Title
of Each Class
|
Name
of Each Exchange
on
Which Registered
|
American
Depositary Shares, each representing ten Ordinary Shares, without
par
value
|
New
York Stock Exchange
|
Ordinary
Shares, without par value
|
New
York Stock Exchange
(for
listing purposes only)
|
Yes
__
|
No
X
|
Yes
__
|
No
X
|
Yes
X
|
No
__
|
Large
accelerated filer __
|
Accelerated
Filer __
|
Non-accelerated
filer X
|
Item
17 __
|
Item
18 X
|
Yes
__
|
No
X
|
Identity
of Directors, Senior Management and Advisers
|
1
|
|
Offer
Statistics and Expected Timetable
|
1
|
|
Key
Information
|
1
|
|
Information
on the Company
|
9
|
|
Operating
and Financial Review and Prospects
|
25
|
|
Directors,
Senior Management and Employees
|
42
|
|
Major
Shareholders and Related Party Transactions
|
46
|
|
Financial
Information
|
48
|
|
Offer
and Listing Details
|
49
|
|
Additional
Information
|
52
|
|
Quantitative
and Qualitative Disclosures about Market Risk
|
65
|
|
Description
of Securities Other than Equity Securities
|
65
|
|
Defaults,
Dividend Arrearages and Delinquencies
|
65
|
|
Material
Modifications to the Rights of Security Holders and Use of
Proceeds
|
65
|
|
Controls
and Procedures
|
65
|
|
Reserved
|
66
|
|
Financial
Statements
|
67
|
|
Financial
Statements
|
67
|
|
Exhibits
|
67
|
|
F-1
|
·
|
International,
national and local general economic and market conditions;
|
|
·
|
The
overall size and growth of the Mexican pharmaceutical market;
|
|
·
|
The
level of competition among distributors, suppliers and sellers
of
pharmaceuticals;
|
|
·
|
Fluctuations
and difficulty in forecasting operating results;
|
|
·
|
Dependence
on suppliers and clients;
|
|
·
|
General
risks associated with doing business in Mexico, including political
and
economic instability and changes in government regulations;
and
|
|
·
|
Other
factors referenced in this annual report.
|
Year
ended December 31,
|
2001
|
2002
|
2003
|
2004
|
2005
|
2005
(1)
|
|||||||||||||
(in
thousands of constant Pesos as of December 31, 2005 and U.S.
Dollars,
except share and per share data)
|
|||||||||||||||||||
Income
Statement
|
|||||||||||||||||||
Mexican
GAAP:
|
|||||||||||||||||||
Net
sales
|
Ps.
|
19,396,589
|
Ps.
|
20,577,834
|
Ps.
|
21,229,791
|
Ps.
|
21,255,521
|
Ps.
|
21,873,753
|
|
U.S.$
2,042,196
|
|||||||
Gross
profit
|
2,077,011
|
2,170,959
|
2,110,545
|
2,188,164
|
2,257,161
|
210,735
|
|||||||||||||
Operating
expenses
|
1,318,813
|
1,377,536
|
1,308,435
|
1,363,782
|
1,361,922
|
127,153
|
|||||||||||||
Operating
income, net
|
758,198
|
793,423
|
802,110
|
824,382
|
895,239
|
83,582
|
|||||||||||||
Comprehensive
cost of financing, net
|
169,304
|
17,547
|
50,322
|
16,321
|
-1,568
|
-147
|
|||||||||||||
Other
income (2)
|
-36,141
|
-6,700
|
-37,298
|
-51,562
|
-38,413
|
-3,586
|
|||||||||||||
Income before
taxes and employee profit sharing
|
625,035
|
782,576
|
789,086
|
859,624
|
935,220
|
87,315
|
|||||||||||||
Net
income
|
484,471
|
614,743
|
626,035
|
670,427
|
728,225
|
67,989
|
|||||||||||||
Net
income per Ordinary Share (3)
|
1.825
|
2.316
|
2.359
|
2.526
|
2.744
|
0.256
|
|||||||||||||
Weighted
average Ordinary Shares outstanding (in thousands) (3)
|
265,419
|
265,419
|
265,419
|
265,419
|
265,419
|
||||||||||||||
U.S.
GAAP (4):
|
|||||||||||||||||||
Net
sales
|
Ps.
|
19,396,589
|
Ps.
|
20,577,834
|
Ps.
|
21,229,791
|
Ps.
|
21,255,521
|
Ps.
|
21,873,753
|
|
U.S.$
2,042,196
|
|||||||
Gross
profit
|
2,077,011
|
2,170,959
|
2,110,545
|
2,188,164
|
2,257,161
|
210,735
|
|||||||||||||
Operating
income
|
787,752
|
763,650
|
865,824
|
824,382
|
895,239
|
83,582
|
|||||||||||||
Income before
taxes and employee profit sharing
|
654,588
|
752,801
|
852,800
|
859,624
|
933,652
|
87,168
|
Net
income (4)
|
514,027
|
584,971
|
689,749
|
670,427
|
695,814
|
64,963
|
|||||||||||||
Net
income per Ordinary share (3)
|
1.9367
|
2.2039
|
2.5987
|
2.5259
|
2.6216
|
||||||||||||||
Weighted
average Ordinary Shares outstanding (in thousands) (3)
|
265,419
|
265,419
|
265,419
|
265,419
|
265,419
|
||||||||||||||
Balance
Sheet Data
|
|||||||||||||||||||
Mexican
GAAP:
|
|||||||||||||||||||
Property
and equipment, net
|
Ps.
|
1,135,158
|
Ps.
|
1,101,460
|
Ps.
|
1,069,452
|
Ps.
|
1,105,536
|
Ps.
|
1,065,255
|
|
U.S.$
99,455
|
|||||||
Total
assets
|
8,018,684
|
8,482,119
|
8,990,122
|
9,431,006
|
9,832,979
|
918,034
|
|||||||||||||
Short-term
debt
|
363,164
|
401,222
|
423,916
|
-
|
-
|
-
|
|||||||||||||
Long-term
debt
|
452,760
|
48,594
|
-
|
-
|
-
|
-
|
|||||||||||||
Capital
stock
|
1,040,863
|
1,040,863
|
1,040,863
|
1,040,863
|
1,040,863
|
97,178
|
|||||||||||||
Total
stockholders’ equity (4)
|
3,134,571
|
3,369,064
|
3,631,498
|
4,167,477
|
4,614,282
|
430,803
|
|||||||||||||
U.S.
GAAP (4):
|
|||||||||||||||||||
Property
and equipment, net
|
Ps.
|
1,135,158
|
Ps.
|
1,101,460
|
Ps.
|
1,069,452
|
Ps.
|
1,105,536
|
Ps.
|
1,065,255
|
|
U.S.$
99,455
|
|||||||
Total
assets
|
8,018,684
|
8,482,119
|
8,990,122
|
9,431,006
|
9,832,979
|
918,034
|
|||||||||||||
Short-term
debt
|
363,164
|
401,222
|
423,916
|
-
|
-
|
-
|
|||||||||||||
Long-term
debt
|
452,760
|
48,594
|
-
|
-
|
-
|
-
|
|||||||||||||
Capital
stock
|
1,040,863
|
1,040,863
|
1,040,863
|
1,040,863
|
1,040,863
|
97,178
|
|||||||||||||
Total
stockholders’ equity (4)
|
3,163,265
|
3,330,291
|
3,656,439
|
4,192,418
|
4,635,121
|
432,749
|
|||||||||||||
·
|
the
resolution by our shareholders in light of our results, financial
condition, cash requirements, future prospects and other factors
deemed
relevant by our shareholders for this purpose;
|
|
·
|
the
extent to which we receive cash dividends, advances and other payments
from our subsidiaries. We are a holding company with no significant
operating assets other than the ones we own through our subsidiaries.
Given the fact that we receive substantially all of our operating
income
from our subsidiaries, our ability to meet our financial obligations,
including the payment of dividends, depends significantly on the
dividend
payments we receive from our subsidiaries; and
|
|
·
|
the
extent to which we have cash available for distribution after funding
our
working capital needs, capital expenditures and investments.
|
Exchange
Rate(1)
|
||||
Year
ended December 31,
|
High
|
Low
|
Average(2)
|
Period
End
|
2001
|
9.97
|
8.95
|
9.34
|
9.17
|
2002
|
10.43
|
9.00
|
9.66
|
10.43
|
2003
|
11.41
|
10.11
|
10.79
|
11.24
|
2004
|
11.64
|
10.81
|
11.30
|
11.15
|
2005
|
11.41
|
10.41
|
10.89
|
10.63
|
Month
ended
|
||||
December
31, 2005
|
10.77
|
10.41
|
10.63
|
10.63
|
January
30, 2006
|
10.64
|
10.44
|
10.44
|
10.44
|
February
28, 2006
|
10.53
|
10.43
|
10.48
|
10.45
|
March
31, 2006
|
10.95
|
10.46
|
10.75
|
10.90
|
April
30, 2006
|
11.16
|
10.86
|
11.05
|
11.09
|
May
31, 2006
|
11.31
|
10.84
|
11.09
|
11.29
|
June
15, 2006
|
11.46
|
11.28
|
11.37
|
11.42
|
·
|
inflation
can adversely affect consumer purchasing power, thereby adversely
affecting consumer demand for the products we distribute; and
|
|
·
|
to
the extent inflation exceeds price increases, our prices and revenues
will
be adversely affected in “real” terms.
|
Name
of Subsidiary(1)
|
Jurisdiction
of Incorporation
|
Percentage
Ownership(2)
|
Casa
Saba, S.A. de C.V.(3)
|
Mexico
|
99.9%
|
Drogueros,
S.A. de C.V.(4)
|
Mexico
|
99.9%
|
Grupo
Mexatar, S.A. de C.V.(5)
|
Mexico
|
99.9%
|
Centennial,
S.A. de C.V.(6)
|
Mexico
|
99.9%
|
Inmuebles
Visosil, S.A. de C.V.(7)
|
Mexico
|
99.9%
|
Publicaciones
CITEM, S.A. de C.V.(8)
|
Mexico
|
99.9%
|
Transportes
Marproa, S.A. de C.V.(9)
|
Mexico
|
99.9%
|
Servicios
Corporativos Saba, S.A. de C.V.(10)
|
Mexico
|
99.9%
|
Distribuidora
Casa Saba, S.A. de C.V. (11)
|
Mexico
|
99.9%
|
Other
companies (12)
|
Mexico
|
99.9%
|
(1)
|
With
the exception of Casa Saba, S.A. de C.V., none of our operating
subsidiaries is a “significant subsidiary” within the meaning of Rule
1-02(w) of Regulation S-X of the Securities Act of
1933.
|
|
(2)
|
Percentage
of equity owned by us directly or indirectly through subsidiaries
or
affiliates.
|
|
(3)
|
Direct
subsidiary through which we distribute pharmaceutical products
to private
and government clients.
|
|
(4)
|
Indirect
subsidiary through which we distribute pharmaceutical products
to private
and government clients.
|
|
(5)
|
Indirect
subsidiary through which we distribute office and electronic products,
including keyboards, audio and television equipment and related
accessories.
|
(6)
|
Indirect
subsidiary through which we distribute general merchandise and
other
products.
|
|
(7)
|
Indirect
subsidiary through which we lease real property to our other subsidiaries.
Inmuebles Visosil, S.A. de C.V. owns substantially all of the capital
stock of Drogueros, S.A. de C.V., another indirect subsidiary of
Grupo
Casa Saba.
|
|
(8)
|
Direct
subsidiary through which we distribute publications.
|
|
(9)
|
Direct
subsidiary through which we deliver products to our distribution
centers
throughout Mexico. We place centralized purchase orders for all
of our
distribution centers directly with suppliers, who deliver these
centralized purchase orders to Transportes Marproa, S.A. de C.V.,
or
Marproa. Marproa then distributes customized orders to each of
our 22
distribution centers throughout Mexico. Marproa also provides freight
services to third parties at market rates.
|
|
(10)
|
Indirect
subsidiary that provides administrative, legal, accounting, tax
planning,
financial counseling and other professional services to Casa Saba,
S.A. de
C.V.
|
|
(11)
|
Direct
subsidiary that provides logistical and transportation services
to Casa
Saba, S.A. de C.V.
|
|
(12)
|
Real
estate and service companies.
|
Year
ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
(Millions
of constant Pesos as of December 31, 2005)
|
||||||||||
Distribution
fleet
|
Ps. |
36.8
|
Ps. |
36.9
|
Ps. |
45.8
|
||||
Technology
and computer
equipment
|
21.4
|
9.9
|
38.0
|
|||||||
Acquisitions
|
0.0
|
0.0
|
4.0
|
|||||||
Other
general capital
expenditures
|
0.7
|
1.0
|
0.4
|
|||||||
Total
capital expenditures
|
Ps. |
58.9
|
Ps. |
47.8
|
Ps. |
88.2
|
·
|
5,500
pharmaceutical products;
|
|
·
|
4,600
health and beauty products;
|
|
·
|
950
general merchandise and other products, such as food, toiletries
and
electronics; and
|
|
·
|
5,400
publications.
|
·
|
more
than 17,600 pharmacies owned by private individuals;
|
|
·
|
approximately
3,250 privately owned chain pharmacies and over 650
government
pharmacies;
|
|
·
|
approximately
2,200 regional and national supermarkets;
|
|
·
|
approximately
850 magazine stores, approximately 200 racks and 161 nationwide
agents;
|
|
·
|
over
70 department stores; and
|
|
·
|
approximately
200 major wholesalers and more than 1,200 convenience
stores.
|
|
|
Year
Ended December 31,
|
|||||||||
2003
|
2004
|
2005
|
|||||||||
Private
Pharmaceuticals(1)
|
83.5
|
%
|
83.6
|
%
|
82.9
|
%
|
|||||
Government
Pharmaceuticals
|
2.7
|
%
|
3.0
|
%
|
3.7
|
%
|
|||||
HBCG/Other
Products
|
10.5
|
%
|
9.9
|
%
|
9.8
|
%
|
|||||
Publications
|
3.3
|
%
|
3.5
|
%
|
3.6
|
%
|
|||||
Total
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
·
|
maintaining
a continuous contact with clients and suppliers to enhance the
supply
chains in which we
participate;
|
|
·
|
raising
participation with government institutions and state health
institutions;
|
|
·
|
developing ambitious
internal savings and operating efficiencies programs to maximize
our
operations’
profitability;
|
|
·
|
complementing
our existing businesses through our Internet solutions;
|
|
·
|
implementing
information technology solutions and renovating our transportation
fleet;
and
|
|
·
|
capitalizing
on our favorable capital structure.
|
·
|
increased
our operating profit margin from 3.88% in 2004 and to 4.09% in
2005;
|
|
·
|
canceled,
created and reduced some of the distribution routes to increase
their
profitability;
|
|
·
|
achieved sales
growth, in particular 27.8% in our Government Pharma
division;
|
|
·
|
reviewed,
and in some cases changed, the commercial terms of several of our
clients
and suppliers and,
when
required, discontinued unprofitable operations;
|
|
·
|
maintained
a healthy financial structure, which allowed us to close the year
with a
solid cash balance,
of
Ps. 714 million, and to increase our dividend distribution by 9.09%;
and
|
|
·
|
increased
our net income in 2005 by 8.6% to Ps. 728.2 million.
|
|
Year
Ended December 31,(1)
|
||||||||
|
|
2003
|
|
|
2004
|
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
Sales
in millions(2)
|
|
U.S.$7,061.7
|
|
|
U.S.$7,721.3
|
|
|
U.S.$9,009.7
|
|
Sales
in millions of units(3)
|
|
1,005.0
|
|
|
972.6
|
|
|
992.9
|
|
Average
unit price
|
U.S.$7.03
|
U.S.$7.94
|
U.S.$9.07
|
||||||
Growth
in average unit price
|
2.6%
|
|
12.9%
|
|
14.2%
|
|
(1)
|
Statistics
based on information made publicly available by IMS Health, A.G.
for
private sector data and our
estimates.
|
|
(2)
|
Revenues
based on prices charged by wholesalers to retailers.
|
|
(3)
|
In
Mexico, pharmaceutical products are distributed in pre-packaged
doses or
units, which may vary in size
from
year to year.
|
·
|
Mexsana
talcum powders from Schering-Plough (since 1999);
|
|
·
|
Coppertone
suntan lotions (since 1999);
|
|
·
|
Brunswick
Sea Food products (since 1994);
|
|
·
|
Canderel
and Nutra Sweet products (since 1999);
|
|
·
|
Cure
Band bandaids (since 2002);
|
|
·
|
Merisant
chocolates (since 2003);
|
|
·
|
Lander
lotions (since 2003);
|
|
·
|
Toblerone
chocolates (since 2001);
|
|
·
|
Alo
coffee (since 2005);
|
|
·
|
Lipovitan
energizing beverage (since 2002);
|
·
|
Planet
Pop, pork chips for microwave oven (since 2005);
|
|
·
|
The
Sensual Tea (since 2004); and
|
|
·
|
Pringles
potato chips (since 2005).
|
·
|
Intermex,
a company owned by Televisa, which primarily distributes its own
publications;
|
|
·
|
Codyplirsa,
which primarily distributes popular magazines nationwide; and
|
|
·
|
DIMSA,
which distributes primarily English-language publications.
|
|
||
Credit
terms
|
Days
|
|
Pharmacies
|
35
|
|
Supermarkets
and local wholesalers
|
35
|
|
Government
|
45
|
|
Publications
to wholesalers
|
40
|
|
Publications
to retailers (1)
|
45
|
(1)
|
National
retail chains are centralized.
|
Distribution
Center’s Name
|
Location
(City, State)
|
|
1.
|
Taxqueña
|
Mexico
City, Distrito Federal
|
2.
|
Chihuahua
|
Chihuahua,
Chihuahua
|
3.
|
Coatzacoalcos
|
Coatzacoalcos,
Veracruz
|
4.
|
Culiacán
|
Culiacán,
Sinaloa
|
5.
|
Guadalajara
|
Guadalajara,
Jalisco
|
6.
|
Hermosillo
|
Hermosillo,
Sonora
|
7.
|
Juárez
|
Ciudad
Juárez, Chihuahua
|
8.
|
La
Laguna
|
Gómez
Palacio, Durango
|
9.
|
León
|
León,
Guanajuato
|
10.
|
Centennial
|
Tlalnepantla,
Mexico
|
11.
|
Monterrey
|
Monterrey,
Nuevo León
|
12.
|
Morelia
|
Morelia,
Michoacán
|
13.
|
Peninsular
|
Mérida,
Yucatán
|
14.
|
Citem
|
Tlalnepantla,
Mexico
|
15.
|
Puebla
|
Puebla,
Puebla
|
16.
|
Reynosa
|
Reynosa,
Tamaulipas
|
17.
|
Tampico
|
Tampico,
Tamaulipas
|
18.
|
Tijuana
|
Tijuana,
Baja California
|
19.
|
Tláhuac
|
Mexico
City, Distrito Federal
|
20.
|
Tuxtla
|
Tuxtla
Gutiérrez, Chiapas
|
21.
|
Vallejo
|
Mexico
City, Distrito Federal
|
22.
|
Veracruz
|
Veracruz,
Veracruz
|
Year
Ended December 31,
|
|||||||||||||
2003
|
2004
|
2005
|
|||||||||||
Total
Private Pharmaceuticals Market:
|
|||||||||||||
Real
Unit Price Increases
|
7.6
|
%
|
6.6
|
%
|
6.2
|
%
|
|||||||
Growth
in Units
|
1.7
|
%
|
-3.2
|
%
|
2.1
|
%
|
|||||||
Grupo
Casa Saba Private Pharmaceutical Products:
|
|||||||||||||
Real
Unit Price Increases
|
4.2
|
%
|
7.2
|
%
|
7.4
|
%
|
|||||||
Growth
in Units
|
1.5
|
%
|
-6.8
|
%
|
-5.0
|
%
|
|||||||
Market
Share of Grupo Casa Saba(1):
|
27.9
|
%
|
26.0
|
%
|
24.0
|
%
|
|||||||
Inflation(2)
|
4.0
|
%
|
5.2
|
%
|
3.3
|
%
|
_________________ | ||
(1)
|
Based
on information from IMS Health, A.G. and Grupo Casa Saba estimates.
This
market share does not include purchases made by government
institutions
and sales in the private pharmaceutical market from similares,
generics and impulso.
Also, includes an estimate made by IMS of sales that
are
not done through wholesalers.
|
|
(2)
|
Based
on the changes in the NCPI.
|
Year
Ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
(Millions
of constant Pesos as of December 31, 2005)
|
||||||||||
Pharmaceuticals:
|
||||||||||
Private
sector
|
Ps.
17,732.7
|
Ps.17,758.4
|
Ps.
18,121.9
|
|||||||
%
Growth
|
5.8
|
%
|
0.1
|
%
|
2.1
|
%
|
||||
Government
|
579.4
|
638.1
|
815.4
|
|||||||
%
Growth
|
-29.2
|
%
|
10.1
|
%
|
27.8
|
%
|
||||
Health,
Beauty, Consumer Goods, General Merchandise and Other
Products
|
2,224.1
|
2,122.8
|
2,142.0
|
|||||||
%
Growth
|
0.9
|
%
|
-4.6
|
%
|
0.9
|
%
|
||||
Publications
|
693.6
|
736.3
|
794.5
|
|||||||
%
Growth
|
(12.9)
|
%
|
6.2
|
%
|
7.8
|
%
|
||||
Total
|
Ps.
21,229.8
|
Ps.
21,255.5
|
Ps.
21,873.8
|
|||||||
Total
% Growth
|
3.2
|
%
|
0.1
|
%
|
2.9
|
%
|
Year
Ended December 31,
|
||||||||||||
2003
|
2004
|
2005
|
||||||||||
Pharmaceuticals:
|
||||||||||||
Private
|
83.5
|
%
|
83.6
|
%
|
82.9
|
%
|
||||||
Government
|
2.7
|
%
|
3.0
|
%
|
3.7
|
%
|
||||||
Health,
Beauty, Consumer Goods, General Merchandise and Other
Products
|
10.5
|
%
|
9.9
|
%
|
9.8
|
%
|
||||||
Publications
|
3.3
|
%
|
3.5
|
%
|
3.6
|
%
|
||||||
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
|||||||
Cost
of Sales
|
90.1
|
%
|
89.7
|
%
|
89.7
|
%
|
||||||
Gross
Profit
|
9.9
|
%
|
10.3
|
%
|
10.3
|
%
|
||||||
Operating
expenses:
|
||||||||||||
Selling
expenses
|
2.5
|
%
|
2.7
|
%
|
2.5
|
%
|
||||||
Administrative
expenses
|
3.7
|
%
|
3.7
|
%
|
3.7
|
%
|
||||||
6.2
|
%
|
6.4
|
%
|
6.2
|
%
|
|||||||
Operating
income
|
3.8
|
%
|
3.9
|
%
|
4.1
|
%
|
||||||
Comprehensive
cost of financing, net
|
0.2
|
%
|
0.0
|
%
|
0.0
|
%
|
||||||
Other
income
|
(0.2
|
)%
|
(0.2
|
)%
|
(0.2
|
)%
|
||||||
Income
tax and employee profit sharing
|
0.8
|
%
|
0.9
|
%
|
0.9
|
%
|
||||||
Net
income
|
2.9
|
%
|
3.2
|
%
|
3.3
|
%
|
||||||
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
Contractual
Obligations
|
Payments
due by period
|
||||
Total
|
Less
than 1 year
|
1-3
years
|
3-5
years
|
More
than 5 years
|
|
Long-Term
Debt (1)
|
-
|
-
|
-
|
-
|
-
|
Capital
Lease Obligations (2)
|
-
|
12,779
|
-
|
-
|
-
|
Operating
Leases (3)
|
-
|
-
|
-
|
-
|
-
|
Purchase
Obligations (4)
|
-
|
-
|
-
|
-
|
-
|
Other
Long-Term Liabilities Reflected on Our Balance Sheet
Under Mexican GAAP
(5)
|
87,707
|
-
|
-
|
-
|
87,707
|
Total
|
100,486
|
12,779
|
-
|
-
|
87,707
|
(1)
|
Current
Maturities of Long-Term Debt (see Note 8 to our audited consolidated
financial statements).
|
(2)
|
Includes
leasing obligations of Information Technology equipment and transport
equipment from Hewlett-Packard, Capital and Paragon.
|
(3)
|
Not
applicable.
|
(4)
|
Not
applicable.
|
(5)
|
Includes
reserve for retirement pensions and seniority premiums. The maturity
of
this obligation will occur in accordance with the disclosure in
Note 3(j)
to our audited consolidated financial statements.
|
(i)
|
The
statutory income tax rate will be 30% for 2005 and will be reduced
by one
percentage point per year through 2007, when the rate will be
28%.
|
|
(ii)
|
The
tax deduction for inventories will be made through cost of sales,
and the
inventory balance as of December 31, 2004, will be taxable effective
2005,
not exceeding 2012, based on specific criteria provided for in
the Income
Tax Law.
|
|
(iii)
|
Paid
employee profit sharing will be deductible from income tax,
and
|
|
(iv)
|
The
limit on stockholders’ participation in taxable income or loss from
Mexican subsidiaries will be eliminated for tax consolidation
purposes.
|
·
|
NIF
and its interpretations;
|
|
·
|
APB
Bulletins transferred to the CINIF on May 31, 2004 that have
not been
amended, substituted, or annuled by the new NIFs; and
|
|
·
|
IFRS
that are supplementary guidance to be used when Mexican GAAP
does not
provide primary guidance.
|
·
|
|
In
addition to the statement of changes in financial position, NIF
A-3
includes the statement of cash flows, which should be issued
when required
by a particular standard.
|
·
|
|
NIF
A-5 includes a new classification for revenues and expenses:
ordinary and
extraordinary. Ordinary revenues and expenses are derived from
transactions or events thar are within the normal course of business
or
that are inherent in the entity’s activities, whether frequent or not;
extraordinary revenues and expenses refer to unusual transactions
and
events, whether frequent or not.
|
·
|
|
NIF
A-7 requires the presentation of comparative financial statements
for at
least with the preceding period. Through December 31, 2004, the
presentation of prior years’ financial statements was optional. The
financial statements must disclose the authorized date for their
issuance,
and the name of the officers or administrative body authorizing
the
related issuance.
|
·
|
|
In
October 2005, the CINIF issued NIF B-1, “Accounting changes and
corrections of errors”, intended to establish specific presentation and
disclosure rules of accounting changes and corrections of errors.
NIF B-1
sets forth the retrospective application of the effects of changes
and
correction of accounting errors to evaluate the financial information
as
if the change had not existed or the error had not been committed.
Application of the NIF is mandatory for accounting changes and
corrections
of errors recognized, effective January 1,
2006.
|
Directors
Name
and Date of Birth
|
Principal
Occupation
|
Business
Experience
|
First
Elected
|
Isaac
Saba Raffoul
(10/17/23)
|
Chairman
of the Board
|
President
and Director -
Xtra
Inmuebles, S.A. de C.V.
|
February
2000
|
Moisés
Saba Ades
(07/12/63)
|
Vice
Chairman of the Board
|
Director
- Xtra Inmuebles, S.A. de C.V.
|
February
2000
|
Alberto
Saba Ades
(07/09/65)
|
Vice
Chairman of the Board
|
Director
- Xtra Inmuebles, S.A. de C.V.
|
February
2000
|
Manuel
Saba Ades
(11/03/67)
|
Vice
Chairman of the Board and Chief Executive Officer
|
Director
- Xtra Inmuebles, S.A. de C.V.
|
February
2000
|
Gabriel
Saba D’jamus
(07/27/69)
|
Deputy
Chief Executive Officer
|
Executive
Director - Grupo Comercial Hotelera, S.A. de C.V.
|
February
2000
|
Agustín
Rodríguez Legorreta
(02/11/63)
|
Director
|
Investor
Advisor -Internacional de Capitales, S.A. de C.V.
|
February
2000
|
Raúl
Fernández Diaque
(05/16/63)
|
Director
|
Investor
Advisor -Internacional de Capitales, S.A. de C.V.
|
February
2000
|
Name
and Date of Birth
|
Principal
Occupation
|
Business
Experience
|
First
Elected
|
Iván
Moguel Kuri
(01/31/63)
|
Tax
Adviser to Grupo Casa Saba, S.A. de C.V.
|
Partner
- Chevez, Ruiz, Zamarripa y Cia, S.C.
|
February
2000
|
Alejandro
Sadurni Gómez
(10/8/59)
|
Chief
Financial Officer
|
Former
Chief Financial
Officer of Administration - INMAS, S.A. de C.V. |
February
2000
|
·
|
one
of our employees or managers;
|
|
·
|
a
controlling shareholder;
|
|
·
|
a
director, executive officer or relative of a controlling shareholder,
or
entities controlled or managed by a controlling shareholder;
or
|
|
·
|
a
significant client, supplier, debtor or creditor, or member of
the board
of directors or executive officer of any of these
entities.
|
·
|
prepare
an annual report regarding its activities for submission to the
Board of
Directors and to our shareholders at our annual shareholders’
meeting;
|
|
·
|
prepare
and render statements to the Board of Directors as to the fairness
of
transactions and arrangements with related parties; and
|
|
·
|
retain
independent experts to render fairness opinions in connection
with
material transactions and arrangements with related parties.
|
·
|
call
ordinary or extraordinary general meetings;
|
|
·
|
place
items on the agenda for meetings of shareholders or the Board
of
Directors;
|
|
·
|
attend
meetings of shareholders, the Board of Directors, or the Audit
Committee;
and
|
|
·
|
generally
monitor our affairs.
|
Name
and Date of
Birth
|
Current
Position
|
Business
Experience
|
First
Appointed
|
Manuel
Saba Ades
(11/03/67)
|
Chief
Executive Officer and Vice Chairman of the Board
|
President
and Director -Xtra Inmuebles, S.A. de C.V.
|
February
2000
|
Gabriel
Saba D’jamus
(07/27/69)
|
Deputy
Chief Executive Officer
|
Executive
Director - Grupo Comercial Hotelera, S.A. de C.V.
|
February
2000
|
Alejandro
Sadurni Gomez
(10/08/59)
|
Chief
Financial Officer
|
Former
Chief Financial Officer of Administration - INMAS, S.A. de
C.V.
|
February
2000
|
Ricardo
Ríos Cardenas
(01/02/55)
|
North
Region Operations and Sales Director
|
Deputy
Personal Assistant of the President of the United Mexican
States
|
December
2000
|
Oscar
Gutiérrez Melgar (17/04/67)
|
South
Region Operations and Sales Director
|
Former
Manager of Drogueros, S.A. de C.V.
|
November
1985
|
Jesus
Guerra de Luna
(05/29/61)
|
General
Counsel
|
Legal
Manager - Grupo Casa Autrey, S.A. de C.V.
|
June
1995
|
Jose
Norberto Mouret
(03/30/52)
|
Human
Resources Director
|
Human
Resources Director - Taesa
|
October
1999
|
Fernando
Torres Suarez
(09/21/64)
|
Purchasing
Director
|
Commercial
Director - Farmacias Benavides
|
April
2001
|
Jorge
Luis García
(09/12/61)
|
Chief
Information Officer
|
Former
Manager - Grupo Casa Autrey, S.A. de C.V.
|
May
1992
|
Name
|
Number
of Ordinary Shares Owned(1)
|
Percentage
Stake
|
Isaac
Saba Raffoul
|
225,606,456
|
85%
|
Directors,
executive officers and key employees(2)
|
225,606,456
|
85%
|
Total
|
225,606,456
|
85%
|
(1)
|
Does
not include Ordinary Shares directly held by funds advised by
Internacional de Capitales, S.A. de C.V., an investment advisory
firm that
renders investment advisory services to funds that invest in
securities of
Latin American and emerging market issuers. Shares held directly
by these
funds as of May 31, 2006 represented less than 3% of our issued and
outstanding capital stock as of that date. Agustin Rodriguez
Legorreta and
Raul Fernandez Diaque, two members of our Board of Directors,
render
investment advisory services to these funds in their capacity
as
investment advisors of Internacional de Capitales, S.A. de
C.V.
|
|
(2)
|
The
only director, executive officer and/or key employee who owns
Ordinary
Shares or ADSs is Isaac Saba Raffoul, our controlling shareholder.
The
listed amount is based on information provided by Mr. Saba.
|
Pesos
per Ordinary Share(1)
|
|||||||
High
|
Low
|
||||||
Year
|
|||||||
2001
|
Ps. |
8.99
|
Ps. |
3.69
|
|||
2002
|
Ps. |
12.40
|
Ps. |
6.52
|
|||
2003
|
Ps. |
13.30
|
Ps. |
10.00
|
|||
2004:
|
Ps. |
16.60
|
Ps. |
12.70
|
|||
First
Quarter
|
14.40
|
12.80
|
|||||
Second
Quarter
|
14.70
|
14.30
|
|||||
Third
Quarter
|
14.30
|
12.70
|
|||||
Fourth
Quarter
|
16.60
|
13.25
|
|||||
2005:
|
Ps. |
20.50
|
Ps. |
16.70
|
|||
First
Quarter
|
20.50
|
17.00
|
|||||
Second
Quarter
|
18.50
|
16.70
|
|||||
Third
Quarter
|
18.25
|
16.80
|
|||||
Fourth
Quarter
|
20.50
|
18.00
|
|||||
2006:
|
|||||||
First
Quarter
|
Ps. |
24.20
|
Ps. |
16.95
|
|||
Month
|
|||||||
December
2005
|
Ps. |
19.50
|
Ps. |
18.00
|
|||
January
2006
|
18.70
|
17.00
|
|||||
February
2006
|
19.20
|
16.95
|
|||||
March
2006
|
24.20
|
20.40
|
|||||
April
2006
|
24.50
|
23.95
|
|||||
May
2006
|
24.10
|
24.00
|
|||||
June
(through June 15, 2006)
|
24.05
|
24.05
|
(1)
|
Source:
Infosel and Economática
|
U.S.
Dollars per ADS(1)
|
|||||||
High
|
Low
|
||||||
Year
|
|||||||
2001
|
U.S.$ |
$8.35
|
U.S.$ |
$5.05
|
|||
2002
|
U.S.$ |
12.51
|
U.S.$ |
6.60
|
|||
2003
|
U.S.$ |
12.50
|
U.S.$ |
9.40
|
|||
2004:
|
U.S.$ |
14.99
|
U.S.$ |
10.70
|
|||
First
Quarter
|
13.01
|
11.40
|
|||||
Second
Quarter
|
13.00
|
12.11
|
|||||
Third
Quarter
|
11.83
|
10.70
|
|||||
Fourth
Quarter
|
14.99
|
11.25
|
|||||
2005:
|
U.S.$ |
18.50
|
U.S.$ |
14.75
|
|||
First
Quarter
|
18.50
|
14.75
|
|||||
Second
Quarter
|
16.77
|
14.80
|
|||||
Third
Quarter
|
17.29
|
15.30
|
|||||
Fourth
Quarter
|
18.30
|
17.10
|
|||||
2006:
|
|||||||
First
Quarter
|
U.S.$ |
22.60
|
U.S.$ |
16.52
|
|||
Month
|
|||||||
December
2005
|
U.S.$ |
18.30
|
U.S.$ |
17.85
|
|||
January
2006
|
18.09
|
17.21
|
|||||
February
2006
|
18.72
|
16.52
|
|||||
March
2006
|
22.60
|
18.42
|
|||||
April
2006
|
22.45
|
21.20
|
|||||
May
2006
|
22.44
|
20.35
|
|||||
June
(through June 15, 2006)
|
21.44
|
20.80
|
(1)
Source: Bloomberg, Infosel and Economática
|
·
|
their
identification as sociedad
anónima bursátil
(a
stock corporation with stock registered in the CNBV and listed
in the
Mexican Stock Exchange) and a new set of corporate governance
requirements;
|
|
·
|
the
redefinition of functions and structure of the Board of Directors,
including (i) the number of members of the Board of Directors,
up to 21
with at least 25% of these being independent members, and (ii)
the
independence status of the independent members of the Board of
Directors
will be qualified by the shareholders’ meeting and the CNBV will have the
authority to challenge such independence;
|
|
·
|
the
introduction of the general manager and senior management positions
as a
means for the Board of Directors to conduct the business;
|
·
|
a
clear definition of fiduciary duties for members of the Board
of Directors
and its secretary, the chief executive officer and other executive
officers, including duty of care and duty of loyalty;
|
|
·
|
the
increase of liability standards for members of the Board of Directors
and
its secretary with respect to the operations and performance
of the
Company, including (i) the payment of damages and losses caused
as result
of their lack of care or loyalty and (ii) criminal sanctions
of up to ten
years for damages caused to the Company as a result of certain
illegal
acts involving willful misconducts. The liability actions may
be exercised
by the Company or by shareholders that represent 5% or more of
the capital
stock of the Company;
|
|
·
|
the
inclusion of sanctions applicable to senior management, shareholders
that
hold 10% or more of the capital stock of an issuer and external
auditors;
|
|
·
|
the
omission of the statutory auditor for the audit committee, the
corporate
governance committee and the external auditors, assigning to
each of these
specific obligations of surveillance and corporate
governance;
|
|
·
|
the
attribution of independent status to all the members of the audit
and
corporate governance committees, except in companies with controlling
shareholder[s] with 50% of the capital stock, such as the
Company;
|
|
·
|
the
increase of functions and responsibilities of the audit committee,
including (i) the evaluation of the performance of the external
auditors,
(ii) the review and discussion of the financial statements of
the Company
and advising the Board of Directors on the approval of such financial
statements; (iii) the surveillance of internal controls and internal
audit
procedures of the Company, (iv) the reception and analysis of
recommendations and observations made by the shareholders, members
of the
Board of Directors and senior management, and the authority to
take the
necessary actions, (v) the authority to call a shareholders meeting
and
include the items to be discussed in the meeting’s agenda and (vi) the
surveillance of the performance of the general manager; and
|
|
·
|
the
requirement that the shareholders meeting approve transactions
that represent 20% or more of the consolidated assets of the
Company
within one fiscal year; and the inclusion of a new set of rules
to obtain
authorization from the CNBV to execute public offerings.
|
·
|
to
be considered as Mexicans with respect to Ordinary Shares that
they
acquire or hold as well as to the property, rights, concessions,
participations or interests owned by us or to the rights and
obligations
derived from any agreements we have with the Mexican government;
and
|
|
·
|
not
to invoke the protection of their own governments. Failure to
comply is
subject to a penalty of forfeiture of such a shareholder’s capital
interests in favor of Mexico.
|
·
|
any
redemption shall be made on a pro-rata basis among all of our
shareholders;
|
|
·
|
to
the extent that a redemption is effected through a public tender
offer on
the Mexican Stock Exchange, the shareholders’ resolution approving the
redemption may empower the Board of Directors to specify the
number of
shares to be redeemed and appoint the related intermediary or
purchase
agent; and
|
|
·
|
any
redeemed shares must be cancelled.
|
·
|
holders
of at least 10% of our outstanding capital stock to call a shareholders’
meeting;
|
|
·
|
holders
of at least 15% of our outstanding capital stock to bring a derivative
suit against any member of our Board of Directors for breach
of fiduciary
duties;
|
|
·
|
holders
of at least 10% of our shares represented at a shareholders’ meeting to
request that resolutions with respect to any matter on which
they were not
sufficiently informed to be postponed; and
|
|
·
|
subject
to the satisfaction of certain requirements under Mexican law,
holders of
at least 20% of our outstanding capital stock to contest any
shareholder
resolution.
|
·
|
to
be considered as Mexicans with respect to the Ordinary Shares
that they
acquire or hold, as well as to the property, rights, concessions,
participation or interests owned by us or to the rights and obligations
derived from any agreements we have with the Mexican government;
and
|
|
·
|
not
to invoke the protection of their own governments. If a holder
of our
Ordinary Shares invokes the protection of its own government,
the holder’s
Ordinary Shares will be forfeited to the Mexican government.
|
·
|
The
Income Tax Law;
|
|
·
|
The
Federal Tax Code; and
|
|
·
|
The
Tax Treaty between Mexico and the U.S., which we refer to as
the Tax
Treaty.
|
·
|
a
natural person may be treated as a resident of Mexico if he or
she has
established his or her home in Mexico, unless he or she resided
in another
country for more than 183 calendar days during a year and can
demonstrate
that he or she had become a resident of that country for tax
purposes;
|
|
·
|
a
legal entity is a resident of Mexico if it is established under
Mexican
law, or it has established in Mexico its main place of
management;
|
|
·
|
a
Mexican citizen is presumed to be a resident of Mexico unless
he or she
can demonstrate otherwise; and
|
|
·
|
a
legal entity that has a permanent establishment or fixed base
in Mexico
shall be required to pay taxes in accordance with relevant tax
provisions.
|
·
|
the
sale is carried out through the Mexican Stock Exchange, or other
recognized securities market approved by the Mexican tax authorities
through general rules; and
|
|
·
|
the
Ministry of Finance and Public Credit considers such Ordinary
Shares to be
publicly held.
|
·
|
a
citizen or resident of the United States;
|
|
·
|
a
corporation or other entity taxable as a corporation organized
or created
in the United States or any political subdivision thereof; as
the case may
be;
|
|
·
|
an
estate, the income of which is subject to U.S. federal income
tax,
regardless of its source; or
|
|
·
|
a
trust, if a court within the United States is able to exercise
primary
supervision over its administration and one or more United States
persons
have the authority to control all substantial decisions of such
trust
|
NYSE
Standards
|
Our
Corporate Governance Practice
|
|
Majority
of Board of Directors must be independent. Exception for “controlled
companies,” which would include our Company if we were a U.S.
issuer.
|
We
are required to have a Board of Directors of between 5 and 20
members, 25%
of whom must be independent under the Mexican Stock Exchange
Law. Our
Board of Directors is not required to make a determination as
to the
independence of our directors. The applicable definition of independence,
which differs in certain respects from the definition applicable
to U.S.
issuers under the NYSE standard, prohibits, among other relationships,
an
independent director from being an employee or officer of the
Company or
an independent director from being a shareholder that may have
influence
over the Company. It also prohibits certain relationships between
the
Company and the independent director, entities with which the
independent
director is associated and family members of the independent
director.
|
|
Non-management
directors must meet at executive sessions without
management.
|
Our
non-management directors are not required to meet in executive
sessions.
Executive sessions are not recommended by the Mexican Code of
Enhanced
Corporate Practices. Our Chief Executive Officer is a member
of our Board
of Directors.
|
|
Nominating/corporate
governance committee of independent directors required. Exception
for
“controlled companies,” which would include our Company if we were a U.S.
issuer.
|
We
are not required to have a nominating corporate governance committee,
and
such committee is not recommended by the Mexican Code of Enhanced
Corporate Practices.
|
|
Compensation
committee of independent directors required. Exception for “controlled
companies,” which would include our Company if we were a U.S.
issuer.
|
We
are not required to have a compensation committee, and currently
we do not
have one.
|
|
Audit
committee satisfying the independence and other requirements
of Rule 10A-3
under the Exchange Act and the NYSE independence
standards.
|
We
have a two member audit committee, both of which are independent
under
applicable Mexican standards and on Rule 10A-3. Members of our
audit
committee do not need to satisfy the NYSE independence standards
that are
not required by Rule 10A-3. Our audit committee does not have
a written
charter.
|
|
Equity
compensation plans require shareholder approval, subject to limited
exemptions.
|
Shareholder
approval is not required under Mexican law or our bylaws for
the adoption
and amendment of an equity-compensation plan. However, regulations
of the
Mexican Banking and Securities Commission require shareholder
approval
under certain circumstances.
|
|
Corporate
governance guidelines and code of conduct and ethics required,
with
disclosure of any waiver for directors or executive officers.
|
The
practices for our Board of Directors, including committees and
compensation of directors, are described in this annual report.
We have
adopted a code of ethics applicable to all of our directors and
executive
officers, which is available at http://www.casasaba.com.
|
|
CEO Certifications must certify to the NYSE each year that the CEO is not aware of any violation by the Company of the NYSE corporate governance listing standards. Additionally CEO’s must notify the NYSE in writing if any executive officer becomes aware of any material non-compliance with the new listing standards. | We are required to disclose each year our degree of compliance with the Code of Enhanced Corporate Governance Practices, and the truthfulness of such disclosure must be certified by the Chairman of the Board of Directors; however there is no such concept as a violation of the Code of Enhanced Corporate Governance Practices since compliance with these is not mandatory. Furthermore, other than the disclosure provided by our CEO in this annual report, the CEO is not required to provide notification of any non-compliance of which he may be aware of. |
For
the year ended December 31,
|
|||||||
2004
|
2005
|
||||||
(Ps.
millions)
|
|||||||
Audit
Fees
|
Ps. |
5.2
|
Ps. |
5.6
|
|||
Audit-Related
Fees
|
1.3
|
2.1
|
|||||
Tax
Fees
|
3.1
|
4.9
|
|||||
Other
Fees
|
0
|
0
|
|||||
Total
|
Ps. |
9.6
|
Ps. |
12.6
|
Page
|
|
Index
to Consolidated Financial Statements
|
F-1
|
Report
of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated
Balance Sheets as of December 31, 2004 and 2005
|
F-3
|
Consolidated
Statements of Income for each of the years ended
December
31, 2003, 2004 and 2005
|
F-4
|
Consolidated
Statements of Stockholders’ Equity for the years ended
December
31, 2003, 2004 and 2005
|
F-5
|
Consolidated
Statements of Changes in Financial Position for the
years
ended December 31, 2003, 2004 and 2005
|
F-6
|
Notes
to Consolidated Financial Statements
|
F-8
|
Exhibit
Number
|
Description
of Exhibits
|
1.1
|
Amended
and Restated Bylaws (English translation).**
|
8.1
|
List
of Subsidiaries of the Registrant.*
|
12.1
|
Certification
of the Principal Executive Officer of Grupo Casa Saba, S.A. de
C.V.
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.*
|
12.2
|
Certification
of the Principal Financial Officer of Grupo Casa Saba, S.A. de
C.V.
pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.*
|
13.1
|
Certification
of the Principal Executive and Financial Officer of Grupo Casa
Saba, S.A.
de C.V. pursuant to 18 U.S. C. Section 1350, as adopted pursuant
to
Section 906 of the Sarbanes-Oxley Act of
2002.*
|
|
* | Filed herewith. |
|
** | Filed as an Exhibit to Grupo Casa Saba, S.A. de C.V.'s annual report for the year ended December 31, 2004 and incorporated by reference hereto. |
Dated:
June 30, 2006
|
GRUPO
CASA SABA, S.A. DE C.V.
|
By:/s/
Manuel Saba Ades
Name:
Manuel Saba Ades
Title:
Chief Executive Officer
|
Page
|
|
Consolidated
Financial Statements of Grupo Casa Saba, S.A. de
C.V.
|
|
Report
of Independent Registered Public Accounting Firm
|
F-2
|
Consolidated
Balance Sheets as of December 31, 2004 and 2005
|
F-3
|
Consolidated
Statement of Income for each of the years ended December 31,
2003, 2004
and 2005
|
F-4
|
Consolidated
Statements of Stockholders’ Equity for the years ended December 31, 2003,
2004 and 2005
|
F-5
|
Consolidated
Statement of Changes in Financial Position for the years ended
December
31, 2003, 2004 and 2005
|
F-6
|
Notes
to Consolidated Financial Statements
|
F-8
|
2004
|
2005
|
Convenience
translation 2005
|
2004
|
2005
|
Convenience
translation 2005
|
|||||||||||||||||
CURRENT
ASSETS:
|
CURRENT
LIABILITIES:
|
|||||||||||||||||||||
Cash
and cash equivalents (Note 3.d)
|
Ps. |
497,069
|
Ps. |
714,487
|
$ |
66,706
|
Trade
accounts payable
|
Ps. |
4,217,198
|
Ps. |
4,030,376
|
$ |
376,287
|
|||||||||
Accounts
receivable, net (Notes 3.f and 4)
|
3,700,261
|
4,161,762
|
388,554
|
Other
payables and accrued liabilities
|
164,264
|
222,829
|
20,803
|
|||||||||||||||
Inventories,
net (Notes 3.c and 5)
|
3,817,600
|
3,590,104
|
335,182
|
Employee
profit sharing (Notes 3.l
and
12.d)
|
|
2,856
|
4,184
|
391
|
||||||||||||||
Prepaid
expenses
|
8,891
|
10,680
|
997
|
|||||||||||||||||||
Total
current liabilities
|
4,384,318
|
4,257,389
|
397,481
|
|||||||||||||||||||
Total
current assets
|
8,023,821
|
8,477,033
|
791,439
|
|||||||||||||||||||
|
|
|||||||||||||||||||||
|
RESERVE
FOR RETIREMENT PENSIONS AND SENIORITY PREMIUM (Note
3.j)
|
55,615
|
87,707
|
8,188
|
||||||||||||||||||
|
DEFERRED
INCOME TAX (Notes 3.k and 9)
|
815,415
|
870,713
|
81,292
|
||||||||||||||||||
|
DEFERRED
EMPLOYEE PROFIT SHARING
|
8,181
|
2,888
|
270
|
||||||||||||||||||
PROPERTY AND EQUIPMENT, net (Notes 3.g and 6) |
1,105,536
|
1,065,255
|
99,455
|
|||||||||||||||||||
|
Total
liabilities
|
5,263,529
|
5,218,697
|
487,231
|
||||||||||||||||||
|
STOCKHOLDERS’
EQUITY
|
|||||||||||||||||||||
|
Capital
stock (Note 11)
|
1,040,863
|
1,040,863
|
97,178
|
||||||||||||||||||
|
Premium
on stock sold
|
805,706
|
805,706
|
75,223
|
||||||||||||||||||
OTHER
ASSETS, net
|
86,439
|
119,951
|
11,199
|
Reserve
for
share repurchases (Note 11)
|
|
983,841
|
983,841
|
91,854
|
||||||||||||||
|
Retained
earnings
|
3,275,675
|
3,873,936
|
361,682
|
||||||||||||||||||
Deficit
on restatement (Note 3.c)
|
(1,900,915
|
)
|
(2,024,062
|
)
|
(188,972
|
)
|
||||||||||||||||
|
Accrued
deferred income tax effect
|
(37,693
|
)
|
(37,693
|
)
|
(3,519
|
)
|
|||||||||||||||
|
Additional
employee retirement liability
|
-
|
(28,309
|
)
|
(2,643
|
)
|
||||||||||||||||
GOODWILL,
net (Note 3.h)
|
215,210
|
170,740
|
15,941
|
Total
stockholders’
equity
|
4,167,477
|
4,614,282
|
430,803
|
|||||||||||||||
Total
assets
|
Ps. |
9,431,006
|
Ps. |
9,832,979
|
$ |
918,034
|
Total
liabilities and stockholders’
equity
|
Ps. |
9,431,006
|
Ps. |
9,832,979
|
$ |
918,034
|
|||||||||
The
accompanying notes are an integral part of these consolidated
financial
statements.
|
2003
|
2004
|
2005
|
Convenience
translation
2005
|
||||||||||
Net
sales (Note 3.o and 13)
|
Ps. |
21,229,791
|
Ps. |
21,255,521
|
Ps. |
21,873,753
|
$
|
2,042,196
|
|||||
Cost
of sales
|
19,119,246
|
19,067,357
|
19,616,592
|
1,831,461
|
|||||||||
Gross
Profit
|
2,110,545
|
2,188,164
|
2,257,161
|
210,735
|
|||||||||
Operating
expenses
|
|||||||||||||
Selling
|
528,857
|
582,904
|
542,977
|
50,694
|
|||||||||
Administrative
|
779,578
|
780,878
|
818,945
|
76,459
|
|||||||||
1,308,435
|
1,363,782
|
1,361,922
|
127,153
|
||||||||||
Operating
income
|
802,110
|
824,382
|
895,239
|
83,582
|
|||||||||
Comprehensive
cost of financing, net
|
|||||||||||||
Interest
income
|
(3,297
|
)
|
(6,236
|
)
|
(27,216
|
)
|
(2,541
|
)
|
|||||
Interest
expense
|
68,901
|
30,805
|
13,029
|
1,216
|
|||||||||
Exchange
loss, net (Note 3.I)
|
193
|
2
|
2,682
|
250
|
|||||||||
(Gain)
loss on monetary position (Note 3.c)
|
(15,475
|
)
|
(8,250
|
)
|
9,937
|
928
|
|||||||
50,322
|
16,321
|
(1,568
|
)
|
(147
|
)
|
||||||||
Other
income, net
|
(37,298
|
)
|
(51,562
|
)
|
(38,413
|
)
|
(3,586
|
)
|
|||||
Income
before provisions
|
789,086
|
859,623
|
935,220
|
87,315
|
|||||||||
Provisions
for:
|
|||||||||||||
Income
tax (Notes 3.k, 12.a and 12.e)
|
171,655
|
59,813
|
307,671
|
28,724
|
|||||||||
Income
tax offset by prior year tax loss
carryforwards
|
(140,504
|
)
|
(38,294
|
)
|
(188,344
|
)
|
(17,584
|
)
|
|||||
Asset
tax (Note 12.b)
|
-
|
10,687
|
-
|
-
|
|||||||||
Deferred
income tax (Notes 3.k and 9)
|
130,342
|
147,164
|
88,437
|
8,257
|
|||||||||
161,493
|
179,370
|
207,764
|
19,397
|
||||||||||
Employee
profit sharing (Notes 3.k and 12.d)
|
1,558
|
1,645
|
4,259
|
398
|
|||||||||
Deferred
employee profit sharing (Notes 3.k and 12.d)
|
-
|
8,181
|
(5,028
|
)
|
(469
|
)
|
|||||||
163,051
|
189,196
|
206,995
|
19,326
|
||||||||||
Net
income
|
Ps. |
626,035
|
Ps. |
670,427
|
Ps. |
728,225
|
$
|
67,989
|
|||||
Net
income per share (Note 3.n)
|
Ps. |
2,359
|
Ps. |
2,526
|
Ps. |
2.744
|
$
|
0.256
|
|||||
Weighted
average shares
outstanding
(in thousands)
|
265,419
|
265,419
|
265,419
|
Capital
stock
|
||||||||||||||||||||||||||||
|
Historical
|
|
|
Restatement
|
Premium
on stock sold
|
Reserve
for share repurchases
|
Retained
earnings
|
Deficit
on restatement
|
Accrued
deferred income tax effect
|
Additional
employee retirement liability
|
Total
|
|||||||||||||||||
Balances
as of January 1, 2003
|
Ps. |
167,903
|
Ps. |
872,960
|
Ps. |
805,706
|
Ps. |
983,841
|
Ps. |
2,207,889
|
Ps. |
(1,631,542
|
)
|
Ps. |
(37,693
|
)
|
Ps. |
-
|
Ps. |
3,369,064
|
||||||||
Dividends
paid
|
-
|
-
|
-
|
-
|
(111,131
|
)
|
-
|
-
|
-
|
(111,131
|
)
|
|||||||||||||||||
Comprehensive
income
|
-
|
-
|
-
|
-
|
626,035
|
(252,470
|
)
|
-
|
-
|
373,565
|
||||||||||||||||||
Balance
as of December 31, 2003
|
167,903
|
872,960
|
805,706
|
983,841
|
2,722,793
|
(1,884,012
|
)
|
(37,693
|
)
|
-
|
3,631,498
|
|||||||||||||||||
Dividends
paid
|
-
|
-
|
-
|
-
|
(117,545
|
)
|
-
|
-
|
-
|
(117,545
|
)
|
|||||||||||||||||
Comprehensive
income
|
-
|
-
|
-
|
-
|
670,427
|
(16,903
|
)
|
-
|
-
|
653,524
|
||||||||||||||||||
Balance
as of December 31, 2004
|
167,903
|
872,960
|
805,706
|
983,841
|
3,275,675
|
(1,900,915
|
)
|
(37,693
|
)
|
-
|
4,167,477
|
|||||||||||||||||
Dividends
paid
|
-
|
-
|
-
|
-
|
(129,964
|
)
|
-
|
-
|
-
|
(129,964
|
)
|
|||||||||||||||||
Comprehensive
income
|
-
|
-
|
-
|
-
|
728,225
|
(123,147
|
)
|
-
|
(28,309
|
)
|
576,769
|
|||||||||||||||||
Balance
as of December 31, 2005
|
Ps. |
167,903
|
Ps. |
872,960
|
Ps. |
805,706
|
Ps. |
983,841
|
Ps. |
3,873,936
|
Ps. |
(2,024,062
|
)
|
Ps. |
(37,693
|
)
|
Ps. |
(28,309
|
)
|
Ps. |
4,614.282
|
2003
|
2004
|
2005
|
Convenience
translation 2005
|
||||||||||
Operating
activities:
|
|||||||||||||
Net
income
|
Ps. |
626,035
|
Ps. |
670,427
|
Ps. |
728,225
|
$ |
67,989
|
|||||
Add
- Non cash items:
|
|||||||||||||
Depreciation
and amortization
|
99,865
|
107,530
|
130,012
|
12,138
|
|||||||||
Allowance
for
doubtful accounts
|
87,639
|
90,828
|
70,452
|
6,578
|
|||||||||
Loss
on
sale of property and equipment
|
8,703
|
1,464
|
4,444
|
415
|
|||||||||
Provision
for
retirement pensions and seniority premium
|
13,917
|
14,071
|
19,261
|
1,798
|
|||||||||
Deferred income
tax
|
130,342
|
147,164
|
88,437
|
8,257
|
|||||||||
Deferred
employee profit sharing
|
-
|
8,181
|
(5,028
|
)
|
(469
|
)
|
|||||||
966,501
|
1,039,665
|
1,035,803
|
96,706
|
||||||||||
Changes
in assets and liabilities:
|
|||||||||||||
(Increase)
decrease in:
|
|||||||||||||
Accounts
receivable
|
(505,945
|
)
|
283,768
|
(531,953
|
)
|
(49,665
|
)
|
||||||
Inventories
|
(248,812
|
)
|
(521,910
|
)
|
104,349
|
9,742
|
|||||||
Prepaid
expenses
|
(1,598
|
)
|
8,213
|
(1,789
|
)
|
(167
|
)
|
||||||
Trade
accounts payable
|
(134,301
|
)
|
334,109
|
(186,822
|
)
|
(17,442
|
)
|
||||||
Other
payables and accrued liabilities
|
143,906
|
(65,018
|
)
|
58,565
|
5,468
|
||||||||
Employee
profit
sharing
|
(2,332
|
)
|
1,298
|
1,328
|
124
|
||||||||
(749,082
|
)
|
40,460
|
(556,322
|
)
|
(51,940
|
)
|
|||||||
Net
cash provided by operating activities
|
217,419
|
1,080,125
|
479,481
|
44,766
|
|||||||||
Investing
activities:
|
|||||||||||||
Additions
of
property and equipment, net of retirements
|
47,800
|
116,583
|
45,261
|
4,226
|
|||||||||
Increase
in
other assets
|
2,145
|
2,499
|
41,137
|
3,841
|
|||||||||
Reserve
for retirement pensions and seniority
premium
|
12,806
|
12,106
|
12,297
|
1,148
|
|||||||||
Net
cash used in investing activities
|
62,751
|
131,188
|
98,695
|
9,215
|
|||||||||
Financing
activities:
|
|||||||||||||
Dividends
paid
|
(111,131
|
)
|
(117,545
|
)
|
(129,964
|
)
|
(12,134
|
)
|
|||||
Bank
loans, net of payments made
|
(8,695
|
)
|
(402,998
|
)
|
-
|
-
|
|||||||
Effect
in change of bank loans due to the
|
|||||||||||||
restatement
|
(17,204
|
)
|
(20,919
|
)
|
-
|
-
|
|||||||
Deferred
income
tax
|
98,652
|
(96,369
|
)
|
(33,139
|
)
|
(3,094
|
)
|
||||||
Deferred
employee profit sharing
|
-
|
-
|
(265
|
)
|
(25
|
)
|
|||||||
Net
cash (used in) financing activities
|
(38,378
|
)
|
(637,831
|
)
|
(163,368
|
)
|
(15,253
|
)
|
2003
|
2004
|
2005
|
Convenience
translation 2005
|
||||||||||
Net
increase in cash and
|
|||||||||||||
cash
equivalents
|
116,290
|
311,106
|
217,418
|
20,298
|
|||||||||
Cash
and cash equivalents
|
|||||||||||||
at
beginning of year
|
69,673
|
185,963
|
497,069
|
46,408
|
|||||||||
Cash
and cash equivalents
|
|||||||||||||
at
end of year
|
Ps. |
185,963
|
Ps. |
497,069
|
Ps. |
714,487
|
$ |
66,706
|
|||||
Supplementary
information:
|
|||||||||||||
Income
tax and asset tax paid
|
Ps. |
175,790
|
Ps. |
100,172
|
Ps. |
266,846
|
$ |
24,913
|
|||||
|
|||||||||||||
Employee
profit
sharing paid
|
Ps. |
1,417
|
Ps. |
1,579
|
Ps. |
2,583
|
$ |
241
|
|||||
Interest
paid
|
Ps. |
55,369
|
Ps. |
21,219
|
Ps. |
4,107
|
$ |
383
|
Economic
Interest
|
||||
(Direct
or indirect)
|
||||
2004
|
2005
|
|||
Casa
Saba, S.A de C.V.
|
(Casa
Saba)
|
99.9%
|
99.9%
|
|
Drogueros,
S.A. de C.V.
|
(Drogueros)
|
99.9%
|
99.9%
|
|
Grupo
Mexatar, S.A. de C.V.
|
(Mexatar)
|
99.9%
|
99.9%
|
|
Centennial,
S.A. de C.V.
|
(Centennial)
|
99.9%
|
99.9%
|
|
Inmuebles
Visosil, S.A. de C.V.
|
(Visosil)
|
99.9%
|
99.9%
|
|
Publicaciones
Citem, S.A. de C.V.
|
(Citem)
|
99.9%
|
99.9%
|
|
Transportes
Marproa, S.A. de C.V.
|
(Marproa)
|
99.9%
|
99.9%
|
|
Servicios
Corporativos Saba, S.A. de C.V.
|
(Servicios
Corporativos Saba)
|
99.9%
|
99.9%
|
|
Distribuidora
Casa Saba, S.A. de C.V.
|
(Distribuidora
Saba)
|
99.9%
|
99.9%
|
|
Other
companies (real estate and service companies)
|
99.9%
|
99.9%
|
December
31,
|
|||||||||||||
2004
|
2005
|
||||||||||||
Labor
liability
|
|||||||||||||
Vested
benefit obligation
|
Ps.
|
114,913
|
Ps.
|
125,736
|
|||||||||
Non-vested
benefit obligation
|
24,274
|
12,702
|
|||||||||||
Accumulated
benefit obligation
|
139,187
|
138,438
|
|||||||||||
Additional
benefit related to future
|
|||||||||||||
compensation
increases
|
9,515
|
25,001
|
|||||||||||
Projected
benefit obligation
|
148,702
|
163,439
|
|||||||||||
Fair
value of plan assets
|
59,637
|
67,094
|
|||||||||||
Unfunded
projected benefit obligation
|
89,064
|
96,345
|
|||||||||||
Unrecognized
net transition obligation
|
(41,815
|
)
|
(44,607
|
)
|
|||||||||
Negative
amendments
|
16,452
|
15,411
|
|||||||||||
Unrecognized
net loss
|
(39,669
|
)
|
(42,516
|
)
|
|||||||||
|
|
||||||||||||
Unfunded
accrued pension cost
|
|||||||||||||
and
seniority premium to be recognized
|
|||||||||||||
under
U.S. GAAP and Mexican GAAP
|
Ps.
|
24,032
|
Ps.
|
24,633
|
|||||||||
Additional
employee retirement liability
|
31,584
|
63,074
|
|||||||||||
Net
actual obligation
|
Ps.
|
55,615
|
Ps.
|
87,707
|
|||||||||
Net
periodic cost
|
|||||||||||||
Service
cost
|
Ps.
|
5,028
|
Ps.
|
8,196
|
|||||||||
Interest
on projected benefit obligation
|
7,839
|
8,458
|
|||||||||||
Expected
return on plan assets
|
(3,248
|
)
|
(3,483
|
)
|
|||||||||
Amortization
of net transition obligation
|
3,567
|
5,132
|
|||||||||||
Amortization
of amendments
|
(989
|
)
|
(1,007
|
)
|
|||||||||
Amortization
of losses
|
1,873
|
1,965
|
|||||||||||
Net
periodic cost under U.S. GAAP
|
|||||||||||||
and
Mexican GAAP
|
Ps.
|
14,071
|
Ps.
|
19,261
|
|||||||||
Assumptions
(real rates)
|
|||||||||||||
Discount
rate
|
5.5
|
%
|
5.5
|
%
|
|||||||||
Salary
increase rate
|
1
|
%
|
1
|
%
|
|||||||||
Return
on plan assets
|
7.5
|
%
|
6
|
%
|
December
31,
|
|||||||||||||
2004
|
2005
|
||||||||||||
Change
in projected benefit obligation
|
|||||||||||||
Actual
projected benefit obligation at
|
|||||||||||||
Beginning
of year
|
Ps.
|
152,083
|
Ps.
|
158,904
|
|||||||||
Service
cost
|
5,028
|
13,470
|
|||||||||||
Interest
on projected benefit obligation
|
7,839
|
8,375
|
|||||||||||
ActuTimes
New Roman loss
|
-
|
(4,463
|
)
|
||||||||||
Benefits
paid
|
(16,248
|
)
|
(12,848
|
)
|
|||||||||
Projected
benefit obligation at end of year
|
Ps.
|
148,702
|
Ps.
|
163,438
|
|||||||||
Change
in plan assets
|
|||||||||||||
Fair
value of plan assets at beginning of year
|
Ps.
|
52,242
|
Ps.
|
59,637
|
|||||||||
Actual
return on plan assets
|
(16,622
|
)
|
4,468
|
||||||||||
Employer
contributions
|
10,717
|
14,455
|
|||||||||||
Benefits
paid
|
13,300
|
(11,466
|
)
|
||||||||||
Fair
value of plan assets at end of year
|
Ps.
|
59,637
|
Ps.
|
67,094
|
|||||||||
Funded
status
|
Ps.
|
89,064
|
Ps.
|
96,344
|
|||||||||
Unrecognized
net transition obligation
|
(41,815
|
)
|
(44,606
|
)
|
|||||||||
Negative
amendments
|
16,452
|
15,411
|
|||||||||||
Unrecognized
net loss
|
(39,669
|
)
|
(42,516
|
)
|
|||||||||
Unfunded
accrued pension cost and seniority
|
|||||||||||||
premium
to be recognized under U.S. GAAP
|
|||||||||||||
and
Mexican GAAP
|
Ps.
|
24,032
|
Ps.
|
24,633
|
|||||||||
Amounts
recognized in the statement of
|
|||||||||||||
financial
position consist of:
|
|||||||||||||
Unfunded
accrued pension cost and seniority
|
|||||||||||||
premium
to be recognized
|
Ps.
|
24,032
|
Ps.
|
24,633
|
|||||||||
Accrued
benefit liability
|
(63,014
|
)
|
(63,074
|
)
|
|||||||||
Intangible
asset
|
31,584
|
34,765
|
|||||||||||
Accumulated
other comprehensive income
|
31,430
|
28,309
|
|||||||||||
-
|
-
|
||||||||||||
Net
amount recognized
|
Ps.
|
24,032
|
Ps.
|
24,633
|
|||||||||
2004
|
2005
|
||||||
Trade
receivables
|
Ps.
|
3,728,205
|
|
Ps.
|
4,101,327
|
||
Allowance
for doubtful accounts
|
(325,819
|
)
|
348,872
|
||||
3,402,386
|
3,752,455
|
||||||
Other
receivables
|
70,976
|
66,513
|
|||||
Related
parties
|
3,786
|
3,870
|
|||||
Value
added tax recoverable
|
59,024
|
61,052
|
|||||
Income
tax recoverable
|
150,682
|
259,243
|
|||||
Asset
tax recoverable
|
13,407
|
18,629
|
|||||
Ps. | 3,700,261 | Ps. |
4,161,762
|
||||
2004
|
2005
|
||||||
Pharmaceutical products | Ps. | 2,523,571 | Ps. | 2,417,078 | |||
Beauty
care products
|
318,980
|
305,519
|
|||||
Books
and magazines
|
284,618
|
219,646
|
|||||
Electric
appliances
|
3,579
|
3,248
|
|||||
Groceries
|
90,756
|
95,928
|
|||||
Other
|
12,278
|
12,178
|
|||||
3,233,782
|
3,053,597
|
||||||
Estimate
for slow-moving inventory
|
(7,251
|
) |
7,022
|
||||
3,226,531
|
3,046,575
|
||||||
Merchandise-in-transit
|
591,069
|
543,529
|
|||||
Ps. |
3,817,600
|
Ps.3,590,104
|
|||||
2004
|
2005
|
|||||||||||||
Total
|
Original cost |
Restatement
|
Total
|
|||||||||||
Buildings
|
Ps.
|
838,114
|
|
Ps. 247,039
|
|
Ps.
|
595,502
|
Ps.
|
842,541
|
|||||
Machinery
and equipment
|
93,973
|
39,690
|
55,103
|
94,793
|
||||||||||
Transportation
equipment
|
238,581
|
174,126
|
86,994
|
261,120
|
||||||||||
Office
equipment
|
143,780
|
44,158
|
100,573
|
144,731
|
||||||||||
Computer
equipment
|
303,874
|
151,425
|
156,181
|
307,606
|
||||||||||
1,618,322
|
656,438
|
994,353
|
1,650,791
|
|||||||||||
Less-accumulated
depreciation
|
(833,010
|
)
|
(313,349
|
) |
(591,678
|
)
|
(905,027
|
)
|
||||||
785,312
|
343,089
|
402,675
|
745,764
|
|||||||||||
Land
|
320,224
|
57,834
|
261,657
|
319,491
|
||||||||||
|
|
Ps.
|
1,105,536 | Ps. |
400,923
|
Ps. |
664,332
|
Ps.
|
1,065,255
|
Buildings
and improvements
|
2.10%
|
Machinery
and equipment
|
6.09%
|
Transportation
equipment
|
10.15%
|
Furniture
and fixtures
|
6.50%
|
Computer
equipment
|
11.15%
|
2004
|
2005
|
||||||
Aeroxtra,
S.A. de C.V.
|
Ps. |
2,067
|
Ps. |
2,000
|
|||
Xtra
Inmuebles, S.A. de C.V.
|
1,719
|
1,870
|
|||||
|
Ps. | 3,786 |
3,870
|
2004
|
2005
|
||||||
Inventories
|
|
Ps.
|
3,873,180
|
|
Ps.
|
-
|
|
Cumulative
inventory
|
-
|
3,058,383
|
|||||
Allowance
for doubfoul accounts and estimate for low-moving
inventory
|
(303,713
|
)
|
(337,176
|
)
|
|||
Property
and equipment
|
385,775
|
457,603
|
|||||
Other
|
217
|
362,707
|
|||||
Excess
of accounting over tax values of assets and liabilities
|
3,955,459
|
3,541,517
|
|||||
Tax
loss carryforwards
|
(757,373
|
)
|
(11,400
|
)
|
|||
3,198,086
|
3,530,117
|
||||||
Income
tax rate
|
28%
|
|
28%
|
|
|||
Deferred
income tax
|
895,464
|
988,433
|
|||||
Less-
Asset tax recoverable |
(80,049
|
)
|
(117,720
|
)
|
|||
Deferred
income tax liability
|
Ps. |
815,415
|
Ps. |
870,713
|
2004
|
2005
|
||||||
Current
assets
|
$
|
5,554
|
$
|
9,728
|
|||
Current
liabilities
|
1,048
|
4,736
|
|||||
Net
position in U.S. dollars
|
$
|
4,506
|
$
|
4,992
|
|||
|
|||||||
Net
position (at fiscal year end constant Mexican pesos)
|
Ps.
50,556
|
$
|
53,473
|
Number
|
Par
value
|
|||||||||
2004
|
2005
|
|||||||||
Fixed
capital shares without retirement rights
|
265,149,080
|
Ps. |
167,730
|
Ps. |
167,730
|
|||||
Variable
capital shares
|
270,280
|
173
|
173
|
|||||||
Ps. | ||||||||||
265,419,360
|
Ps. |
167,903
|
167,903
|
|||||||
At
fiscal year end constant Mexican pesos
|
Ps. |
1,040,863
|
Ps. |
1,040,863
|
Year
incurred
|
Asset
tax
recoverable
|
||
1995
|
Ps. 4,178
|
||
1996
|
15,658
|
||
1999
|
8,051
|
||
2001
|
3,212
|
||
2002
|
32,934
|
||
2003
|
32,038
|
||
2004
|
21,649
|
||
|
Ps. 117,720 |
Year
ended December 31,
|
||||||||||
2003
|
2004
|
2005
|
||||||||
Statutory
income tax rate
|
34
|
%
|
33
|
%
|
30
|
%
|
||||
Permanent
differences:
|
||||||||||
Comprehensive
cost of financing vs. annual inflationary adjustment
|
3
|
15
|
1
|
|||||||
Non-deductible items
|
(10
|
)
|
(35
|
)
|
(3
|
)
|
||||
Other (cumulative inventory)
|
-
|
-
|
(4
|
)
|
||||||
Temporary
differences:
|
||||||||||
Depreciation
|
4
|
9
|
1
|
|||||||
Book cost of sales vs. purchases, labor and overhead
|
16
|
225
|
-
|
|||||||
Application
of prior year tax loss carryforwards
|
26.5
|
(226.1
|
)
|
(2.8
|
)
|
|||||
20.5
|
%
|
20.9
|
%
|
22.2
|
%
|
2003
|
2004
|
2005
|
||||||||
Pharmaceutical
products
|
Ps.
|
17,736
|
Ps.
|
18,396
|
Ps.
|
18,937
|
||||
Health
and beauty aids/other products
|
2,618
|
1,945
|
1,925
|
|||||||
Entertainment
products
|
693
|
737
|
795
|
|||||||
Food/non-perishable
products
|
161
|
176
|
212
|
|||||||
Office/electronic
products
|
22
|
2
|
5
|
|||||||
Total
|
Ps.
|
21,230
|
Ps.
|
21,256
|
Ps.
|
21,874
|
·
|
NIF
and its interpretations.
|
|
·
|
|
APB
Bulletins transferred to the CINIF on May 31, 2004 that
have not been
amended,
substituted,
or anulled by the new NIFs; and
|
·
|
IFRS
that
are supplementary guidance to be used when Mexican GAAP
does not provide
primary guidance.
|
·
|
In
addition to the statement of changes in financial position,
NIF A-3
includes the statement of cash flows, which should be
issued when required
by a particular standard.
|
|
·
|
NIF
A-5 includes a new classification for revenues and expenses:
ordinary and
extraordinary. Ordinary revenues and expenses are derived
from
transactions or events thar are within the normal course
of business or
that are inherent in the entity’s activities, whether frequent or not;
extraordinary revenues and expenses refer to unusual
transactions and
events, whether frequent or not.
|
|
·
|
NIF
A-7 requires the presentation of comparative financial
statements for at
least with the preceding period. Throuhg December 31,
2004, the
presentation of prior years’ financial statements was optional. The
financial statements must disclose the authorized date
for their issuance,
and the name of the officers or administrative body authorizing
the
related issuance
|
|
·
|
In
October 2005, the CINIF issued NIF B-1, “Accounting changes and
corrections of errors”, intended to establish specific presentation and
disclosure rules of accounting changes and corrections
of errors. NIF B-1
sets forth the retrospective application of the effects
of changes and
correction of accounting errors to evaluate the financial
information as
if the change had not existed or the error had not been
committed.
Application of the NIF is mandatory for accounting changes
and corrections
of errors recognized, effective January 1,
2006.
|
CONSTANT
MEXICAN PESOS
|
|||||||||||||
MEXICAN
GAAP
|
U.S.
GAAP
|
||||||||||||
2004
|
2005
|
2004
|
2005
|
||||||||||
Current
|
Ps. | - |
Ps.
|
-
|
Ps. |
999,512
|
Ps. |
863,495
|
|||||
Noncurrent
|
815,415
|
870,713
|
(184,097
|
)
|
7,218
|
||||||||
|
Ps. |
815,415
|
Ps. |
870,713
|
Ps. |
815,415
|
Ps. |
870,713
|
DEFERRED
EMPLOYEE PROFIT SHARING
CONSTANT
MEXICAN PESOS
|
||||||||||
2003
|
2004
|
2005
|
||||||||
Current
|
||||||||||
Inventories
|
Ps.
|
307,932
|
Ps.
|
28,453
|
Ps.
|
-
|
||||
Cumulative
inventory
|
-
|
-
|
8,592
|
|||||||
Non-deductible
reserves
|
(104,126
|
)
|
-
|
(5,780
|
)
|
|||||
203,806
|
28,453
|
2,812
|
||||||||
Non-current
|
||||||||||
Property
and
equipment
|
405
|
-
|
76
|
|||||||
Prepaid
expenses and prepaid pension cost
|
(48
|
)
|
-
|
-
|
||||||
Other
|
(204,163
|
)
|
(20,272
|
)
|
-
|
|||||
(203,806
|
)
|
(20,272
|
)
|
76
|
||||||
|
Ps. | - | Ps. |
8,181
|
Ps. |
2,888
|
Thousands
of Mexican pesos (Ps.) and thousands of U.S. dollars
($),
except
per share
|
|||||||||||||
NET INCOME |
Year
|
Convenience
translation
|
|||||||||||
2003
|
2004
|
2005
|
2005
|
||||||||||
|
|||||||||||||
Net
income under Mexican GAAP
|
Ps.
|
626,035
|
Ps. |
670,427
|
Ps. |
728,225
|
$ |
67,989
|
|||||
U.S.
GAAP adjustments-
|
|||||||||||||
Deferred
employee profit Sharing
|
61,277
|
-
|
-
|
-
|
|||||||||
Additional
employee retirement liability (Note 3.j)
|
-
|
-
|
(28,309
|
)
|
(2,643
|
)
|
|||||||
Unrecognized
net transition obligation (Note 3.j)
|
-
|
-
|
(4,102
|
)
|
(383
|
)
|
|||||||
Impact
of inflation accounting on U.S. GAAP adjustments
|
2,437
|
-
|
-
|
-
|
|||||||||
63,714
|
-
|
(32,411
|
)
|
(3,026
|
)
|
||||||||
Net
income under U.S. GAAP
|
689,749
|
670,427
|
695,814
|
64,963
|
|||||||||
Weighted
average common shares outstanding
(thousands)
|
265,419
|
265,419
|
265,419
|
||||||||||
Basic
and diluted earnings per share under U.S. GAAP
|
Ps. |
2.60
|
Ps. |
2.53
|
Ps. |
2.62
|
STOCKHOLDERS’
EQUITY
|
|||||||||||||
2003
|
2004
|
2005
|
Convenience
translation
2005
|
||||||||||
Stockholders’
equity under Mexican GAAP
|
Ps.
|
3,631,498
|
Ps. |
4,167,477
|
Ps. |
4,614,282
|
$ |
430,803
|
|||||
|
|||||||||||||
Unrecognized
net transition labor obligation (Note 3.J)
|
-
|
-
|
(4,102
|
)
|
(383
|
)
|
|||||||
Amortization
of goodwill
|
24,941
|
24,941
|
24,941
|
2,329
|
|||||||||
24,941
|
24,941
|
20,839
|
1,946
|
||||||||||
Stockholders’
equity under U.S. GAAP
|
Ps. |
3,656,439
|
Ps. |
4,192,418
|
Ps. |
4,635,121
|
$ |
432,749
|
Changes
in stockholders’ equity under U.S. GAAP
|
|||||||||||||
2003
|
2004
|
2005
|
Convenience
translation
2005
|
||||||||||
Stockholders’
equity under U.S. GAAP as of beginning of the year
|
Ps.
|
3,330,291
|
Ps. |
3,656,439
|
Ps. |
4,192,418
|
$ |
391,417
|
|||||
Comprehensive
income under U.S. GAAP
|
437,279
|
653,524
|
572,667
|
53,466
|
|||||||||
Dividends
paid
|
(111,131
|
)
|
(117,545
|
)
|
(129,964
|
)
|
(12,134
|
)
|
|||||
Stockholders’
equity under U.S. GAAP at year end
|
Ps. |
3,656,439
|
Ps. |
4,192,418
|
Ps. |
4,635,121
|
$ |
432,749
|
Comprehensive
income under U.S. GAAP
|
|||||||||||||
2003
|
2004
|
2005
|
Convenience
translation
2005
|
||||||||||
Net
income under U.S. GAAP
|
Ps.
|
689,749
|
Ps. |
670,427
|
Ps. |
695,814
|
$ |
64,963
|
|||||
Deficit
on restatement
|
(252,470
|
)
|
(16,903
|
)
|
(123,147
|
)
|
(11,497
|
)
|
|||||
Comprehensive
income under U.S. GAAP
|
Ps. |
437,279
|
Ps. |
653,524
|
Ps. |
572,667
|
$ |
53,466
|