Grupo México Informa - 15 Edition - Spring 2023

GRUPO MÉXICO INFOR MA

EDITORIAL LETTER

EDITORIAL LETTER

In Grupo México, our experience has allowed us to have the stability to develop solid projects and to operate amid uncertain scenarios, as the ones we´ve lived in recent years.

Our experience has also served us as a platform to overcome the challenges that have allowed us to grow.

This year Ferromex celebrates its 25th anniversary and, as anniversaries always do, it invites us to reflect about what has been achieved and what we still have to accomplish. Also, it invites us to think about what has brought us to where we are. Indalecio Cumplido Rivera, who has been with Ferromex since its beginnings, tells us how he has spent a quarter of a century at Ferromex. Thank you, Indalecio, for your dedication and commitment!

Our commitment to safety is reflected by our readiness to invest and innovate. The commissioning of a new communication system for underground operations at our Mining Division in San Martin unit in Zacatecas, which is a huge step forward in terms of the safety of our collaborators, proofs its.

The Infrastructure Division finished the new airfield in Cananea, which, in addition to being key to Sonora's connectivity, will boost the productivity of Grupo México's projects in the state.

Some time ago, with the conviction that conducting ourselves under clear ethical guidelines would strengthen our company, we drew up our Code of Ethics. You can access it whenever you want through our website.

Fundación Grupo México works with the conviction that we have a social task to fulfill. When its work is recognized, we are pleased because this tells us that things are being done well and that we are on the right track.

THE SAN MARTIN MINE REVOLUTIONIZES

IT’S SAFETY MECHANISMS WITH A NEW UNDERGROUND COMMUNICATIONS SYSTEM

In 2020, with an investment of US$2,600,000, and an additional one million for the parallel micro seismic protection project, the construction began on the infrastructure to provide the necessary support for the operation of this new underground communications system at all levels of the mine.

San Martin collaborators will receive a radio and a lamp with a tracking chip that will allow a permanent location of the worker while inside the mine, which can be followed from the Safe Operations Monitoring Center .

This new radio communication system uses LTE (4G) technology and allows collaborators to communicate with each other. This technology also makes it possible to take photographs that serve as a record and evidence and send them to the surface so that any necessary measures can be taken as quickly as possible.

The Safe Operations Monitoring Center will also track the microseismical system. This microseismical system, or earth events, send the precise location of these events, which allows a timely response to be given either by inspecting the site or, if necessary, stopping activities or evacuating personnel, depending on the magnitude of the event.

The San Martin unit, in Zacatecas, will be one of the first mines in the world to use the latest technology for communication within its underground operations. This revolutionizes the mechanisms for the protection and safety of our colleagues.

FERROMEX CELEBRATES 25 YEARS AS ONE OF THE MOST PRODUCTIVE RAILROADS IN NORTH AMERICA

A quarter of a century later, we look back on what brought us to where we are today.

By the end of the 20th century, the lack of maintenance and investment had led the Mexican National Railways to a serious situation of deterioration.

Eighty-one percent of the tracks needed rehabilitation work and the rolling stock was not in much better condition.

In the late 1980s, state-owned companies stopped transporting products by rail due to high costs and ine cient service. And in the nineties, the government cancelled the passenger transportation service due to its high cost and excessive travel times.

Ferromex is Mexico's most important freight railroad, one of eight Class 1 railroads in North America. On average it has the lowest market rates in America.

To overcome these conditions and to relaunch the railroad service in the country, the federal government proposed the privatization of the public company.

To this end, in February 1995, President Ernesto Zedillo modified Article 28 of the Constitution to allow private investment in the railroad sector and, in May of the same year, the Railroad Service Regulatory Law was published, which established the regulatory framework for granting concessions to such investors.

In order to carry out its privatization, the Mexican railroad system was divided into five sections. The first section tendered was the Northern Pacific Railroad (7164 km), together with the Ojinaga-Topolobampo short line (Chihuahua-Pacific Railroad, 943 km) and the Nacozari short line (320 km), totaling 8,427 km of railroad track.

In 1997 Grupo Ferroviario Mexicano, a company integrated by Grupo México (74%), with an investment of US$921 million at present value, won the concession (Ingenieros Civiles y Asociados (13%) and Union Pacific de México (13%).

The following year, Grupo México created the subsidiary Ferrocarril Mexicano (Ferromex), through which it began to operate the assigned lines.

GMXT's fleet has more than

- 800 locomotives

- 26,300 railroad cars

The GMXT network has more than - 11,000 km of track, 80% of which is reconstructed to move longer and heavier trains at higher speeds.

We have invested more than - US$8 billion in infrastructure, rolling stock and telecommunications.

With a track record that predates even Ferromex, Indalecio recalls all the di culties faced during the first weeks of Ferromex's operation: "Everything was very complicated because the operation was paralyzed. In addition, we had to rehire or hire new people. In February 1998, to restart the operation, it took us about ten days just to get the trains out, because we had to explore the entire track, pay attention to landslides and in general to the train passing by ".

It was clear from the beginning, that the company was committed to the project: "We had to make investments to renovate the most central sections because we found the tracks very a ected. It was nothing more and nothing less than the safety of the passage of trains". Today, twenty-five years later, the challenges we had to face to become the most important railroad company in the country and one of the most important in North America could be forgotten.

Indalecio Cumplido Rivera, Deputy Director of Infrastructure:

The new airfield, carried out by the Infrastructure Division, will be key to Sonora's connectivity and the productivity of Grupo México's projects in the state.

CONSTRUCTION OF CANANEA, SONORA AIRFIELD IS COMPLETED

At the end of 2022, the Cananea, Sonora Aerodrome built by México Compañía Constructora was inaugurated.

The aerodrome, located at km 62 of the Agua Prieta - Cananea highway, has a runway 2,000 meters long and 30 meters wide. It is also worth mentioning that its design allows it to receive aircraft such as the Gulfstream G650 type.

Thirty-four major pieces of equipment were used for its construction. 402 thousand cubic meters of earthwork material, 11 thousand cubic meters of asphalt and 4 thousand cubic meters of hydraulic concrete were placed.

The airfield is an example of the infrastructure development in the state of Sonora, and will facilitate air connectivity, allowing for increased productivity in Grupo México's projects.

RESULTS OF GRUPO MÉXICO FOUNDATION 2022

Fundación Grupo México has developed programs that have grown and gained strength over the years, achieving the recognition that has allowed it to become a benchmark for social activity in our country.

DURING 2022, FUNDACIÓN GRUPO MÉXICO CARRIED OUT ACTIONS, GOOD PRACTICES AND SOCIAL PROGRAMS IN FAVOR OF SOCIETY, WHICH HAVE BEEN WIDELY RECOGNIZED NATIONALLY AND INTERNATIONALLY.

National and international recognition:

The ILAN Foundation (Israel + Latin American Network), recognized Dr. Vagón, El Tren de la Salud as the most Innovative project in the category of Health and Science.

TOPS Mexico magazine awarded our Foundation a distinction for being the company most committed to health in Mexico.

The book Nopal, entre Pencas, Tunas y Flores by Editorial Xocoyo, was nominated in the Best of the Best category at the Gourmand World Cookbook Awards.

The Network of Associations was a finalist in the Kybernus Social Leadership Awards of the Ricardo Pliego Center, for generating spaces and synergies in Mexico's social sector.

Mexicanos Sembrando; a program of the Environment department, was nominated and a finalist in the Boscars Reforest Mexico Award, in the category Contribution to Forest Restoration, for donating more than 3 million trees annually.

These recognitions reiterate the commitments and social work carried out through 4 main lines of action: Health, Environment, Institutional Support, Education and Culture.

OUR CODE OF ETHICS

We are convinced that acting ethically is also in the best interest of both our performance as a company and our interests as part of society.

Based on this conviction, we developed our Code of Ethics. In it we rea rm our values, set out our Mission and Vision, and establish the fundamental principles and conducts for us to work in harmony and with full respect for human rights, by that established in our Human Rights Policy.

All of us who are part of Grupo México must be congruent with these values, complying with the policies and procedures established for this purpose.

Check it out

https://www.gmexico.com/GMDocs/CulturaCorporativa/CC_ES_01.pdf

In the event of any non-compliance with the Code of Ethics, we have a system for the reception and proper investigation of reports of irregularities received through the Whistleblower Hotline, in each of its divisions:

Grupo México Whistleblower Hotline:

https://www.lineadedenuncia.com/grupomexico gms@lineadedenuncia.com

Phone: 800 062 2105

Infrastructure Division Whistleblower Hotline:

www.lineadedenuncia.com/infraestructura infraestructura@lineadedenuncia.com

Phone: 800 062 2105

Transportation Division Whistleblower Hotline:

www.lineadedenuncia.com/gmt gmt@lineadedenuncia.com

Phone: 800 062 2105

Mining Division Whistleblower

Hotline:

Minera México www.lineadedenuncia.com/mineramexico mineramexico@lineadedenuncia.com

Phone: 800 062 2105

Southern Perú Copper Corporation www.lineadedenuncia.com/scc SCC@lineadedenuncia.com

Phone: 800 062 2105

ASARCO www.ethic-line.com/asarco/default.html asarco@ethic-line.com

Phone: 800 062 2105

Minera Los Frailes www.lineadedenuncia.com/mineralosfrailes mineralosfrailes@lineadedenuncia.com

Phone: 800 062 2105