment $140,270,901 Development of Mexican talent TOTAL INVESTMEN $178,000,000 ANNUAL REPORT 2017 ANNUAL REPORT 118 of social content. wealth a with workshops and conferences attendants offering of country. The event was planned and organized under the premise society and organizations strengthening (CSOs) social work in our Congress in order Expo to provide aspace of training for civil We successfully held the fourth edition of the Foundation and FOUNDATION ANDCONGRESSEXPO gram has benefited 2,114 people since it began. and the possibility of entrepreneurship or self-employment, this pro options. offering By training in trades based on employment demand in order to improve the quality of life of people with limited work makeup, professional and colorimetry, barbering, decoration, and care nail hairstyling, offered: have been rey, courses following the Since 2012, in the Styling Workshop provided in at Monter the CAI CAI MONTERREY 4. idealistas Los nave3. La 2. El rey de la fiesta 1. Invisible In 2017, we supported 8projects, approved: out of which CIEFICINE production. their through the One Hundred Percent Fiscal Stimulus and consolidate uate, and choose high-potential cinema projects to benefit them Committed to what is done well in Mexico, we at receive, FGM eval EFICINE 189ASSISTANCE SUPPORT TOINSTITUTIONS - - - and CongressExpo. the 4theditionofFoundation Yordi Rosadoattheclosureof to obtain updates on social issues and form alliances. The event was attended by 152 NGOs, which were able out theircarry work. to knowledge and techniques fundamental attendees Odin Dupeyron discussed various matters that provided their institutions. Marco Antonio Regil, Yordi Rosado, and the attendees practical tools to improve the running of filled the forum with innovativeknowledge and provided ues required to achieve any purpose in life. Our lecturers val discipline and the about awareness create to story professional Mexican golfer, who shared her success Ochoa, Lorena by given was inaugural conference The FOUNDATION - 119 ANNUAL REPORT 2017 FOUNDATION

NETWORK OF BUSINESS ASSOCIATIONS AND SOCIAL LIAISON FOUNDATIONS

After two years, the Network of Business Associations and Founda- FUNDACIÓN GRUPO MÉXICO tions now has 3,000 Organizations and 91 Business Associations VOLUNTEER DAY and Foundations registered. As every year, during the second Saturday of October, Fundación Gru- po México held its FGM Volunteer Day for the fifth consecutive year. In 2017, the Network achieved presence throughout the Republic, The employees of Grupo Mexico’s member companies and Cinemex, as well as in some Latin American countries (Colombia, Venezuela, together with their families, participated as volunteers, channeling Chile, Argentina, and Peru). their selfless work, joining forces, and multiplying the will to benefit those in greatest need in the communities where they operate. The network received the INDESOL award, as part of the Annual Regional Meetings for the Strengthening of Civil Society Organizations. As of 2016, and once again in 2017, given the success and impact of this program, these social activities were extended to communities in Furthermore, we have been acknowledged in the International Peru and the US, through the participation of collaborators from Grupo Congress for Peace Education and Culture organized by SERCAP Mexico’s companies in those countries: Southern Copper Corporation Internacional (a company dedicated to providing training services and ASARCO, respectively. to the public and private sector), in Peru, for the best Innovative and Socially Responsible Project in the Corporate Social Responsibility category.

Volunteer participating 32 On-site Workshops and 12 webinars were carried out, translating in the FGM Volunteer Day. into 192 hours of on-site training and 48 hours of online training, for free.

120 122 tions with Sense program in Peru, whose goal is to In May 2017, we held the first edition of the Vaca VACATIONS WITHSENSE public, states two of the and provinces US, two in Peru. in 32 communities and 14 states of the Mexican Re- thousand95 people and institutions 45 were benefited During the Fundación Grupo México Volunteer Day, over centers. migrantand care institutions, social spaces, public schools, benefited thousand volunteers in Mexico, Peru, and the who US, 29 over families, their totaled with together who, ees We were honored by the presence of 7,200 employ made inPeru. Holidays withmeaning, the 1steditionof program Volunteers participating in - - tian, Wanchaq, Yucay, Cusco, and Huasao. were benefited fivein communities SebasSan in Peru: Thanks to this program, 62 people and 7institutions service. voluntary of hours Our employees in Mexico, Peru, and supplied the US 40 commitment. and solidarity,ty understood as mutual support and countries, as well as to encourage respect of diversi to the social development of communities in various contribute to cooperation international experiencing offer Grupo México collaborators the of opportunty - - Education 2016 VS2017COMPARISON Dr. Vagon, theHealthTrain Management 2016 VS2017COMPARISON Education workshops Management Humanitarian Aid The Health Dr. Vagon, Dr. Vagon, the Health Project Train Train Project Project 45,573 22,925 64,741 Attendees Increase Attendees 2016 2016 2016 2016 13 Medicines Patients States 2016 2016 4 3 45,806 61,212 79,013 2017 2017 2017 2017 States States 15 2017 2017 5 5 2016 -2017 2016 -2017 2016 -2017 2016 -2017 Increase Increase Increase Increase 100% 22% 34% 15% and high school and highschool 15,230 people 11,629 middle students students 2016 2016 No. of beneficiaries of No. beneficiaries of No. 184,928 Asistente a talleres a Asistente 12,796 2016 2016 2016 2016 Workshops offered Workshops 803 Medical Services Medical 59,781 people and high school and highschool 19,846 middle 19,846 middle Kilometers students 2017 2017 266,440 15,443 1,028 2017 2017 2017 2017 2016 -2017 2016 -2017 2016 -2017 2016 -2017 2016 -2017 2016 -2017 Incremento Increase Increase Increase Increase Increase 292% 71% 44% 21% 28% FOUNDATION 123 ANNUAL REPORT 2017 124 Environment Management 2016 VS2017COMPARISON Educational materials Educational materials for healthandlife Reforestations Reforestations Food Day Invitation to World Project Project Project Project 412,159 2016 2016 2016 2016 32 4 9 Trees donated States States States 839,247 2017 2017 2017 2017 32 18 6 2016 -2017 728 children 3,619,725 Increase 4,938 104% 2016 2016 2016 No. of beneficiaries of No. beneficiaries of No. beneficiaries of No. 2,300 children 2016 8,524,762 608 No. of volunteers of No. 20,128 2017 2017 2017 2,702 2017 2016 -2017 2016 -2017 2016 -2017 Increase Increase Increase 308% 136% 215% 2016 -2017 Increase 344% Network ofBusinessAssociationsandFoundations 2016 VS2017COMPARISON Cinemex Awareness andInstitutionalSupport 2016 VS2017COMPARISON Foundation and Foundation and Congress Expo Associations and Associations and Premieres for Premieres for Cineminutos Foundations Network of Network of CAI MTY Project Project Project Project benefit Business Business Social Social Project 2015 2,786 2016 2016 2016 2016 29 1 32 Events held Events 6 Workshops held Workshops Copies listed Copies Carried out Carried States 2017 2017 32 3,445 1 2017 2017 31 2017 2 Benefited organizations Benefited 2016 985 2016 1 2016 2016 32 States 6 2016 1 States States States 1,530 2017 2017 1 2017 2017 2017 32 10 1 2016 -2017 174 Institutions Increase 24 24 13 13 55% 1 Institution 1 4,107,583 2016 200 Institutions Institutions 53,498 2016 2016 2016 Direct Beneficiaries Direct 476 Direct Beneficiaries Direct Direct Beneficiaries Direct Direct beneficiaries Direct Indirect Beneficiaries Indirect 49,250 2016 152 152 24 24 13 13 23,723,351 1 541,806 Institution Institutions Institutions Institutions 2017 354 2017 2017 2017 674 76,500 2017 2015 -2016 2016 -2017 2016 -2017 2015 -2017 2016 -2017 Increase Increase Increase Increase FOUNDATION 478% 913% Increase 42% 77% 55% 125 ANNUAL REPORT 2017 in SanLuisPotosi,Mexico. Educational Greenhouse

05 AWARENESS AWARENESS MILA Pacific Alliance. MILA Jones SustainabilityIndices included intheS&PDow We werechosentobe AWARENESS

ENVIRONMENTAL AND SOCIAL ACTIONS

In the global context there is a growing interest from all sorts of Grupo México S.A.B. de - Efficient use of energy ENERGY AND CLIMATE CHANGE investors in working hand in hand with sustainable companies. C.V. was chosen to be a - Preservation of biodiversity At Grupo México, we know that the fight against climate member of the S&P Dow Thus, Grupo México is pleased to inform that on October 18, Jones Sustainability - Reforestation change is everyone’s responsibility, including the private 2017, Grupo México S.A.B. de C.V. was chosen to be a member Indices MILA Pacific - comprehensive waste management sector and all the industries in it. Moreover, we are well of the S&P Dow Jones Sustainability Indices MILA Pacific Alliance Alliance (DJSI MILA), aware of the possible impacts that it may have on our op- which includes 42 (DJSI MILA) which includes 42 leading companies in sustainability leading companies in These lines of action are carried out within the frame- erations; therefore, we have identified the potential risks among the countries included in the Pacific Alliance (Mexico, sustainability among work of the international and local certifications that our linked to the global temperature change to be able to Chile, Colombia, and Peru). the countries included operating units have in all three countries where we are anticipate any situation that could have adverse effects in the Pacific Alliance. present. In 2017, we held 8 units certified under ISO for the company. The DJSI MILA is part of a family of 8 DJSI indices acknowledged 14001:2004, together with the 29 Clean Industry and worldwide as the benchmark used by investors who consider factors Environmental Quality certificates, resulting from the Faced with the challenges of climate change, at Grupo such as sustainability in their investment decisions. efforts of each of our collaborators, and the transversal México we are working on: application of our environmental practices. • Making a more efficient use of energy. Likewise, for the seventh consecutive year, we have been chosen to be a member of the Sustainable IPC index of the Mexican Stock Exchange (BMV in Spanish), a financial indicator that acknowledges the companies with the highest commitment to social responsibility, environmental performance, and corporate governance. These achievements are a reflection of Grupo Mexico’s actions and commitment to a development that makes sense.

OUR ENVIRONMENTAL COMMITMENT At Grupo México, our mining operations are aligned with the best practices in the sector, in order to ensure that our environmental impact is minimal and to preserve the surroundings where we work. Thus, we operate through the following lines of action, which form our For the seventh 128 environmental management system: consecutive year, we have been chosen to be part ENVIRONMENTAL BALANCE of the Mexican Stock Exchange’s Sustainable Wind Farm in Juchitan, - Rational use of water and natural resources IPC index. Oaxaca, Mexico - Reduction of emissions AWARENESS

• Developing and using clean and renewable energy sources. In the Transportation the Automatic Equipment Start Stop (AESS) has enabled an energy • Promoting activities to capture greenhouse gas emissions (GGE). Division, we have saved efficiency in our engines when they are stopped or idle. Thanks to 17 million liters of this mechanism, we saved 17 million liters of diesel in 2017. This is diesel in 2017. In addition, through its subsidiary México Generadora de Energía particularly relevant if we consider that 99% of the energy supply of (MGE), the Company has two combined cycle plants—“La Caridad the Transportation Division is based on diesel consumption. I and II”—and one wind farm called “El Retiro”. With these facilities, we take advantage of the energy content of natural gas, and use Last, we must note that regarding climate change, Grupo México wind energy to power our operations. With the wind generators of has begun to work together with NGOs to contribute to the fight the wind farm, in 2017 we produced a total of 177 gigawatts-hour against climate change. Such is the case of our second report in (GWh) of energy from fully renewable sources. By replacing traditio- 2017 to the Carbon Disclosure Project, through which we have dou- nal sources of energy with sources that make an efficient use of na- bled efforts to be even more transparent regarding the actions that tural gas and wind energy, in 2017, we managed avoid the emission the Company carries out to measure, verify, and mitigate its carbon

of 559,866 tons of CO2eq, or the equivalent of removing 119,886 footprint, as well as to work towards a green economic development. passenger vehicles from the road for a year.

As part of our strategy for climate change and given the opening of the energy market in Mexico, we are betting on more clean ener- gy generation projects. Grupo Mexico’s goal is not only to produce renewable energy for our own operations, but also to supply the market and contribute to the development of a sustainable energy infrastructure in the country and the world.

We managed to avoid the With regard to fuel efficiency, in the Transportation Division, we strive emission of 559,866 tons to make diesel consumption more efficient in terms of ton-kilometer of CO2eq, the equivalent of of product hauled, as well as to achieve considerable savings in removing 119,886 passenger vehicles from the road for benefit of the operation, enabling us to reduce the amount of emis- a year. 130 sions released into the atmosphere. Thereby, the implementation of 131

Greenhouse at Buenavista del Cobre in Cananea, Sonora. 132 mining operations is from from is operations mining fugitive emissions and dust. and emissions fugitive lation systems, extraction hoods, and filters to increase the capture of venti improvement of and reengineering the and furnaces, converter through the replacement of 5old furnaces for 3new high-efficiency possible becoming is This environment. the into matter particulate of ity of SO ity With the modernization, we will manage to increase the capture capac communities. surrounding the and environment the best practices and technology to absorb more emissions, in benefit of ization of the Copper Smelter in Hayden, Arizona, to implement the million investment,With aUS$229 we have invested in the modern REDUCTION OFEMISSIONSINTOTHEATMOSPHERE CO animal life; on the other, they are natural carbon sinks, capturing contribute to the biological diversity and enrichment of plant and adjacent to our operations. On the one hand, these forest nurseries not are that areas including rehabilitation, and reforestation system regional of eco production to destined is species whose houses Within our operating units, we have 5forest nurseries and green in 2017.trees mining industry in Mexico, achieving the production of 4,966,200 We are the company with the largest tree production capacity in the BIODIVERSITY recovered water consumption 71% water total ofthe 5.7 hectares, which have been conditioned to replicate the habitats totaling enclosures with Spanish), in (UMA Unit Management mental of to our part preserveAs effort biodiversity, we have an Environ 2 from the environment. the from 2 from 95% to 99%, and significantly from to 99%, 95% reduce the emissions of our of . ------Wetlands inIte,Peru. availability of freshwater. of availability habitants of both cities, by ensuring urban sanitation and greater nurseries, after treating it, and thus directly benefit 70,500 in lect municipal wastewater to use them in our operations and tree wastewater treatment plants in Cananea and Luis San Potosi col We know how important water is to the local economies. Our water,recovered freshwater. minimizing of use the of the total water consumed in our mining operations to come from water treatment plants. This program has made it possible for 71% thickeners,ery maintenance of closed circuits, and the use of waste- water, recov recovered water pump to systems of implementation the The efficient use of water and water savings programs are based on parties. other efficiency in its use, boost reutilization, and use water discarded by to preserve it, we have developed projects to keep gaining greater For our mining operations, water is the most important resource; thus, CARE OFWATER Convention. SAR inclusion in the list of internationally relevant wetlands in the RAM with the greatest diversity of water birds, becoming acandidate for work translates into the fact that Ite now has the broadest wetland nance actions under the cleanup program for Ite Bay, in Tacna. This In Peru, we continue out to significant carry investments and mainte- program. ant Wolf and the Wild Turkey, among others, that are of our part import of threatened and endangered species, including the Mexican Gray AWARENESS - - - - - 133 ANNUAL REPORT 2017 134 projects, infrastructure development, and services. opment activities regarding education, health, productive millionWe invested in 2017 US$61 in community devel projects • Productive capital • Seed committees • Community diagnoses• Participative • tools: following the through This model, known as “Casa Grande”, is set in motion development. of engines main the as people places that model development community a implement agement focus on based on joint responsibility. Thus, we of the communities where we operate, fostering aman At Grupo México, we seek to improve the quality of life OUR COMMUNITIES the formationthe productive of abilities. Development of projects that transform lives through life. of ity makes it possible to improve the community’s qual isIt aresult of invitations to social projects, and it proposals. able sustain assessing collaborate who members company Comprised by voluntary community leaders, as well as development. for actions joint We respect the voice of the community, carrying out offered. are development foster to workshops Spaces open to the community where courses and Development16 Centers Community - - - - Grupo México and Cinemex. Fundación through suppliers, and clients, collaborators, motion the “1x3” campaign to encourage donations from collection points throughout the country, and we set in Defense and State Civil Protection. We also activated 20 cue activities, in coordination with the Ministry of National from the Mining Division attended to offer support in res In Mexico City, 24 of our brigade experts in mine rescues Oaxaca through Dr. Vagon, Health “The Train”. we provided medical care to the affected communities in Transportation México, Fundación Divisionand Grupo emotional support. Moreover, in coordination with our as well as community care through psychological and spaces, provisional of development diagnoses, structural demolition,with removal debris, of groceries, of delivery the communities of Juchitan and Ventosa, La Oaxaca, Oaxaca and Mexico in City September 2017. We assisted help the people affected by the earthquakes that struck On the other hand, at Grupo México, we came together to communities. their of wellbeing the will strengthen who leaders proactive and generators productive projects, we foster the creation of development and capital, seed invitations, through developed projects help of 12,868 community and company volunteers. With out 1,283 activities and over 110 active projects with the have designed jointly with our neighbors. In 2017, we carried unteers, this model enables us to develop projects we With the help of our team of experts and community vol - - Oaxaca, Mexico Wind FarminJuchitan, 135 ANNUAL REPORT 2017 AWARENESS

In Peru, our mining operations are located in a distant 4,000 people, we encourage the trade, education, and We invested US$61 million in In addition to the social fare program, the Transporta- area in the south of the country, in a rural setting, where economic diversification of our people. education, health, production tion division supports the mountain communities and projects, and the development we seek to contribute to its development, working closely of infrastructure and services. religious orders of Chihuahua by transporting merchan- with authorities and representative organizations of the Through the construction of the Ilabaya – Cambaya– dise free of charge, so the inhabitants will have access region. Our commitment to the community is shown Camilaca road, we increase connectivity among the to food and several basic products. In 2016, we as- through the following work axes: Education and strength- high-Andean communities. This road infrastructure work sisted the transportation of foodstuffs and groceries ening of abilities, health, nutrition, infrastructure, and is considered the largest investment nationwide, under and other farm products to feed children who live in the support to the agriculture sector. the format of Constructioin Works for Taxes. It was fos- Sierra Tarahumara. tered by the District Municipality of Ilabaya and financed Thus, at Grupo México we contribute to the expansion of by Grupo México. With an investment of over US$39 water supply infrastructure and irrigation modernization million, we foster local trade, road safety, and regional in the provinces where we operate. An example of this tourism to benefit 4 communities in Tacna, Peru. is the work done to improve the irrigation infrastructure of Torata, in the Moquegua region. The works include In the Transportation Division, the Chihuahua-Pacific improvements to the water reservoirs, pipe installation, train (“El Chepe”) is a strategic form of transportation construction of support walls, and other maintenance for the inhabitants of Chihuahua and Sinaloa, and par- works for the water infrastructure. ticularly the mountain municipalities of those states. We Greenhouse at Buenavista have implemented a social fare program in coordination del Cobre in Cananea, Sonora. We also foster development and improve the quality of life with the government of the state of Chihuahua, designed of our communities by building means of communication for the Tarahumara and low-income population, whose that will enable them to gain access to various sources of only form of transportation is that train. During 2017, El wealth and wellbeing. By supporting the mobility of over Chepe’s social fare benefited a total of 35,258 people.

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We treated municipal wastewater to reuse it in our operations, benefiting 70,500 inhabitants. 138 MANAGEMENT BOARD GRUPO MÉXICO CHAIRMAN OF THE BOARD BOARD THE OF CHAIRMAN AND PRESIDENT EXECUTIVE Velasco Mota Larrea Germán VICE-PRESIDENT Xavier García de Quevedo Topete PRESIDENT Velasco Mota Larrea Germán MANAGEMENT TEAM

PATRIMONIAL ADVISOR Pérez Casar Alfredo INDEPENDENT DIRECTOR Carlos Rojas Velasco Mota INDEPENDENT DIRECTOR Sierra Prieto Carlos INDEPENDENT DIRECTOR Bracho Madero Antonio INDEPENDENT DIRECTOR Antonio del Valle Ruiz PATRIMONIAL ADVISOR Oscar González Rocha PATRIMONIAL ADVISOR Morales Castelazo Luis HEAD OF INVESTOR RELATIONS OF INVESTOR HEAD Marlene Finny de la Torre CONTROL AND OFDIRECTOR ADMINISTRATION Neaves Valdés Miguel DIRECTOR OF AUDIT Mendieta Barreto Guillermo SECURITY OF DIRECTOR Rafael Ríos García COUNSEL GENERAL Campos Ibañez Mauricio OFFICER AND ADMINISTRATIVE CHIEF FINANCIAL Xavier García de Quevedo Topete

SECRETARY OF THE BOARD THE OF SECRETARY Muñiz Daniel INDEPENDENT DIRECTOR Vega Sáenz Rolando INDEPENDENT DIRECTOR Martínez López Prudencio INDEPENDENT DIRECTOR Sahagún Ruiz Fernando INDEPENDENT DIRECTOR Gamboa Carrillo Emilio INDEPENDENT DIRECTOR Laporte González X. Claudio MANAGEMENT TEAM CHAIRMAN OF THE BOARD THE OF CHAIRMAN Velasco Mota Larrea Germán MANAGEMENT BOARD MINING DIVISION SOUTHERN COPPERCORPORATION VICE-PRESIDENT EXECUTIVE Quintanilla Muñiz Daniel PRESIDENT EXECUTIVE Oscar González Rocha BOARD THE OF CHAIRMAN Velasco Mota Larrea Germán MINING DIVISION AMERICAS MININGCORPORATION MARKETING DIRECTOR MARKETING Aldo Massa Peschiera COUNSEL GENERAL Jorge Psihas Lazalde DIRECTOR OF RESOURCES HUMAN JáureguiJorge Morales CONTROL AND OFDIRECTOR ADMINISTRATION Oscar González Barrón OFDIRECTOR OPERATIONS ASARCO Manuel Ramos Rada OFDIRECTOR PERU OPERATIONS SOUTHERN Viveros Meza Hugo Jorge MEXICO OFDIRECTOR OPERATIONS MINERA Carreón Chávez Daniel INDEPENDENT DIRECTOR Sacristán Ruiz Carlos PATRIMONIAL ADVISOR Xavier García de Quevedo Topete PATRIMONIAL ADVISOR Os PATRIMONIAL ADVISOR Quintanilla Muñiz Daniel PATRIMONIAL ADVISOR Pérez Casar Alfredo car González Rocha

IT DIRECTOR IT Verde Guzmán René DIRECTOR PROJECT Francisco López Guerra OFDIRECTOR DEVELOPMENT BUSINESS NEW Tobar Sáiz Raquel FINANCE CORPORATE OF CHIEF Navarro Sandoval Rodrigo DIRECTOR PROCUREMENT Villar del Ramírez Jaime OFDIRECTOR ENGINEERING CONSTRUCTION AND Dip Muhech Vidal INDEPENDENT DIRECTOR SECRETARY Psihas Lazalde Jorge Bonilla Palomino Miguel Luis INDEPENDENT DIRECTOR Cifuentes Perezalonso Gilberto INDEPENDENT DIRECTOR Mejorada Sánchez Castillo Enrique INDEPENDENT DIRECTOR Gamboa Carrillo Emilio 139 ANNUAL REPORT 2017 140 MANAGEMENT BOARD MANAGEMENT BOARD PATRIMONIAL ADVISOR Lorenzo Reyes Retana Padilla PATRIMONIAL ADVISOR Hugo Rafael Gómez Díaz PATRIMONIAL ADVISOR Fernando López Guerra PATRIMONIAL ADVISOR ElíasArturo Ayub PATRIMONIAL ADVISOR Alfredo Casar Pérez BOARD THE OF CHAIRMAN G TRANSPORTATION DIVISION GRUPO MÉXICOTRANSPORTES PRESIDENT EXECUTIVE Oscar González Rocha BOARD THE OF CHAIRMAN Velasco Mota Larrea Germán MINING DIVISION ASARCO, LLC.INC. ermán Larrea Mota Velasco Mota Larrea ermán

INDEPENDENT ADVISOR INDEPENDENT ADVISOR NoriegaCarlos Arias PATRIMONIAL ADVISOR Xavier García de Quevedo Topete PATRIMONIAL ADVISOR Seade Slim Roberto SECRETARY Helguera Lippert Cristian INDEPENDENT ADVISOR Esnaola Corredor Jaime INDEPENDENT ADVISOR Armella Gallástegui Joaquín Eduardo SECRETARY Psihas Lazalde Jorge Manuel Ramos Rada Quintanilla Muñiz Daniel Oscar González Barrón Xavier García de Quevedo Topete Alfredo Casar Pérez OPERATIONS DIRECTOR Hugo Rafael Gómez Díaz OFFICER AND ADMINISTRATIVE CHIEF FINANCIAL Fernando López Guerra PRESIDENT EXECUTIVE Alfredo Casar Pérez MANAGEMENT TEAM SECRETARY Javier Gómez Aguilar Octavio J. Ornelas Esquinca Quintanilla Muñiz Daniel Dip Muhech Vidal Julio Francisco Larrea Mena Xavier García de Quevedo Topete Pérez Casar Alfredo BOARD THE OF CHAIRMAN Velasco Mota Larrea Germán INFRASTRUCTURE DIVISION MÉXICO PROYECTOSYDESARROLLOS MANAGEMENT BOARD

DIRECTOR GRUPO MÉXICO ENGINEERING SERVICES MÉXICO GRUPO DIRECTOR Héctor Raúl Avendaño Huerta AUTOPISTAS OFDIRECTOR MÉXICO GRUPO Juan Francisco Bueno Zirion MÉXICO OFDIRECTOR CONSTRUCTORA Julio Francisco Larrea Mena DIRECTOR ENERGY DIVISION Gómez Ortega Gustavo MEXICO OFDIRECTOR PERFORADORA Rogelio Vélez López de la Cerda OFFICER AND ADMINISTRATIVE CHIEF FINANCIAL Octavio J. Ornelas Esquinca PRESIDENT EXECUTIVE Xavier García de Quevedo Topete EXECUTIVE TEAM

141 ANNUAL REPORT 2017 FUNDACIÓN GRUPO MÉXICO

MANAGEMENT BOARD MANAGEMENT TEAM

Germán Larrea Mota Velasco Ximena Ugarte Luiselli CHAIRMAN OF THE BOARD GENERAL DIRECTOR Alfredo Casar Pérez Karla Guadalupe Díaz Castro Luis Castelazo Morales ADMINISTRATIVE MANAGER OF DR. VAGON, THE HEALTH TRAIN Xavier García de Quevedo Topete Arianna Berinece Chacón Muñoz Oscar González Rocha OPERATIONS MANAGER DR. VAGON, THE HEALTH TRAIN Daniel Muñiz Quintanilla Gardenia Lemmen-Meyer Valero SECRETARY SOCIAL LIAISON MANAGER

Jessica Pons Fernández MANAGER OF NETWORK OF ASSOCIATIONS AND NEW PROJECTS

Yazmín Torres Martínez MANAGER OF EDUCATION AND ENVIRONMENT

Lucero Vallejo Durán CINEMEX AWARENESS AND INSTITUTIONAL SUPPORT

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