Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V. and Subsidiaries Consolidated Statement of Income (Amounts expressed in thousands of US dollars) (Unaudited) Three months ended March 31, --------------------------- 2004 2003 -------------- ------------ -------------- ------------ Transportation revenues $167,512 $168,524 Operating expenses (119,713) (119,448) Depreciation and amortization (22,007) (21,212) ------------- ------------ Total cost (141,720) (140,660) ------------- ------------ Operating profit 25,792 27,864 ------------- ------------ Other expenses - net (5,718) (4,057) ------------- ------------ Financial expenses - net (27,863) (27,482) Exchange profit (loss) - net (97) (5,064) ------------- ------------ Net comprehensive financing cost (27,960) (32,546) ------------- ------------ Loss before taxes and minority interest (7,886) (8,739) Income tax 4,092 (7,000) ------------- ------------ Loss before minority interest (3,794) (15,739) Minority interest 628 3,200 ------------- ------------ Net loss for the period ($3,166) ($12,539) ------------- ------------ The consolidated financial statements were prepared in accordance with International Financial Reporting Standards. Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V. and Subsidiaries Consolidated Balance Sheet (Amounts expressed in thousands of US dollars) (Unaudited) March 31, December 31, 2004 2003 (Audited) ------------- ------------ Assets Current assets Cash and cash equivalents $3,106 $3,597 Accounts receivable - net 202,104 192,295 Materials and supplies 17,503 16,693 Other current assets 12,258 13,157 ------------- ------------ Total current assets 234,971 225,742 Concession, property and equipment - net 1,803,745 1,814,668 Other assets 2,951 2,857 Deferred income tax 82,937 78,845 ------------- ------------ Total assets $2,124,604 $2,122,112 ------------- ------------ Liabilities and stockholders' equity Current liabilities Commercial paper and capital lease due within one year $185,023 $193,154 Accounts payable and accrued expenses 183,976 167,609 ------------- ------------ Total current liabilities 368,999 360,763 Long-term debt and capital lease obligation 747,996 746,745 Other non-current liabilities 30,523 33,724 ------------- ------------ Long-term liabilities 778,519 780,469 ------------- ------------ Total liabilities 1,147,518 1,141,232 ------------- ------------ Minority interest 316,846 317,475 ------------- ------------ Stockholders' equity Capital stock 807,008 807,008 Treasury shares (204,904) (204,904) Effect on purchase of subsidiary shares (33,562) (33,562) Retained earnings 91,698 94,863 ------------- ------------ Total stockholders' equity 660,240 663,405 ------------- ------------ Total liabilities and stockholders' equity $2,124,604 $2,122,112 ------------- ------------ The consolidated financial statements were prepared in accordance with International Financial Reporting Standards. Grupo Transportacion Ferroviaria Mexicana, S.A. de C.V. and Subsidiaries Consolidated Statement of Cash Flows (Amounts expressed in thousands of US dollars) (Unaudited) Three months ended --------------------------- March 31, --------------------------- 2004 2003 -------------- ------------ Cash flows from operating activities: Net loss for the period ($3,166) ($12,539) ------------- ------------ Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 22,007 21,212 Amortization of deferred financing costs 1,605 1,598 Other non cash item (4,225) 4,454 Changes in working capital 3,101 15,191 ------------- ------------ Total adjustments 22,488 42,455 ------------- ------------ Net cash provided by operating activities 19,322 29,916 ------------- ------------ Cash flows from investing activities: Acquisitions of property and equipment - net (11,565) (8,690) Sale of equipment 35 98 ------------- ------------ Net cash used in investing activities (11,530) (8,592) ------------- ------------ Cash flows from financing activities: Proceeds payments of commercial paper - net 10,000 (7,000) Payment of term loan (18,283) 0 ------------- ------------ Net cash (used in) provided by financing activities (8,283) (7,000) ------------- ------------ Increase in cash and cash equivalents (491) 14,324 Cash and cash equivalents Beginning of period 3,597 30,249 ------------- ------------ End of period $3,106 $44,573 ------------- ------------ The consolidated financial statements were prepared in accordance with International Financial Reporting Standards.