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Minera Frisco
ANNUAL REPORT 2011

Contents
01 Introduction
02 Overview of MINERA FRISCO
04 Key Financial and Operating Data
06 Letter to Shareholders
08 Units in Operation
22 Projects in Installation and Expansion
36 Projects under feasibility and implementation studies
38 Exploration
40 Sustainability Studies
42 Human Resources
46 Board of Directors
47 Report of the Corporate and Auditing Practices Committee
49 Consolidated Financial Statements
El Coronel / Aerial view

CORPORATE PROFILE. MINERA FRISCO is a company with a deep history
dedicated to the exploration and exploitation of mining lots for the production and
sale of mainly gold doré and silver bars, as well as cathode copper and copper,
lead-silver and zinc concentrates.
The company currently has 3,500 employees and six mining units in Mexico: El Coronel,
San Felipe, María, San Francisco del Oro, Tayahua and Asientos, developing six projects
including new mines and expansions, as well as several exploration projects.
Through alliances and its own resources, the company uses cutting-edge technology
for the localization and processing of minerals and carries out environmental
administration initiatives focused on minimizing the generation of residues and water
consumption, while compensating for adverse environmental impacts.

VISION, MISSION AND PRINCIPLES
Vision:
To be a strong mining company in the global
arena of the extraction of precious and base
metals with processes that have minimal
risks to guarantee the rate of return to
shareholders and favor the development of
sustainable communities.
Mission:
To work in a harmonious way with all
stakeholders, promoting a culture of
innovation and practices of technological
and environmental efficiency that allow
us to grow toward common objectives.
Principles:
• Commitment with shareholders
• Integral human development
• Teamwork
• Environmental, security and hygiene
consciousness
• Quality and ongoing improvement
El Concheño / Open-pit

2011 was a milestone year for Minera Frisco.
The company continued an ambitious investment
plan to increase production at all of its mining
units and increased exploration activities
and metallurgical research with the goal of
expanding reserve and resource bases across all
of its projects.
MINERA FRISCO has a long history that dates back to the
17 th century, when the first mineral deposits were discovered in
San Francisco del Oro. Throughout the years the company has
incorporated different mines to its portfolio and was constituted in
1962 as a 100% Mexican company. Since its founding to the present,
Frisco has maintained its positioning as a solid mining company with
the constant goal of high standards of efficiency, quality and security.
San Felipe / Aerial view
1

Overview of Minera Frisco
2
2
6
12
Breakdown of Sales by Product
45% Gold and silver doré bars
19% Lead-silver concentrates
15% Zinc concentrates
9% Copper concentrates
12% Cathodic copper
History Timeline
Mining begins in
Chihuahua during
the second half of
the 17 th century,
with a mineral
deposit discovery
by Francisco de
Molina.
7
As a result of the
new Mining Law,
foreign and Mexican
companies partner
to create Minera
Frisco, S.A.
5
9
13
16
1
4 11
14
3
8
Minera Lampazos
begins mining silver
ore (closed in 1987).
1658 -1961 1962 1972 1978 1980 1985
10
Minera Cumobabi,
S.A. de C.V. begins
operations, mining
copper ore and
molybdenum (closed
in 1989).
15
Minera María begins
operations in the town
of Cananea in Sonora,
mining copper ore
(closed in 1981).
Empresas Frisco,
S.A. de C.V. is created
and acquired by
Grupo Carso.

Mining Units
Name
Units in Operation
Metals Exploitation Type Process
1 El Coronel Au, Ag Open-Pit Heap Leaching
2 San Felipe Au, Ag Open-Pit Heap Leaching / Dynamic Leaching
3 Asientos Au, Ag, Pb, Zn, Cu Underground Milling and Flotation
4 Tayahua Au, Ag, Pb, Zn, Cu Underground Milling and Flotation
5 San Francisco del Oro Au, Ag, Pb, Zn, Cu Underground Milling and Flotation
6 María Cu Open-Pit Heap Leaching
Expansion Projects
1 El Coronel - Secondary Crusher Crushing circuit, expansion of settling ponds and heap formation
2 San Felipe II Crushing circuit, settling ponds, heap formation and Merrill Crowe plant
4 Tayahua - Primary Copper Access ramp of 5.6 kms, crushing, grinding and flotation plant
Installation Projects
7 El Concheño Au, Ag Open-Pit Dynamic Leaching
8 El Porvenir Au, Ag Open-Pit Heap Leaching
9 San Francisco del Oro Open-pit Au, Ag Open-Pit Flotation and Dynamic Leaching
Projects under Feasibility and Implementation Studies
10 Espejeras Au, Ag Open-Pit Dynamic Leaching
11 Calcosita - Tayahua Cu Open-Pit Heap Leaching
12 Lampazos Au, Pb Open-Pit / Underground Flotation
13 Clarines Au, Ag Open-Pit Flotation and Dynamic Leaching
14 Vetas Negras Au, Ag Open-Pit Dynamic Leaching
15 Santa Fe Au, Ag Open-Pit Bulk Flotation
16 Federicos Au, Ag Open-Pit Heap Leaching
Compañía
San Felipe begins
operations in Baja
California (closed
in 2001).
Minera Tayahua is
acquired (51%),
located in Mazapil,
Zacatecas.
The Unidad de
Manejo para la
Conservación de la
Vida Silvestre (UMA)
(Unity of Conservation
Management
of Wildlife) creates
the “Reserva San
Francisco del Oro”
in Chihuahua.
The second phase
of Minera María
begins operations,
mining copper ore
for the production
of cathodes.
The Asientos unit
in Aguascalientes
and the El Coronel
unit in Zacatecas
begin operations to
produce gold doré
and silver bars.
Beginning in the
second half of 2010
Frisco begins a
program of strong
investment in six
projects that contemplate
expansions
as well as new
plants and facilities.
1994 1998 2001 2004 2008 2010
3

Key Financial and
Operating Data
4
MINERA FRISCO
(Thousand pesos at December 31, 2011*)
2011 2010 Change %
Revenues 8,544,566 7,141,703 19.6%
Operating Income 3,669,712 3,237,612 13.3%
Operating Margin 42.90% 45.30% -2.4
EBITDA 4,309,534 3,657,054 17.8%
EBITDA Margin 50.40% 51.20% -0.8
Controlling participation in Net Income 545,750 1,397,208 -60.9%
Percentage to Sales 6.40% 19.60% -13.2
Total Assets 24,303,232 20,097,799 20.9%
Total Liabilities 12,300,424 18,339,381 -32.9%
Consolidated Stockholder’s Equity 12,002,808 1,758,418 582.6%
CapEx 7,984,478 3,087,281 158.6%
Total Debt 8,350,000 12,616,045 -33.8%
Net Debt 3,488,644 6,276,013 -44.4%
Net Debt/EBITDA (times) 0.8 1.7 -0.9
CapEx/Revenues 93.4% 43.2% 50.2
Shares Outstanding (thousand) 2,545,382 0 NA
Income per Share** 0.22 0 NA
Stock Price at year end*** 50.71 0 NA
* Except outstanding shares and Income per share.
** Controlling Participation in Net Income divided by the compounded average number of oustanding shares.
*** Price at the beginning of its trading on January 6, 2011 was of $30.14 pesos per share.
EBITDA: Earnings before interest, taxes, depreciation and amortization.
NA: Not applicable

7,142
8,545
3,238
3,670
3,657
4,309
3,087
7,984
6,276
10 11 10 11 10 11 10 11 10 11
Revenues
(Million pesos)
Operating
Income
(Million pesos)
EBITDA
(Million pesos)
CapEx
(Million pesos)
3,489
Net Debt
(Million pesos)
5

Letter to shareholders
Global Economic Outlook
The economic outlook since 2000 includes structural problems,
mainly in developed countries, which have not been
resolved and have only been faced with aggressive monetary
and fiscal policies.
With the change in civilizations from industrial to service
societies, as well as rapid technological advances that have
allowed large productivity increases and the ability to produce
goods and services at lower costs, we should be seeing
the generalized creation of value and wealth. However, fiscal
and structural trade deficits, as well as an unsustainable
welfare state and problems with the financial system that do
not appropriately guide change are provoking high levels of
unemployment that are most evident even among the bestprepared
youth.
Despite a global economic situation that is unfavorable for the
exports of developed nations, the monetary policies of these
nations have allowed important capital access and long-term,
low-interest financing for developing nations. It has also permitted
developing countries to focus on domestic economies
and impulse the activities necessary for development with the
formation of human and physical capital, as well as the promotion
of activities that will be intensive job engines in coming
years. Investments in coming years that are equivalent to
25% of GDP would create high sustained economic growth,
as well as sustained job growth, which would allow developing
countries to cross the threshold of per capita income of
$15,000 dollars. This in turn would result in a larger middle
class and bring currently marginalized and poverty-stricken
groups to the benefits of better education and health, leading
to a virtuous cycle of development for our countries.
Even with the negative effects of the global economy, Mexico
and other emerging countries are facing more growth opportunities
than developed nations. Mexico has an adequatelycapitalized
banking system, better public finances, low interest
rates, long-term peso and dollar-indexed financing, and
most importantly, many needs that become investment opportunities
for the private sector, which in turn lead to potential
for development and more employment.
6
Metals Market
In 2011, the precious metals market experienced an important
increase in prices. In the case of gold, the global economic
situation, negative real interest rates and the growing demand
for the physical metal —especially in China— as well as
the growing demand of exchange-traded funds have pushed
prices to maximum historic levels. Gold traded at $1,925 USD/
Oz in September of 2011 and prices for the year were 25%
above 2010 levels. Meanwhile, global production was 2,801
tons, a 5.7% increase from 2010.
In the case of silver, it is being considered an investment in
addition to industrial uses. Global mining production was
24,150 tons in 2011, a similar level to 2010. Throughout the
year, there were large periods of volatility, with prices closing
the year at 60% above 2010.
In the case of base metals, copper has had an important upturn
in recent years. Demand in China for the metal increased
in 2011 to almost 8.0 Mt, which is 40% of global consumption.
Meanwhile, the supply of deposits has been affected in
recent years by labor strikes, climate and decreases in production
laws. Global mining production was 16.30 Mt for 2011.
As for zinc and lead, there has been an increase in global supply
in recent years, creating historically high inventories, with
China as the principal consumer and producer.
MINERA FRISCO
Within this context there is a historic opportunity for the company,
which in addition to having many years of operation,
has a portfolio of important mining lots in Mexico and important
growth potential for its operational units. Thanks to the
experience of the company in executing and installing projects
and taking advantage of specialization in process engineering,
construction and the build-out of structures from affiliated
companies, there are currently six expansion projects as well
as the simultaneous installation of new mines. These projects
are the principal present and near future challenge for the
company. These projects represent an important increase in
the production capacity of over 200% and a CapEx of $7.984
billion pesos for 2011, a figure that will be surpassed in 2012.

Frisco currently has one of the most aggressive expansion programs
in the world for now and the near future, executing
with the highest levels of quality, in record time and cost efficiency,
offering experience and equipment integration that is
fundamental for the execution of future projects.
In the operation of our mining units, we have made an important
effort to continue metallurgical investigation and the
optimization of our processes. This translates into production
cost improvements, efficiency in the recovery of metallurgical
values, processes with better environmental sustainability and
in general better economic viability of the projects.
In terms of exploration, in 2011 we significantly increased
the economic resources, equipment and specialists to increase
our reserve base and mineral resources to support
the operation of current projects, expansion plans and the
viability of projects that are being installed. Additionally,
there are many mining lots from our portfolio that are in
geological study and exploration seeking viability to be exploited
in the future.
In terms of operations, higher year-on-year metals prices in
2011 and increases in produced volumes of mainly copper,
gold and lead caused revenue to increase 20% to $8.545
billion pesos, while EBITDA increased 18% with a slight decrease
of 0.8 percentage points in EBITDA margin, which
was 50.4%.
Total assets were $24.303 billion pesos, while controlling
stockholders’ equity was $12.003 billion pesos. Debt to equity
was 1.0 time, while net debt was 0.8 times 2011 EBITDA.
Debt coverage was 7.1 times.
Given the relevance of the investments in installation projects,
the company considered the guarantee of minimum level of
José Humberto Gutiérrez-Olvera Zubizarreta
Chairman of the Board
profitability to be fundamental and has hedged the price of
metals. As the projects near operation and the new projects
have a lesser weight with respect to the total production base,
the company has significantly decreased its position of hedges
with respect to production.
Among the most important corporate events, at the beginning
of the year the acquisition was completed of 39% of the
shares of Minera Tayahua, raising the participation of Minera
Frisco to 90.2% of equity. At the same time, an Extraordinary
Shareholders’ Meeting was held to decree a capital increase
of 250 million shares at a price of $47.00 pesos per share, of
which 242.6 million shares were subscribed.
Sustainability activities in 2011 included environmental control
operative plans, sustainability of water and energy resources,
management of environmental liabilities, certifications, integral
management systems and the analysis of stakeholders.
Additionally, we increased our labor force by 30%, benefitting
the communities where we operate with job creation.
The labor climate and relation between the company and the
unions remains healthy and cordial.
Minera Frisco has a solid financial position that allows it to
face its current, immediate and future expansion plans that
will convert it into a company with world-class production levels,
as well as the operating experience to achieve these goals
with the highest standards.
On behalf of the Board of Directors and the management
team at Minera Frisco, we thank all of our employees, their
effort, commitment, and our shareholders for their trust.
Minera Frisco will seek to maintain the successful course to
contribute to the development of our country.
Sincerely,
Alejandro Aboumrad González
Chief Executive Officer
7

Operational Units
MINING UNITS
Frisco is the fastest-growing Mexican mining company,
establishing an exceptional portfolio of high-quality assets.
In recent years due to the recovery of metals prices, the
company significantly increased exploration in the lots
that has conserved, such as San Francisco del Oro, María,
Tayahua and San Felipe. Additionally, new units were
put into operation such as Asientos and El Coronel, both
property of Minera Real de Ángeles and which began
activities in 2008.
As of the second half of 2010, the company began
an important investment program in six projects that
contemplates expansions as well as new facilities and plants
to increase capacity of crushing and production.
8
Units in Operation
Installed Capacity Expansion Current + Start-Up of Ore Milled 2011
Name TPD at Dec 31, 2011 Projects Project Operations (t)
El Coronel 35,000 30,000 65,000 2 nd Semester 2012 13,750,130
San Felipe 7,500 15,000 22,500 2 nd Semester 2012 3,354,832
Asientos 4,000 0 4,000 - 1,148,986
Tayahua Pb - Zn 1,500 0 1,500 - 596,277
Tayahua Cu 3,700 20,000 23,700 2013 989,950
San Francisco del Oro 4,000 0 4,000 - 993,909
María 27,000 0 27,000 - 6,046,713
Total 82,700 65,000 147,700 26,880,797
Units in Installation
Name Nominal Installed Start-Up of
Capacity Operations
El Concheño 20,000 2 nd Semester 2012
El Porvenir 10,000 3 rd Quarter 2012
San Francisco del Oro Tajo 10,000 3 rd Quarter 2012
Total 40,000
Annual estimated utilization factor 88%

STRATEGY
Minera Frisco is making a great effort to continue
metallurgical investigation, improvement of processes
and explorations, which allow us:
1. To be more efficient in our operations
2. To increase our reserves
3. To consolidate sustainability activities
4. To improve recoveries
5. To lower costs
Also create solid fundamentals for economic, operational
and environmental viability of the projects in operation
and installation, as well as those in the process of geological
evaluation, exploration or beginning exploitation.
Production of Metal Contents
At December 31, 2011
Name Gold % Silver % Lead % Zinc % Copper %
(Oz) total (Oz) total (t) total (t) total (t) total
El Coronel 197,631 84.1 20,419 0.4 0 0.0 0 0.0 0 0.0
San Felipe 24,478 10.4 392,757 7.4 0 0.0 0 0.0 0 0.0
Asientos 4,442 1.9 1,656,871 31.2 8,953 39.9 37,458 45.6 605 2.8
Tayahua 5,117 2.2 1,837,328 34.6 5,282 23.6 27,097 33.0 8,159 38.1
San Francisco del Oro 3,401 1.4 1,401,938 26.4 8,181 36.5 17,580 21.4 1,176 5.5
María 0 0.0 0 0.0 0 0.0 0 0.0 11,455 53.5
Total 2011 235,069 100 5,309,313 100 22,416 100 82,135 100 21,395 100
Total 2010 199,791 5,496,360 20,744 91,571 16,830
Var% 17.7 -3.4 8.1 -10.3 27.1
9

El Coronel
Aerial view of the mining unit
Crushing circuit including mineral conveyor belts
screening and hopper
10

Aerial view of the pit
The El Coronel mining unit is located in Zacatecas. It is an
open-pit mine that uses heap leaching and recovers the mineral
through carbon absorption, stripping and electrolysis. Then
the ore is sent to the foundry to be processed into doré gold
and silver bars for sale.
11

San Felipe
Panoramic view
Crushing circuit
12

Loading a truck with mineral to be transported to the
crushing process
San Felipe is located in Baja California. It is an open-pit mine
that uses heap leaching. Its milling capacity at the end of the
year was 7,500 tons daily and it produces doré gold and silver
bars for sale.
13

Asientos
Aerial view of the plant
Underground drilling
14

Night view of the milling area
Asientos is located in the state of Aguascalientes. This is an
underground mine that uses a milling and flotation process.
In November of 2011 a new mill, floatation cells and a settling
tank were installed to guarantee an installed milling capacity
of 4,000 daily tons for the production of lead, zinc and copper.
15

Tayahua
Milling and Flotation plant
Rock transportation in the mine
16

Underground drilling in the mine
Tayahua is in Zacatecas and is a polymetallic underground
operation that exploits mainly bodies of primary copper and zinc.
17

San Fco. del Oro
Underground mining
Transportation system by aerial ropeway buckets
18

Milling and classification process
San Francisco del Oro is where Minera Frisco gets its name and
is a polymetal underground mine.
19

María
Crushing circuit
Mineral conveyor belt to the stockpile
Production of cathode copper
20

Minera María is a copper mine. The mineral is extracted and
sent to the crushing area to reduce its size and be stockpiled
or terraced.
21

Installation and expansion projects
MINERA FRISCO has formed a specialized team with an
important execution capacity, which is fundamental for
simultaneously installing six projects of the dimensions
of those currently being built in record time, maintaining
quality, cost and process efficiency. This has resulted in
a CapEx of $7.984 billion pesos in 2011, a figure that is
expected to be surpassed in 2012. Today Frisco is a mining
company with one of the highest levels of investment
in the world and is positioning itself in the near future
as a company with the best capacity to face and execute
these growth rates.
Minera Frisco has one of the most aggressive expansion
programs in the world today and in the near future, executing
with the highest levels of quality, record execution
times and cost efficiencies, generating an experience and
integration of teams that are fundamental for the execution
of the following projects:
22
Mining Units
Name Metals Exploitation Type Process
Installation Projects
7 El Concheño Au, Ag Open-Pit Dynamic Leaching
8 El Porvenir Au, Ag Open-Pit Heap Leaching
9 San Francisco del Oro pen-pit Au, Ag Open-Pit Flotation and Dynamic Leaching
Expansion Projects
1 El Coronel - Secondary Crusher Crushing circuit, expansion of settling ponds and heap formation
2 San Felipe II Crushing circuit, settling ponds, heap formation and Merrill Crowe plant
4 Tayahua - Primary Copper Access ramp of 5.6 kms, crushing, grinding and flotation plant
Numeration corresponding to map on page 2

El Concheño
Crushing area and leaching tanks / Installation
Located in Chihuahua, El Concheño is a new unit for gold and
silver ores, which will be exploited by open-pit and underground
mine, recovering metals through dynamic leaching.
23

El Concheño
General view of the plant / Installation
Foundation of the grinding and hydrocyclone area
24

Foundation of the thickening tanks and leaching area
25

El Porvenir
Formation of beds / Installation
Installation of crushing circuits
26

Screening and crushing area
El Porvenir is a new project located in Aguascalientes that
consists of an open mining pit, using heap leaching. The plant
will use the Merrill Crowe process and the metals will be smelted
in an induction oven to produce doré bars of gold and silver.
27

San Fco. del Oro Tajo
Open-pit / Installation
Crushing area of 10 thousand tons per day
28

Installation of leaching tanks
Within the San Francisco del Oro unit, a new project is being
installed that includes open-pit mine extraction in areas such
as Frisco, Sainas and Clarines.
29

El Coronel-Secondary Crusher
Conveyor belts / Expansion
Explosion to prepare the area for the second
crushing circuit
30

Within the expansion plans of El Coronel, the installation of
a new fixed crushing circuit began at the end of 2011 with an
estimated capacity of 30,000 tons daily. This will increase the
crushing capacity of El Coronel to 65,000 tons daily, almost
doubling the current capacity.
31

San Felipe II
Panoramic view / Expansion
Screening and crushing area
32

Grinding area and conveyor belt to the stock-pile
San Felipe II is an expansion project that contemplates the
installation of a new crushing circuit, stockpiling and Merrill
Crowe plant.
33

Tayahua-Primary Copper
Access tunnel / Expansion
Subterranean extraction equipment
34

Entry to the “Gloria Estela” access ramp
This project contemplates the development of a 5,600 meter
access ramp, a beltway around the ore body and the installation
of an internal crusher with a capacity of 20,000 tons daily.
35

Feasibility studies and
implementation projects
The work plan to assess the viability of mining lots is
centered on ongoing metallurgic research, geological
studies and the evaluation of the environmental and
social impact of projects. Seven exploration projects are
currently being evaluated, in which probable gold and silver
resources have been identified. Geological and geophysical
exploration, as well as diamond tipped and reverse
circulation drilling, are being carried out with copper and
basic sulfur projects. Mineralogical and metallurgical test
are continuously being done.
36
Mining Units
Name Metals Exploitation Type Process
Projects under Feasibility and Implementation Studies
10 Espejeras Au, Ag Open-Pit Dynamic Leaching
11 Calcosita - Tayahua Cu Open-Pit Heap Leaching
12 Lampazos Au, Pb Open-Pit / Underground Flotation
13 Clarines Au, Ag Open-Pit Flotation and Dynamic Leaching
14 Vetas Negras Au, Ag Open-Pit Dynamic Leaching
15 Santa Fe Au, Ag Open-Pit Bulk Flotation
16 Federicos Au, Ag Open-Pit Heap Leaching
Numeration corresponding to map on page 2

Topography Metallurgical tests
Drilling
37

Exploration
During 2011 the exploration budget was six times larger
than the prior year. These resources were assigned to
equipment as well as personnel, increasing the number of
professionals with vast experience in mining and diamond
drilling and inverse circulation equipment.
The current and future exploration programs are focused
on locating gold and silver deposits to increase reserves
that can be mined with open-pit techniques. Geological
and geophysical works, as well as drilling, are currently
being carried out. In the more advanced exploration
projects, surface land is being acquired for modeling of
geological resources.
38

Conducting geological tests
We have significantly increased the economic resources and exploration
equipment, as well as specialists to increase the base
of reserves and mineral resources to support the current operation,
expansion plans and the feasibility of installation projects.
39

Sustainability activities
A fundamental part of the strategy and culture
of Minera Frisco is social responsibility, a commitment
that —beyond business activity— maximizes
the positive impact of its activities and transfers
resources to benefit the communities where it operates.
With this objective, in 2011 the following
activities were carried out:
In the area of hazardous waste management, we
introduced an initiative so that all of our units
have a registered plan with the Environmental
and Natural Resources Ministry, with San Francisco
del Oro receiving the first validation. We also began
the process to identify and quantify environmental
liabilities in all mining units to reduce the
environmental footprint to comply with Mexican
norms and the NIF C-18.
CIDEC, Microm and Sinergia —companies
dedicated to the production of efficient energy
technologies—, diagnosed the lighting needs in
all business units to soon implement eco technologies
and solar and wind power to reduce greenhouse
effects.
As part of the activities aimed at the conservation
of biodiversity, there was a second monitoring
of the Royal Eagle in the Altamira hill in Aguas-
40
calientes, in accordance with the protection and
conservation program that Asientos co-sponsors.
In the El Concheño project, construction of the
native plant nursery has begun according to
the initiatives of the other units that have these
production structures. It should be noted that
Minera Frisco has maintained since 2001 the UMA
wildlife conservation management unit “Reserva
San Francisco Oro,” which includes 150 hectares
of wild flora and fauna. The reserve promotes
ecological consciousness and tourism.
At midyear, the water project of the San Felipe unit
began, including the installation of a desalinization
plant that uses inverse osmosis technology, representing
an environmental benefit as a smaller area
would be impacted and a greater water recovery
would be achieved. At El Coronel, the implementation
has begun of the Environmental and Social
Management System, which takes into account the
ISO 140001, ISO 26000 norms and the best practices
of the International Code for Cyanide Handling.
The objective is to reduce the health and environmental
risks. Four units of the Group: Minera
María, Tayahua, El Coronel and San Francisco del
Oro maintain the Certificado de Industria Limpia
(Certification for clean industry) that is awarded by
the Federal Environmental Protection Agency.

Minera Frisco has maintained since 2001 the UMA wildlife
conservation management unit “Reserva San Francisco del
Oro,” which includes 150 hectares of wild flora and fauna.
41

Human Resources
Due to the expansion projects and the construction of new
units, 963 people were hired in the year, many of them
local, benefitting neighboring communities with jobs.
There were a total of 3,580 people in the operation, of
which 6% were women and 94% men, without including
outside contractors.
Security of employees and neighboring communities is a
priority for Minera Frisco. This is why the company offered
training in industrial security and occupational health, the
environment and operational processes. A total of 123,159
hours of training was provided for union and non-union
collaborators.
The relationship between the company and the national
and local union is healthy and cordial, maintaining
positive and direct communication that permits dialog
and agreements. With respect to the social benefits to
collaborators, the company pays equitable and fair wages,
above those established by the Federal Work Law and
based on performance evaluations.
42

Personnel installing irrigation pipes
Security of employees is a priority for Minera Frisco. This is
why the company offered training in industrial security and occupational
health, the environment and operational processes.
43

44
San Felipe / Equipment
Tayahua / Underground operation
Asientos / Drilling

San Fco. del Oro / Underground operation
El Coronel / Open-pit
El Concheño / Panoramic view
Tayahua / Metallurgical tests
El Concheño / Construction
Tayahua / Aerial view
45

Board of Directors
Board Members
46
Position* Years as Board Member** Type of Board Member*
Carlos Slim Helú COB - Fundación Carlos Slim
COB - Fundación Telmex
COB - Impulsora del Desarrollo y el Empleo en América Latina
COB - Carso Infraestructura y Construcción 1 Patrimonial Related
José Humberto Gutiérrez COB - Minera Frisco
Olvera Zubizarreta CEO - Grupo Carso
COB and CEO - Grupo Condumex 1 Related
Sergio W. Covarrubias Vázquez CEO - Grupo IDESA
CEO - Constructora y Fraccionadora Montebello 1 Independent
Alejandro Gutiérrez Gutiérrez Business Consultant 1 Independent
Guillermo Gutiérrez Saldívar COB - Grupo IDESA
CEO - Equipos Mecánicos 1 Independent
José Kuri Harfush COB - Janel 1 Related
Gerardo Kuri Kaufmann CEO - Inmuebles Carso 1 Related
Juan Rodríguez Torres Business Consultant 1 Independent
José Shedid Mehry Business Consultant 1 Independent
Patrick Slim Domit Vice Chairman - Grupo Carso
COB - América Móvil
Commercial Director of Mass Markets - Teléfonos de México
COB - Sears Operadora México 1 Patrimonial Related
Treasurer
Quintín Humberto
Botas Hernández Comptroller - Grupo Condumex 1
Secretary
Sergio F. Medina Noriega Director of the Legal Department - Teléfonos de México 1
Pro-secretary
Alejandro Archundia Becerra Manager of the Legal Department - Grupo Condumex 1
* Based on information from the Board members.
** The age as board members was considered from 2011, date on which the shares of Minera Frisco, S.A.B. de C.V. were listed on the Mexican Stock Exchange.
COB: Chairman of the Board CEO: Chief Executive Officer

Report of the Corporate and
Auditing Practices Committee
of Minera Frisco, S.A.B. de C.V.
Juan Rodríguez Torres Chairman
Guillermo Gutiérrez Saldivar
José Shedid Mehry
To the Board of Directors:
As the chairman of the Corporate and Auditing Practices Committee of Minera Frisco, S.A.B. de C.V. (the “Committee”), I submit the
following annual report of activities for the 2011 fiscal year.
Corporate Practices, Evaluation and Compensation
The CEO of Minera Frisco, S.A.B. de C.V. (the “Company”) and the executives of the corporate entities controlled by the Company,
satisfactorily complied with the stated goals and with their responsibilities.
The transactions with affiliates submitted to the consideration of the Committee were approved. Among them are the following
significant transactions, each of which represents more than 1% of the consolidated assets of the Company, executed successively:
Cobre de México, S.A. de C.V., for the sale of cathode cable; and Condumex, Inc. for the purchase of machinery, equipment and parts.
All transactions with related parties were reviewed by Galaz, Yamazaki, Ruiz Urquiza, S.C., and a summary of them is contained in a
note of the certified financial statements of Minera Frisco, S.A.B. de C.V. and subsidiaries at December 31, 2011.
The CEO of Minera Frisco, S.A.B. de C.V. receives no remuneration for his activity. The Company does not have employees, and as
to remuneration of the relevant executives of the companies controlled by the Company, we verified that they complied with the
policies approved by the Board of Directors.
The Board of Directors of the Company granted no exemption to any members of the Board, relevant executives or anyone in an
executive position to take advantage of business opportunities, either for himself or for third parties, that correspond to the Company
or to the corporate entities it controls or in which it has a significant influence. The Committee, on its part, granted no exemptions
for the operations referred to in paragraph c), Section III, Article 28 of the Securities Market Law.
Auditing Functions
The internal control and internal auditing system of Minera Frisco, S.A.B. de C.V. and of the corporate entities controlled by it are
satisfactory and comply with the guidelines approved by the Board of Directors, as observed in the information provided to the Committee
by management of the Company and in the external audit certification.
The modifications of accounting policies of the Company were approved to elaborate its financial information based on International
Financial Reporting Standards (IFRS) as of the 2012 fiscal year.
We have no knowledge of any relevant default on the guidelines and operation and accounting registry policies of the Company or
of the corporate entities controlled by it and, consequently, no preventive or corrective measures were implemented.
The performance of the Galaz, Yamazaki, Ruiz Urquiza, S.C. and Camacho, Camacho y Asociados, S.C. accounting firms, the corporate
entities that conducted the audit of the financial statements of Minera Frisco, S.A.B. de C.V. and subsidiaries to December 31, 2011,
and of the external auditor in charge of said audit, was satisfactory and the objectives agreed at the time they were retained were
achieved. In addition, according to the information provided by said firms to the management of the Company, their fees for the
external audit represented a percentage less than 20% of their total revenue.
47

On the other hand, approval was given for Galaz, Yamazaki, Ruiz Urquiza, S.C. to provide to Minera Frisco, S.A.B. de C.V. and to some
of its subsidiaries the following additional services: guidance to fulfill requirements of the Tax Administration System (SAT for initials
in Spanish) for Compañía San Felipe, S.A. de C.V., Construcciones y Servicios Frisco, S.A. de C.V. and Minera Tayahua, S.A. de C.V.; various
services provided to Minera CX, S.A. de C.V. and Minera Cra, S.A. de C.V.; preparation of financial statements, tax statement and
annual report of the Company; revision of operations known as collars and the deferred employee profit sharing of some subsidiaries
of the Company; and revision through the auditing of the initial balances for the IFRS.
Pursuant to the information provided to us by the management of the Company and the meetings we held with the external and
internal auditors without the presence of the Company’s officers, and to the best of our knowledge, there were no relevant comments
from shareholders, members of the Board, relevant executives, employees or, in general, any third party, related to the accounting,
internal control and matters related to the internal or external audit, nor claims by said persons regarding any irregularity in the
management of the Company.
During the period to which this report refers, we verified that the resolutions adopted by shareholders’ meetings and the Board of
Directors of the Company were duly complied with. In addition, according to the information provided to us by the management
of the Company, we verified that it has controls that allow for determining that it complies with provisions applicable to the stock
market and that the legal department conducts a review at least once a year to verify said compliance, and there were no comments
in this respect or any adverse change in the legal situation.
With respect to financial information prepared by the Company and filed with the Bolsa Mexicana de Valores (Mexican Stock
Exchange) and the Comisión Nacional Bancaria y de Valores (National Banking and Securities Commission), we verified that the
information was prepared under the same principles, criteria and accounting practices with which the annual information is prepared.
Finance and Planning Functions
During the 2011 fiscal year, the Company and some of the entities under its control effected significant investments. In this regard, we
verified that the financing was carried out in accordance with the strategic plan of the Company over the medium and long terms. In
addition, we evaluated from time to time that the strategic position of the Company was conformed to said plan. We also reviewed
and evaluated the budget for the 2011 fiscal year together with financial projects that were taken into account for its preparation,
which include the principal investments and financial transactions of the Company, which we consider are viable and congruent with
investment and financing policies and with the strategic vision of the Company.
For the preparation of this report, the Committee for Corporate and Auditing Practices evaluated information provided by the director
general of the Company, the relevant executives of the corporate persons controlled by the Company and by the external auditor.
The Chairman
Juan Rodríguez Torres
48

Independent auditors’ report
To the Board of Directors and Stockholders of Minera Frisco, S.A.B. de C.V.
(formerly mining sector of Grupo Carso, S.A.B. de C.V.)
We have audited the accompanying consolidated balance sheets and statements of changes in stockholders’ equity of Minera Frisco, S. A. B.
de C. V. and Subsidiaries, formerly mining sector of Grupo Carso, S. A. B. de C. V. (the “Company”) as of December 31, 2011 and 2010, and
the related consolidated and combined statements of income and cash flows for the years then ended. These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in Mexico. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and that they are
prepared in accordance with Mexican Financial Reporting Standards. An audit includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also includes assessing the financial reporting standards used and significant
estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
As mentioned in Note 2, on December 31, 2010 Grupo Carso, S. A. B. de C. V. split the mining sector and created a new public Company named
Minera Frisco, S. A. B. de C. V. which is the direct and indirect owner, through its subsidiaries, of the assets of the mining sector of Grupo Carso,
S. A. B. de C. V. and its subsidiaries.
As mentioned in Note 3, beginning January 1, 2011, the Company adopted the following new provisions: Mexican Financial Reporting Standards
(MFRSs/NIFs) C-4, Inventories; C-5, Prepaid Expenses; C-6, Property, Plant and Equipment; C-18, Obligations Associated with the Retirement of
Property, Plant and Equipment; Improvements to Mexican Financial Reporting Standards 2011; Interpretation of Mexican Financial Reporting
Standards 19, Changes Derived from the Adoption of International Financial Reporting Standards.
The combined financial statements include the records and transactions of the mining sector companies as mentioned in Note 2. Such
companies have common shareholders and administration. As such, the Company presents combined statements of income and cash flows for
the year ended December 31, 2010.
In our opinion, such consolidated and combined financial statements present fairly, in all material respects, the financial position of Minera
Frisco, S.A. B de C.V. and subsidiaries as of December 31, 2011 and 2010, and the results of their operations, changes in their stockholders’
equity, and their cash flows for the years then ended, in conformity with Mexican Financial Reporting Standards.
The accompanying consolidated and combined financial statements have been translated into English for the convenience of readers.
Galaz, Yamazaki, Ruiz Urquiza, S. C.
Member of Deloitte Touche Tohmatsu Limited
C. P. C. Walter Fraschetto
March 6, 2012
49

Consolidated balance sheets
Minera Frisco, S.A.B. de C.V. (formerly mining sector of Grupo Carso, S.A.B. de C.V.)
As of December 31, 2011 and 2010 (In thousands of Mexican pesos)
Assets
50
2011 2010
Current assets:
Cash and cash equivalents $ 4,861,356 $ 6,340,031
Derivative financial instruments 726,179 47,097
Accounts receivable – Net 1,645,861 1,377,643
Due from related parties 612,004 266,058
Inventories – Net 1,161,581 1,278,242
Prepaid expenses 150,253 666,313
Total current assets 9,157,234 9,975,384
Property, plant and equipment – Net 12,436,162 5,079,228
Deferred income taxes 751,314 2,572,931
Deferred profit sharing – 370,724
Other assets – Net 1,958,522 2,099,532
Total $ 24,303,232 $ 20,097,799
Liabilities and stockholders’ equity
Current liabilities:
Marketable notes $ 8,350,000 $ –
Derivative financial instruments 410,699 297,398
Accounts payables, taxes and accrued expenses 588,180 524,627
Direct employee benefits 191,825 154,475
Current portion of long term debt due to related parties – 116,715
Due to related parties 170,390 545,913
Income taxes – 523
Total current liabilities 9,711,094 1,639,651
Derivative financial instruments 2,244,207 3,977,221
Employee benefits 17,869 15,210
Provision for environment remediation 215,072 207,969
Deferred profit sharing 112,182 –
Long term debt due to related parties – 12,499,330
Total liabilities 12,300,424 18,339,381
Stockholders´ equity:
Capital stock 74,362 67,274
Additional paid-in capital 11,396,656 –
Retained earnings 2,638,360 6,821,752
Loss of valuation of derivative financial instruments (2,522,480) (6,498,987)
Controlling interest 11,586,898 390,039
Noncontrolling interest in consolidated subsidiaries 415,910 1,368,379
Total stockholders ‘equity 12,002,808 1,758,418
Total $ 24,303,232 $ 20,097,799
See accompanying notes to consolidated and combined financial statements.

Consolidated and combined statements of income
Minera Frisco, S.A.B. de C.V. (formerly mining sector of Grupo Carso, S.A.B. de C.V.)
For the years ended December 31, 2011 and 2010 (In thousands of Mexican pesos)
2011 2010
Consolidated Combined
Net sales $ 8,544,566 $ 7,141,703
Costs and expenses:
Cost of sales 3,936,544 3,147,380
Project exploration expenses and mining concessions rights 425,636 304,856
4,362,180 3,452,236
Gross profit 4,182,386 3,689,467
Operating expenses 512,674 451,855
Income from operations 3,669,712 3,237,612
Other expenses – Net (157,071) (194,157)
Impairment of long-lived assets (37,727) (3,870)
Comprehensive financing cost:
Interest income 44,658 108,706
Interest expense (606,061) (365,977)
Loss of valuation of forwards– Net (2,332,968) (230,773)
Exchange gain (loss) – Net 264,134 (129,299)
(2,630,237) (617,343)
Income before income taxes 844,677 2,422,242
Income taxes 175,647 731,439
Net income $ 669,030 $ 1,690,803
Controlling interest $ 545,750 $ 1,397,208
Noncontrolling interest 123,280 293,595
$ 669,030 $ 1,690,803
Basic earnings per common share $ 0.2229071 $ 0.6067564
Average of shares in transit (‘000) 2,448,330 2,302,750
See accompanying notes to consolidated and combined financial statements.
51

Consolidated statements of changes
in stockholders’ equity
Minera Frisco, S.A.B. de C.V. (formerly mining sector of Grupo Carso, S.A.B. de C.V.)
For the years ended December 31, 2011 and 2010 (In thousands of Mexican pesos)
52
Additional
Capital paid-in
stock capital
Combined balances at the beginning of 2010 $ 3,732,802 $ 251,790
Effect from adoption of NIF C-4 Inventorie – –
Balances at the beginning of 2010, as adjusted 3,732,802 251,790
Additional capital contribution in Minera San Francisco del Oro,
Minera Real de Angeles and Minera Tayahua 2,500,001 196,796
Decrease due to split of Inmuebles Riama (81,041) –
Dividends paid for subsidiary – –
Effect of split (6,084,488) (448,586)
Balances before comprehensive loss 67,274 –
Loss of valuation of derivative financial instrument – –
Net income – –
Comprehensive loss – –
Consolidated balances as of December 31, 2010 67,274 –
Decrease in noncontrolling interest of subsidiaries
due to purchase of share – –
Increase in capital stock 7,088 11,396,656
Dividends paid for subsidiary – –
Balances before comprehensive income 74,362 11,396,656
Income (loss) of valuation of derivative financial instrument – –
Net income – –
Comprehensive income – –
Consolidated balances as of December 31, 2011 $ 74,362 $ 11,396,656
See accompanying notes to consolidated and combined financial statements.

Loss of
valuation of Noncontrolling
derivative interest Total
Retained financial Controlling in consolidated stockholders´
earnings (losses) instruments interest subsidiaries equity
$ (1,056,369) $ (109,200) $ 2,819,023 $ 1,274,832 $ 4,093,855
28,247 – 28,247 352 28,599
(1,028,122) (109,200) 2,847,270 1,275,184 4,122,454
– – 2,696,797 189,079 2,885,876
25,889 – (55,152) – (55,152)
(76,500) – (76,500) (73,500) (150,000)
6,503,277 27,847 (1,950) 2,000 50
5,424,544 (81,353) 5,410,465 1,392,763 6,803,228
– (6,417,634) (6,417,634) (317,979) (6,735,613)
1,397,208 – 1,397,208 293,595 1,690,803
1,397,208 (6,417,634) (5,020,426) (24,384) (5,044,810)
6,821,752 (6,498,987) 390,039 1,368,379 1,758,418
(4,729,142) – (4,729,142) (898,779) (5,627,921)
– – 11,403,744 – 11,403,744
– – – (73,500) (73,500)
2,092,610 (6,498,987) 7,064,641 396,100 7,460,741
– 3,976,507 3,976,507 (103,470) 3,873,037
545,750 – 545,750 123,280 669,030
545,750 3,976,507 4,522,257 19,810 4,542,067
$ 2,638,360 $ (2,522,480) $ 11,586,898 $ 415,910 $ 12,002,808
53

Consolidated and combined
statements of cash flows
Minera Frisco, S.A.B. de C.V. (formerly mining sector of Grupo Carso, S.A.B. de C.V.)
For the years ended December 31, 2011 and 2010 (In thousands of Mexican pesos)
54
2011 2010
Consolidated Combined
Operating activities:
Income before income taxes $ 844,677 $ 2,422,242
Items related to investing activities:
Depreciation and amortization 639,822 419,442
Loss in sale of property, plant and equipment 11,075 5,266
Impairment of property, plant and equipment 37,727 3,870
Interest income (44,658) (108,706)
Adjustment in useful lives of property, plant and equipment (11,847) –
Items related to financing activities:
Interest expense 606,061 365,977
2,082,857 3,108,091
(Increase) decrease in:
Accounts receivable – Net (353,690) (373,291)
Due from related parties (345,946) 60,246
Inventories – Net 93,794 (739,773)
Prepaid expenses 516,060 –
Deferred profit sharing 10,426 48,772
Other assets (170,370) (111,460)
Increase (decrease) in:
Accounts payable, taxes and accrued expenses 63,030 216,227
Employees benefits 40,009 21,812
Provision for environment remediation 7,103 56,407
Due to related parties (375,523) 524,372
Income taxes (111,479) (662,479)
Net cash flows from operating activities 1,456,271 2,148,924
Investing activities:
Purchase of subsidiaries shares (5,627,921) –
Purchase of property, plant and equipment (7,984,478) (3,087,281)
Purchase of mining concessions (22,535) (309,331)
Proceeds from sale of property, plant and equipment 41,858 62,059
Interest received 44,658 108,706
Effect of split – 50
Net cash flows from investing activities (13,548,418) (3,225,797)
Cash to be obtained from financing activities (12,092,147) (1,076,873)
Financing activities:
Increase in capital stock and additional paid-in capital 11,403,744 2,885,876
Interest paid (606,061) (365,977)
Dividends paid (73,500) (150,000)
Derivative financial instruments 4,155,334 (7,703,922)
Marketable notes 8,350,000 –
Net (decrease) increase of loans received from related parties (12,616,045) 9,746,273
Net cash flows from financing activities 10,613,472 4,412,250
Net (decrease) increase in cash and cash equivalents (1,478,675) 3,335,377
Cash and cash equivalents at beginning of the year 6,340,031 3,004,654
Cash and cash equivalents at end of year $ 4,861,356 $ 6,340,031
See accompanying notes to consolidated and combined financial statements.

Notes to consolidated
and combined financial statements
Minera Frisco, S.A.B. de C.V. (formerly mining sector of Grupo Carso, S.A.B. de C.V.)
For the years ended December 31, 2011 and 2010 (In thousands of Mexican pesos)
1. Activity and important events
a. Activity – The subsidiaries of Minera Frisco, S. A. B. de C. V. (“Minera Frisco” or the “Company”) are engaged in the exploration and
exploitation of mining lands for the production and sale of concentrates of lead-silver, zinc, copper, “dore” (gold and silver) and copper
cathodes. Such activity corresponds to the mining industry.
b. Important events
Since 2010, the Company has been in a process of accelerated growth. The Company has increased its exploration activity within the mining
concessions owned by its subsidiaries.
During 2011, the Company invested in the installation of new mining units and in the expansion of mining units that were already placed
into operation. Company´s investment in 2011 was $7,170,119 (accumulated as of December 31, 2011 $9,707,892) and the expected
investment for 2012 and 2013 is $10,000,000.
The projects under construction or expansion are detailed as follows:
1. Minera Real de Angeles, S. A. de C. V. (“Real de Angeles”)
El Coronel unit. This mining unit is located in Zacatecas. It has a trituration capacity of 35,000 tons per day. El Coronel is a surfacing
mining unit. The mineral is extracted through a leaching process in which the crushed mineral is placed in layers and it is irrigated with a
chemical solution. Once the solution runs through the mineral layers it is processed in a plant to produce “dore” bars. Such bars contain
gold and silver.
As part of the unit´s expansion plans, at the end of 2011, the Company began to install a new trituration train which will have a capacity
of 65,000 daily tons approximately. Once placed into service, the new train will double the current trituration capacity of the unit. The
Company estimates the new installed capacity will be placed into service at the end of 2012.
Concheño unit. It is located in Chihuahua. Currently, the Company is building a new mine and plant to produce gold and silver. This unit
will be a new surface mine and will have a trituration capacity of 20,000 daily tons. It will produce “dore” bars with silver and gold
content through a leaching process. Concheño will have a significant contribution to the future production of gold and silver of Minera
Frisco. The Company expects to initiate operation of the unit at the end of 2012.
Asientos unit. It is located in Aguascalientes. Within this unit is the sub-surface mine called “Santa Francisca” with a capacity of 4,000
daily tons. The mineral produced in this unit is lead, zinc and copper which are produced using a flotation process.
Additionally, as part of the Asientos unit, the Company is installing a new project called “El Porvenir” that will have an independent
operation. El Porvenir will be a surface mine and it will have a trituration daily capacity of 10,000 tons. El Porvenir will produce “dore”
bars with silver and gold content through a leaching process. The Company expects to conclude this project at the end of 2012.
San Felipe unit. This surface mining unit is located in Baja California. It has a daily trituration capacity of 7,500 tons. As part of the
expansion plans for this unit, the Company is installing a new trituration train which will increase the total trituration capacity of the
unit to 37,500 daily tons, approximately. This means that the current capacity will increase 5 times. The Company expects to conclude
the new trituration train at the end of 2012.
2. Minera San Francisco del Oro, S. A. de C. V. (“San Francisco del Oro”)
It is a sub-surface mine located in Chihuahua. The mineral extracted in this mine is crushed in a plant with a capacity of 4,000 daily tons.
After such process, the mineral is placed into a flotation process to produce concentrates of lead, zinc and copper.
The Company is installing a new surface mine project that will operate independently to exploit mineral areas such as “Frisco”, “Sainas”
and “Clarines”. After crashed in a train with a capacity above the 10,000 daily tons, the mineral will be processed in a new plant which
is currently being installed. The mineral will be produced through leaching and flotation processes to obtain concentrates of lead, zinc,
copper and “dore” with silver and gold contents. The Company expects to place this unit into service at the end of 2012.
55

56
3. Minera Tayahua, S. A. de C. V. (“Tayahua”)
It is a sub-surface mine located in Zacatecas which produces mainly copper and zinc. The mineral is extracted and crashed in a plant with a
capacity of 5,200 daily tons. The mineral is distributed in a lead-zinc and copper- zinc circuit and later goes to a flotation process to obtain
concentrates of lead, zinc and copper with contents of gold, silver, lead, zinc and copper.
The Company is developing a new project that considers an access ramp with a length of approximately 5,300 meters and the installation of
a new trituration train with a daily capacity of 20,000 tons. The mineral will be crushed and later processed in a new flotation plant with a
capacity of 20,000 daily tons. The Company expects to place into service this unit at the end of 2014.
4. Minera María, S. A. de C. V. (“Maria”)
It is a copper surface mine located in Sonora. It´s capacity is 27,000 daily tons. The crashed mineral is placed in layers to run the leaching
process to obtain copper cathodes. During 2011, Maria contributed with 53.5% of the total copper production of Minera Frisco.
2. Basis of presentation
a. Explanation for translation into English - The accompanying consolidated and combined financial statements have been translated from
Spanish into English for use outside of Mexico. These consolidated financial statements are presented on the basis of Mexican Financial
Reporting Standards (“MFRS”, individually referred to as Normas de Información Financiera or “NIFs”). Certain accounting practices applied
by the Company that conform with MFRS may not conform with accounting principles generally accepted in the country of use.
b. Split from Grupo Carso, S. A. B. de C. V. - As of December 31, 2010, Grupo Carso, S. A. B. de C. V. (“Grupo Carso”), split its mining sector net
assets, resulting in the constitution of Minera Frisco, which is the direct and indirect owner, through its subsidiaries, of the mining concessions
that until that date, were owned by Grupo Carso and its subsidiaries. The main activity of the Company is the exploration and exploitation of
mining lands to produce and sale concentrated lead-silver, zinc and copper, copper cathodes and “dore” (gold and silver) bars.
c. Corporate restructuring - At the beginning of the restructuring process the entities that currently are subsidiaries of Minera Frisco, used to
be subsidiaries of Grupo Condumex, S. A. de C. V. (“Grupo Condumex”) which was a subsidiary of Grupo Carso. The restructuring process is
detailed as follows:
1. As of October 22, 2010, the board of Directors and stockholders approved the split of Maria. In such split process Maria did not ceased
to exist and the entity called Inmuebles Riama, S. A. de C. V. (“Inmuebles Riama”) was created. As a consequence of the split, Maria
transferred to Inmuebles Riama the ownership of a property that does not belong to the economic group led by Minera Frisco.
2. Once approved the split of Maria, on October 22, 2010, the Board of Directors and Stockholders also approved the split of Grupo Condumex,
without ceasing its existence, to create a new entity called Minera CX, S. A. de C. V. (“Minera CX”).
3. As a result of the above split, Grupo Condumex transferred the ownership of its shares to Minera CX as follows:
(i) 51.00% of capital stock of Tayahua
(ii) 68.00% of capital stock of Compañía Internacional Minera. S.A. de C.V. (“Internacional Minera”);
(iii) 99.99% of capital stock of Compañía San Felipe, S.A. de C.V. (“San Felipe”);
(iv) 99.99% of capital stock of San Francisco del Oro
(v) 99.99% of capital stock of Real de Angeles
(vi) 98.00% of capital stock of Construcciones y Servicios Frisco, S.A. de C.V. (“Construcciones y Servicios Frisco”);
(vii) 99.90% of capital stock of Servicios Minera Real de Angeles, S. A. de C. V. (“Servicios Minera Real de Angeles”); and
(viii) 99.99% of capital stock of Maria
4. On October 26, 2010, the Board of Directors and Stockholders of Inmuebles Cantabria, S. A. de C. V. (“Inmuebles Cantabria”) approved the
split of such entity, without ceasing its existence, to create a new entity called Minera CRA, S. A. de C. V. (“Minera CRA”).
5. As a result of the above split, Inmuebles Cantabria transferred to Minera CRA the ownership of its shares of Minera CX.
6. On November 4, 2010 the board of Directors and stockholders of Grupo Carso approved, with the previous accomplishment of certain
conditions, the split of Grupo Carso, without ceasing its existence, to create a new entity called Minera Frisco.
7. As a result of the above split and once the conditions were accomplished, Grupo Carso transferred its shares of Minera CRA and Minera
CX to Minera Frisco. Such shares represent the total capital stock of Minera CRA and Minera CX.

8. The Company is a pure holding with indirect subsidiaries that are controlled by Minera CX. Such subsidiaries are engaged in the exploration
and exploitation of mining lands for the production and sale of concentrates of lead-silver, zinc, copper, “dore” (gold and silver) and copper
cathodes.
9. The Company´s direct and indirect subsidiaries and its respective ownership as of December 31, 2011 and 2010 are:
Ownership percentage
Subsidiary 2011 2010 Activity
Minera CRA, S. A de C.V. 99.99 99.99 Holding.
Minera CX, S.A. de C.V. 99.57 99.57 Holding.
Minera Tayahua, S.A. de C.V. 89.98 50.78 Production and sale of concentrates of
lead – silver, zinc and copper.
Compañía Minera Tayahua, S.A. de C.V. 89.98 50.78 Services.
Compañía San Felipe, S.A. de C .V. 99.57 99.57 Rent of equipment and machinery.
Minera San Francisco del Oro, S.A. de C.V. 99.57 99.57 Production and sale of concentrates of
lead – silver, zinc and copper.
Minera Real de Angeles, S.A. de C.V. 99.57 99.57 Production and sale of concentrates of
lead – silver, zinc and “dore” (gold and silver).
Minera Maria, S.A. de C.V. 99.57 99.57 Production and sale of copper cathodes.
Construcciones y Servicios Frisco, S.A. de C.V. 99.57 99.57 Services.
Compañía Internacional Minera, S.A. de C.V. 67.71 67.71 In exploration stage.
Servicios Minera Real de Angeles, S.A. de C.V. 99.57 99.57 Personnel services.
Compañía Minera San Francisco del Oro, S.A. de C.V. 99.57 – Services.
Empresa Minera de San Francisco del Oro, S.A. de C.V. 99.57 – Services.
d. Monetary unit of the financial statements - The financial statements and notes as of December 31, 2011 and 2010 and for the years then ended
include balances and transactions denominated in Mexican pesos of different purchasing power.
e. Consolidation of financial statements - The consolidated financial statements include the financial statements of Minera Frisco and those of
its subsidiaries where it holds control, as of December 31, 2011 and 2010 and for the years then ended. The Balance Sheet and the Statement
of Changes in Stockholders ‘Equity as of December 31, 2010 include consolidated balances which represent the balances of the Company and
its subsidiaries as an integrated economic entity. As such, during its elaboration the balances and operations between the Company and its
subsidiaries were eliminated. The Income Statement and the Statement of Cash Flows as of December 31, 2010 represent combined balances
which correspond to the addition of the balances of the entities that were part of the mining sector of Grupo Carso. As such, the balances and
transactions between related parties were eliminated.
e. Comprehensive income (loss) - Represents changes in stockholders’ equity during the year, for concepts other than capital contributions,
reductions and distributions, and is comprised of the net income (loss) of the year, plus other comprehensive income (loss) items of the same
period, which are presented directly in stockholders’ equity without affecting the statements of income (loss). Other comprehensive income
(loss) is represented by the loss of valuation of derivative financial instruments net of the respective deferred taxes.
f. Classification of costs and expenses - Costs and expenses presented in the consolidated and combined statements of income were classified
according to their function because this is the practice of the sector to which the Company belongs.
g. Income from operations - Income from operations is the result of subtracting the exploration expenses, mining concessions rights and general
expenses from net sales. While NIF B-3, Statement of Income, does not require inclusion of this line item in the consolidated Statements of
Income, it has been included for a better understanding of the Company’s economic and financial performance.
57

3. Summary of significant accounting policies
The accompanying consolidated financial statements have been prepared in conformity with Mexican Financial Reporting Standards (MFRSs/NIFs),
which require that management make certain estimates and use certain assumptions that affect the amounts reported in the financial statements and
their related disclosures; however, actual results may differ from such estimates. The Company’s management, upon applying professional judgment,
considers that estimates made and assumptions used were adequate under the circumstances. The significant accounting policies of the Company
are as follows:
a. Accounting changes
Beginning January 1, 2011, the Company adopted the following new NIFs and Interpretations to the Financial Reporting Standards (INIFs):
58
NIF C-4, Inventories, eliminates the direct cost and last-in, first-out valuation methods. It establishes that any change in the purchase cost of
inventories based on the lower of cost or market, be made only based on net realizable value. It also requires additional disclosures of inventory
reduction and impairment losses. The effect of the change represented an increase in the value of inventories of $28,599 and a decrease in the
retained earnings for the same amount. Such effect was recorded retroactively.
NIF C-5, Prepaid Expenses, establishes that their basic feature is that they do not transfer to the Company the risks and rewards inherent in the
goods and services to be acquired or received. It also requires that impairment be recognized when such payments lose their ability to generate
such benefits and how they should be presented in the balance sheet, as current or long-term assets. The change represented an increase in the
balance of prepaid expenses for $656,374, a decrease in inventory for $17,722 and a decrease in the property, plant and equipment for $638,652,
as of December 31, 2010.
Improvements to Mexican Financial Reporting Standards 2011. - The main improvements that generate accounting changes are as follows:
NIF B-1, Accounting Changes and Correction of Errors, requires that, if an accounting change is made or an error is corrected, a retroactively
adjusted balance sheet be presented as of the start of the earliest period for which financial information is compared to that of the current
period.
Improvements generating accounting changes in Bulletin C-10, Derivative Financial Instruments and Hedging Transactions (“C-10”)
Hedging with options
Due to their nature, options are used to hedge changes in the cash flows or fair value of a hedged item above or below its specific strike price,
which means that the risk is located on one side, due to upward or downward changes, as applicable. It is clarified that the effective portion
of these hedges, subject to recognition in comprehensive income (loss), is represented only by the intrinsic value of the option, maintaining
the criterion to recognize in current earnings any fluctuation in valuation of the excluded portion of the hedging instrument at the time
effectiveness is measured (time value of money or extrinsic value). Under this criterion, the practice of recording fluctuations in overall
valuation in other comprehensive income (loss) (change with retroactive application) is unjustified.
Forecasted intragroup transactions
There is a limitation to hedging among entities belonging to the same group, since these transactions are eliminated in the consolidation
of their financial statements. Hedge accounting may be applied in the separate financial statements of the entity hedging the risk. As an
exception, in consolidated financial statements, the hedging of a transaction is allowed if it is carried out between related parties with
different functional currencies and if the exchange rate risk has an impact on the consolidated financial statements.
Hedging the fair value of a portfolio portion
Bulletin C-10 states that for fair value hedges (where both the derivative and the hedged item are valued), the effect of valuing the primary
position attributable to the hedged risk should be adjusted to the book value of such position.
It also states that if a portfolio of financial assets or liabilities is partially hedged, the effect of the valuation of the hedged interest rate
risk should be presented in an auxiliary account of the primary position as a separate line item, making the effects of partial hedging more
transparent.
Margin accounts
Improvements require that margin accounts be presented as a line item separate from that of derivative financial instruments in order to not
affect the fair value included in the balance sheet. Previously, margin accounts were presented under derivative financial instruments.

Inability to establish a hedging relationship for a portion of the life of the hedging instrument
A portion of the overall amount of a hedging instrument may be designated in a hedging relationship. However, a hedging relationship may
not be designated only for a portion of the period in which the instrument intended to be used as hedge is in effect.
Improvements not generating accounting changes in Bulletins C-2, Financial Instruments and C-10, Derivative Financial Instruments and
Hedging Transactions
Bulletin C-2, Financial Instruments, eliminates net presentation of effects of derivatives and their hedged items.
Bulletin C-10, Derivative Financial Instruments and Hedging Transactions, explains that when only a portion of a position subject to risk is
hedged, any effects of unhedged risks of the primary position should be recognized in accordance with the valuation method related to such
primary position.
b. Reclassifications - Certain amounts in the financial statements as of and for the year ended December 31, 2010 have been reclassified to conform
to the presentation of the 2011 financial statements.
c. Recognition of the effects of inflation - Since the cumulative inflation for the three fiscal years prior to those ended December 31, 2011 and
2010 was 15.19% and 14.48%, respectively, the economic environment may be considered non-inflationary in both years and, consequently, no
inflationary effects are recognized in the accompanying consolidated financial statements. Inflation rates for the years ended December 31, 2011
and 2010 were 3.82% and 4.40%, respectively.
Beginning on January 1, 2008, the Company discontinued recognition of the effects of inflation in its financial statements. However, non-monetary
assets and liabilities and stockholders’ equity include the restatement effects recognized through December 31, 2007.
d. Cash and cash equivalents - Consist mainly of bank deposits in checking accounts and short-term investments, highly liquid and easily convertible
into cash, maturing within three months as of their acquisition date, which are subject to immaterial value change risks. Cash is stated at nominal
value and cash equivalents are valued at fair value; any fluctuations in value are recognized in comprehensive financing (cost) income of the
period. Cash equivalents are represented mainly by investment funds and money market funds
e. Restricted cash - Represents deposits in bank accounts which availability is restricted in conformity with the terms of some derivative financial
instruments agreements.
f. Investments in securities - According to its intent, from the date of acquisition the Company classifies investments in debt and equity securities in
one of the following categories: (1) trading, when the Company intends to trade debt and equity instruments in the short-term, prior to maturity,
if any, and are stated at fair value. Any value fluctuations are recognized within current earnings. (2) held-to-maturity, when they represent debt
instruments and the Company intends to, and is financially capable of, holding such investments until maturity. These investments are recognized
and maintained at amortized cost; and (3) available-for-sale. These investments include those that are classified neither as trading nor held-tomaturity.
These investments are stated at fair value; any unrealized gains or losses, net of income taxes and statutory employee profit sharing,
are recorded as a component of comprehensive income (loss) within stockholders’ equity, and reclassified to current earnings upon their sale. Fair
value is determined using prices quoted on recognized markets. If such securities are not traded, fair value is determined by applying recognized
technical valuation models.
Investments in securities classified as held-to-maturity and available-for-sale are subject to impairment tests. If there is evidence that the reduction
in fair value is other than temporary, impairment is recognized in current earnings.
g. Derivative financial instruments - The derivative financial instruments with speculation purposes or hedge against metal price fluctuations
purposes are recognized as assets or liabilities in the balance sheet at fair value, regardless of the purpose for which they are held. Fair value is
determined based on recognized market prices and when not traded on a market, it is determined based on valuation techniques accepted in the
financial sector.
Trading in derivative instruments is carried out only with institutions of recognized financial strength and limits for each institution have been
established. The Company’s policy is not to carry out transactions with derivative financial instruments for the purpose of speculation.
When derivatives are entered into to hedge risks, and such derivatives meet all hedging requirements, their designation is documented at the
beginning of the hedging transaction, describing the transaction’s objective, characteristics, accounting treatment and how the effectiveness of
the instrument will be measured.
Changes in the fair value of derivative instruments designated as hedges are recognized as follows: (1) for fair value hedges, changes in both the
derivative instrument and the hedged item are stated at fair value and recognized in current earnings; (2) for cash flow hedges, changes in the
effective portion are temporarily recognized as a component of other comprehensive income (loss) in stockholders’ equity and then reclassified
to current earnings when affected by the hedged item. The ineffective portion of the change in fair value is immediately recognized in current
earnings; (3) for hedges of an investment in a foreign subsidiary, the effective portion is recognized as a component of other comprehensive
income (loss) as part of the cumulative translation adjustment. The ineffective portion of the gain or loss on the hedging instrument is recognized
in current earnings, if it is a derivative financial instrument. Otherwise, it is recognized as a component of other comprehensive income (loss) until
the investment is sold or transferred.
The Company discontinues hedge accounting when the derivative instrument matures, is sold, cancelled or exercised; when the derivative
instrument does not reach a high percentage of effectiveness to compensate for changes in fair value or cash flows of the hedged item, or when
the Company decides to cancel its designation as a hedge.
59

60
For cash flow hedges, upon discontinuing hedge accounting, the amounts recorded in stockholders’ equity as a component of other comprehensive
income (loss) remain there until the time when the effects of the forecasted transaction or firm commitment affect current earnings. If it is not
likely that the firm commitment or forecasted transaction will occur, the gains or losses accumulated in other comprehensive income (loss) are
immediately recognized in current earnings. When the hedge of a forecasted transaction has proven satisfactory, but subsequently the hedge
fails the effectiveness test, the cumulative effects recorded within other comprehensive income (loss) in stockholders’ equity are proportionately
recorded in current earnings, to the extent that the forecasted asset or liability affects current earnings.
While certain derivative financial instruments are contracted for hedging from an economic point of view, they are not designated as hedges
because they do not meet all of the requirements and are instead classified as held-for-trading for accounting purposes. Changes in fair value are
recognized as a component of other comprehensive income (loss).
h. Inventories - Inventories are stated at the lower of cost or realizable value, using the first-in, first-out method.
i. Property, plant and equipment - Are recorded at acquisition cost. Balances from acquisitions made through December 31, 2007 were restated for
the effects of inflation by applying factors derived from the National Consumer Price Index (NCPI) through that date. Depreciation is calculated
using the straight-line method based on the remaining useful lives of the related assets, as follows:
Machinery and equipment
%
4 to 20
Buildings 4 and 10
Computers 33
Vehicles 20
Office furniture and equipment 10
Major maintenance that increases the remaining useful lives are amortized during the remaining useful life of the respective asset. The regular
maintaining expenses are recorded within the results of the period.
Comprehensive financing cost incurred during the period of construction and installation of qualifying property, plant and equipment was capitalized.
j. Impairment of long-lived assets in use - The Company reviews the carrying amounts of long-lived assets in use when an impairment indicator
suggests that such amounts might not be recoverable, considering the greater of the present value of future net cash flows or the net sales price
upon disposal. Impairment is recorded when the carrying amounts exceed the greater of the aforementioned amounts. Impairment indicators
considered for these purposes are, among others, operating losses or negative cash flows in the period if they are combined with a history or
projection of losses, depreciation and amortization charged to results, which in percentage terms in relation to revenues are substantially higher
than that of previous years, obsolescence, reduction in the demand for the products manufactured, competition and other legal and economic
factors. The company recognized impairment in the value of long-lived assets for $37,727 and $3,870 in 2011 and 2010, respectively.
k. Financial risk management policy - The activities carried out by the Company expose it to a number of financial risks, including market risk (which
encompasses foreign exchange, interest rate and price risks – such as investment in share certificates and commodity prices futures), credit risk
and liquidity risks. The Company seeks to minimize the potential negative effects of these risks on its financial performance through an overall risk
management program. The Company uses derivative and non-derivative financial instruments to hedge against some exposures to financial risks
embedded in the balance sheet (recognized assets and liabilities) and off-balance sheet risks (firm commitments and highly probable forecasted
transactions). Both, financial risk management and the use of derivative and non-derivative financial instruments are ruled by Company policies
approved by the Board of Directors and are carried out by the Company’s treasury. The Company identifies, assesses and hedges financial risks in
collaboration with its subsidiaries. The Board of Directors has approved written policies of a general nature with respect to the management of
financial risks, as well as policies and limits associated to other specific risks; guidelines for permissible losses, when the use of certain derivative
financial instruments is approved, or when such instruments can be designated as hedges, or when they do not qualify for hedge accounting, but
rather for trading.
l. Other assets - Intangibles and deferred costs are recognized in the balance sheet when they can be identified, provide future economic benefits
and the Company can control such benefits. Intangibles and deferred costs are systematically amortized based on the best estimate of their useful
life which is determined in accordance to the expectation of future economic benefits. The value of these assets is subject of an annual impairment
evaluation.
Other assets include: i) Investments in mining concessions, which are amortized using the straight-line method on the remaining useful lives which
are determined based on the mine useful life, ii) costs incurred in mountaintop removal and costs incurred in preparation of leaching layers. Such
costs provide future long-term economic benefits and are amortized using the straight-line method over their estimated useful lives. The value of
other assets is subject to impairment tests.
m. Provisions - Provisions are recognized for current obligations that arise from a past event, that will probably result in the use of economic
resources, and that can be reasonably estimated.
n. Direct employee benefits - Direct employee benefits are calculated based on the services rendered by employees, considering their most recent
salaries. The liability is recognized as it accrues. These benefits include mainly statutory employee profit sharing payable, compensated absences,
such as vacation and vacation premiums, and incentives.
o. Employee benefits from termination, retirement and other - Liabilities from seniority premiums, pension plans and severance payments are
recognized as they accrue and are calculated by independent actuaries based on the projected unit credit method using nominal interest rates.

p. Provisions of environment remediation - The Company policy is to develop environment control plans and projects to accomplish with regulations
about remediation of environment at the end of the exploitation of mining concessions.
Costs incurred during the period to remediate the environment are applied against the related provision. Current obligations of such provision
are debited to the period expenses. If such obligations correspond to the retirement of property, plant and equipment are amortized based on the
useful lives of such assets.
During 2010, the Company incurred in remediation costs for $2,094 that were applied against the provision for the remediation of environment.
In 2011 the Company did not incurred in any costs related to remediation.
q. Statutory employee profit sharing (PTU) - PTU is recorded in the results of the year in which it is incurred and presented under other income and
expenses in the accompanying consolidated statements of income. Deferred PTU is derived from temporary differences that result from comparing
the accounting and tax bases of assets and liabilities and is recognized only when it can be reasonably assumed that a liability may be settled or
a benefit is generated, and there is no indication that circumstances will change in such a way that the liabilities will not be paid or benefits will
not be realized.
r. Income taxes - Income tax (“ISR”) and the Business Flat Tax (“IETU”) are recorded in the results of the year they are incurred. To recognize
deferred income taxes, based on its financial projections, the Company determines whether it expects to incur ISR or IETU and, accordingly,
recognizes deferred taxes based on the tax it expects to pay. Deferred taxes are calculated by applying the corresponding tax rate to temporary
differences resulting from comparing the accounting and tax bases of assets and liabilities and including, if any, future benefits from tax loss carry
forwards and certain tax credit. Deferred tax assets are recorded only when there is a high probability of recovery.
s. Foreign currency transactions - Foreign currency transactions are recorded at the applicable exchange rate in effect at the transaction date.
Monetary assets and liabilities denominated in foreign currency are translated into Mexican pesos at the applicable exchange rate in effect at
the balance sheet date. Exchange fluctuations are recorded as a component of net comprehensive financing cost (income) in the consolidated
statements of income (loss).
t. Revenue recognition - Revenues for sales of concentrates of lead, silver, zinc, copper, molybdenum and cathodes of copper are recognized in the
period in which the risks and rewards of ownership of the inventories are transferred to customers, which generally coincides when the inventories
are delivered or shipped to customers and the customer assumes responsibility for them.
u. Projects exploration expenses - Such expenses are recognized in the results of the period in which they are incurred.
v. Earnings per share - Basic earnings per common share are calculated by dividing consolidated net income of controlling interest by the weighted
average number of common shares outstanding during the year.
4. Cash and cash equivalents
2011 2010
Cash and bank deposits $ 17,503 $ 1,730,770
Cash equivalents 2,716,680 1,597,652
Investments in Grupo Condumex, S.A. de C.V., related party – 56,738
Restricted cash 2,127,173 2,954,871
$ 4,861,356 $ 6,340,031
5. Accounts receivable
2011 2010
Trade $ 747,294 $ 687,049
Recoverable taxes, mainly Value-added Tax 799,885 660,018
Sundry debtors 98,682 30,576
$ 1,645,861 $ 1,377,643
6. Inventories
2011 2010
Materials, supplies and spare parts $ 1,076,812 $ 796,680
Concentrates and “dore” 102,307 25,502
1,179,119 822,182
Allowance for slow movement inventory (17,538) (17,330)
1,161,581 804,852
Inventory in transit – 473,390
$ 1,161,581 $ 1,278,242
61

7. Property, plant and equipment
62
Balances as of
December 31, 2010 Additions Reclassifications
Investment:
Land $ 139,122 $ – $ –
Buildings 1,714,304 – –
Machinery and equipment 6,086,793 – –
Office furniture and equipment 29,758 – –
Vehicles 96,494 – –
Computers 39,229 – –
Spare parts – – 22,868
Projects in process 1,899,124 7,984,478 (180,248)
Site restoration 175,921 – –
Total investment 10,180,745 7,984,478 (157,380)
Depreciation:
Buildings (1,105,984) (63,145) –
Machinery and equipment (3,853,047) (306,199) –
Office furniture and equipment (22,123) (2,221) –
Vehicles (52,673) (10,652) –
Computers (31,278) (1,252) –
Site restoration (36,412) (7,881) –
Total accumulated depreciation (5,101,517) (391,350) –
Net investment $ 5,079,228 $ 7,593,128 $ (157,380)
Balances as of
January 1, 2010 Additions Reclassifications
Investment:
Land $ 126,295 $ $
Buildings 1,663,593 – –
Machinery and equipment 5,521,736 – –
Office furniture and equipment 27,632 – –
Vehicles 75,983 – –
Computers 35,893 – –
Spare parts 406,727 2,971,967 (638,652)
Projects in process 60,607 115,314 –
Site restoration 7,918,466 3,087,281 (638,652)
Total investment
Depreciation:
Buildings (1,068,217) (37,376) –
Machinery and equipment (3,718,089) (249,409) –
Office furniture and equipment (21,432) (706) –
Vehicles (46,931) (7,291) –
Computers (27,695) (3,118) –
Site restoration (28,531) (7,881) –
Total accumulated depreciation (4,910,895) (305,781) –
Net investment $ 3,007,571 $ 2,781,500 $ (638,652)

Effect of
adjustment in Balances as of
Transfers Disposals Impairment effect useful-lives December 31, 2011
$ 2,647 $ $ – $ – $ 141,769
162,818 – – – 1,877,122
1,554,238 (61,659) – – 7,579,372
2,767 – – – 32,525
35,299 (1,979) – – 129,814
4,009 (24) – – 43,214
– – – – 22,868
(1,761,778) – – – 7,941,576
– (6,923) – – 168,998
– (70,585) – – 17,937,258
– – (861) 3,014 (1,166,976)
– 16,994 (36,828) 12,075 (4,167,005)
– – – 1,264 (23,080)
– 634 (38) (2,517) (65,246)
– 24 – (1,990) (34,496)
– – – – (44,293)
– 17,652 (37,727) 11,846 (5,501,096)
$ – $ (52,933) $ (37,727) $ 11,846 $ 12,436,162
Effect of
adjustment in Balances as of
Transfers Disposals Impairment effect useful-lives December 31, 2010
$ 29,145 $ (16,318) $ $ $ 139,122
91,236 (40,525) – – 1,714,304
690,567 (125,510) – – 6,086,793
2,142 (16) – – 29,758
24,492 (3,981) – – 96,494
3,336 – – – 39,229
(840,918) – – – 1,899,124
– – – – 175,921
– (186,350) – – 10,180,745
– 1,515 (1,906) – (1,105,984)
– 115,937 (1,486) – (3,853,047)
– 15 – – (22,123)
– 1,560 (11) – (52,673)
– – (465) – (31,278)
– – – – (36,412)
– 119,027 (3,868) – (5,101,517)
$ $ (67,323) $ (3,868) $ $ 5,079,228
63

8. Other assets
64
2011 2010
Derivative financial instruments $ 1,262,931 $ 1,528,622
Mining concession, Net 331,866 309,331
Deferred costs, Net 363,725 261,579
$ 1,958,522 $ 2,099,532
9. Derivative financial instruments
The objectives of entered into derivative financial instruments agreements are: (i) To reduce exposure to the risk metal prices fluctuations or (ii)
expectation of a good economic performance due to the behavior of the underlying asset. The decision of enter into a financial instrument agreement
depends on the market conditions, the expectation of such financial instrument to a given date and the international and national economic context
of the economic indicators that have influence in the Company´s activities. Company´s operations with derivative financial instruments are held
mainly with hedging purposes.
As of December 31, 2011 the Company has the following derivative financial instruments operations
Notional
Fair value as of December 31,
2011
Amount Maturity Asset Comprehensive
(Income)
loss in
Instrument Type (´000) Unit date (liability) (income) loss liquidation
Forward dollar Negotiation Purchase 60,000 Dollars During 2011 $ – $ – $ 5,409
Forward dollar Negotiation Sale 2,191,000 Dollars During 2011 – – 1,060,808
Forward dollar
Total as of
Negotiation Sale 1,315,500 Dollars February 2012 (221,570) 221,570 –
December 31, 2011 $ (221,570) $ 221,570 $ 1,066,217
Open and closed operations with forwards and swaps of metal prices with hedging purposes, as of December 31, 2011 are:
Valuation at December 31,
(Income)
loss in
Notional 2011
Comprehensive
liquidation
Asset (income)
Instrument Amount Unit Maturity date (Liability) loss Sales
Silver forwards (1) 10,840 Thousands of ounces July and December 2013 $ 146,468 $ 519,547 $ –
Silver collars (put) (call) 56,080 Thousands of ounces January 2012 to
December 2013 1,374,398 (859,389) –
Silver forwards 21,520 Thousands of ounces During 2011 – – 424,023
Gold forwards and swaps (1) 652 Thousands of ounces January 2012 to
December 2013 (1,327,220) 2,952,835 –
Gold collars (put) (call) 756 Thousands of ounces January 2011 to
December 2014 (606,100) 424,271 –
Gold forwards and swaps 299 Thousands of ounces During 2011 – – 1,062,911
Copper forwards and swaps 49,306 Tons During 2011 – – 251,850
Copper forwards and swaps Tons Anticipated maturity (14,387) – –
Lead swaps 57,700 Tons During 2011 – – 29,019
Lead forwards and swaps Tons Anticipated maturity (38,398) – –
Zinc swaps 180,100 Tons During 2011 – – (27,227)
Zinc swaps 81,504 Tons Anticipated maturity 21,013 – –
Total as of December 31, 2011 $ (444,226) $ 3,037,264 $ 1,740,576
(1) Rolling Hedge Strategy
As of December 31, 2011, the fair value of the silver forwards for $(400,330) is presented, within the Balance Sheet, net of the cash and cash
equivalents balance, due to there were margin calls to guarantee the instruments.
As of December 31, 2011, the fair value of the gold forwards and swaps for $(1,458,843) is presented, within the Balance Sheet, net of the cash and
cash equivalents balance, due to there were margin calls to guarantee the instruments.
As of December 31, 2011, there were anticipated liquidations resulting in an ineffectiveness effect which generated a loss of $2,332,968 presented
in the comprehensive financing cost.

Open and closed operations with forwards and swaps of metal prices with hedging purposes, as of December 31, 2010 are:
(Income)
Valuation at December 31, loss in
Notional 2010 liquidation
Comprehensive
Asset (income)
Instrument Amount Unit Maturity date (Liability) loss Sales
Silver forwards 24,841 Thousands of ounces January 2011 to
December 2013 $ – $ 2,515,185 $ –
Silver collars (put) 45,280 Thousands of ounces April 2011 to
December 2013 1,026,619 (647,397) –
Silver collars (call) 45,280 Thousands of ounces April 2011 to
December 2013 (1,852,424) 1,163,306 –
Silver forwards (1) 4,705 Thousands of ounces During 2010 – 334,550 214,286
Gold forwards and swaps 915 Thousands of ounces January 2011 to
December 2013 (1,004,386) 2,015,355 –
Gold collars (put) 480 Thousands of ounces January 2011 to
December 2013 538,329 (381,067) –
Gold collars (call) 480 Thousands of ounces January 2011 to
December 2013 (710,514) 502,648 –
Gold forwards and swaps (1) 144 Thousands of ounces During 2010 – 598,027 243,123
Copper forwards and swaps (1) 41,815 Tons January 2011 to
December 2012 (558,976) 692,335 –
Copper forwards and swaps 16,424 Tons During 2010 – – 92,888
Lead swaps 38,262 Tons January 2011 to
December 2012 (100,236) 63,500 –
Lead swaps 19,520 Tons During 2010 – – (38,984)
Zinc swaps 136,448 Tons January 2011 to
December 2012 (37,312) 53,859 –
Zinc swaps 81,504 Tons During 2010 – – (67,326)
Total as of December, 31 2010 $ (2,698,900) $ 6,910,301 $ 443,987
(1) Rolling Hedge Strategy
As of December 31, 2010 the fair value of the silver forwards for $(3,836,953) is presented, within the Balance Sheet, net of the cash and cash
equivalents balance, due to there were margin calls to guarantee the instruments.
As of December 31, 2010 the fair value of the gold and copper forwards and swaps for $(1,863,136) and $(588,984), respectively is presented, within
the Balance Sheet, net of the cash and cash equivalents balance, due to there were margin calls to guarantee the instruments.
As of December 31, 2010, the evaluation of collars transactions do not resulted in ineffectiveness. In the rest of the transactions the ineffectiveness
effect was a loss of $185,703 presented within the comprehensive financing cost.
Open and closed operations with forwards of metal prices available for sale, as of December 31, 2010 are:
Valuation at
(Income)
loss in
December 31, 2010 liquidation
Comprehensive Comprehensive
Assets financing financing
(Liabilities) cost cost
Gold forwards 23 Thousands of ounces During 2010 $ – $ $ 51,327
Copper forwards 3,742 Tons During 2010 – – (6,257)
Total as of December 31, 2010 $ – $ – $ 45,070
65

10. Employee benefits
a. The company has plans to make payments for retirement and dead or disability to the employees not enrolled in the union. This plan also provides
seniority premium benefits to all employees, which consist of a lump sum payment of 12 days’ wage for each year worked, calculated using the
most recent salary, not to exceed twice the minimum wage established by law. The related liability and annual cost of such benefits are calculated
by an independent actuary on the basis of formulas defined in the plans using the projected unit credit method.
b. Present value of these obligations are:
2011 2010
Defined benefit obligation (unfunded) $ (19,153) $ (16,701)
Actuarial gains and losses 1,284 1,491
Net projected liability $ (17,869) $ (15,210)
c. Nominal rates used in actuarial calculations are as follows:
2011 2010
% %
Discount of the projected benefit obligation at present value 7.00 7.00
Salary increase to employees not enrolled in the union 5.57 5.57
Salary increase to employees enrolled in the union 5.05 5.05
d. Net cost for the period includes the following items:
2011 2010
Service cost $ 2,982 $ 3,378
Financing cost 1,077 1,461
Amortization of transition liability 39 2,070
Prior service costs 449 1,359
Net actuarial gains
Effect of anticipated reduction of obligations
(1,286) (7,340)
other than a restructuring or discontinued operation) – (443)
Net cost for the period $ 3,261 $ 485
e. Under Mexican legislation, the Company must make payments equivalent to 2% of its workers’ daily integrated salary (ceiling) to a defined
contribution plan that is part of the retirement savings system. The expense in 2011 was $10,293 and $6,663 in 2010.
11. Provision for environment remediation
Beginning
2011
Provision Ending
balance Additions used Reversals balance
Provision $ 207,969 $ 24,604 $ – $ (17,501) $ 215,072
Beginning
2010
Provision Ending
balance Additions used Reversals balance
Provision $ 151,562 $ 60,013 $ (2,094) $ (1,512) $ 207,969
The Company policy is to develop environment control plans and projects to accomplish with regulations about remediation of environment at the
end of the exploitation of mining concessions.
12. Stockholders´ equity
a. Common stock at par value (historical pesos) as of December 31, is as follows:
Number of shares Amount
2011 2010 2011 2010
Fixed capital
Series A 2,545,382 2,302,750 $ 74,362 $ 67,274
Common stock consists of nominative shares Series A -1 with no-par value.
66

. As mentioned in Note 2, as of December 31, 2010 Grupo Carso split and Minera Frisco was created. The following equity was transferred as result
of such split:
Concept Amount
Capital stock $ 67,274
Retained earnings 6,821,752
Loss of valuation of derivative financial instruments (6,498,987)
Controlling interest $ 390,039
c. Pursuant to a resolution of the general extraordinary stockholders’ meeting on April 29, 2011, fixed common stock was increased by $7,304
through the emission of 250 million of series A-1 shares of which 242,632,864 shares were subscribed and paid with a price of $47 pesos each
share. The amount of $0.0292145041 pesos for each share which represents a total of $7,088 was recorded as capital stock and the remaining
$11,396,656, was recorded as additional paid-in capital.
d. Pursuant to a resolution of the general ordinary stockholders’ meeting on April 29, 2011, the Company acquired 39.2% of the shares of Tayahua
on May 27, 2011. As such, the Company increased its controlling interest in $5,627,921 which represents the 89.98% of the equity of Tayahua.
e. Pursuant to a resolution of the general ordinary stockholders’ meeting of Tayahua on April 6, 2011, payment of dividends in cash, for $150,000
was approved against the Net Tax Income Account (CUFIN), equivalent to $290.5918 pesos per share. The dividend portion that corresponds to
the noncontrolling interest is $73,500.
f. Controlling interest of equity as of January 1, 2010 corresponds to the addition of the equity of all the indirect subsidiaries of the mining sector
of Grupo Carso at such date.
g. As of December 31, 2010, Maria split without ceasing its existence and a new entity called Inmuebles Riama was created. Maria transferred part
of its assets and equity and as a consequence the variable part of the capital stock decreased in $43,004 at nominal value ($81,041 with inflation
effect). No shares were canceled in this transaction.
h. Pursuant to a resolution of the general ordinary stockholders’ meeting on December 27, 2010, variable common stock of San Francisco del Oro
was increased by $500,000 through the emission of 46,969,838 Series “A” shares and 1,957,075 Series “B” shares. All of them are ordinary shares
without par value and paid with a subscription price of $10.219325 each share.
i. Pursuant to a resolution of the general ordinary stockholders’ meeting on December 27, 2010, variable common stock of Real de Angeles was
increased by $2,000,000 through the emission of 40,105,659 Series “A” shares and 38,532,889 Series “B” shares. All of them are ordinary shares
without par value and paid with a subscription price of $25.4328196 each share.
j. Pursuant to a resolution of the general ordinary stockholders’ meeting of Tayahua on June 4, 2010, payment of dividends in cash, for $150,000
was approved against the Net Tax Income Account (CUFIN), equivalent to $290.5918 pesos per share. Additionally, variable common stock was
increased by $1 through the emission of 1000 shares. All of them are ordinary shares without par value and paid with a subscription price of $1
peso each share. Additionally, a subscription premium for 30 million dollars was paid to Grupo Condumex which represents $385,875 Mexican
pesos.
k. Retained earnings include the statutory legal reserve. The General Corporate Law requires that at least 5% of net income of the year be transferred
to the legal reserve until the reserve equals 20% of capital stock at par value (historical pesos). The legal reserve may be capitalized but may not
be distributed unless the entity is dissolved. The legal reserve must be replenished if it is reduced for any reason.
l. Stockholders’ equity, except for restated paid-in capital and tax retained earnings will be subject to ISR payable by the Company at the rate in
effect upon distribution. Any tax paid on such distribution may be credited against annual and estimated ISR of the year in which the tax on
dividends is paid and the following two fiscal years.
m. The balances of the stockholders’ equity tax accounts as of December 31; 2011, are:
Contributed capital account $ 11,851,600
Net tax income account (CUFIN) 347,584
Total $ 12,199,184
13. Foreign currency balances and transactions
a. As of December 31, the foreign currency monetary position is as follows:
2011 2010
Thousands of U. S. dollars:
Monetary assets 307,697 499,536
Current monetary liabilities (30,223) (76,142)
Noncurrent monetary liabilities – (366,857)
Net monetary asset position 277,474 56,537
Equivalent in Mexican pesos $ 3,878,725 $ 698,633
67

. Transactions denominated in foreign currency were as follows:
68
(Thousands of U. S. dollars)
2011 2010
Export sales 116,462 182,434
Domestic sales 572,477 382,335
Import purchases 249,800 105,060
Loss in financial instruments 214,200 563
Other expenses – 689
Net financing expenses 467 3,630
Concentrates, copper cathodes and “dore” produced by the Company are sold in U. S. dollars based on metal prices in international markets.
c. Mexican peso exchange rates in effect at the dates of the consolidated balance sheets and at the date of issuance of these financial statements
were as follows:
December 31, March 6,
2011 2010 2012
U. S. dollar 13.9787 $ 12.3571 $ 12.7723
14. Transactions and balances with related parties
a. Transactions with related parties, carried out in the ordinary course of business were as follows:
2011 2010
Income:
Sales $ 1,258,133 $ 846,575
Services
Expenses:
11,582 10,017
Operating services (1) 1,418,409 157,876
Exploration services 136,703 94,297
Administrative services 128,616 177,813
Insurance 89,635 54,358
Other income – Net 21,590 4,044
Interest expense – Net 360,937 349,440
Purchases for investment projects (2) 4,027,815 1,619,846
(1) Correspond, mainly, to the rent of machinery, spare parts, tools, equipment and shipping expenses.
(2) Correspond, mainly, to machinery and equipment, spare parts, commissions and shipping expenses.
b. Balances with related parties are as follows:
2011 2010
Due from related parties:
Cobre de México, S.A. de C.V. $ 513,095 $ 193,636
Condumex, Inc. 94,789 –
Servicios Condumex, S.A. de C.V. 3,140 72,332
Other 980 90
$ 612,004 $ 266,058
Due to related parties:
Grupo Condumex, S.A. de C.V. $ – $ 112,097
Logtec, S.A. de C.V. 16,046 2,198
Conductores Mexicanos Eléctricos y de Telecomunicaciones, S.A. de C.V. 4,208 2,056
Sinergia Soluciones Integrales para la Construcción, S.A. de C.V. 91,758 17,025
Carso Infraestructura y Construcción, S.A.B. de C.V. 2,544 –
Condumex, Inc. – 401,090
Selmec Equipos Industriales, S.A. de C.V. 2,294 5,850
Operadora Cicsa, S.A. de C.V. 48,138 2,967
Microm, S.A. de C.V. 3,056 1,543
Other 2,346 1,087
$ 170,390 $ 545,913
Debt:
Grupo Condumex, S.A. de C.V. (3) $ – $ 12,616,045
Less – current portion – (116,715)
$ – $ 12,499,330
(3) As of December 31, 2010, the Company has short term revolving credits for $116,715 and long term credits for $11,943,260 and 45 million U. S. dollars which
represent $556,070 Mexican pesos with an annual interest rate of 7%, 7.14% and 3%, respectively.

15. Marketable notes
As of December 31, 2011, the Company issued marketable notes that were approved by the National Banking and Securities Commission (“CNBV”)
on May, 31, 2011. Such issuance has the following characteristics:
Amount: $ 8,350,000
Total approved amount: $ 10,000,000
Issuance date: December 15, 2011
Maturity date: January 26, 2012
Interest rate: 4.65%
Discount interest: 4.62491057%
Authorization´s validity date: May 30, 2013
16. Other expenses
a. Detail is as follows:
2011 2010
PTU $ 186,465 $ 187,289
Maintenance of mines and not-in use equipment 1,777 7,751
Sales of scrap and other materials (23,513) –
Federal taxes actualization by inflation (9,993) –
Other expenses (income), net 2,335 (883)
$ 157,071 $ 194,157
b. PTU is as follows:
2011 2010
Current $ 172,039 $ 138,833
Deferred 14,426 48,456
$ 186,465 $ 187,289
c. The main items that give rise to a deferred PTU asset (liability) are:
2011 2010
Deferred PTU (liability) asset:
Inventory – Net $ 840 $ 688
Property, plant and equipment – Net (6,426) (9,911)
Deferred expenses – Net (8,445) –
Loss (income) of derivative financial instruments (91,415) 373,800
Environment remediation and site restoration 5,950 4,962
Unrealized exchange fluctuation (13,934) –
Other, net 1,248 1,185
$ (112,182) $ 370,724
17. Income taxes
The Company is subject to ISR and IETU.
The ISR rate is 30% for 2010 to 2012; it will be 29% for 2013, and 28% for 2014.
IETU - Revenues, as well as deductions and certain tax credits, are determined based on cash flows of each fiscal year. Beginning in 2010, the IETU
rate is 17.5%. The Asset Tax (IMPAC) Law was repealed upon enactment of the IETU Law; however, under certain circumstances, IMPAC paid in the
ten years prior to the year in which ISR is paid for the first time, may be recovered, according to the terms of the law.
Income tax incurred will be the higher of ISR and IETU.
Based on its financial projections and according to INIF 8, Effects of the Business Flat Tax, the Company determined that it will basically pay ISR.
Therefore, it only recognizes deferred ISR.
a. Income tax is as follows:
2011 2010
Current $ 198,385 $ 191,593
Deferred (22,738) 539,846
$ 175,647 $ 731,439
69

. The reconciliation between the effective and legal tax rates is as follows:
70
2011 2010
% %
Legal tax rate: 30 30
Plus (less) effect of permanent items:
Inflation effect (6) (1)
Nondeductible items effect (1) –
Other item (2) 1
Effective tax rate 21 30
c. The main items that give rise to a deferred ISR asset (liability) are:
2011 2010
Deferred ISR asset (liability):
Effect of tax loss carry forwards $ 774,260 $ 366,893
Inventories (555) 1,383
Property, plant and equipment - Net (754,666) (539,432)
Deferred costs – Net (13,880) –
Loss of derivative financial instruments 669,736 2,673,484
PTU 51,508 42,231
Environment remediation 26,607 20,578
Other (1,696) 7,794
Recoverable IMPAC 12,477 12,188
Valuation allowance for deferred recoverable IMPAC paid (12,477) (12,188)
Net deferred ISR asset $ 751,314 $ 2,572,931
d. The benefits of restated tax loss carry forwards and recoverable IMPAC for which the deferred ISR asset and tax credit, respectively, have been
recognized, can be recovered subject to certain conditions. Expiration dates and restated amounts as of December 31, 2011, are:
Year of Tax loss Recoverable
expiration carry forward IMPAC
2012 $ – $ 3,463
2013 323 2,477
2014 523 5,445
2015 133,513 4,356
2016 3,094 7,740
2017 4,698 18,109
2018 413,954 –
2019 1,322 –
2020 495,069 –
2021 1,542,363 –
$ 2,594,859 $ 41,590
e. As of December 31, 2011, the Company recovered $189,202 of tax loss carry forwards applied against the fiscal income of the year 2011.
f. In calculating deferred ISR according to the above paragraphs, the effects of tax loss carry forwards and recoverable IMPAC paid of $4,198 and
$20,864, respectively, were included; however, they have been fully reserved because there is not a high probability of recovering such amounts.
18. Commitments
The Company sells the concentrates, copper cathodes and “dore” to its clients based on sales agreements which are generally renewed on an annual
basis. Such agreements established the conditions and references to the metal prices in international markets.

19. Effects of adopting International Financial Reporting Standards
The National Banking and Securities Commission (CNBV) requires certain entities that disclose their financial information to the public through the
Mexican Stock Exchange, that beginning in 2012, they must prepare and disclose their financial information according to International Financial
Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB).
The consolidated financial statements for the year ending December 31, 2012 to be issued by the Company will be its first annual financial statements
that comply with IFRS. The transition date is January 1, 2011 and, therefore, the year ended December 31, 2011 will be the comparative period
established by IFRS 1, s According to IFRS 1, the Company will apply the relevant mandatory exceptions and certain optional exemptions to the
retroactive application of IFRS.
The effect of significant changes in accounting policies that the Company has identified as result of the adoption of IFRS are:
1.- Property, plant and equipment: The Company modified its policy to include the requirements of IAS 16 “Property, plant and equipment” related to
the depreciation of components. Additionally, there is an option of valuate the fixed assets using the fair value or the historic cost. The Company
adopted the valuation using historic cost.
2.- Investment in subsidiaries, associates and other: There is an option to valuate the investments using the cost method or the fair value method. The
Company adopted the cost method to valuate the investments.
3.- Intangible assets: There is an option to valuate the intangible assets using the cost method or the fair value method. The Company adopted the
cost method to valuate the intangible assets.
4.- Functional currency: The functional currency of the Company was not modified as result of the adoption of IFRS. However, the functional currency
of some subsidiaries was modified due to IAS 21 “The Effects of Changes in Foreign Exchange Rates” emphasizes certain factors and economic
indicators which are defined in such IAS 21.
5.- Cash flows: There is an option to present the Statement of cash flow using the direct method or indirect method. The Company decided to adopt
the indirect method.
6.- Employees benefits: The Company chose to take an early adoption of the new IFRS which will have effects starting in 2013. As such, the Company
recognizes the actuarial gains and losses in the results of the period. Additionally, the Company recognizes the termination costs and the liabilities
for past services when they are realized.
7.- Comprehensive income in the financial statements: There is the option of presenting the comprehensive income within the statement of income
or as separate financial statement. As of December 31, 2011, the Company does not include the comprehensive income as part of the Statement
of Income even when starting in 2013 it is mandatory to present it in such way.
As of the date of issuance of the financial statements the Company has determined some transition adjustments in the Balance Sheet as of January 1,
2011 in the following items: accounts receivable, property, plant and equipment, deferred PTU and employees benefits. The Company considers these
adjustments have a significant impact in the financial statements.
Impact in accounting policies due to the adoption of IFRS:
a. In accordance to IAS 16 “Property, plant and equipment” the Company determined the significant components of property, plant and equipment.
As consequence, the useful-lives and the residual values were adjusted with the respective effect in the accumulated depreciation as of the
transition date. Additionally, the Company capitalized the spare parts that are expected to be consumed in more than a year. Such spare parts
qualify as a component and part of the fixed assets. In prior years, this kind of spare parts were recorded as an expense when they were acquired.
The total effect was a credit in property, plant and equipment for $8,486.
b. In accordance to IAS 19, Benefits to employees, the Company is allowed to record only expenses for the current PTU. IAS 19 requires, among
others, that the present legal or assumed obligation to pay to the employees for their services be the result of a past event. As such, the Company
eliminated the balance of deferred PTU since the transition date. The effect of this change is $370,724.
c. The Company took an early adoption of IFRS 1 and recorded, as of the transition date, all the accumulated actuarial gains and losses not
recognized at the end of the period. The effect of the adoption is $9,597.
d. The Company recalculated its deferred taxes in accordance to IAS 12 “Income taxes”. Using the new adjusted values of assets and liabilities the
effect recorded was $10,930.
e. In accordance to IAS 29 Financial Reporting in Hyperinflationary Economies, the inflation effects must be recognized for the economies in
which the inflation is above the 100% in 3 years. Mexican economy has not being a hyperinflationary economy since 1999. As consequence,
the Company cancelled the effects of inflation that were recognized since 1999 until 2007, except for the fixed assets portion. The fixed assets
cancelation effect of $1,109,348 was reclassified to retained earnings in accordance to IFRS 1
71

The Company is in process of evaluating the impacts within the financial statements during 2011. However, the net effect in the cash flow must not
be modified for the adoption of IFRS.
The information contained in this Note has been prepared in accordance with the standards and interpretations issued and in effect, or issued and
adopted in advance of the date of preparation of these consolidated financial statements. Standards and interpretations that will be applicable as
of December 31, 2012, including those that may be applied optionally, are not known with certainty at the time of preparation of the consolidated
financial statements as of December 31, 2011 and 2010. In addition, the accounting policies selected by the Company could be modified as a
consequence of changes in the economic environment or industry trends that occur after the issuance of these consolidated financial statements.
The information contained in this Note is not intended to comply with IFRS, as only a group of financial statements that includes the statements
of financial position, comprehensive income, changes in stockholders ‘equity and cash flows, along with comparative information and explanatory
notes, can provide an appropriate presentation of the financial position of the Company, the result of its operations and its cash flows in accordance
with IFRS.
20. Recently issued new and revised IFRSs not yet effective
The international accounting standard board (IASB) issued a new series of International Financial Reporting Standards (IFRS) and modifications to the
International Accounting Standards (IAS) as follows:
72
Amendments to IFRS 7 Financial Instruments: Disclosures
IFRS 9 Financial Instruments
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interests in Other Entities
IFRS 13 Fair Value Measurement
Amendments to IAS 1 Presentation of Financial Statements
Amendments to IAS 12 Income Taxes
Amendments to IAS 32 Financial Instruments: Presentation
Amendments to IAS 27 Separate Financial Statements
Amendments to IAS 28 Investments in Associates and Joint Ventures
The amendments (October 2010) to IFRS 7 increase the disclosure requirements for transactions involving transfers of financial assets. These
amendments are intended to provide greater transparency around risk exposures when a financial asset is transferred but the transferor retains
some level of continuing exposure in the asset. The amendments also require disclosures where transfers of financial assets are not evenly distributed
throughout the period.
Other amendments (December 2011) to the disclosure requirements in IFRS 7 require information about all recognized financial instruments that are
set off in accordance with paragraph 42 of IAS 32. The amendments also require disclosure of information about recognized financial instruments
subject to enforceable master netting arrangements and similar agreements even if they are not set off under IAS 32. The IASB believes that these
disclosures will allow financial statement users to evaluate the effect or potential effect of netting arrangements, including rights of set-off associated
with an entity’s recognized financial assets and recognized financial liabilities, on the entity’s financial position.
The amendments (October 2010) to IFRS 7 are effective for annual periods beginning on or after 1 July 2011, with earlier application permitted.
Other amendments (December 2011) are effective for annual periods beginning on or after 1 January 2013 and interim periods within those periods.
IFRS 9 issued in November 2009 introduces new requirements for the classification and measurement of financial assets. IFRS 9 amended in October
2010 includes the requirements for the classification and measurement of financial liabilities and for derecognition.
Key requirements of IFRS 9 are described as follows:
• IFRS 9 requires all recognized financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and Measurement to be
subsequently measured at amortized cost or fair value. Specifically, debt investments that are held within a business model whose objective is
to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal
outstanding are generally measured at amortized cost at the end of subsequent accounting periods. All other debt investments and equity
investments are measured at their fair values at the end of subsequent accounting periods.
• The most significant effect of IFRS 9 regarding the classification and measurement of financial liabilities relates to the accounting for changes
in the fair value of a financial liability (designated as at fair value through profit or loss) attributable to changes in the credit risk of that liability.
Specifically, under IFRS 9, for financial liabilities that are designated as at fair value through profit or loss, the amount of change in the fair value
of the financial liability that is attributable to changes in the credit risk of that liability is presented in other comprehensive income, unless the
recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch
in profit or loss. Changes in fair value attributable to a financial liability’s credit risk are not subsequently reclassified to profit or loss. Previously,
under IAS 39, the entire amount of the change in the fair value of the financial liability designated as at fair value through profit or loss was
presented in profit or loss.

IFRS 9 is effective for annual periods beginning on or after 1 January 2015 (mandatory application date amended December 2011), with earlier
application permitted.
In May 2011, a package of five Standards on consolidation, joint arrangements, associates and disclosures was issued, including IFRS 10, IFRS 11,
IFRS 12, IAS 27 (as revised in 2011) and IAS 28 (as revised in 2011).
Key requirements of these five Standards are described below.
IFRS 10 replaces the parts of IAS 27 Consolidated and Separate Financial Statements that deal with consolidated financial statements. SIC-12
Consolidation – Special Purpose Entities has been withdrawn upon the issuance of IFRS 10. Under IFRS 10, there is only one basis for consolidation,
that is control. In addition, IFRS 10 includes a new definition of control that contains three elements: (a) power over an investee, (b) exposure, or
rights, to variable returns from its involvement with the investee, and (c) the ability to use its power over the investee to affect the amount of the
investor’s returns. Extensive guidance has been added in IFRS 10 to deal with complex scenarios.
IFRS 11 replaces IAS 31 Interests in Joint Ventures. IFRS 11 deals with how a joint arrangement of which two or more parties have joint control
should be classified. SIC-13 Jointly Controlled Entities – Non-monetary Contributions by Venturers has been withdrawn upon the issuance of IFRS 11.
Under IFRS 11, joint arrangements are classified as joint operations or joint ventures, depending on the rights and obligations of the parties to the
arrangements. In contrast, under IAS 31, there are three types of joint arrangements: jointly controlled entities, jointly controlled assets and jointly
controlled operations.
In addition, joint ventures under IFRS 11 are required to be accounted for using the equity method of accounting, whereas jointly controlled entities
under IAS 31 can be accounted for using the equity method of accounting or proportionate accounting.
IFRS 12 is a disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or unconsolidated
structured entities. In general, the disclosure requirements in IFRS 12 are more extensive than those in the current standards.
IAS 27 (as revised in 2011) contains accounting and disclosure requirements for investments in subsidiaries, joint ventures and associates when
an entity prepares separate financial statements. The Standard requires an entity preparing separate financial statements to account for those
investments at cost or in accordance with IFRS 9.
IAS 28 (as revised in 2011) prescribes the accounting for investments in associates and sets out the requirements for the application of the equity
method when accounting for investments in associates and joint ventures. The revised standard is to be applied by all entities that are investors with
joint control of, or significant influence over, an investee. An entity applies IFRS 11 to determine the type of joint arrangement in which it is involved.
Once it has determined that it has an interest in a joint venture, the entity recognizes an investment and accounts for it using the equity method in
accordance with IAS 28 (as amended in 2011), unless the entity is exempted from applying the equity method as specified in the Standard.
These five standards are effective for annual periods beginning on or after 1 January 2013. Earlier application is permitted provided that all of these
five standards are applied early at the same time.
IFRS 13 establishes a single source of guidance for fair value measurements and disclosures about fair value measurements. The Standard defines
fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements. The scope of IFRS 13 is broad;
it applies to both financial instrument items and non-financial instrument items for which other IFRSs require or permit fair value measurements and
disclosures about fair value measurements, except in specified circumstances. In general, the disclosure requirements in IFRS 13 are more extensive
than those required in the current standards. For example, quantitative and qualitative disclosures based on the three-level fair value hierarchy
currently required for financial instruments only under IFRS 7 will be extended by IFRS 13 to cover all assets and liabilities within its scope.
IFRS 13 is effective for annual periods beginning on or after 1 January 2013, with earlier application permitted.
The amendments to IAS 1 retain the option to present profit or loss and other comprehensive income in either a single statement or in two separate
but consecutive statements. However, the amendments to IAS 1 require additional disclosures to be made in the other comprehensive income section
such that items of other comprehensive income are grouped into two categories: (a) items that will not be reclassified subsequently to profit or loss;
and (b) items that will be reclassified subsequently to profit or loss when specific conditions are met. Income tax on items of other comprehensive
income is required to be allocated on the same basis.
The amendments to IAS 1 are effective for annual periods beginning on or after 1 July 2012.
The amendments to IAS 12 provide an exception to the general principles in IAS 12 that the measurement of deferred tax assets and deferred tax
liabilities should reflect the tax consequences that would follow from the manner in which the entity expects to recover the carrying amount of an
asset. Specifically, under the amendments, investment properties that are measured using the fair value model in accordance with IAS 40 Investment
Property are presumed to be recovered through sale for the purposes of measuring deferred taxes, unless the presumption is rebutted in certain
circumstances.
73

The amendments to IAS 12 are effective for annual periods beginning on or after 1 January 2012.
Amendments to IAS 32 provide clarifications on the application of the offsetting rules. This joint project between the IASB and FASB was intended to
address the differences in their respective accounting standards regarding offsetting of financial instruments. However, the FASB decided to retain
the current US GAAP guidance. Therefore, the Boards decided to jointly focus on developing converged disclosure requirements to allow financial
statement users the ability to more easily compare financial instruments exposures under IFRS and US GAAP. Additionally, the IASB decided to amend
IAS 32 to clarify certain aspects because of diversity in application that was identified during the IASB constituent outreach.
The project to amend IAS 32 focused on four main areas:
74
• the meaning of ‘currently has a legally enforceable right of set-off’
• the application of simultaneous realization and settlement
• the offsetting of collateral amounts
• the unit of account for applying the offsetting requirements.
The amendments to IAS 32 are not effective until annual periods beginning on or after 1 January 2014.
Except for the amendments to IAS 1 whose presentation of items of other comprehensive income will be modified accordingly when the amendments
are applied in the future accounting periods, the Company has not yet performed a detailed analysis of the effect derived from the application of these
new and revised Standards and hence has not yet quantified the extent of the impact.
21. Authorization to issue the financial statements
On March 6, 2012, the issuance of the accompanying consolidated and combined financial statements was authorized by C. P. Quintín Botas
Hernández and C. P. Andrés Santiago López; consequently, they do not reflect events occurred after that date. These consolidated financial statements
are subject to the approval of the Company’s general ordinary stockholders’ meeting, where they may be modified, based on provisions set forth in
the Mexican General Corporate Law.

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INVESTOR INFORMATION
Bolsa Mexicana de Valores
The shares Series A-1 of Minera Frisco, S.A.B de C.V. are
listed in the Mexican Stock Exchange under the ticker
symbol “MFRISCO”.
OTC Market
ADR’s Level 1
Symbol: MSNFY 2:1
Cusip: 60283E101
Depositary Bank
BNY Mellon
P.O. Box 11258
New York, N.Y. 10286-1258
Tel. 1-888-BNY-ADRS (1-888-269-2377)
shrrelations@bnymellon.com
www.bnymellon.com/shareowner
Contacts
Jorge Serrano Esponda
jserranoe@inbursa.com
Angélica Piña Garnica
napinag@condumex.com.mx
www.minerafrisco.com

Lago Zurich No. 245
Frisco Building, 7th Floor
Plaza Carso
Colonia Granada Ampliación
México, D.F. 11529
www.minerafrisco.com
María / Aerial view