Notes to consolidated financial statements
For the years ended December 31, 2011 and 2010 (as adjusted)
(In thousands of Mexican pesos ($) and thousands of U.S. dollars (US$))

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1. Activities and significant events

a. Activities - The consolidated financial statements include the financial statements of Grupo Carso, S.A.B. de C.V. and Subsidiaries ("the Company" or "Grupo Carso") as a single reporting entity

The principal subsidiaries and associated companies and their activities are as follows:

	Ownership percentage
Subsidiary	2011	2010	Activity
Carso Infraestructura y Construcción, S.A.B. de C.V. and Subsidiaries (CICSA)	67.15	65.76	Performance of several branches of engineering, including: oil well drilling and oil rig construction projects and all types of civil, industrial and electromechanical projects and facilities; construction and maintenance of highways, water pipes, water treatment plants and hydroelectric stations; housing construction; manufacturing and selling of cold-formed carbon steel tubes; and installation of telecommunication and telephone networks
Grupo Condumex, S.A. de C.V.	99.57	99.57	Manufacture and sale of cable products used in the construction, automotive, energy and telecommunications industries.
Grupo Sanborns, S.A. de C.V. and Subsidiaries ("Sanborns")	99.98	99.98	Operation of department stores, gift shops, record stores, restaurants, cafeterias and management of shopping malls through the following commercial brands, principally: Sanborns, Sears, Saks Fifth Avenue and Mix-up.
Industrial Cri, S.A. de C.V. and Subsidiaries ("Industrial Cri")	100.00	100.00	Holding of shares of companies in the following sectors: installation and maintenance of telephone stands, manufacturing all types of candies and manufacture of bicycles.
Associate
Infraestructura y Transportes México, S.A. de C.V. (ITM)	16.75	16.75	Railroad transportation
Philip Morris México, S.A. de C.V.	20.00	20.00	Manufacture and sale of cigarettes.
Elementia, S.A. de C.V. ("Elementia")	46.00	46.00	Manufacture and sale of high technology products for the cement, concrete, polyethylene, styrene, copper and aluminum production industries.

b. Significant events

• On January 14, 2011, Grupo Condumex, S.A. de C.V. (a spinoff from Inmuebles Corporativos e Industriales CDX, S.A. de C.V., formerly Grupo Condumex, S.A. de C.V.) sold the shares of its subsidiaries Hubard y Bourlon, S.A. de C.V., Ingeniería HB, S.A. de C.V. and Selmec Equipos Industriales, S.A. de C.V. to its related party Enesa Ingeniería, S.A. de C.V. The total selling price of the shares was $515,000, generating an accounting profit of $92,040 for Hubard y Bourlon, S.A. de C.V., an accounting loss of ($69) for Ingeniería HB, S.A. de C.V. and an accounting profit of $78,228 for Selmec Equipos Industriales, S.A. de C.V. As of December 31, 2010 such operations were classified as held for sale under the heading of discontinued operations.
• On March 1, 2011 an issuance of capital was carried out to formalize the transaction whereby Grupo Carso contributed the amount of US$23,300 to Tabasco Oil Company (TOC), in exchange for 70% of the equity of such company. TOC is certified as an oil company and has the concession for the LLA 56 block located in the Llanos Orientales region of northeast Colombia, which was granted by the Agencia Nacional de Hidrocarburos de Colombia (ANH) in February 2011 for purposes of exploration and production of hydrocarbons. The concession area covers 413.2 km2 and includes a commitment to make initial investments marked in the concession itself. TOC must complete three-dimensional seismic studies in an area of at least 145.2 km_ and develop at least one exploratory well in the first phase. At the date of issuance of this report, there are basic studies on the perspectives of such block, including two dimensional seismic studies.
  
  On March 29, 2011 Grupo Carso sold Carso Energy, S.A. de C.V., a direct subsidiary, its 70% share in the stockholders' equity of TOC. This transaction did not generate any profit or loss.
• In November 2010, CICSA reached an agreement with its related party, Ideal Panamá, S.A., to sell 100% of the common stock of its subsidiary Cilsa Panamá, S.A. for US$700, which transaction was performed on January 31, 2011. This sale generated a profit of $51,390, which is presented in income from discontinued operations. Accordingly, the operating results of this subsidiary are excluded from income from continuing operations as presented in these consolidated financial statements.
• In November 2011, CICSA acquired the remaining 20% of the common stock of Bronco Drilling MX, S.A. de C.V. (formerly Bronco Drilling MX, S. de R.L. de C.V.), for US$5,000, after which CICSA now holds 100% of the common stock of Bronco Drilling MX, S.A. de C.V. This purchase originated a benefit of $132,156 recorded directly to stockholders' equity because it represents the acquisition of the non-controlling interest.
• As of December 31, 2011, CICSA sold all its shares held in Archer Limited (a company which it acquired in 2011, to Allis-Chalmers Energy, Inc., the original seller of the shares owned by CICSA), a public company listed on the Oslo Stock Exchange. This transaction generated a loss on the sale of shares of $105,206, which was recorded under the heading of other expenses. This loss arose due to the reduced market price of the shares compared to the acquisition price. As of December 31, 2010, there were 2,700,000 shares valued at market value.
• In August 2010, Elementia carried out an issuance of common stock in which Grupo Carso, which holds an investment in Elementia through its subsidiary, Tenedora de Empresas y Materiales de Construcción, S.A. de C.V. ("Temaco"), did not participate, thereby resulting in a 3% reduction in the equity held, which was 46% as of December 31, 2010. The gain generated by this dilution was $59,958, which was recorded as a credit to investments in associated companies.
• On December 31, 2010, the Company spun off its real estate and mining assets, which resulted in the creation of: i) a variable stock company which directly or indirectly owns, through its subsidiaries, several real estate properties previously owned by Grupo Carso, named Inmuebles Carso, S.A.B. de C.V. ("Inmuebles Carso") and; ii) a variable stock company which directly or indirectly owns, through its subsidiaries, the concessioned mining assets previously owned by Grupo Carso, named Minera Frisco, S.A.B. de C.V. The accompanying financial statements retroactively recognize the spinoff, as required by Mexican Financial Reporting Standards; consequently, the 2010 figures are comparable with those of 2011.
  
  Condensed consolidated financial statements of the spun-off sectors and the Company as of December 31, 2010, after the spin-off, are as follows:

		Grupo Carso (historical amounts)		Adjustments, eliminations and reclassifications		Real Estate sector		Mining sector		Grupo Carso (Adjusted for spinoff before adjustments from NIF C-4 and C-5)		Adjustments from NIFs C-4 and C-5 (Note 3.a)		Grupo Carso (as adjusted for Spin-off and NIFs C-4 and C-5)
Current assets:
Cash, cash equivalents and investments in securities	$	10,634,828	$	112,065	$	(1,237,776)	$	(6,340,032)	$	3,169,085	$	-	$	3,169,085
Accounts and notes receivable		21,586,041		2,074,451		(4,306,302)		(1,643,351)		17,710,839		416,768		18,127,607
Inventories		15,301,959		207,374		-		(1,267,365)		14,241,968		1,692,911		15,934,879
Other current assets		1,142,870		526,150		(77,851)		(57,386)		1,533,783		1,070,685		2,604,468
Total current assets		48,665,698		2,920,040		(5,621,929)		(9,308,134)		36,655,675		3,180,364		39,836,039
Property, plant and equipment – Net		48,539,832		594,073		(23,297,800)		(5,578,370)		20,257,735		(2,872,726)		17,385,009
Investment in shares of associated companies and other		10,156,928		-		(1,121,461)		-		9,035,467		-		9,035,467
Other long-term assets		5,064,618		15,355,568		(12,447)		(5,182,696)		15,225,043		-		15,225,043
Total	$	112,427,076	$	18,869,681	$	(30,053,637)	$	(20,069,200)	$	81,173,920	$	307,638	$	81,481,558
Liabilities:
Notes payable to financial institutions and current portion of long-term debt	$	28,481,508	$	762,710	$	(4,519,423)	$	(116,715)	$	24,608,080	$	-	$	24,608,080
Accrued expenses and taxes other than income taxes		11,125,880		2,399,640		(4,386,825)		(1,308,367)		7,830,328		19,578		7,849,906
Other current liabilities		7,970,728		416,570		(244,045)		(214,569)		7,928,684		-		7,928,684
Total current liabilities		47,578,116		3,578,920		(9,150,293)		(1,639,651)		40,367,092		19,578		40,386,670
Long-term liabilities		7,246,301		15,290,761		(3,649,165)		(16,699,730)		2,188,167		115,914		2,304,081
Total liabilities		54,824,417		18,869,681		(12,799,458)		(18,339,381)		42,555,259		135,492		42,690,751
Stockholders' equity:
Controlling interest		47,997,906		-		(16,046,100)		(361,792))		31,590,014		125,122		31,715,136
Non-controlling interest		9,604,753		-		(1,208,079)		(1,368,027)		7,028,647		47,024		7,075,671
Total stockholders' equity		57,602,659		-		(17,254,179)		(1,729,819)		38,618,661		172,146		38,790,807
Total	$	112,427,076	$	18,869,681	$	(30,053,637)	$	(20,069,200)	$	81,173,920	$	307,638	$	81,481,558