Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (PAC) 20-F/A 2015 FY Annual report (foreign) (amended)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 20-F/A

(Amendment No. 2)

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2015

Commission File Number: 001-32751

Grupo Aeroportuario del Pacífico, S.A.B. de C.V.

(Exact name of registrant as specified in its charter)

Pacific Airport Group	United Mexican States
(Translation of registrant’s name into English)	(Jurisdiction of incorporation or organization)

Avenida Mariano Otero No. 1249-B

Torre Pacífico, Piso 6

Col. Rinconada del Bosque

44530 Guadalajara, Jalisco

Mexico

(Address of principal executive offices)

Saúl Villarreal

Chief Financial Officer

Grupo Aeroportuario del Pacífico, S.A.B. de C.V.

Avenida Mariano Otero No. 1249-B

Torre Pacífico, Piso 6

Col. Rinconada del Bosque

44530 Guadalajara, Jalisco

Mexico

Telephone: + 52 (33) 38801100 ext. 20151

svillarreal@aeropuertosgap.com.mx

(Name, telephone, e-mail and/or facsimile number and address of company contact person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Series B Shares	New York Stock Exchange, Inc.*
American Depositary Shares (ADSs), each representing ten Series B Shares	New York Stock Exchange, Inc.

* Not for trading, but only in connection with the registration of American Depositary Shares, pursuant to the requirements of the Securities and Exchange Commission.

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: N/A

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:

Title of each class:	Number of Shares
Series B Shares	476,850,000
Series BB Shares	84,150,000

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes  x            No   ¨

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes  ¨            No  x

Note: Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Yes  x            No   ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

N/A

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  x            Accelerated filer  ¨            Non-accelerated filer  ¨

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP  ¨            IFRS  x             Other  ¨

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow:

Item 17  ¨            Item 18  ¨

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  ¨            No   x

EXPLANATORY NOTE

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (“GAP”) is filing this Amendment No. 2 to Form 20-F/A (the “Form 20-F/A”) to amend its annual report on Form 20-F for the fiscal year ended December 31, 2015 (the “2015 Form 20-F”), as originally filed with the Securities and Exchange Commission (the “SEC”) on April 20, 2016 and amended on June 6, 2016, to include the entirety of Item 18 with a full set of financial statements and accompanying notes, so as to comply with Rule 12b-15, as requested by the staff of the Securities and Exchange Commission in a comment letter to GAP dated July 6, 2016.

This Form 20-F/A does not, and does not purport to, revise, update, amend or restate the information presented in any item of the 2015 Form 20-F, including the full set of financial statements and accompanying notes incorporated therein by reference, or reflect any events that have occurred after the filing of the 2015 Form 20-F.

Item 18. Financial Statements

See our consolidated financial statements beginning on page F-1, incorporated herein by reference. The following is an index to the financial statements:

Consolidated Financial Statements for Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

	Page
Report of Independent Registered Public Accounting Firm		F-1
Consolidated Statements of Financial Position as of December 31,  2015, 2014 and 2013		F-2
Consolidated Statements of Profit or Loss and Other Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013		F-4
Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2015, 2014 and 2013		F-6
Consolidated Statements of Cash Flows for the Years Ended December  31, 2015, 2014 and 2013		F-7
Notes to Consolidated Financial Statements		F-9

SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Amendment No. 2 to the annual report on its behalf.

Grupo Aeroportuario del Pacífico, S.A.B. de C.V.
By:	/s/ SAÚL VILLARREAL GARCÍA
Name:	Saúl Villarreal García
Title:	Chief Financial Officer

Dated: July 20, 2016

Grupo Aeroportuario del Pacífico,

S.A.B. de C.V. and Subsidiaries

Consolidated Financial Statements as of December 31, 2015 and 2014 and for the Years Ended December 31, 2015, 2014 and 2013 and Report of Independent Registered Public Accounting Firm Dated April 20, 2016

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Report of Independent Registered Public Accounting Firm and 2015, 2014 and 2013 Consolidated Financial Statements

Table of Contents	Page
Report of Independent Registered Public Accounting Firm		F-1
Consolidated Statements of Financial Position as of December  31, 2015, 2014 and 2013		F-2
Consolidated Statements of Profit or Loss and Other Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013		F-4
Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2015, 2014 and 2013		F-6
Consolidated Statements of Cash Flows for the Years Ended December  31, 2015, 2014 and 2013		F-7
Notes to Consolidated Financial Statements		F-9

i

Report of Independent Registered Public

Accounting Firm to the Board of Directors and

Stockholders of Grupo Aeroportuario del

Pacífico, S.A.B. de C.V.

We have audited the accompanying consolidated financial statements of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and subsidiaries (the “Company”), which comprise the consolidated statements of financial position as of December 31, 2015, 2014 and 2013 and the consolidated statements of profit or loss and other comprehensive income, changes in stockholders’ equity and of cash flows for the years then ended, and a summary of significant accounting policies and other explanatory information.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles 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.

In our opinion, such consolidated financial statements present fairly, in all material respects, the consolidated financial position of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and subsidiaries as of December 31, 2015, 2014 and 2013, and their results of operations, changes in their shareholders’ equity and their cash flows for the years then ended, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.

The accompanying consolidated financial statements have been translated into English solely for the convenience of readers.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the effectiveness of the Company’s internal control over financial reporting as of December 31, 2015, based on the criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated April 20, 2016 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Galaz, Yamazaki, Ruiz Urquiza, S. C.

Member of Deloitte Touche Tohmatsu Limited

/s/ SALVADOR A. SÁNCHEZ BARRAGÁN

C.P.C. Salvador A. Sánchez Barragán

Guadalajara, Jalisco, Mexico

April 20, 2016

F-1

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Financial Position

As of December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

Assets

	December 31, 2015		December 31, 2014		December 31, 2013
Current assets:
Cash and cash equivalents (Note 6)	Ps.	2,996,499	Ps.	1,595,502	Ps.	2,168,187
Financial investments held for trading purposes		—		—		410,433
Trade accounts receivable – net (Note 7)		159,196		337,581		207,515
Recoverable taxes and undue payments (Note 13.b)		175,578		124,616		82,846
Other current assets		55,410		4,872		3,106
Total current assets		3,386,683		2,062,571		2,872,087
Advanced payments to suppliers		253,491		30,288		82,843
Machinery, equipment and improvements on leased assets – net (Note 8)		1,555,593		812,653		873,541
Improvements to concession assets – net (Note 9)		7,294,318		5,148,431		5,002,667
Airport concessions – net (Note 10)		12,240,167		9,611,296		9,895,346
Rights to use airport facilities – net (Note 11)		1,100,394		1,157,093		1,213,792
Other acquired rights – net (Note 12)		548,387		565,084		581,781
Deferred income taxes – net (Note 13.e)		4,933,221		4,851,164		4,673,687
Investments in associates (Note 14)		92,232		—		—
Other assets – net		68,913		47,627		38,856
Total	Ps.	31,473,399	Ps.	24,286,207	Ps.	25,234,600

(Continued)

F-2

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Financial Position

As of December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

Liabilities and Stockholders’ Equity

	December 31, 2015			December 31, 2014			December 31, 2013
Current liabilities:
Banks loans and current portion of long-term borrowings (Note 16.a)	Ps.	3,529,102		Ps.	978,538		Ps.	637,577
Concession taxes payable		117,802			38,704			36,335
Aeropuertos Mexicanos del Pacífico, S.A.P.I. de C.V. (Note 31)		149,637			124,957			102,394
Accounts payable (Note 15)		637,246			300,642			316,233
Taxes payable		26,982			41,211			23,765
Income taxes payable (Note 13)		197,541			98,174			95,850
Total current liabilities		4,658,310			1,582,226			1,212,154
Deposits received in guarantee (Note 5)		725,437			597,139			522,204
Deferred income taxes (Note 13.e)		818,879			—			—
Employee benefits (Note 17)		93,367			80,015			70,632
Long-term borrowings (Note 16.a)		421,363			740,936			1,216,899
Debt securities (Nota 16.b)		2,600,000			—			—
Total long-term liabilities		4,659,046			1,418,090			1,809,735
Total liabilities		9,317,356			3,000,316			3,021,889
Stockholders’ equity (Note 18):
Common stock		12,528,780			13,937,322			15,447,322
Repurchased shares		(1,733,374	)		(1,733,374	)		(1,664,034	)
Legal reserve		840,743			735,491			635,914
Reserve for repurchase of shares		2,583,374			2,133,374			2,027,302
Retained earnings		6,638,935			6,213,078			5,766,207
Foreign currency translation reserve		415,493			—			—
Total controlling interest		21,273,951			21,285,891			22,212,711
Non-controlling interest (Nota 19)		882,092			—			—
Total stockholder´s equity		22,156,043			21,285,891			22,212,711
Total	Ps.	31,473,399		Ps.	24,286,207		Ps.	25,234,600

See accompanying notes to consolidated financial statements.

(Concluded)

F-3

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Profit or Loss and Other Comprehensive Income

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos, except per share amounts)

	2015			2014			2013
Revenues (Note 20):
Aeronautical services	Ps.	5,419,022		Ps.	3,925,736		Ps.	3,616,616
Non-aeronautical services		1,849,252			1,338,542			1,170,492
Improvements to concession assets		838,635			281,874			440,728
		8,106,909			5,546,152			5,227,836
Operating costs:
Cost of services (Note 21)		1,558,258			1,161,588			1,128,951
Technical assistance fees (Note 31)		236,507			194,228			171,470
Concession taxes (Note 1.a)		483,086			261,577			237,728
Depreciation and amortization (Note 22)		1,156,435			925,220			883,235
Cost of improvements to concession assets (Note 24)		838,635			281,874			440,728
Other income – net (Note 25)		(254,612	)		(43,424	)		(7,453	)
		4,018,309			2,781,063			2,854,659
Income from operations		4,088,600			2,765,089			2,373,177
Finance cost – net (Note 26):
Interest income		90,889			71,376			124,223
Interest expense		(209,304	)		(86,601	)		(179,145	)
Exchange (loss) gain – net		(338,395	)		7,235			3,763
		(456,810	)		(7,990	)		(51,159	)
Share of loss of associate (Nota 14)		(13,704	)		—			—
Income before income taxes		3,618,086			2,757,099			2,322,018
Income tax expense (Note 13.c):
Current		1,030,026			760,508			653,565
Deferred		(182,717	)		(245,929	)		(577,777	)
		847,309			514,579			75,788
Profit for the year		2,770,777			2,242,520			2,246,230
Other comprehensive income:
Exchange differences on translating foreign operations		482,394			—			—
Total comprehensive income for the year	Ps.	3,253,171		Ps.	2,242,520		Ps.	2,246,230

(Continued)

F-4

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Profit or Loss and Other Comprehensive Income

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos, except per share amounts)

	2015		2014		2013
Profit for the year attributable to:
Controlling interest	Ps.	2,726,020	Ps.	2,242,520	Ps.	2,246,230
Non-controlling interest		44,757		—		—
	Ps.	2,770,777	Ps.	2,242,520	Ps.	2,246,230
Total comprehensive income for the year attributable to:
Controlling interest	Ps.	3,141,513	Ps.	2,242,520	Ps.	2,246,230
Non-controlling interest		111,658		—		—
	Ps.	3,253,171	Ps.	2,242,520	Ps.	2,246,230
Weighted average number of common shares outstanding		525,575,547		525,636,745		530,061,831
Basic and diluted earnings per share (in Mexican Pesos, Note 3.s)	Ps.	5.9772	Ps.	4.2663	Ps.	4.2377

See accompanying notes to consolidated financial statements.

(Concluded)

F-5

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

	Number of Shares		Common stock			Repurchased shares			Legal reserve		Reserve for repurchase of shares		Retained earnings			Foreign currency translation reserve		Total			Non-controlling interest			Total stockholders´ equity
Balances as of January 1, 2013		561,000,000	Ps.	15,447,322		Ps.	(1,387,302	)	Ps.	553,477	Ps.	1,667,302	Ps.	5,172,414		Ps.	—	Ps.	21,453,213		Ps.	—		Ps.	21,453,213
Transfer of earnings to legal reserve (Note 18.h)		—		—			—			82,437		—		(82,437	)		—		—			—			—
Dividends declared and paid, Ps. 2.2837 pesos per share (Note 18.b)		—		—			—			—		—		(1,210,000	)		—		(1,210,000	)		—			(1,210,000	)
Reserve for repurchase of shares (Note 18.b)		—		—			—			—		360,000		(360,000	)		—		—			—			—
Repurchase of 4,127,492 shares		—		—			(276,732	)		—		—		—			—		(276,732	)		—			(276,732	)
Comprehensive income		—		—			—			—		—		2,246,230			—		2,246,230			—			2,246,230
Balances as of December 31, 2013		561,000,000		15,447,322			(1,664,034	)		635,914		2,027,302		5,766,207			—		22,212,711			—			22,212,711
Transfer of earnings to legal reserve (Note 18.h)		—		—			—			99,577		—		(99,577	)		—		—			—			—
Dividends declared and paid, Ps. 3.0249 pesos per share (Note 18.c)		—		—			—			—		—		(1,590,000	)		—		(1,590,000	)		—			(1,590,000	)
Capital distribution (Note 18.d)		—		(1,510,000	)		—			—							—		(1,510,000	)		—			(1,510,000	)
Reserve for repurchase of shares (Note 18.c)		—		—			—			—		106,072		(106,072	)		—		—			—			—
Repurchase of 1,017,561 shares (Note 18.e)		—		—			(69,340	)		—		—		—			—		(69,340	)		—			(69,340	)
Comprehensive income		—		—			—			—		—		2,242,520			—		2,242,520			—			2,242,520
Balances as of December 31, 2014		561,000,000		13,937,322			(1,733,374	)		735,491		2,133,374		6,213,078			—		21,285,891			—			21,285,891
Transfer of earnings to legal reserve (Note 18.h)		—		—			—			105,252		—		(105,252	)		—		—			—			—
Dividends declared and paid, Ps. 3.32 pesos per share (Note 18.f)		—		—			—			—		—		(1,744,911	)		—		(1,744,911	)		—			(1,744,911	)
Capital distribution Ps. 2.68 pesos per share (Note 18.g)		—		(1,408,542	)		—			—		—		—			—		(1,408,542	)		—			(1,408,542	)
Reserve for repurchase of shares (Note 18.f)		—		—			—			—		450,000		(450,000	)		—		—			—			—
Business combinations non-controlling interest		—		—			—			—		—		—			—		—			852,825			852,825
Dividends declared and paid non-controlling interest		—		—			—			—		—		—			—		—			(82,391	)		(82,391	)
Comprehensive income:
Profit of the year		—		—			—			—		—		2,726,020			—		2,726,020			44,757			2,770,777
Other comprehensive income for the year		—		—			—			—		—		—			415,493		415,493			66,901			482,394
		—		—			—			—		—		2,726,020			415,493		3,141,513			111,658			3,253,171
Balances as of December 31, 2015		561,000,000	Ps.	12,528,780		Ps.	(1,733,374)		Ps.	840,743	Ps.	2,583,374	Ps.	6,638,935		Ps.	415,493	Ps.	21,273,951		Ps.	882,092		Ps.	22,156,043

See accompanying notes to consolidated financial statements.

F-6

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

	2015			2014			2013
Cash flows from operating activities:
Profit for the year	Ps.	2,770,777		Ps.	2,242,520		Ps.	2,246,230
Adjustments for:
Employee benefits		13,352			9,383			10,342
Bad debt expense		5,380			15,056			11,758
Depreciation and amortization		1,156,435			925,220			883,235
Share of loss of associate		13,704			—			—
Bargain purchase gain		(189,744	)		—			—
Net loss on derivative financial instruments		—			340			705
Interest expense		198,567			65,730			115,612
Unrealized exchange gain		354,458			—			—
Income tax expense		847,309			514,579			75,788
		5,170,238			3,772,828			3,343,670
Changes in working capital:
(Increase) decrease in:
Financial investments held for trading purposes		—			410,433			23,140
Trade accounts receivable		173,005			(145,122	)		25,523
Recoverable income tax and other current assets		(27,188	)		25,047			74,695
Recoverable income tax		—			269			1,592
Increase (decrease) in:
Concession taxes payable		79,098			2,369			4,108
Aeropuertos Mexicanos del Pacífico, S.A.P.I. de C.V.		24,680			22,563			17,073
Accounts payable		301,508			37,772			(13,057	)
Taxes payable		(14,229	)		17,446			4,144
Deposits received in guarantee		128,298			74,935			91,579
Cash generated by operating activities		5,835,410			4,218,540			3,572,467
Income taxes paid		(930,657	)		(758,310	)		(607,754	)
Net cash flows provided by operating activities		4,904,753			3,460,230			2,964,713
Cash flows from investing activities:
Purchases of machinery, equipment, improvements on leased buildings, improvements to concession assets and advance payments to suppliers		(1,128,382	)		(620,266	)		(686,270	)
Proceeds from sales of machinery and equipment		2,023			435			677
Net cash outflows on acquisition of subsidiary		(2,543,568	)		—			—
Other investing activities		—			(13,209	)		4,642
Net cash flows used in investing activities		(3,669,927	)		(633,040	)		(680,951	)

(Continued)

F-7

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Consolidated Statements of Cash Flows

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

	2015			2014			2013
Cash flows from financing activities:
Dividends declared and paid		(1,744,911	)		(1,590,000	)		(1,210,000	)
Dividends paid to non-controlling interest		(82,391	)		—			—
Capital distribution		(1,408,542	)		(1,510,000	)		—
Repurchase of shares		—			(69,340	)		(276,732	)
Debt securities		2,600,000			—			—
Proceeds from bank loans		9,056,701			1,378,881			488,204
Payments on bank loans		(8,076,912	)		(1,513,883	)		(646,452	)
Interest paid on bank loans		(177,774	)		(95,533	)		(134,278	)
Net cash flows used in financing activities		166,171			(3,399,875	)		(1,779,258	)
Net increase (decrease) in cash and cash equivalents		1,400,997			(572,685	)		504,504
Cash and cash equivalents at beginning of year		1,595,502			2,168,187			1,663,683
Cash and cash equivalents at the end of year	Ps.	2,996,499		Ps.	1,595,502		Ps.	2,168,187
Non-cash investing activities:
Purchases of machinery, equipment, improvements on leased buildings and improvements to concession assets on account	Ps.	221,151		Ps.	86,383		Ps.	135,386

See accompanying notes to consolidated financial statements.

(Concluded)

F-8

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and Subsidiaries

Notes to Consolidated Financial Statements

For the years ended December 31, 2015, 2014 and 2013

(In thousands of Mexican Pesos)

1. Activities of the Company and significant events

Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and subsidiaries (the Company or GAP) was incorporated in May 1998 as a state-owned entity to manage, operate and develop 12 airport facilities, mainly in Mexico’s Pacific region. The airports are located in the following cities: Guadalajara, Puerto Vallarta, Tijuana, Los Cabos, Silao (Guanajuato), Hermosillo, Mexicali, Los Mochis, La Paz, Manzanillo, Morelia and Aguascalientes. Additionally, in April 2015, GAP acquired 100% of the shares of Desarrollo de Concesiones Aeroportuarias, S.L. (DCA), a Spanish company, which owns a majority stake in MBJ Airports Limited (MBJA), which operates the Sangster International Airport in Montego Bay in Jamaica. The Company’s principal address is Mariano Otero Avenue 1249 B, six floor, Rinconada del Bosque, zip code 44530, Guadalajara, Jalisco, Mexico.

a. Activities

The Company began operations on November 1, 1998. Prior to that date, the Company’s activities were carried out by Aeropuertos y Servicios Auxiliares (ASA), a Mexican Governmental agency, which was responsible for the operation of all public airports in Mexico.

In June 1998, the subsidiaries of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. were granted concessions by the Ministry of Communications and Transportation (SCT) to manage, operate and develop each of the Pacific Group’s 12 airports and benefit from the use of the airport facilities, for a 50-year term beginning November 1, 1998. The cost of the concessions, which totaled Ps.15,938,359, was determined by the Mexican Government in August 1999, based upon the price paid by Aeropuertos Mexicanos del Pacífico, S.A.P.I. de C.V. (AMP, the strategic stockholder of the Company) for its interests in GAP. On August 20, 1999, GAP entered into a Liabilities Assumption Agreement with each of its subsidiaries, whereby it assumed the liabilities incurred by each subsidiary derived from obtaining the concession. Such liabilities were capitalized by GAP as equity in favor of the Mexican Government on such date.

The term of the concessions may be extended under certain circumstances by the SCT, for terms not to exceed an additional 50 years. Beginning on November 1, 1998, the Company is required to pay an annual tax to the Mexican Government, through the SCT, for use of the public property, equivalent to 5% of each concessionaire’s annual gross revenues, according to the concession terms and the Mexican Federal Duties Law.

Title to all of the long-term fixed assets within the airports is retained by the Mexican Government. Accordingly, upon expiration of the term of the concessions granted to the Company, the assets, including all of the improvements made to the airport facilities during the term of the concessions, shall automatically revert to the Mexican Government. Additionally, ASA and other agencies of the Mexican Government maintain the rights to provide certain services such as air traffic control, fuel supply and immigration control.

On February 24, 2006, the Company made an initial public offering of its Series B shares, under which the Mexican Government, which held 85% of the voting common stock of the Company sold its 100% shares participation, both in the United States of America, via the New York Stock Exchange (NYSE) and in Mexico, via the Mexican Stock Exchange (BMV). Consequently, as of such date, the Company became a public entity in both Mexico and in the United States of America and is required to meet various legal obligations and regulations for public entities applicable in each country.

F-9

The Board of Directors of the Company at an extraordinary meeting held on March 18, 2015, approved the participation in bidding for the acquisition of DCA, leaving the Operating Committee and three independent members of the Board of Directors the authority to determine the acquisition price and conditions to offer in the bidding. The Board of Directors also granted special powers of attorney to the Chief Executive Officer, Chief Financial Officer and the General Counsel to sign all contracts related to the transaction and the ability to obtain bank or debt securities to finance the entire acquisition.

On April 20, 2015, the Company completed a transaction with Spanish company Abertis Airports, S.A (Abertis) for the acquisition of 100% of the shares of DCA. The acquisition was the result of a private and confidential bidding process among various participants. The total amount of the transaction was USD$192,000,000, with funding provided by Scotiabank for Ps. 1,091,000 and USD$95,000,000 and BBVA for USD$27,000,000.

DCA has a 74.5% stake in MBJA, the entity that operates Sangster International airport in Montego Bay in Jamaica. MBJA holds the concession to operate, maintain and utilize the airport for a period of 30 years, beginning April 3, 2003. Vantage Airport Group Limited (Vantage) owns the remaining 25.5% stake in MBJA.

DCA also has a 14.77% stake in SCL Terminal Aéreo Santiago, S.A. (SCL), the operator of the international terminal in Santiago, Chile until September 30, 2015. On September 30, 2015, the concession to operate the Santiago, Chile airport expired, consequently, those assets were immediately returned to the Chilean government and the new operator without any significant incidents. Though SCL will no longer have operations, according to the concession agreement, SCL must remain in effect for an additional year after the transfer, so if there are potential contingencies, SCL can address them. After that first year, SCL will remain in effect for another year before its dissolution in accordance with tax regulations in Chile.

Significant events

• On January 8, 2015, the Company obtained proceeds of Ps. 635,430 related to the credit agreement signed with Scotiabank. Additionally, on February 3, 2015, it obtained proceeds of Ps. 375,570, related to a loan for Ps. 730,000 described in Note 16.a, which will be used to prepay other bank loans. The total amount of debt paid on March 9, 2015 was Ps. 1,741,000, with the proceeds obtained from the issuance of Debt securities on February 20, 2015.

• In the months of January and February 2015, the Company prepaid bank loans related to outstanding balances at December 31, 2014 of the different agreements signed with Banco Nacional de Mexico, S.A. (Banamex), BBVA and HSBC Mexico, S.A. (HSBC) described in Note 16.a. The total amounts paid were Ps. 989,474, with which such loans were fully repaid.

• On February 20, 2015 the Company made public debt issuance by means of long-term debt securities (Certificados Bursátiles de Largo Plazo) in the Mexican market for Ps. 2,600,000, which are unsecured and have a principal payment at maturity, under the Ps. 9,000,000 program approved by the Mexican Banking and Securities Commission (Comisión Nacional Bancaria y de Valores or CNBV) as a recurring issuer for the next five years. Certificates GAP 15 andGAP 15-2 were issued in the amounts of Ps. 1,100,000 and Ps. 1,500,000, respectively, at a variable rate equal to 28-day TIIE plus 24 basis points and a fixed rate of 7.08%, with maturities of 5 and 10 years, due February 14, 2020 and February 7, 2025, respectively. The funds raised in this issuance will be used to repay existing outstanding debt with Scotiabank in an amount equal to Ps. 1,741,000; and the remaining Ps. 859,000 of the proceeds will be used to finance capital investments in accordance with investments for 2015 set forth in the Company’s Master Development Program.

• In an Ordinary Stockholders’ Meeting held on April 21, 2015, the stockholders approved a dividend payment of Ps. 3.32 per shares outstanding at the date of each payment, excluding shares repurchased in accordance with Article 56 of the Mexican Securities Market Law. The first payment for Ps. 1.82 per share was in cash on August 21, 2015 of Ps. 956,547 and the second payment for Ps. 1.50 per share was made on November 4, 2015 of Ps. 788,364. (Note 18.f.)

F-10

• In an Extraordinary Stockholders’ Meeting held on April 21, 2015, the stockholders approved a capital reduction of Ps. 2.68 per share. The payment was made on May 15, 2015 for Ps. 1,408,542 as described in Note 18.g.

• On May 19, 2015, Company signed with Scotiabank an unsecured loan line totaling USD$191,000,000 for financing the purchase of DCA, with an interest rate of LIBOR plus 70 basis points, with interest payments every 28 days and a single payment of principal on 18 May 2016. With this bridge loan it prepaid the loan entered into for the acquisition of DCA.

• On June 17, 2015, the Mexican Supreme Court issued anamparo to the Company upholding the validity of Articles X and XII of the Company’s bylaws regarding the limitations on ownership of its capital stock. Consequently, the challenge initiated by Grupo México and ITM against these articles has been definitively concluded, with the ruling confirming the validity and effectiveness of these articles. On December 11, 2015, both parties were notified of the final judgment, ordering them to refer to the collegiate court of origin to the effect that the Second Civil Chamber of the High Court of Mexico City, who is ordered to confirm articles X and XII of the bylaws of the Company are valid based on Article 48, section III of the Mexican Securities Market Law. As of the issuance date of the consolidated financial statements, the Company is still awaiting final resolution by the court.

• In an Ordinary Stockholders’ Meeting of MBJA held on June 30, 2015, the stockholders approved a dividend payment of USD$26,000,000 to be distributed to shareholders in their respective proportion. The dividends were paid on September 17, 2015, of which USD$19,370,000 were paid to DCA while USD$6,630,000 were paid to Vantage.

• On August 19, 2015, the Company prepaid the USD$95,000,000 loan contracted with Scotiabank on May 19, 2015 and a new line of credit with BBVA for the same amount was obtained at a rate of LIBOR plus 60 basis points, with a single payment on February 15, 2016 and payments of monthly interest.

• On September 30, 2015, the concession to operate the Santiago Airport in Chile expired, consequently, those assets were immediately returned to the Chilean government and the new operator without any significant incidents. However, there is a one-year period during which SCL remains responsible for latent defects.

• On December 9, 2015, the operations at the Tijuana International Airport of a cross-border bridge between Otay, United States and Tijuana, Mexico was initiated. The bridge facilitates transfers between the United States and Mexico for travelers holding a boarding pass to all flights departing from or arriving in Tijuana, The Mexican border authority’s services are located in the Tijuana airport, and the corresponding U.S. services are located on the premises of the CBX terminal on the north side of the border (operated by Otay-Tijuana Venture, L.L.C.). Use of this new facility is not subject to additional charges as it is part of the services offered by the Tijuana airport, which are included in the passenger fees (Tarifa por Utilización de los Servicios Aeroportuarios, or “TUA”). Passengers using the bridge from or to Tijuana may be subject to toll charges levied by CBX, the bridge operator in the U.S.

2. Basis of presentation

a. Statement of Compliance – These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS), its amendments and interpretations issued by the International Accounting Standards Board (IASB) issued and outstanding or issued and early adopted at the date of preparation of these financial statements.

b. Translation into English – The accompanying consolidated financial statements have been translated from Spanish into English for use outside of Mexico.

c. Basis of preparation– The consolidated financial statements have been prepared on the historical cost basis except for assets and liabilities assumed in the business combinations on the date of purchase, which were recorded at fair value.

F-11

• Historical cost – Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

• Fair value – The Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Company takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope of IAS 17, and measurements that have some similarities to fair value but are not fair value, such as net realizable value in IAS 2 or value in use in IAS 36.

In addition, for financial reporting purposes, fair value measurements are categorized into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;

• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and

• Level 3 inputs are unobservable inputs for the asset or liability

d. Consolidation of financial statements – The consolidated financial statements include those of Grupo Aeroportuario del Pacífico, S.A.B. de C.V. and its subsidiaries, for the years ended December 31, 2015, 2014 and 2013. The consolidated subsidiaries are as follows:

Company	% participation	Location	Activity
Aeropuerto de Aguascalientes, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto del Bajío, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Guadalajara, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Hermosillo, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de La Paz, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Los Mochis, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Manzanillo, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Mexicali, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Morelia, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Puerto Vallarta, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de San José del Cabo, S.A. de C.V.	99.99%	Mexico	Operation of airport
Aeropuerto de Tijuana, S.A. de C.V.	99.99%	Mexico	Operation of airport
Corporativo de Servicios Aeroportuarios, S.A. de C.V. (CORSA)	99.99%	Mexico	Provides personnel services
Fundación Grupo Aeroportuario del Pacífico, A.C. (Fundación GAP)	99.99%	Mexico	Social advice and support infrastructure of educational institutions
Puerta Cero Parking, S.A. de C.V. (PCP)	99.99%	Mexico	Operation of parking lot.
Servicios a la Infraestructura Aeroportuaria del Pacífico, S.A. de C.V. (SIAP)	99.99%	Mexico	Administrative services
Desarrollo de Concesiones Aeroportuarias, S.L. (Consolidated as of April 2015)	100%	Spain	Management administration, maintenance, servicing of all types of infrastructure
MBJ Airports Limited (consolidated as of April 2015)	74.50%	Jamaica	Operation of airport
GA del Pacífico es do Brasil, LTDA	99.99%	Mexico	No operation

F-12

Control is achieved when the Company:

• Has power over the investee;

• Is exposed, or has rights, to variable returns from its involvement with the investee; and

• Has the ability to use its power to affect its returns.

The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss and other comprehensive income from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Profit and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Company’s accounting policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Company are eliminated in full on consolidation.

e. Application of new and revised International Financing Reporting Standards

Application of new and revised International Financing Reporting Standards (“IFRSs” or “IAS”) and interpretations that are mandatorily effective for the current year

In the current year, the Company has applied a number of amendments to IFRSs and new Interpretation issued by the International Accounting Standards Board (IASB) that are mandatorily effective for an accounting period that begins on or after January 1, 2015.

Annual Improvements to IFRSs 2010 – 2012 Cycle and 2011 – 2013 Cycle

The Company has applied the amendments to IFRSs included in the Annual Improvements to IFRSs 2010 – 2012 Cycle and 2011 – 2013 Cycle. One of the annual improvements requires entities to disclose judgements made by management in applying the aggregation criteria set out in paragraph 12 of IFRS 8 Operating Segments. The application of the other amendments has had no impact on the disclosures or amounts recognized in the Company’s consolidated financial statements.

f. Functional and presentation currency – The consolidated financial statements and notes as of December 31, 2015, 2014 and 2013, and for the years then ended, are prepared in pesos, which is the reporting currency of the Company and are presented in thousands of pesos.

The assets and liabilities of foreign operations, including the fair value of assets arising on acquisition, are translated at the exchange rates prevailing at the reporting date. Income and expenses of foreign operations are translated at the average exchange rate for the period of transactions of $16.1548 pesos per USD and euros to USD$1.1057.

g. Use of estimates and critical judgments in preparing the financial statements – The preparation of consolidated financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the application of accounting policies relating to the reported amounts of assets, liabilities, income and expenses of the relevant period. Actual results could differ from these estimates. Information on the uncertainty in the use of assumptions and estimates that have a significant risk of resulting in a material adjustment within the next financial year are included in the following notes:

F-13

• Identification of net assets and liabilities assumed in a business combination and determination of fair value (Note 4)

• Estimation of doubtful accounts (Note 7)

• Definition of useful lives and depreciation and amortization periods (Note 3 c. and .3.d.)

• Probability of recovery of tax loss (Note 13.g)

• Recovery of tax on assets paid in prior years (Note 13.f)

• Assumptions used to determine liabilities for retirement benefits (Note 17)

• Contingency liabilities (Note 28)

In addition to the estimates, the Company makes critical judgments in applying its accounting policies, which have a material effect on the amounts recognized in the financial statements. Management believes that the decisions made are the most reasonable based on information available, on the judgments made and the way it manages the operation of the Company. Critical judgments relate to the following:

Accounting for the Concession – Management believes it has carried out a comprehensive implementation of the standards applicable to the accounting treatment of its concessions in México and Jamaica and it determined that, among others, International Financial Reporting Interpretation (IFRIC) 12Service Concession Arrangements is applicable to the Company. The Company treats its investments related to improvements and upgrades to be performed in connection with the MDP under the intangible asset model established by IFRIC 12 and does not recognize a provision for maintenance, as all investments required by the MDP, regardless of their nature, directly increase the Maximum Tariff per traffic unit (MT). Accordingly, all amounts invested under the MDP have a direct correlation to the amount of fees the Company will be able to charge each passenger or cargo service provider, and thus, a direct correlation to the amount of revenues the Company will be able to generate. As result, management defines all expenditures associated with investments required by the MDP as revenue generating activities given that they ultimately provide future benefits, whereby subsequent improvements and upgrades made to the concession are recognized as intangible assets based on the principles of IFRIC 12. Additionally, compliance with the committed investments per the MDP is mandatory, as well as the fulfillment of the MT and therefore, in case of default in any of these obligations (MDP or MT), the Company could be subject to sanctions and even its concession could be revoked. To determine the amortization period of the intangible associated with the improvements and upgrades made to comply with the MDP, the Company focuses on the period over which they will generate future economic benefits or the concession term, whichever is less.

h. Income from operations – This line item is comprised by total revenues less operating costs. Although this presentation is not required by IAS 1Presentation of Financial Statements, it is included in the consolidate statements of profit or loss and other comprehensive income because it represents a reliable measure of the economic and financial performance of the Company.

i. Comprehensive income – Comprehensive income comprised the net income of the period, plus other comprehensive income (loss) items of the same period. For the year ended December 31, 2015, other comprehensive income are represented by the effects of translation of foreign subsidiaries. At the moment the assets and liabilities giving rise to other comprehensive income are realized, the latter are recognized in the income statement. For the years ended December 31, 2014 and 2013, comprehensive income is represented only by the net income of each year.

j. Classification of cost and expenses– Costs and expenses presented in the consolidated statements of profit or loss and other comprehensive income were classified according to their nature.

F-14

3. Significant accounting policies

The consolidated financial statements comply with IFRS as issued by the IASB. Its preparation requires management to make certain estimates and use certain assumptions that affect certain items of the consolidated financial statements and their related disclosures required therein. However, actual results could differ from those estimates. The Company’s management, upon applying professional judgment, considers that estimates and assumptions used were adequate under the circumstances (Note 2.g). The significant accounting policies of the Company are as follows:

a. Financial instruments

Financial assets – Financial assets are recognized when the Company becomes a contractual party to the terms of the related instruments.

Financial assets are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issuance of financial assets (other than financial assets at fair value through profit or loss) are added to or deducted from the fair value of the financial assets, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets at fair value through profit or loss (FVTPL) are recognized immediately in profit or loss.

The Company’s financial assets are classified into the following specified categories: i) FVTPL and ii) accounts receivable. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognized and derecognized on a trade date basis. Regular way of purchases or sales, are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.

• Financial assets at FVTPL – Financial assets are classified as at FVTPL when the financial asset is either held for trading or it is designated as at FVTPL. A financial asset is classified as held for trading if:

• It has been acquired principally for the purpose of selling it in the near term; or

• In its initial recognition, it is part of a portfolio of identified financial instruments that the Company manages together and has a recent actual pattern of short-term profit-taking; or

• It is a derivative that is not designated and is effective as a hedging instrument.

Financial assets at FVTPL are stated at fair value, with any gain or loss arising on remeasurement is recognized in profit or loss. The net gain or loss recognized in profit or loss includes any dividend or interest earned from the financial asset and is included in the finance income in the consolidated statements of profit or loss and other comprehensive income. Fair value is determined in the manner described in Note 5.

• Accounts receivable – Trade accounts receivable and other receivables, with fixed or determinable payments that are not quoted in an active market are classified as receivables. Interest income is recognized by applying the effective interest rate, except for the short term receivables, in the event that the recognition of interest is not material.

The effective interest rate is the rate that discounts the estimated future cash receipts (including all professional fees and basis points paid or received that are part of the effective interest rate, transaction costs and other premiums or discounts) for the expected life of the instrument, or when is appropriate a shorter period, to the net carrying amount at initial recognition.

• Derecognition of financial assets

The Company derecognizes a financial asset when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Company neither transfers nor retains

F-15

substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.

On derecognition of a financial asset in its entirety, the difference between the asset’s carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognized in other comprehensive income and accumulated in equity is recognized in profit or loss.

On derecognition of a financial asset other than in its entirety (e.g. when the Company retains an option to repurchase part of a transferred asset), the Company allocates the previous carrying amount of the financial asset between the part it continues to recognize under continuing involvement, and the part it no longer recognizes on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognized and the sum of the consideration received for the part no longer recognized and any cumulative gain or loss allocated to it that had been recognized in other comprehensive income is recognized in profit or loss. A cumulative gain or loss that had been recognized in other comprehensive income is allocated between the part that continues to be recognized and the part that is no longer recognized on the basis of the relative fair values of those parts.

Financial liabilities and equity instruments – Financial liabilities are recognized when the Company becomes a contractual party to the terms of the related instruments.

Financial liabilities and are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of the financial liabilities (other than financial liabilities at fair value through profit or loss) are added to or deducted from the fair value of the financial liabilities, as appropriate, on its initial recognition. Transaction costs directly attributable to the acquisition of financial liabilities at fair value through profit or loss are recognized immediately in profit or loss.

Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements.

Equity instruments – An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. Equity instruments issued by the Company are recognized at the resources received, net of direct costs from the emission.

Repurchase of the Company’s common stock is recognized and deducted directly in equity. No gain or loss is recognized in profit or loss at the purchase, sale, issue or cancellation of the Company’s own equity instruments.

Financial liabilities – Financial liabilities are classified as financial liabilities at FVTPL or as other financial liabilities. At the date of the financial statements, the Company does not have liabilities at FVTPL.

Other financial liabilities (including borrowings and trade accounts payable) are subsequently measured at amortized cost, using the effective interest rate method.

The effective interest rate method is a method of calculating the amortized cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that discounts estimated future cash payments exactly (or as appropriate in a short term) with the net book value on its initial recognition.

The Company derecognizes financial liabilities when, and only when, the Company’s obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognized and the amount paid and payable is recognized in profit or loss.

F-16

Even when the Company has the right, in certain cases, for a compensation of financial assets and liabilities, as of the date of this consolidated financial statements, the Company does not have the intention of compensate a liability with an asset, nor expect in a short term may require it. Therefore, deposits received in guarantee are presented separately from accounts receivable.

b. Cash and cash equivalents – Cash and cash equivalents consist mainly of bank deposits in checking accounts and readily available daily investments of cash surpluses with immediate availability. Cash is stated at nominal value and cash equivalents are valued at fair value that does not exceed their market value; the yields, which are recognized as interest income as it accrues.

c. Machinery, equipment and improvements on leased buildings

• Recognition and valuation – Machinery, equipment and improvements to leased buildings are recognized at acquisition cost less accumulated depreciation and any accumulated impairment losses. The acquisition cost includes expenses directly attributable to the acquisition of the asset.

When significant parts of an asset of machinery, equipment and improvements to leased buildings have different useful lives, they are accounted for separately as a component of the asset.

Gains and losses from sales or retirements of machinery, equipment and improvements to leased buildings are determined comparing the proceeds from the sale or retirement against net amount of machinery, equipment and improvements to leased buildings and are recognized net in other income in the consolidated statement of profit and loss and other comprehensive income.

• Subsequent costs – The cost to replace a part or item of machinery, equipment and improvements to leased buildings are recognized in the value of the asset when it is probable that future economic benefits associated with that part will flow to the Company and its cost can be measured reliably. The net value of the replaced item is derecognized at its net book value. Minor maintenance costs are recognized in the consolidated statement of profit and loss and other comprehensive income.

• Depreciation – Depreciation is calculated over the depreciable amount, which is the cost of an asset, or other substitute value of that cost based on the straight-line method, this is the value that reflects more certainty the expected pattern of consumption of future economic benefits implicit in the active. The Company does not determine residual values for machinery, equipment, improvements and leased buildings as they are not considered to be material.

• Depreciation of machinery and equipment is recognized in the consolidated statement of profit and loss and other comprehensive income and is calculated under the straight-line method based on the useful lives of the related assets. Also, improvements to leased buildings are amortized by the straight-line method based on the remaining useful life of the improvements or the lease term, whichever is less. The estimated useful life, residual value and the depreciation method are reviewed at the end of each year, and the effect of any changes in the estimate recorded is recognized on a prospective basis.

The estimated useful lives for the current period and comparative period are as follows:

	Useful life (years)	Average annual depreciation rate
Machinery and equipment	10	10%
Office furniture and equipment	10	10%
Computer equipment	3.3 - 4	30% - 25%
Transportation equipment	4-5	25% - 20%
Communication equipment	10 - 4 - 3.3	10% - 25% - 30%
Improvements on leased buildings	10	10%

F-17

d. Intangible Assets

• Improvements to concession assets – Improvements to concession assets are accounted for the improvements that are made pursuant to the MDP and improvements carried out by the daily operation of the Company’s airports. All infrastructure investments made by the airports will be delivered to the Mexican government or the government of Jamaica as corresponds at the end of the term of the Concession. Under the Company’s concession agreements, through the Master Development Programs agreed with each governments every five years, the Company is committed to carry out various improvements, upgrades and additions to each of its airports on an annual basis in the case of Mexican airports and every five years in Jamaica. In exchange for investing in those additions and upgrades, each government grants the Company the right to obtain benefits for services provided using those assets. The Company, as the operator of the concession assets, recognizes an intangible asset as it receives a right granted by each government to charge users of the public service associated with the use of its airports.

• Airport concessions – The Company recognized an intangible asset of the Concession granted by the SCT to manage and operate each of the airports in Mexico for 50 years since its acquisition. As regards to MBJA, the Company recognized an intangible asset at the fair value of the concession to operate and exploit that airport until 2033 according to the determination of fair values resulting from the acquisition of DCA and MBJA accordance IFRS 3Business Combinations.

• Rights to use airport facilities – Rights to use airport facilities are recorded at acquisition cost of the assets recorded by ASA and transferred to the Company according to the Concession granted, in order to manage, operate and exploit them during the Concession term. At MBJA no rights to use airport facilities were identified.

• Other acquired rights – These rights correspond to payments made by the Company after the date the Mexican concessions were granted, in order to early-terminate certain long-term leases contracts that existed at that time between ASA and third-party leaseholders, these rights are recorded at its acquisition cost. In MBJA there are no other acquired rights.

• Amortization – After to its initial recognition, intangible assets are valued at acquisition cost plus capitalized borrowing costs that are recognized, less accumulated amortization and accumulated impairment losses. Amortization is recognized in the consolidated statement of comprehensive income under the straight line method applied to the shorter of the estimated period of future economic benefits the intangible assets will generate, or the concession period, from the date they are available for use.

Amortization periods for the current and comparative period are as follows:

	Period (years)	Average annual amortization rate
Improvements to concession assets	12.5 - 20	8% - 5%
Airport concessions	49 - 18	2% - 5.5%
Rights to use airport facilities	10 - 49	10% - 2%
Other acquired rights	44 - 48	2%

The amortization method and useful lives are reviewed at each year end date and adjusted prospectively if necessary.

e. Capitalized borrowing costs – Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use are added to the cost of those assets, until such time as the assets are substantially ready for their intended use for sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.

F-18

f. Impairment of financial and non-financial assets

• Financial assets – A financial asset that is not recognized at FVTPL is evaluated by the Company at the close of each reporting period to determine whether there is evidence of potential impairment. A financial asset is impaired if there is objective evidence that a loss has occurred after the initial recognition of the asset and that loss has a negative effect on the estimated future cash flows of the asset, that can be estimated reliably.

For all other financial assets, objective evidence of impairment could include:

• Significant financial difficulty of the issuer or counterparty; or

• Breach in the payment of the interests or the loan; or

• It is probable that the borrower will enter in bankruptcy or into a financial reorganization; or

• The disappearance of an active market for that financial asset because of financial difficulties.

An impairment loss on financial assets carried at amortized cost is calculated as the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Losses are recognized in consolidated statements of profit or loss and other comprehensive income and are reflected in the allowance for doubtful accounts included in cost of services. When a subsequent event causes the amount of impairment loss to reverse, such amount is recognized in consolidated statements of profit or loss and other comprehensive income on a prospective basis and cannot exceed the amount of the impairment previously recognized.

Individually significant financial assets are tested one by one for impairment. The remaining financial assets are assessed in groups of similar credit risk characteristics.

For financial assets that are carried at cost, the amount of the impairment loss is measured as the difference between the asset’s carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods.

All impairment losses are recognized in the consolidated statement of profit and loss and other comprehensive income.

A reversal of an impairment loss occurs only if it can be associated objectively to an event that occurred after the date the loss was recognized.

• Non-financial assets – Non-financial assets of the Company are assessed at each period end date to determine whether there is any indication of impairment. If there is such an indication of impairment, management estimates the recoverable amount.

The recoverable amount of an asset or cash-generating unit is the higher of asset value in use and net selling price. To determine the asset’s value in use, the estimated future cash flows are discounted to present value using an appropriate discount rate before tax that reflects current market conditions in relation to the time value of money and the risks specific to the asset. For purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating unit or CGU). An impairment loss is recognized immediately in profit and loss.

The individual airports of the Company in Mexico cannot be considered as separatecash-generating units, as the bidding process for the concession made by the Mexican Federal Government included the package of twelve airports, and therefore the Company is required to operate and maintain all 12 airports independently of the results they generate individually. Considering the above, if there are indicators of impairment exist, the Company performs an impairment assessment on a consolidated basis with is Mexican companies. Moreover, the value of the assets of MBJA are individually valued at the end of each period to determine whether there are indications of impairment to be a single separate cash-generating units.

F-19

When an impairment loss subsequently reverses, the carrying amount of the asset (orcash-generating unit) is increased to the revised estimated recoverable amount, so that the increased carrying amount does not exceed the carrying amount that would have been determined had an impairment loss not been recognized for the asset (or CGU) in prior years. A reversal of an impairment loss is recognized immediately in profit and loss, unless the relevant asset is recognized on a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.

For purposes of assessing impairment, goodwill is allocated to each single separate CGU of the company, which is expected to be benefited from the synergies of the combination.

The single separate CGU to which goodwill has been allocated are tested for impairment annually or more frequently when there are indications that the CGU may be impaired. If the recoverable amount of a CGU is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the CGU and then to the other assets of the CGU pro rata basis and based on the book value of each asset within the CGU. Any impairment loss of goodwill is recognized directly in income. An impairment loss recognized in goodwill is not reversed in periods posteriors.

g. Investment in associate – An associate is an entity over which the Company has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. Under the equity method, an investment in an associate is initially recognized in the consolidated statement of financial position at cost and adjusted thereafter to recognize the Entity’s share of the profit or loss and other comprehensive income of the associate.

The Company discontinues the use of the equity method from the date when the investment ceases to be an associate, or when the investment is classified as held for sale.

When the Company transacts with an associate of the Company, profits and losses resulting from the transactions with the associate are recognized in the Company’s consolidated financial statements only to the extent of interests in the associate that are not related to the Company.

h. Derivative financial instruments – The Company occasionally uses derivative financial instruments, specifically interest rate caps, to hedge its exposure to interest rate risk arising primarily from debt instruments.

Derivatives are initially recognized at fair value at the date the derivative contract are entered into and subsequently valued at fair value at the end of each reporting period. The gain or loss is recognized in profit or loss immediately unless the derivative is designated as a hedging instrument and is considered to be effective. The timing of the recognition of the hedging instrument in earnings will depend on the nature of the hedge.

The Company may designate certain instruments as hedges for accounting purposes if at inception of the hedge, the Company documents the relationship between the hedging instrument and the hedged item, as well as the risk management and management strategy objectives for undertaking various hedging transactions. Additionally, at the inception of the hedge and on an ongoing basis, the Company documents whether the hedging instrument is highly effective in offsetting the exposure to changes in fair value or changes in cash flows of the hedged item.

Hedge accounting is discontinued when the Company revokes the hedging relationship, when the hedging instrument expires or is sold, terminated, or exercised, or when it fails to meet the criteria for hedge accounting. Any cumulative gain or loss on the hedging instrument that has been recognized in equity remains in equity until the forecasted transaction is ultimately recognized in profit or loss. When management no longer expects the forecasted transaction to occur, the gain or loss accumulated in equity is recognized immediately in profit or loss.

F-20

i. Business combinations – Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Company, liabilities incurred by the Company to the former owners of the acquiree and the equity interests issued by the Company in exchange for control of the acquiree. Acquisition-related costs are generally recognized in profit or loss as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognized at their fair value, except that:

• Deferred tax assets or liabilities, and assets or liabilities related to employee benefit arrangements are recognized and measured in accordance with IAS 12 Income Taxes and IAS 19 respectively;

• Liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the Company entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 at the acquisition date; and

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquire (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognized immediately in profit or loss as a bargain purchase gain.

Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity’s net assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests’ proportionate share of the recognized amounts of the acquiree’s identifiable net assets. The choice of measurement basis is made on atransaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in another IFRS.

When the consideration transferred by the Company in a business combination includes assets or liabilities resulting from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the ‘measurement period’ (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date.

The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates in accordance with IAS 39, or IAS 37 Provisions, Contingent Liabilities and Contingent Assets, as appropriate, with the corresponding gain or loss being recognized in profit or loss.

Transaction costs, different from those associated with the issuance of debt or capital, incurred by the Company in connection with a business combination are expensed as incurred.

j. Other intangible assets – Costs incurred in the development phase, as well as other intangible assets that meet certain requirements and that the Company has determined will have future economic benefits, are capitalized and amortized based on the straight-line method. Expenditures that do not meet such requirements, as well as research costs, are recorded in the results of the period in which they are incurred.

F-21

k. Leases – The payments made by the Company as a lessee under operating leases are recognized in the consolidated statements of profit of loss and other comprehensive income on a straight-line basis over the lease term. Lease incentives received are recognized, as applicable, as a decrease in overall rental costs over the term of the contract. The Company’s accounting policy as a lessor is disclosed in Note 3.q.

l. Provisions – Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.

The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.

When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, an account receivable is recognized as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.

Provisions are classified as current or noncurrent based on the period of time estimated to meet the obligations covered.

m. Direct employee benefits – The Company provides its employees in Mexico and abroad different types of benefits. In Mexico the liabilities for direct employee benefits are recognized based on the services rendered by employees, considering their most recent salaries. These benefits primarily include statutory employee profit sharing (PTU) payable, compensated absences, vacation and vacation premium and incentives. The PTU is recorded in the income year in which it is incurred and presented under cost of services in the consolidated statements of profit or loss and other comprehensive income.

n. Employee benefits – The seniority premium liability are calculated by independent actuaries at the projected unit credit method using nominal interest rates. Due to its impact is not material, actuarial gains and losses generated during the year are recognized directly in the profit or loss rather than recognize them in other comprehensive income.

The past service cost is recognized in the profit or loss in the year of the plan amendment. Interest is calculated using the discount rate at the beginning of the period the balance of the defined benefit obligation. Defined benefit costs are classified as follows:

• Cost of service (including current service cost, past service cost and gains and losses on reductions and compensations).

• Interest expenses.

• Remeasurements.

The Company present the first two components of defined benefit cost as an expense in cost of services. The reduction and early liquidation of obligations are recognized as past service costs.

Contributions to benefit plans to defined contribution retirement are recognized as expenses at the time the employees render services that give them the right to contributions.

Any liability for compensation is recognized when the Company can no longer withdraw the offer of compensation and / or when the entity recognizes related restructuring costs.

o. Revenue recognition – Aeronautical and non-aeronautical revenues are recognized at their fair value, within a maximum thirty-day term subsequent to the time passengers depart, planes land or other services are provided, as the case may be, considering that the events that occur and services that are rendered in any given month are invoiced and recognized within that same month.

F-22

• Aeronautical services – The majority of the revenues in México are derived from rendering aeronautical services, related to the use of airport facilities by airlines and passengers. These revenues are regulated by the SCT through a “maximum rate” per “workload unit.” A workload unit is currently equivalent to one terminal passenger or 100 kilograms (220 pounds) of cargo. Moreover, in MBJA aeronautical revenues correspond to the fee for passengers and security, which are collected by airlines who are also invoice other charges for landing and parking aircraft.

• Revenues from non-aeronautical services consist mainly of the leasing of commercial space at the airport terminals (other than space deemed essential to airline operations), car parking, access fees charged to third parties providing food catering and other services at the airports, and other miscellaneous revenues.

Commercial space within the terminals is leased through operating lease agreements, based on either a monthly fixed rent or a charge based on the higher of a minimum monthly rent or a percentage of the lessee’s monthly revenues. Rental income from the Company’s leases is recognized on a straight-line basis over the term of the relevant lease.

• Revenues and cost of improvements to concession assets – In conformity with IFRIC 12, the Company recognizes revenues and the associated costs of improvements to concession assets which it is obligated to perform at the airports as established by the MDP. Revenues represent the value of the exchange between the Company and the government with respect to the improvements, given that the Company constructs or provides improvements to the airports as obligated under the MDP and in exchange, the government grants the Company the right to obtain benefits for services provided using those assets. The Company has determined that its obligations per the MDP should be considered to be a revenue-earning activity as all expenditures incurred to fulfill the MDP are included in the maximum tariff it charges its customers and therefore it recognizes the revenue and expense in profit or loss when the expenditures are performed. The cost for such additions and improvements to concession assets is based on actual costs incurred by the Company in the execution of the additions or improvements, considering the investment requirements in the MDP. Through bidding processes, the Company contracts third parties to carry out such construction.

The amount of revenues for these services are equal to the amount of costs incurred, as the Company does not obtain any profit margin for these construction services. The amounts paid are set at market value.

p. Foreign currency transactions – Transactions in currencies other than the functional currency of the Company (foreign currencies) are recognized using exchange rates prevailing at the dates on which the transactions are made. At the end of each reporting period, monetary items denominated in foreign currencies are converted at the exchange rates prevailing at that time.

Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rates prevailing at the date of the statements would. Exchange fluctuations are recorded in results of the period within the financial costs and presented as exchange gain or loss.

Non-monetary items that are valued at historical cost in a foreign currency are converted at the exchange rate at the date of the transaction.

q. Conversion of foreign operations– The assets and liabilities of foreign operations and the fair value adjustments arising from the acquisition, are translated at the exchange rates prevailing at the reporting date. Revenues and expenses of foreign operations are translated at the average exchange rate for the period of transactions.

The differences associated with foreign currency translation of foreign operations to the presentation currency (pesos) are recognized in other comprehensive income and presented in the foreign currency translation reserve in equity.

F-23

r. Income taxes – Current income tax is recorded in the income statement of the year in which it is incurred. The expense for income taxes includes both the tax assessed and deferred tax. Deferred and current tax are recognized the consolidated statement of profit or loss, except when they are related to items recognized in other comprehensive income, or directly in equity, in that case the deferred and current tax are also recognized in other comprehensive income or directly in equity, respectively.

Current tax expense is the tax payable determined for the year, using tax rates enacted or substantially enacted at the reporting date, plus any adjustment to tax payable in respect of previous years. Taxable income differs from income before income taxes reported in the consolidated statements of comprehensive income because there are items of income or expense that are taxable or deductible in other years and items that will never be taxable or deductible.

Deferred income tax is calculated by applying the statutory rate for temporary differences, resulting from comparing the accounting and tax assets and liabilities, and when applicable, the benefits from tax loss carryforwards and certain tax credits, such as the Tax on Assets (IMPAC) paid in previous years and expected to be recovered in future periods in accordance with the rules established in the tax laws, to the extent that it is probable the existence of future taxable profit that can be applied against such tax benefits. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the tax benefit can be recognized.

The rates applied to determine the deferred tax are those that correspond to the year in which it is expected the reversal of the temporary difference.

The Company did not recognized deferred taxes for the following items:

• Initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor tax results.

• Differences relating to investments in subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future and where the Company has the power to control the reversal date.

s. Earnings per share – Basic earnings per common share are calculated by dividing consolidated net income by the weighted average number of shares outstanding during the period, adjusted by repurchased shares retained in treasury. The Company does not have any dilutive securities; therefore basic and diluted earnings per share are the same.

t. Interest income and cost – Interest income comprises interest income from investments in debt securities, changes in the market value of financial assets at FVTPL and gains on hedging instruments that are recognized in the consolidated statement of comprehensive income, among other concepts. Interest income is recognized when it is probable that the economic benefits will flow to the Company and the amount can be reliably measured. Interest income is recorded on a regular basis, with reference to the capital invested and the effective interest rate.

Interest costs comprise interest costs of loans net of interest cost capitalized on qualifying assets, changes in the market value of financial assets at FVTPL, losses on hedging instruments that are recognized in the consolidated statement of comprehensive income, interest paid to the tax authorities, among other items. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognized in the consolidated statement of comprehensive income, using the effective interest method.

u. Operating segments – An operating segment is a component of the Company that is engaged in business activities from which it may earn revenue and incur expenses, including revenues and expenses relating to transactions with other components of the Company. All operating results of the operating segments are regularly reviewed by the Chief Executive Officer for making decisions about resources to be allocated to the segment and assess its performance and for which specific financial information is available. Each of the airports of the Company represents an operating segment.

F-24

v. Cash flow statement – The Company presents cash flows from operating activities using the indirect method, in which the net income is adjusted for the effects of transactions that do not require cash flows including those associated with investing and financing activities. Additionally, the Company presents interest income as part of operating activities.

4. Business Combination

Acquisition of DCA

The Board of Directors of the Company at an extraordinary meeting held on March 18, 2015, approved the participation in bidding for the acquisition of DCA, leaving the Operating Committee and three independent members of the Board of Directors the authority to determine the acquisition price and conditions to offer in the bidding. The Board of Directors also granted special powers of attorney to the Chief Executive Officer, Chief Financial Officer and the General Counsel to sign all contracts related to the transaction and the ability to obtain bank or debt securities to finance the entire acquisition.

On April 17, 2015, the Company reached an agreement with the Spanish company Abertis for the acquisition of the entire stake in the Spanish company DCA for a price of USD$192.0 million. The transaction closed on April 20, 2015. The contract establishes that the date for determining the purchase price was January 1, 2015, so all the rights and obligations of these companies were identified on that date.

DCA also has a MBJA the 74.5% and 14.77% stake in SCL. The acquisition qualifies as a business combination in accordance with IFRS 3.

MBJA operates the Sangster International airport in Montego Bay in Jamaica, who has concession with the government that ends on April 3, 2033. The airport is located right in the center of the tourist corridor from Negril to Ocho Rios, which concentrates 90% the hotel capacity of the island according to information published by the Jamaican Tourist Board. In 2014 the airport served a total of 3.6 million passengers, 99.0% were international, of which 66% had as their origin the United States, 20% from Canada, 1% from Europe and 2% from the Caribbean and others regions.

SCL was the operator of the International Airport of Santiago de Chile until September 30, 2015. On that date SCL was handed over to the airport authority in that country and the new operator. Although it no longer has operations in accordance with the concession agreement, SCL must remain in effect for one year after the transfer of the concession in order to address any potential contingencies that arise. After that first year, SCL will remain in force for a year before dissolutions in accordance with tax regulations in Chile.

As part of the analysis performed to determine the acquisition date of DCA, the Company concluded that the date it acquired control over was April 20, 2015. Therefore, for all practical purposes the beginning of the consolidation was defined as April 1, 2015 so, the consolidated statement of income and other comprehensive income for the year ended December 31, 2015 the Company comprises the results of DCA from that date.

The Company has finalized the determination of the fair value of assets acquired and liabilities assumed in the acquisition of DCA and MBJA and their recognition for accounting purposes.

Valuation Methodology

The income approach was used to quantify the fair value of the concession, which is based on cash generation expected by the asset during its remaining useful life. This approach assumes that the income from the asset determines its value. As a first step, it requires the development of projected cash flows, continuing with the determination of the present value of these cash flows to calculate the terminal value, which is a representation of the defined period in which the asset will continue to generate revenue.

The cost and market approach was used to determine the fair values of property, plant and equipment and improvements to concession assets, which estimates the fair value by determining the current replacement cost of one asset for another of equal value. The replacement cost of an asset reflects the estimated cost of rebuilding or replacement of assets, less an allowance for loss in value due to depreciation. The market approach is based on the price in a different observable market participants have paid for similar and comparable assets for the determination of fair value.

F-25

Assets acquired and liabilities recognized at the date of acquisition

Following are presented the net assets acquired at fair value determined in the measurement period and recorded at the date of acquisition according to IFRS 3 as well as the purchase price paid in cash.

	Fair value acquisition DCA
Assent
Cash and cash equivalents	Ps.	383,799
Trade accounts receivable		98,211
Other current assent		78,597
Machinery and equipment		398,072
Improvements to concession assets		1,816,380
Airport concessions		2,684,026
Other assents		74,926
Total acquisition assents		5,534,011
Liabilities
Accounts playable		(155,515	)
Loans		(658,981	)
Deferred income taxes		(749,579	)
Total current liabilities		(1,564,075	)
Net assets acquired		3,969,936
Consideration transferred		2,927,367
Non-controlling interest		852,825
		3,780,192
Bargain purchase gain	Ps.	189,744

In determining the fair value recognized in the acquisition of DCA a deferred tax liabilities of Ps. 678,792 was recorded.

During the process of the acquisition of DCA there was no contingent consideration.

In the valuation process it was determined that the values of cash equivalents, accounts receivable, other current assets, accounts payable, financial liabilities, other current liabilities and other noncurrent liabilities recorded in DCA approximate their fair value at the date acquisition.

The non-controlling interest (25.5% in MBJA) recognized at the date of acquisition of DCA was valued by reference to the fair value of the net assets acquired and amounted to Ps. 852,825.

The bargain purchase gain was due to a strategy implemented by the Company as part of its financial analysis to determine the most appropriate acquisition price, which was compared to the expected cash flows of the business that resulted in the fair value of the net assets acquired being greater than the price paid. After reviewing if it had appropriately identified and valued all the assets acquired and liabilities assumed, a bargain purchase gain was recognized in the consolidated income statement.

To fulfill the disclosure requirements of IFRS 3, the Company prepared a pro forma consolidated statement of profit or loss and other comprehensive income to present the revenues and income of the combined entity as if the acquisition had occurred on January 1, 2015. In addition to provide analysts and investors a better understanding of the acquisition, the condensed consolidated statement of profit or loss and other comprehensive income of the Company for the year 2014, was presented for comparative purposes.

	December 2015		December 2014
Revenues:
Aeronautical revenue		Ps.  5,622,575		Ps.  3,925,736
No aeronautical revenue		1,933,760		1,338,542
Improvements to concession assets		838,635		281,874
		8,394,970		5,546,152

F-26

	December 2015			December 2014
Operating costs:
Costs of services		1,637,919			1,161,588
Technical assistance fees		242,456			194,228
Concession taxes		525,745			261,577
Depreciation and amortization		1,224,123			925,220
Cost of improvements to concession assets		838,635			281,874
Other income		(254,236	)		(43,424	)
		4,214,642			2,781,063
Operating income		4,180,328			2,765,089
Finance costs		(406,839	)		(7,990	)
Share of loss of associate		(15,733	)		—
Income before income taxes		3,757,756			2,757,099
Income taxes		884,517			514,579
Profit for the year		2,873,239			2,242,520
Other comprehensive income
Exchange differences on translating foreign operations		427,238			—
Comprehensive income	Ps.	3,300,477		Ps.	2,242,520
Profit for the year attributable to:
Controlling interest	Ps.	2,816,523		Ps.	2,242,520
Non-controlling interest		56,716			—
	Ps.	2,873,239		Ps.	2,242,520
Total comprehensive income for the year attributable to:
Controlling interest		3,176,861			—
Non-controlling interest		123,616			—
	Ps.	3,300,477		Ps.	2,242,520

It is important to consider that the dividends to be paid in the future by MBJA to DCA shall include the results for the full year 2015 and its retained earnings at December 31, 2014.

The Company’s consolidated result of the year from DCA include revenues of Ps.995,707 and profits of Ps. 308,323.

5. Financial risk management

The Company is exposed to the following risks from the use of financial instruments:

• Credit risk

• Liquidity risk

• Market risk

This note presents information about the Company’s exposure to each of the above risks, the objectives, policies and processes of measuring and risk management of the Company. In different sections of these financial statements the Company has included additional in-depth disclosures.

F-27

At December 31, 2015, 2014 and 2013, financial instruments held by the Company are comprised of the following:

	December 31, 2015		December 31, 2014		December 31, 2013
Financial assets
Cash and cash equivalents		Ps.  2,996,499		Ps.  1,595,502		Ps.  2,168,187
Financial investments held for trading purposes		—		—		410,433
Receivables		159,196		337,581		207,515
Derivative financial instruments				—		340
Financial liabilities at amortized cost
Long-term debt securities		Ps. 2,600,000		Ps.           —		Ps.           —
Current and long term bank loans		3,950,465		1,719,474		1,854,476
Accounts payable		586,878		353,839		348,242

Financial risk management objectives – The Board of Directors is responsible for developing and monitoring the Company’s risk management policies.

The Company’s risk management policies are established to identify and analyze potential risks, to set appropriate limits and controls, to monitor such risk on an ongoing basis. Policies and risk management systems are reviewed regularly to reflect changes in market conditions and the Company’s activities. The Company, through its training and management standards and procedures, aims to develop an environment of disciplined and constructive control in which all employees understand their roles and obligations.

The Audit Committee of the Company supervises how management monitors compliance with policies, procedures and reviews risks that is appropriate to the risk management framework in relation to the risks faced by the Company. The Audit Committee is supported in its oversight role by the Company’s Internal Audit Function. Internal Audit performs routine and special reviews of controls and risk management procedures, and reports its results directly to the Audit Committee.

Credit risk – Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company and arises primarily for trade accounts receivable and the Company’s investments, including investment funds and derivative financial instruments.

• Accounts receivable and others – The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the demographic characteristics of its customers, including the default risk of the industry and country in which its customers operate, as these factors could also affect credit risk, particularly considering the recent economic downturn. The main source of income for the Company is the Passenger Charge Fees (Tarifa de Uso Aeroportuario, TUA) and leasing revenues from commercial areas in its airports. The TUA is charged to each departing passenger (except diplomat, infant or transit passenger), and is collected by the airlines and subsequently refunded to the airports. At December 31, 2015, 2014 and 2013 the revenues for TUA represented 55.3%, 60.8% and 58.8% of the total revenues, respectively. The leasing revenues from commercial areas are collected from other clients, which are not airline customers. Approximately 29.8%, 37.2% and 33.4% of the Company’s revenues in 2015, 2014 and 2013 are derived from the TUA collected by three major client airlines, which collect the TUA and remit it to the airports. However, geographically there is no credit risk concentration because airports are located in different cities in Mexico and Jamaica, and therefore if one airport has an operating problem the other airports would not be affected. Approximately 29.4%, 35.3% and 35.4% of aeronautical and non-aeronautical revenues earned during the periods ended December 31, 2015, 2014 and 2013 were generated by the Guadalajara airport. In addition, approximately 92.2%, 90.4% and 91.2% of aeronautical and non-aeronautical revenues earned during the periods ended December 31, 2015, 2014 and 2013, respectively, were generated by seven of the Company’s airports (Guadalajara, Tijuana, San Jose del Cabo, Puerto Vallarta, Montego Bay, Bajío and Hermosillo).

F-28

The Company has a credit policy under which each new customer is analyzed individually for creditworthiness before offering the standard terms and conditions of payment and delivery of the services provided by the Company. The review of the Company includes external ratings, when they are available, and in some cases bank references. Every customer has established credit limits, which must be approved by the Company’s management and are reviewed periodically.

The Company has entered into agreements with all its airline customers to collect the TUA in Mexico, by who receive the payment for the use of the airport services on behalf of the airports. According to these agreements, each customer airline could have a grace period of up to a maximum of 60 days to reimburse to the airport the TUA paid by passengers. If an airline customer needed a credit term of up to 60 days, it must provide a guarantee to the airport covering this period, bond or cash equivalent of 30 days more than the estimated consumption for the credit period requested by that airline. In the case of insolvency of any airline or a notice by the authorities on suspension of operations, the Company may recover the pending amounts regarding TUA up to the value of the guarantee. In order to mitigate credit risk with its customers, mainly TUA, airlines have granted cash guaranties, which are reported as deposits received, in the consolidated statements of financial position, in addition to the cash guaranties of other commercial customers. At December 31, 2015, 2014 and 2013, the Company has customer deposits of Ps. 725,437 (Ps. 31,333 are from MBJA), Ps. 597,139 and Ps. 522,204, respectively. These deposits are considered long-term based on the duration of the contracts signed with these airlines and the expectation that they will maintain long-term operations at the Company’s airports.

When reviewing credit risk, management groups the Company’s clients according to their credit characteristics that include whether the customer is an individual or a corporation, if they are airline customers, commercial customers, age and the existence of previous financial difficulties.

The Company systematically and periodically reviews the aging and collection of trade accounts receivable, and recognizes an allowance for doubtful accounts when it has evidence that it is probable these accounts will not be recovered (Note 7).

• Financial instruments held for trading purposes – The Company limits its exposure to credit risk by investing in government-backed securities. Management constantly monitors credit ratings to anticipate any counterparty defaults.

• Liquid funds and derivative financial instruments – The credit risk on liquid funds and derivative financial instruments is limited because the counterparties are banks with high credit ratings assigned by recognized rating agencies.

Liquidity Risk– The risk of liquidity represents the possibility that the Company will have difficulty to fulfill its obligations related with its financial liabilities that will be paid in cash or another financial asset. The Company focuses its liquidity management to ensure, as much as possible, that it will have sufficient liquidity to comply with its obligations at their maturity date, both in normal and in extraordinary conditions, without incurring in unacceptable losses or risking the reputation of the Company.

The Company utilizes its budget, prepared at a cost center level, to allocate resources to render its services, which helps to monitor cash flow requirements and to optimize the performance of its investments. Generally, the Company ensures availability of sufficient cash flows to cover operating expenses for a period of 60 days, including payment of its financial debt; this excludes the possible impact of extreme circumstances that are not reasonably predictable, such as natural disasters. The Company has external financing as described in Note 16 for compliance of its obligations under the MDP, whereas for other obligations it uses cash flows from operating activities and resources received at the maturity of its financial investments. As of December 31, 2015 the Company doesn’t have any unused lines of credit. As of December 31, 2014, the Company has available credit lines of Ps. 1,011,000.

F-29

Following is a table with a summary of the Company’s contractual maturities for its financial liabilities, including the interest to be paid, as of December 31, 2015, 2014 and 2013:

	December 31, 2015
	Weighted average of effective interest rate			Less than 1 month		From 1 to 3 months		From 3 months to 1 year		From 1 year to 5 years		More than 5 years		Total
Long-term debt securities (fixed rate)				Ps.	—	Ps.	—	Ps.	—	Ps.	—	Ps.	1,500,000	Ps.	1,500,000
Long-term debt securities (variable rate)					—		—		—		1,100,000		—		1,100,000
Fixed rate loans					516		1,569		201,860		31,709		5,529		241,183
Variable rate bank loans					—		3,286,442		38,715		358,316		25,809		3,709,282
Fixed rate interest		9.85	%		1,405		5,949		128,836		436,654		483,357		1,056,201
Variable rate interest		3.62	%		5,485		7,014		42,028		160,328		—		214,855
Trade accounts payable		N/A			196,757		240,481		—		—		—		437,238
AMP		N/A			—		—		149,637		—		—		149,637
				Ps.	204,163	Ps.	3,541,455	Ps.	561,076	Ps.	2,087,007	Ps.	2,014,695	Ps.	8,408,396
Fixed rate bank loans				Ps.	21,928	Ps.	—	Ps.	28,929	Ps.	9,643	Ps.	—	Ps.	60,500
Fixed rate interest		8.52	%		1,795		—		2,762		630		—		5,187
Variable rate bank loans					30,503		18,917		878,261		689,586		41,707		1,658,974
Variable rate interest		4.69	%		5,824		16,621		29,070		71,370		2,600		125,485
Trade accounts payable		N/A			133,619		95,263		—		—		—		228,882
AMP		N/A			—		—		124,957		—		—		124,957
				Ps.	193,669	Ps.	130,801	Ps.	1,063,979	Ps.	771,229	Ps.	44,307	Ps.	2,203,985
	December 31, 2013
	Weighted average of effective interest rate			Less than 1 month		From 1 to 3 months		From 3 months to 1 year		From 1 year to 5 years		More than 5 years		Total
Fixed rate bank loans				Ps.	21,929	Ps.	21,429	Ps.	108,642	Ps.	60,500	Ps.	—	Ps.	212,500
Fixed rate interest		8.52	%		3,227		1,369		8,132		3,392		—		16,120
Variable rate bank loans					30,307		267,873		187,397		977,470		178,929		1,641,976
Variable rate interest		5.55	%		9,530		14,016		52,201		149,415		7,532		232,694
Trade accounts payable		N/A			72,443		162,413		10,992		—		—		245,848
AMP		N/A			—		—		102,394		—		—		102,394
				Ps.	137,436	Ps.	467,100	Ps.	469,758	Ps.	1,190,777	Ps.	186,461	Ps.	2,451,532

The interest payable from loans with variable interest rates was determined based on projected interest rates, plus the basis point adjustment corresponding to each bank loan.

Market risk – Is the risk that changes in market prices, such as exchange rates, interest rates and prices of equity instruments, may affect the amount of the Company’s financial instruments. The Company’s market risk management objectives include controlling the risk exposures between acceptable parameters, while optimizing profits.

The Company in certain cases enters into derivatives instrument contracts to manage market risks. These transactions are in-line within the policies established by management. The Company also applies hedge accounting to minimize the volatility in profit or loss associated with certain financial instruments.

• Foreign exchange risk – The Company is exposed to currency risk for its revenues and trade accounts receivable denominated in a currency other than the functional currency of the Company. The foreign currencies in which transactions are primarily denominated is the U.S. dollar (USD) (Note 30).

In Mexico, the tariffs to be charged to international passengers and international flights are published in the Official Journal (Diario Oficial de la Federación) in USD, however, in accordance with Mexican law these tariffs are billed and collected in Mexican pesos. A significant depreciation of the peso during the last two months in each year could lead to an increase in aeronautical revenues that could lead to exceed the maximum tariff per traffic unit allowed, which may be a breach of compliance with the Concession’s maximum rates of each airport. If a significant appreciation of the peso occurs, the Company may be required to provide discounts to avoid exceeding the maximum tariffs. On the other hand, a significant appreciation of the peso could lead to our rates substantially decreasing. The Company has no way to recover the lost revenue if it charges less than the maximum rate as a result of a significant appreciation of the peso.

F-30

In MBJ, the tariffs to be charged to domestic and international passengers in USD, which they are composed for a fixed amount for 12 months (from April to March), and then updated for inflation in the United States. In April 2015, the new tariffs approved by the Airport Authority of Jamaica (AAJ) in November 2014 came into effect, where the increase in the rate for international passengers was USD$8.50 to USD$19.34 per person and domestic passengers tariffs remained of at USD$5.52 per person. Therefore, the Company’s revenues would not be exposed to a possible devaluation or appreciation of the Jamaican dollar against the US dollar.

While the Company can ensure that it does not exceed the maximum rates in Mexico as mentioned above, the depreciation of the Mexican peso can have a positive effect on commercial revenues and aeronautical revenues, while that appreciation of Mexican peso generally has a negative effect. The rates applied to international passengers, international flights and some of our commercial contracts are denominated in USD and are billed and collected in Mexican pesos translated at the average exchange rate of the previous month. Therefore, the depreciation of the peso against the dollar results in the Company obtaining more USD than before the depreciation, while the appreciation of the peso against the USD results in the Company obtaining less Mexican pesos. As the Mexican peso appreciates against the USD, the Company obtains fewer pesos which could result in a decreased in profit, especially if the appreciation continues or exceeds historical levels. In addition, although most of our operating costs are denominated in pesos, we cannot predict whether our cost of services will increase as a consequence of the depreciation of the peso, or as a result of other factors.

In MBJA, expenses are comprised approximately 60% in USD, with the rest payable in Jamaican dollars. An appreciation of the Jamaican dollar would therefore increase expenses in USD terms.

Following is a sensitivity analysis of the Company financial assets and liabilities denominated in USD, if the peso were to depreciate or appreciate by 10%, which is the amount management considers reasonably possible of occurring at year end:

	USD amounts at December 31, 2015			Peso amounts at exchange rate of Ps. 17.2065			Peso amounts if exchange rate would depreciate 10%			Peso amounts if exchange rate would appreciate 10%
Thousands of U.S. dollars:
Financial assets:
Cash and cash equivalents		8,907		Ps.	153,253		Ps.	168,579		Ps.	137,928
Trade accounts receivable		6,578			113,188			124,507			101,869
		15,485			266,441			293,086			239,797
Financial liabilities:
Accounts payable		(96,887	)		(1,667,086	)		(1,833,799	)		(1,500,381	)
Loans		(215,574	)		(3,709,283	)		(4,080,221	)		(3,338,364	)
Net liability position		(296,976	)	Ps.	(5,109,928	)	Ps.	(5,620,934	)	Ps.	(4,598,948	)
	USD amounts at December 31, 2014			Peso amounts at exchange rate of Ps. 14.7180			Peso amounts if exchange rate would depreciate 10%			Peso amounts if exchange rate would appreciate 10%
Thousands of U.S. dollars:
Financial assets:
Cash and cash equivalents		2,886		Ps.	42,473		Ps.	46,720		Ps.	38,226
Trade accounts receivable		1,829			26,922			29,614			24,229
		4,715			69,395			76,334			62,455
Financial liabilities:
Accounts payable		(168	)		(2,472	)		(2,718	)		(2,224	)
Net asset position		4,547		Ps.	66,923		Ps.	73,616		Ps.	60,231

F-31

	USD amounts at December 31, 2013			Peso amounts at exchange rate of Ps. 13.0765			Peso amounts if exchange rate would depreciate 10%			Peso amounts if exchange rate would appreciate 10%
Thousands of U.S. dollars:
Financial assets:
Cash and cash equivalents		181		Ps.	2,366		Ps.	2,603		Ps.	2,130
Financial investments held for trading purposes		31,387			410,433			451,478			369,391
Trade accounts receivable		1,134			14,826			16,310			13,344
		32,702			427,625			470,391			384,865
Financial liabilities:
Accounts payable		(237	)		(3,097	)		(3,402	)		(2,784	)
Net asset position		32,465		Ps.	424,528		Ps.	466,989		Ps.	382,081

Interest rate risk – The Company is exposed to fluctuation in interest rates on financial instruments, such as investments, loans and debt issuances. The Company monitors its interest rate risk and when bank loans are entered into with variable interest rates, it determines whether it should enter into derivative financial instruments, in order to reduce its exposure to the risk of volatility in interest rates. The negotiation with derivative financial instruments is only entered into with institutions of high repute and credit rating. The Company does not enter into operations for speculative purposes.

Fluctuations in interest rates impact primarily loans, changing either their fair value (fixed rate debt) or their future cash flows (variable rate debt). Management does not have a formal policy to determine how much exposure the Company should have to fixed or variable rates. However, when getting new loans, management uses its judgment to decide if it believes that a fixed or variable rate would be more favorable during the term of the loan.

The following sensitivity analysis has been determined based on the exposure to interest rates for both derivatives and non-derivative financial instruments at the end of the reporting period. For loans with variable interest rates, an analysis is prepared assuming the amount of liability outstanding at the end of the reporting period under review has been the current liability for the year. The sensitivity analysis used assumes an increase or decrease of 100 basis points, which is the change management considers reasonably possible of occurring at year end.

The Company has financial debt denominated in pesos and U.S. dollars, which accrues interest at a variable rate based on TIIE 28-days, LIBOR 30-days in Mexico and LIBOR GRA in MBJA, respectively. If the date of year end 2015, variable interest rates to which the Company is exposed had been 100 basis points higher or lower than the interest rate at year-end with the other variables remaining constant, the effect on net income and stockholders’ equity for the years ended December 31, 2015, 2014 and 2013 would be as follows:

	2015			2014			2013
Effect in case of interest rate increase in 100 basis points
Variable rate debt	Ps.	(40,370	)	Ps.	(6,794	)	Ps.	(10,491	)
Effect in case of interest rate decrease in 100 basis points
Variable rate debt	Ps.	40,370		Ps.	6,794		Ps.	10,491

Until February 2014, the Company had contracted hedges of derivative financial instrument interest rate caps (CAPs), whereby it agreed to exchange the difference between the amounts of the variable interest rate calculated over the principal amounts of the hedged items associated with its variable rate debt instruments. These contracts allowed the Company to hedge the cash flow exposures on debt contracted at variable interest rates.

F-32

Capital Management – The policy of the Board of Directors of the Company is to maintain a strong capital position to provide confidence to its investors, creditors, and the market and to sustain future development of the business. The Board of Directors monitors the return on equity, which the Company defines as result from net profit divided by total stockholders’ equity.

The Board of Directors seeks to maintain the optimal balance for the ratio between total liabilities and stockholders’ equity, which may result from increased levels of bank loans up to the financial structure that it deems optimal, therefore, management seeks authorization from the Board of Directors for any additional debt issuances or for the prepayment of debt. While total liabilities grow in relation to equity and net profit continues to increase, the Company will generate higher returns on capital. The Company has no obligation to maintain a ratio of equity to total liabilities in particular.

Following is the ratio of stockholders’ equity to total liabilities of the Company at the end of the reporting period:

	2015		2014		2013
Stockholders’ equity –controlling interest	Ps.	21,191,560	Ps.	21,285,891	Ps.	22,212,711
Total liabilities		9,317,356		3,000,316		3,021,889
Ratio of total stockholders’ equity to liabilities		2.3		7.1		7.4

The Company may elect to repurchase its own shares in the stock market, under the following terms and conditions:

• The acquisition has to be approved previously at a Stockholders Meeting and be at market price (except in the case of public offerings or auctions authorized by the stock market).

• If the acquisition is made the Company reduces stockholders’ equity and reflects the acquisition within the repurchased shares account. If the Company decides to cancel the shares it reduces common stock accordingly.

• Announcing the amount of common stock issued and paid when determining the authorized stock, for repurchase. The Ordinary Stockholders Meeting shall expressly agree, for each year, the maximum amount of funds that may be used for the repurchase of the Company’s shares, with the only limitation that the sum of the resources that can be used for this purpose, in no event shall exceed the total balance of retained earnings of the Company.

Repurchased shares are not subject to vote at the Company’s Stockholders Meeting, do not provide rights or economic benefits and are also not considered when determining a quorum to vote.

During the year, there was no change in the Company’s capital management policy. The Company is not subject to externally equity requirements, except for those corresponding to the minimum common stock required by Mexican Companies Law (Ley General de Sociedades Mercantiles).

Fair value of the financial instruments– Except for loans and debt securities, management believes the carrying amounts of financial assets and financial liabilities, recognized at amortized cost in the financial statements, approximate their fair value due to their short-term maturities.

As of December 31, 2015, 2014 and 2013, the fair value of financial liabilities recognized at amortized cost was Ps. 6,568,634, Ps. 1,702,710 and Ps. 1,817,414, respectively, while their book value is Ps. 6,550,465, Ps. 1,719,474 and Ps. 1,854,476, respectively. The fair value of loans are determined in accordance with generally accepted pricing models based on discounted cash flow analysis.

The fair value of financial assets and liabilities is determined as follows:

• Quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

• Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) (Level 2); and

F-33

• Inputs for the asset or liability that are not based on observable market data (unobservable inputs) (Level 3)

• Financial instruments recognized at fair value, are categorized according to the fair value hierarchy into levels 1 to 3 based on the degree to which their fair value is objectively observable, are:

• Financial instruments classified as FVTPL – Are classified within Level 1 of the fair value hierarchy.

• Derivative financial instruments – Are classified within Level 2 of the fair value hierarchy.

6. Cash and cash equivalents

As of December 31, 2015, 2014 and 2013, the balances are comprised of the following:

	December 31, 2015		December 31, 2014		December 31, 2013
Cash	Ps.	1,171,725	Ps.	140,638	Ps.	119,136
Overnight investments of cash surpluses		1,824,774		1,454,864		2,040,879
Cash equivalents designated for expenditure, held in trust		—		—		8,172
	Ps.	2,996,499	Ps.	1,595,502	Ps.	2,168,187

7. Trade accounts receivable

As of December 31, 2015, 2014 and 2013, trade accounts receivable are comprised of the following:

	December 31, 2015			December 31, 2014			December 31, 2013
Trade accounts receivable	Ps.	295,611		Ps.	490,579		Ps.	372,497
Allowance for doubtful accounts		(136,415	)		(152,998	)		(164,982	)
	Ps.	159,196		Ps.	337,581		Ps.	207,515

Accounts receivable include balances to be reimbursed to the Company by domestic and international airlines for passenger charges fees (TUA) of Ps. 170,541, Ps. 257,605 and Ps. 202,464 as of December 31, 2015, 2014 and 2013, respectively. Passenger charges are payable for each passenger (other than diplomats, infants, transfer and transit passengers) departing from the airport terminals operated by the Company and are collected by the airlines and subsequently remitted to the Company.

The movements in the allowance for doubtful accounts are recorded under cost of services in the consolidated statement of profit or loss and other comprehensive income.

	2015			2014			2013
Beginning balance	Ps.	(152,998	)	Ps.	(164,982	)	Ps.	(226,005	)
Bad debt expense		(15,285	)		(15,056	)		(11,758	)
Write-offs		9,905			6,466			11,282
Reversal of bad debts		24,891			20,574			61,499
Increased for MBJA´s consolidation		(2,928	)		—			—
Ending balance	Ps.	(136,415	)	Ps.	(152,998	)	Ps.	(164,982	)

The allowance for doubtful accounts is comprised of customer balances that are in litigation or bankruptcy process and legal proceedings, which at the date of the consolidated financial statements are not yet completed. As of December 31, 2015, 2014 and 2013 these balances amounted to Ps. 110,442, Ps. 77,137 and Ps. 98,026, respectively. The allowance also includes customer balances in arrears in their payments and that are in a process of regularization; therefore they have not been sued. At December 31, 2015, 2014 and 2013 the amount of these balances amounted to Ps.25,973, Ps.75,861 and Ps. 66,956, respectively. During 2015, 2014 and 2013, the Company recorded reversals of bad debt of the balances that were in a legal process with an unfavorable outcome for the Company. The amount of these bad debt expense totaled Ps. 24,891, Ps. 20,574 and Ps. 61,499, respectively also decreasing the balance of accounts receivable. The reversal of bad debts had no effect on the operating results of the Company during 2015, 2014 and 2013. There are other cancellations of write-off for customers that were in arrears in their payments, but were paid in 2015, 2014 and 2013 for Ps. 9,905, Ps. 6,466 and Ps. 11,282, respectively.

F-34

Following are past due balances of accounts receivable, for which there has not been a provision of allowance for doubtful accounts, according to the Company’s policy and their maturity date:

	December 31, 2015		December 31, 2014		31 de diciembre de 2013
Accounts receivables past due from 1 to 30 days	Ps.	52,833	Ps.	15,619	Ps.	20,600
Accounts receivables past due 31 to 60 days		8,290		7,051		4,475
Accounts receivables past due 61 to 90 days		4,292		3,257		1,009
Accounts receivables past due more than 90 days		1,834		29		121
	Ps.	67,249	Ps.	25,956	Ps.	26,205

Following is the percentage of the main clients of the Company with relation to the total of the trade accounts receivable, segregating the accounts receivable of airport services (SAE) and the passengers charges (TUA) that corresponds to the amounts that airlines recover from passengers on behalf of the Company and subsequently pay:

	December 31, 2015						December 31, 2014						December 31, 2013
	% de TUA to be paid			% de TUA to be paid			% receivable of SAE			% receivable to SAE			% de TUA to be paid			% receivable of SAE
Concesionaria Vuela Compañía de Aviación, S.A.P.I. de C.V.		23.0	%		15.8	%		3.4	%		3.9	%		9.6	%		7.5	%
ABC Aerolíneas, S.A. de C.V.		6.4	%		5.7	%		2.1	%		1.2	%		5.8	%		4.8	%
Aerovías de México, S.A. de C.V.		4.9	%		7.4	%		2.2	%		1.5	%		4.0	%		2.3	%
Aerolitoral, S. A. de C. V.		7.9	%		5.9	%		1.7	%		0.7	%		5.7	%		1.0	%

The Company has cash, bonds and goods that guarantee certain amounts from TUA as well as accounts receivable from clients as of December 31, 2015, 2014 and 2013. These guarantees could be applied to any unpaid balance in case of a breach from clients and under certain circumstances.

8. Machinery, equipment and improvements on leased buildings

As of December 31, 2015, 2014 and 2013, the machinery, equipment and improvements on leased buildings are comprised as follows:

	Balance as of January 1, 2015			Additions			Divestitures			Currency translation effect			Balance as of December 31, 2015
Investment:
Machinery and equipment	Ps.	1,182,501		Ps.	670,607		Ps	. (9,306	)	Ps.	63,429		Ps	. 1,907,231
Office furniture and equipment		143,538			27,737			(435	)		3,848			174,688
Computer equipment		303,645			193,369			(972	)		12,331			508,373
Transportation equipment		27,734			13,253			(4,984	)		844			36,847
Communication equipment		19,542			9,316			(330	)		—			28,528
Improvements on leased buildings		16,473			—			—			—			16,473
Total investment		1,693,433			914,282			(16,027	)		80,452			2,672,140
Accumulated depreciation:
Machinery and equipment		(536,137	)		(123,293	)		7,337			(29,543	)		(681,636	)
Office furniture and equipment		(84,697	)		(12,636	)		435			(3,232	)		(100,130	)
Computer equipment		(219,851	)		(65,456	)		972			(9,313	)		(293,648	)
Transportation equipment		(25,564	)		(1,783	)		4,984			(809	)		(23,172	)
Communication equipment		(10,723	)		(2,515	)		126			—			(13,112	)
Improvements on leased buildings		(3,808	)		(1,041	)		—			—			(4,849	)
Total accumulated depreciation		(880,780	)		(206,724	)		13,854			(42,897	)		(1,116,547	)
Net amounts	Ps.	812,653		Ps.	707,558		Ps	. (2,173	)	Ps.	37,555		Ps	. 1,555,593

F-35

	Balance as of January 1, 2014			Additions			Divestitures			Balance as of December 31, 2014
Investment:
Machinery and equipment	Ps.	1,133,285		Ps.	60,052		Ps.	(10,836	)	Ps.	1,182,501
Office furniture and equipment		144,652			10,339			(11,453	)		143,538
Computer equipment		311,065			44,357			(51,777	)		303,645
Transportation equipment		27,249			1,162			(677	)		27,734
Communication equipment		17,702			2,231			(391	)		19,542
Improvements on leased buildings		10,413			6,060			—			16,473
Total investment	Ps.	1,644,366		Ps.	124,201		Ps.	(75,134	)	Ps.	1,693,433
Accumulated depreciation:
Machinery and equipment	Ps.	(443,718	)	Ps.	(102,813	)	Ps.	10,394		Ps.	(536,137	)
Office furniture and equipment		(79,406	)		(16,485	)		11,194			(84,697	)
Computer equipment		(211,568	)		(58,967	)		50,684			(219,851	)
Transportation equipment		(24,461	)		(1,781	)		678			(25,564	)
Communication equipment		(8,916	)		(2,109	)		302			(10,723	)
Improvements on leased buildings		(2,756	)		(1,052	)		—			(3,808	)
Total accumulated depreciation	Ps.	(770,825	)	Ps.	(183,207	)	Ps.	73,252		Ps.	(880,780	)
Net amounts	Ps.	873,541		Ps.	(59,006	)	Ps.	(1,882	)	Ps.	812,653
	Balance as of January 1, 2013			Additions			Divestitures			Balance as of December 31, 2013
Investment:
Machinery and equipment	Ps.	1,101,715		Ps.	42,834		Ps.	(11,264	)	Ps.	1,133,285
Office furniture and equipment		138,354			9,511			(3,213	)		144,652
Computer equipment		280,670			37,866			(7,471	)		311,065
Transportation equipment		31,529			370			(4,650	)		27,249
Communication equipment		15,597			2,369			(264	)		17,702
Improvements on leased buildings		10,207			206			—			10,413
Total investment	Ps.	1,578,072		Ps.	93,156		Ps.	(26,862	)	Ps.	1,644,366
Accumulated depreciation:
Machinery and equipment	Ps.	(354,840	)	Ps.	(96,155	)	Ps.	7,277		Ps.	(443,718	)
Office furniture and equipment		(70,579	)		(11,591	)		2,764			(79,406	)
Computer equipment		(165,508	)		(51,578	)		5,518			(211,568	)
Transportation equipment		(26,462	)		(2,649	)		4,650			(24,461	)
Communication equipment		(7,465	)		(1,630	)		179			(8,916	)
Improvements on leased buildings		(1,753	)		(1,003	)		—			(2,756	)
Total accumulated depreciation	Ps.	(626,607	)	Ps.	(164,606	)	Ps.	20,388		Ps.	(770,825	)
Net amounts	Ps.	951,465		Ps.	(71,450	)	Ps.	(6,474	)	Ps.	873,541

Additions for investment and depreciation of machinery and equipment and improvements on leased buildings in 2015 include assets acquired as of April 1, 2015 by business combination whose fair value at the acquisition date is shown below:

	Net amounts
Machinery and equipment	Ps.	342,961
Office furniture and equipment		6,498
Computer equipment		31,626
Transportation equipment		342
Total	Ps.	381,427

F-36

During the years ended December 31, 2014 and 2013 no purchases of machinery and equipment and improvements on leased buildings by business combination took place.

As of December 31, 2015, 2014 and 2013, the net balances of machinery, equipment and improvements on leased buildings are:

	December 31, 2015
	Balance Mexican operations		Balance foreign operations		December 31, 2015		December 31, 2014		December 31, 2013
Net amounts:
Machinery and equipment	Ps.	888,011	Ps.	337,584	Ps.	1,225,595	Ps.	646,364	Ps.	689,567
Office furniture and equipment		69,089		5,469		74,558		58,841		65,246
Computer equipment		185,701		29,024		214,725		83,794		99,497
Transportation equipment		12,442		1,233		13,675		2,170		2,788
Communication equipment		15,416		—		15,416		8,819		8,786
Improvements on leased buildings		11,624		—		11,624		12,665		7,657
Total amounts	Ps.	1,182,283	Ps.	373,310	Ps.	1,555,593	Ps.	812,653	Ps.	873,541

The Company has several buildings under operating leasing for office use. In Notes 27.a and 32, the costs and obligations under these leases are disclosed.

9. Improvements to concession assets

As of December 31, 2015, 2014 and 2013, the improvements to concession assets are comprised as follows:

	Balance as of January 1, 2015			Additions			Divestitures		Transfers			Currency translation effect			Balance as of December 31, 2015
Investment:
Improvements to concession assets	Ps.	7,019,188		Ps.	2,278,944		Ps.	—	Ps.	368,575		Ps.	242,677		Ps.	9,909,384
Construction in-progress		203,950			609,743			—		(368,575	)		806			445,924
Total investment		7,223,138			2,888,687			—		—			243,483			10,355,308
Accumulated amortization		(2,074,707	)		(934,177	)		—		—			(52,106	)		(3,060,990	)
Net amounts	Ps.	5,148,431		Ps.	1,954,510		Ps.	—	Ps.	—		Ps.	191,377		Ps	7,294,318

	Balance as of January 1, 2014			Additions			Divestitures			Transfers			Balance as of December 31, 2014
Investment:
Improvements to concession assets	Ps.	6,346,319		Ps.	57,998		Ps.	(17,141	)	Ps.	632,012		Ps.	7,019,188
Construction in-progress		367,598			468,364			—			(632,012	)		203,950
Total investment	Ps.	6,713,917		Ps.	526,362		Ps.	(17,141	)	Ps.	—		Ps.	7,223,138
Accumulated amortization	Ps.	(1,711,250	)	Ps.	(380,598	)	Ps.	17,141		Ps.	—		Ps.	(2,074,707	)
Net amounts	Ps.	5,002,667		Ps.	145,764		Ps.	—		Ps.	—		Ps.	5,148,431

F-37

	Balance as of January 1, 2013			Additions			Divestitures			Transfers			Balance as of December 31, 2013
Investment:
Improvements to concession assets	Ps.	6,005,670		Ps.	97,155		Ps.	(13,591	)	Ps.	257,085		Ps.	6,346,319
Construction in-progress		168,316			456,877			(510	)		(257,085	)		367,598
Total investment	Ps.	6,173,986		Ps.	554,032		Ps.	(14,101	)	Ps.	—		Ps.	6,713,917
Accumulated amortization	Ps.	(1,363,836	)	Ps.	(351,332	)	Ps.	3,918		Ps.	—		Ps.	(1,711,250	)
Net amounts	Ps.	4,810,150		Ps.	202,700		Ps.	(10,183	)	Ps.	—		Ps.	5,002,667

Additions for investment and depreciation of machinery and equipment and improvements on leased buildings in 2015 include assets acquired as of April 1, 2015 by business combination, whose fair value at the acquisition date is shown below:

	Investment		Amortization			Net amounts
Improvements to concession assets	Ps.	2,264,602	Ps.	(462,719	)	Ps.	1,801,883
Construction in-progress		7,523		—			7,523
Total	Ps.	2,272,125	Ps.	(462,719	)	Ps.	1,809,406

During the years ended December 31, 2014 and 2013 no acquisitions of improvements to concession assets by business combination took place.

At December 31, 2015, 2014 and 2013, the net amounts of improvements to concession assets are:

	Balance Mexican operations		Balance foreign operations		Total balance as of December 31, 2015		Balance as of December 31, 2015		Balance as of December 31, 2014
Net amounts:
Improvements to concession assets	Ps.	4,876,173	Ps.	1,972,221	Ps.	6,848,394	Ps.	4,944,481	Ps.	4,635,069
Construction in-progress		429,809		16,115		445,924		203,950		367,598
Total amounts	Ps.	5,305,982	Ps.	1,988,336	Ps.	7,294,318	Ps.	5,148,431	Ps.	5,002,667

Improvements to concession assets are comprised by intangible assets from additions and improvements to such assets in accordance with IFRIC 12, as well as other investments that have been carried out to the infrastructure of the airports qualifying as intangible assets, and even when they are not in committed investments in the MDP.

As of December 31, 2015, 2014 and 2013, the balance of machinery, equipment, improvements on leased buildings and improvements to concession assets includes investments pending to be paid of Ps. 221,151, Ps. 86,383 and Ps. 135,386, respectively. Construction in-progress relates mainly to the expansion of the terminal building at the Guadalajara airport, improvements to terminal building and runways at the San Jose del Cabo airport and improvements to roads and terminal building in Tijuana airport. As of December 31, 2015, 2014 and 2013, the cumulative net amount capitalized was Ps. 186,834, Ps. 185,797 and Ps. 166,610, respectively, with a capitalization rate of 4.6%, 4.8% and 1.3%, respectively. During 2015, 2014 and 2013, the Company capitalized borrowing costs of Ps. 1,037, Ps. 19,187 and Ps. 4,703, respectively.

10. Airport concessions

a. Mexican Concessions

As described in Note 1.a, the Mexican Government granted concessions to manage, operate and develop 12 airports, and benefit from the use of the airport facilities over a 50-year term beginning November 1, 1998. The value of airport concessions and rights to use airport facilities was determined as explained in Note 1.a, and paid by GAP through the issuance of shares to the Mexican Government.

F-38

The table below shows the values of airport concessions and rights to use airport facilities as of December 31, 2015, 2014 and 2013:

Acquisition cost assigned to:	Ps.	15,938,359
Rights to use airport facilities (Note 11):
Runways, aprons, platforms	Ps.	519,057
Buildings		577,270
Other facilities		91,241
Land		930,140
		2,117,708
Airport concessions		13,820,651
	Ps.	15,938,359

The original amortization term for the concessions is 49 years. As mentioned in Note 1.a, the concession value was assigned in August 1999, date in which the amortization term began, and will run through November 2048.

Each airport concession agreement contains the following terms and basic conditions:

• The concessionaire has the right to manage, operate, maintain and use the airport facilities and carry out any construction, improvements, or maintenance of facilities in accordance with its MDP, and to provide airport, complementary and commercial services. Each concessionaire is required to make minimum investments at each airport under the terms of its MDP. The Company’s investment plans under the MDP must be updated every five years starting from 2000 and approved by the SCT. During December 2009, the SCT authorized the Company’s MDP update for the five-year period from 2015 to 2019.

• The concessionaire will use the airport facilities only for the purposes specified in the concession, will provide services in conformity with the law and applicable regulations, and will be subject to inspections by the SCT.

• The concessionaire must pay a tax for the use of the assets under concession (currently 5% of the concessionaire’s annual gross revenues derived from the use of public property), in conformity with the Mexican Federal Duties Law.

• The concessionaire assumed ASA’s rights and obligations derived from airport-related agreements with third parties.

• ASA has the exclusive right to supply fuel for consumption at the airport.

• The concessionaire must grant free access to specific airport areas to certain Mexican Government agencies (such as customs and immigration) so that they may carry out their activities within the airport.

• According to Article 27 of the General Law on Airports, the concession may be revoked if the concessionaire breaches any of its obligations established therein or falls under any of the causes for revocation referred to in Article 26 of law and in the concession agreement. The breach of certain concession terms may be cause for revocation if the SCT has applied sanctions in three different instances with respect to the same concession term.

• The SCT may modify concession terms and conditions that regulate the Company’s operations.

• The concession may be renewed in one or more instances, for terms not to exceed an additional 50 years.

b. Sangster Internacional Airport (MBJ)

As disclosed in Note 1.a, the Company acquired DCA in 2015, which holds a 74.5% stake in MBJA in 2015, located in Montego Bay, Jamaica. MBJA has a concession to operate, maintain and operate the airport for a period of 30 years as of April 3, 2003.

F-39

The concession of MBJ contains the following terms and conditions:

• On April 2003, MBJ entered into a concession agreement with AAJ pursuant to which AAJ granted MBJA the right to rehabilitate, develop, operate and maintain MBJ. MBJA is thereby designated as the approved airport operator and permitted to undertake the functions of AAJ, relative to SIA. The agreement was amended on December 16, 2005 and further amended on April 12, 2006.

• The concession agreement requires MBJA to provide the airport services set out therein at MBJ.

• Through its concession agreement, MBJA is obliged to pay AAJ a monthly concession fee on the basis of traffic units (passengers) multiplied by the rate established in the concession. The rate is subject to annual adjustment according to the National Consumer Price Index in the United States (CPI).

• The concession agreement is governed by Jamaican laws and MBJA cannot assign its rights or obligations under the agreement (except by way of security for indebtedness, without the prior written consent of AAJ).

• AAJ can terminate the concession agreement in an event of default of MBJA including insolvency of MBJA or its shareholders (if the latter would have a material adverse effect on MBJA), cessation of business, material breach by MBJA of the concession agreement including non-payment of any amount due within 60 days after the due date, change of control, bribery or corruption or failure by the shareholders to provide equity funding required by applicable documents. Also, MBJA may terminate the concession agreement in the event of a material breach by AAJ which has a material adverse effect on the business of MBJ or expropriation or other material adverse action by the Jamaican Government.

The value of the concessions at December 31, 2015, 2014 and 2013 is as follows:

	December 31, 2015			December 31, 2014			December 31, 2013
Mexican airport concession	Ps.	13,820,651		Ps.	13,820,651		Ps.	13,820,651
Other airport concession (fair value on date of acquisition in USD$176,086,000)		3,029,824			—			—
Amortization		(4,610,308	)		(4,209,355	)		(3,925,305	)
	Ps.	12,240,167		Ps.	9,611,296		Ps.	9,895,346

Amortization recognized for the years ended December 31, 2015, 2014 and 2013, amounts to Ps. 400,953, Ps. 284,050 and Ps. 284,076, respectively.

11. Rights to use airport facilities

The value of the rights to use airport facilities at December 31, 2015, 2014 and 2013 was as follows only Mexican airports:

	December 31,2015			December 31,2014			December 31,2013
Rights to use airport facilities	Ps.	2,117,708		Ps.	2,117,708		Ps.	2,117,708
Less—accumulated amortization		(1,017,314	)		(960,615	)		(903,916	)
	Ps.	1,100,394		Ps.	1,157,093		Ps.	1,213,792

Amortization recognized for the years ended December 31, 2015, 2014 and 2013 amounted to Ps. 56,699 in each year.

12. Other acquired rights

At December 31, 2015, 2014 and 2013 the other acquired rights correspond to payments made by the Company after the date the concessions were granted, in order to early-terminate certain long-term leases contracts that existed at that time between ASA and third-party leaseholders in Mexican airports. The rights acquired are comprised as follows:

F-40

	December 31, 2015			December 31, 2014			December 31, 2013
Right to operate the charter and general aviation terminal and FBO at Los Cabos airport terminal	Ps.	344,443		Ps.	344,443		Ps.	344,443
Right to operate commercial space at Tijuana airport		15,935			15,935			15,935
Right to operate various space at Puerto Vallarta airport		309,616			309,616			309,616
Right to operate commercial space at Guadalajara airport		93,560			93,560			93,560
Right to operate various parking lots		5,673			5,673			5,673
		769,227			769,227			769,227
Less – accumulated amortization		(220,840	)		(204,143	)		(187,446	)
	Ps.	548,387		Ps.	565,084		Ps.	581,781

Amortization recognized for the years ended December 31, 2015, 2014 and 2013 amounted to Ps. 16,697, in each year. These assets have a useful life until the end of the concession, as its use and operation will continue until the term expires.

13. Income taxes

The Company is subject to income taxes, according to the tax laws in Mexico, Spain and Jamaica.

Current income taxes – The income taxes rate was 30% for 2014, 2015 and the next years will continue the same tax rate for the Mexicans companies. The tax rate for MBJ is 25% in Jamaica and for the subsequent years will continue with the same tax rate and for DCA is 28% tax rate in Spain, and will be 25% in subsequent years.

To determine deferred income taxes at December 31, 2015, 2014 and 2013 the Company applied the applicable tax rates to temporary differences based on their estimated reversal dates.

a. Recoverable income taxes paid on dividends – Dividends paid to stockholders which are not derived from the net tax income account (CUFIN) generate current income taxes, which can be credited against the taxes of the Company during the year of the dividend payment and the two subsequent years.

b. Recoverable taxes – In the regular course of operations, the Company generates receivable balances by the overpayment of taxes payable, according to the calculation mechanism established in the Tax Law, which are recoverable through tax returns or offsetting. The main recoverable taxes are ISR, IMPAC and IVA.

In 2003, the Company filed a request with the tax authorities regarding the confirmation of the criteria with respect to the basis that the Company could use to calculate IMPAC, which included all airports and GAP. In this request, the Company requested that such calculation, based on the interpretations of tax law as published by the Mexican Treasury Department, should only take into account the amount effectively paid by AMP for the shares of the Company that was reflected in the assets in each concession acquired through the bidding process.

After several legal procedures, on August 29, 2006, the Mexican Treasury Department confirmed the criteria for the Aguascalientes, Hermosillo, La Paz, Los Mochis, Morelia and Manzanillo airports, reducing the asset tax basis for these airports. Thus, for these airports, the base used to calculate tax on assets considers only the amount effectively paid by AMP for its 15% of the shares of the Company. This generated a recoverable tax as of December 31, 2006 for Ps. 190,537, plus Ps. 18,026 of interest, for a total recoverable asset of Ps. 208,563, recognized within the current recoverable income tax asset.

F-41

As of December 31, 2014, the remaining portion pending to be recovered corresponds to the Hermosillo airport for Ps. 28,501 (values updated). The tax authorities determined that recoverable amount should be the result of the ISR calculation for the year and not be treated as an overpayment of taxes for the year. The risk with the resolution criteria is that the right to receive the refund of the amounts claimed will expire, as well as the favorable interest being sought by the Company. In a resolution dated October 25, 2013, the Company received a favorable ruling, however the authority filed for a review. On September 3, 2014 the Federal Tax and Administrative Judicial Tribunal (TFJFA) declared final judgment, which states that the authority has to return the amount of the refund and update the claim amount. On January 29, 2015 the Company received partial refund of Ps.9,595 including interest, however, the TFJFA failed to rule on the accrued interest, therefore a judgment for recovery will be presented and the process will continue.

The balances of recoverable taxes are comprised as follows:

	December 31,2015		December 31,2014		December 31,2013
Recoverable taxes:
IMPAC	Ps.	70,398	Ps.	79,306	Ps.	33,893
ISR		47,383		27,882		23,016
Value added tax		35,179		—		5,601
Tax to cash deposits		1,521		1,521		3,303
Business flat tax (IETU)		5,064		5,569		1,986
Withholding taxes		14,977		8,819		10,559
Other		1,056		1,519		4,488
	Ps.	175,578	Ps.	124,616	Ps.	82,846

c. Income Tax – Income tax expense for the years ended at December 31, 2015, 2014 and 2013 consists of the following:

	2015			2014			2013
ISR:
Current	Ps.	1,018,647		Ps.	727,923		Ps.	644,932
Deferred		(182,717	)		(245,929	)		(577,016	)
Cancellation of unrecoverable tax on dividends		11,379			32,585			—
IETU:
Current		—			—			8,633
Deferred		—			—			(761	)
	Ps.	847,309		Ps.	514,579		Ps.	75,788

d. Effective tax rate – The reconciliation of the statutory income tax rate and the effective income tax rate as a percentage of income before income taxes for the years ended December 31, 2015, 2014 and 2013 is shown below:

	%			2015			%			2014			%			2013
Income before income taxes				Ps.	3,618,086					Ps.	2,757,099					Ps.	2,322,018
Income tax by applying the weighted average statutory rate		29.5	%		1,067,335			30	%		827,130			30	%		696,605
Effects of tax inflation		(6.1	%)		(220,630	)		(13	%)		(345,845	)		(16	%)		(371,523	)
Cancellation of non-recoverable ISR from dividends		0.3	%		11,379			1	%		32,585			—			—
Effects of change in tax rate		—			—			—			—			(9	%)		(199,048	)
Effect of change in tax depreciation rates of the Concession		—			—			—			—			(2	%)		(44,437	)
Other		(0.3	%)		(10,775	)		1	%		709			(0	%)		(5,809	)
Effective tax rate		23.4	%	Ps.	847,309			19	%	Ps.	514,579			3	%	Ps.	75,788

F-42

e. Assets and liabilities Deferred income tax recognized –

Deferred taxes are presented according to the origin of the operations of the individual subsidiaries of the Company as IAS - 12Income taxes does not allow the offsetting of taxes in accordance with the following:

An entity shall offset deferred tax assets are tax deferred tax liabilities if, and only if:

(a) It has a legally enforceable right to set off the tax authority, the amounts recognized in these items; and

(b) deferred tax assets and deferred tax liabilities arising from profit tax corresponding to the same fiscal authority, which fall on:

(i) the same company or individual tax; or

(ii) different companies or individuals for tax purposes that seek to either liquidate assets and current tax liabilities on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which expected to be settled or recovered significant amounts of assets or liabilities for deferred taxes.

The deferred income tax are from Mexico subsidiaries:

	Assets
	2015			2014		2013
Deferred ISR asset:
Allowance for doubtful accounts	Ps.	34,813		Ps.	40,020	Ps.	43,222
Machinery and equipment		30,017			29,459		25,954
Improvements to concession assets		372,266			345,242		294,130
Airport concessions and rights to use airport facilities		4,046,418			4,009,860		3,830,501
Other acquired rights		111,492			108,737		100,816
Derivative financial instruments		—			—		17
Other assets		(121	)		583		1,421
Tax loss carryforwards		137,330			55,685		52,775
Employee benefits		25,701			24,005		21,190
Provisions		7,251			4,482		11,930
Recoverable tax on assets		168,054			233,091		291,731
Deferred income tax asset	Ps.	4,933,221		Ps.	4,851,164	Ps.	4,673,687

F-43

The net deferred tax liability corresponds to the subsidiary in Jamaica:

	2015
Deferred tax liability (asset):
Trade receivables	Ps.	(2,158	)
Machinery and equipment		(100,485	)
Improvements to concession assets		(1,908	)
Airport concessions		(728,231	)
Provisions		13,903
Deferred tax liability	Ps.	(818,879	)

f. Unrecognized deferred income tax assets – Unrecognized deferred income tax assets in the statement of financial position is comprised of the following items:

	December 31, 2015		December 31, 2014		December 31, 2013
Tax loss carryforwards	Ps.	202,024	Ps.	184,746	Ps.	174,633
Recoverable tax on assets		230,198		233,370		236,385
	Ps.	432,222	Ps.	418,116	Ps.	411,018

The Company does not recognize deferred tax assets on tax loss carryforwards for which it is not probable to generate future taxable profits to utilize such tax losses.

As disclosed in subparagraph i. of this Note, the recoverable tax on assets will expire in 2017. The recoverable income tax from recoverable tax on assets detailed above has not been recognized because the Company’s financial projections indicate it is not likely to be recovered.

The Company does not recognize deferred tax assets relating to temporary differences between the accounting and tax value of investments in subsidiaries, as it has the power to control the reversal date of those temporary differences, and does not expect them to reverse in the foreseeable future.

g. Deferred income tax from tax loss carryforwards – The Company generated tax loss carryforwards in the airports of Aguascalientes, Los Mochis, Manzanillo and Morelia, and at Grupo Aeroportuario del Pacífico, S.A.B. de C.V. The Company estimates tax loss carryforwards will be recoverable in the airports of Aguascalientes and Morelia and in Grupo Aeroportuario del Pacífico, S.A.B. de C.V., according to the amounts shown in the following table. With respect to tax legislation relative to concessions, such losses will expire in 2048, except for the tax losses of Grupo Aeroportuario del Pacífico, S.A.B. de C.V., which expire in 2020. Tax losses that can be recovered based on management’s financial projections are recognized as part of the deferred tax asset.

	December 31, 2015			December 31, 2014			December 31, 2013
Tax loss carryforwards	Ps.	1,131,181		Ps.	801,434		Ps.	758,025
Unrecognized tax loss carryforwards		(673,415	)		(615,819	)		(582,109	)
Recognized tax loss carryforwards	Ps.	457,766		Ps.	185,615		Ps.	175,916

F-44

h. Balances and movements in deferred taxes during the period.

	Balance as of January 1, 2014		Effects in profit and loss			Allocation to recoverable taxes			Balance as of December 31, 2014		Effects in profit and loss			Allocation to recoverable taxes			Balance as of December 31, 2015
Temporary differences for the deferred ISR:
Allowance for doubtful accounts	Ps.	43,222	Ps.	(3,202)		Ps.	—		Ps.	40,020	Ps.	(5,207	)	Ps.	—		Ps.	34,813
Machinery, equipment and improvements on leased buildings		25,954		3,505			—			29,459		558			—			30,017
Improvements to concession assets		294,130		51,112			—			345,242		27,024			—			372,266
Airport concessions and rights to use airport facilities		3,830,501		179,359			—			4,009,860		36,558			—			4,046,418
Other acquired rights		100,816		7,921			—			108,737		2,755			—			111,492
Derivative financial instruments		17		(17	)		—			—		—			—			—
Other assets		1,421		(838	)		—			583		(704	)		—			(121	)
Tax loss carryforwards		52,775		2,910			—			55,685		81,645			—			137,330
Employee benefits		21,190		2,815			—			24,005		1,696			—			25,701
Provisions		11,930		(7,448	)		—			4,482		2,769			—			7,251
Recoverable tax on assets		291,731		9,812			(68,452	)		233,091		6,118			(71,155	)		168,054
Total	Ps.	4,673,687	Ps.	245,929		Ps.	(68,452	)	Ps.	4,851,164	Ps.	153,212		Ps.	(71,155	)	Ps.	4,933,221

	Balance as of December 31, 2012			Effects in profit and loss			Allocation to recoverable taxes			Balance as of December 31, 2013
Temporary differences for the deferred ISR:
Allowance for doubtful accounts	Ps.	60,773		Ps.	(17,551	)	Ps.	—		Ps.	43,222
Machinery, equipment and improvements on leased buildings		11,652			14,302			—			25,954
Improvements to concession assets		222,038			72,092			—			294,130
Airport concessions and rights to use airport facilities		3,373,508			456,993			—			3,830,501
Other acquired rights		88,777			12,039			—			100,816
Derivative financial instruments		4,317			(4,300	)		—			17
Other assets		1,077			344			—			1,421
Tax loss carryforwards		56,152			(3,377	)		—			52,775
Employee benefits		—			21,190			—			21,190
Provisions		—			11,930			—			11,930
Recoverable tax on assets		335,272			13,354			(56,895	)		291,731
Total		4,153,566			577,016			(56,895	)		4,673,687
Temporary differences for deferred IETU:
Accounts receivable		(28,335	)		28,335			—			—
Accounts payable		17,131			(17,131	)		—			—
Provisions		2,014			(2,014	)		—			—
Liabilities for retirement benefits		10,551			(10,551	)		—			—
Machinery and equipment		(2,123	)		2,123			—			—
Total		(762	)		762			—			—
Total ISR and IETU:	Ps.	4,152,804		Ps.	577,778		Ps.	(56,895	)	Ps.	4,673,687

F-45

	Balance as of January 1, 2015		Effects in profit and loss			Effects in Stockholders			Balance as of December 31, 2015
Temporary differences for the deferred ISR:
Accounts receivable	Ps.	—	Ps.	(78	)	Ps.	(2,080	)	Ps.	(2,158	)
Machinery, equipment and improvements on leased buildings		—		(1,220	)		(99,265	)		(100,485	)
Improvements to concession assets		—		(619	)		(1,847	)		(2,466	)
Airport concessions		—		(29,226	)		(699,005	)		(728,231	)
Accruals		—		1,638			12,823			14,461
Total	Ps.	—	Ps.	(29,505	)	Ps.	(789,476	)	Ps.	(818,879	)

i. As a result of the enactment of IETU law beginning in 2008, specifically with respect to the third transitory article, the Company has ten years to recover, under specific circumstances, existing IMPAC paid in previous years, which as of December 31, 2015 amounted to Ps. 398,252. The previously mentioned article establishes the right to recover the tax on assets paid prior to the IETU law enactment date. However, to obtain a refund there are certain requirements that must be met, including: i) the tax on assets subject to recovery must have been paid over the previous ten years, ii) the ISR has to be higher than the tax on assets for the three years prior to 2008, and iii) is limited to 10% per year over the IMPAC effectively paid.

There are several interpretations as to how an entity can recover the tax on assets paid, but to the date there is no explicit definition from the tax authorities or a precedent from any court that provides clarity as to the proper manner in which to recover such amounts. The Company’s management believes it is not probable that they will recover certain amounts and has therefore not recognized an asset of Ps. 230,198 as of December 31, 2015. The remaining amount of recoverable tax on assets is comprised of Ps. 113,123 (nominal value) and Ps. 54,931 of interest for the period from 2002 to 2015.

At December 31, 2015, 2014 and 2013, the recoverable tax on assets is comprised as follows:

	December 31, 2015			December 31, 2014			December 31, 2013
Recoverable tax on assets paid	Ps.	398,252		Ps.	466,461		Ps.	528,116
Unrecognized recoverable tax on assets paid		(230,198	)		(233,370	)		(236,385	)
Recognized recoverable tax on assets	Ps.	168,054		Ps.	233,091		Ps.	291,731

At December 31, 2015, the recoverable tax on assets paid is comprised as follows:

	Tax on assets recoverable from 2015 results		Tax on assets expected to be recoverable from 2016 to 2017		Total
Bajio	Ps.	608	Ps.	—	Ps.	608
Guadalajara		19,446		16,244		35,690
Puerto Vallarta		49		—		49
Tijuana		51,971		79,736		131,707
Total	Ps.	72,074	Ps.	95,980	Ps.	168,054

F-46

14. Investment in associate

Details of the associate of the Company at the end of the reporting period is as follow:

Name of associate	Place of constitution and operation	Proportion of ownership interest and voting power held by the Company
SCL Terminal Aérea de Santiago, S. A.	Santiago de Chile, Chile	14.77%

As disclosed in Note 1, DCA has a stake of 14.77% in SCL, operator of the international terminal of Santiago de Chile’s airport until September 30, 2015. On that date the operation of the airport was delivered to the new operator. Although it no longer has operations in accordance with the concession agreement, SCL must remain in effect for one year after delivery of the concession to address any potential contingencies. After that first year, SCL shall remain in force for a year before being dissolved in accordance with tax regulations in Chile.

The Company expects to recover approximately Ps. 85,000 from this entity between 2016 and 2017 through dividend and capital repayments.

The book value of SCL is € 4,653,021 (Ps. 105,936). The result of DCA from April, 1 to December 31, 2015 was recognized using the equity method in the consolidated financial statements.

	2015
Net loss SCL (April to December)	Ps.	(92,783	)
Proportion of ownership interest and voting power held by the Company		14.77	%
Share of loss of associate	Ps.	(13,704	)

The Company owns less than 20% of the shares of SCL, however it concluded it has significant influence because it has a representation on its Board of Directors and participates in the process of setting its financial and operating policies.

The summarized financial information below represents the amounts shown in the financial statements of SCL prepared in accordance with IFRS.

	2015
Condensed statement of financial position as of December 31, 2015
Current assets	Ps.	411,465
Non – current assets		281,943
Total assets		693,408
Total liability		193,476
Stockholders´ equity	Ps.	499,932
Condensed statement of comprehensive loss for the period of nine months ended December 31, 2015:
Revenues	Ps.	674,027
Costs, expenses and income taxes		766,810
Loss of the year	Ps.	92,783

15. Accounts payable

The Company receives credit from its suppliers at 30 and 45 days without charging interest, whereby the provider payment policy is to pay the maximum term granted. As of the date of these consolidated financial statements there is no supplier that represents more than 10% of its investments in productive assets and/or the total operating costs.

F-47

	December 31, 2015		December 31, 2014		December 31, 2013
Suppliers	Ps.	437,238	Ps.	228,882	Ps.	245,848
Advance payments from clients		66,676		36,363		34,357
Interest payable		58,499		11,329		16,996
Direct employee benefits		24,210		14,915		15,330
Others accounts payable		50,623		9,153		3,702
Total	Ps.	637,246	Ps.	300,642	Ps.	316,233

Advanced payments from clients represent payments for future services that have not yet been provided and if they are not performed, the Company has the obligation to reimburse it to its customers.

16. Loans and issuance of Debt Certificates

a. Loans

The Company obtained loans to finance capital investments associated with the MDP of its airports in Mexico as well as to repay bank debt used to finance its capital investments committed in the MDP of Bajío, Guadalajara, Hermosillo, Puerto Vallarta and San Jose del Cabo from 2007 to 2014. With the acquisition of MBJA the company obtained new loans which are described below with the unpaid balance at each date.

	December 31 2015		December 31 2014		December 31 2013
On August 31, 2007 the Company entered into an unsecured loan agreement, with crossed guarantees by its individual airports with Banamex for a total amount of Ps. 1,214,000, bearing fixed interest at a rate of 8.52%. The agreement matures in seven years from the date of the borrowing and payments and amortization of principal are required to be made in 28 equal and consecutive quarterly principal and interest payments.	Ps.	—	Ps.	60,500	Ps.	212,500
On December 9, 2009, the Company entered into contracts for unsecured loan agreements, with crossed guarantees among the individual airports with Banamex and HSBC for Ps. 325,723 from each institution, totaling Ps. 651,446. The loans bear interest at a variable TIIE rate plus 350 basis points and require quarterly principal and interest payments for a period of seven years since each disposition. The Company paid off the outstanding balance in full with Certificate resources.		—		—		235,714
On May 26, 2011, the Company entered into a contract for an unsecured loan agreement, with crossed guarantees among the individual airports, with HSBC for Ps. 1,023,980. The loans bear interest at a variable 28-day TIIE plus 165 basis points and require quarterly principal and interest payments for a period of seven years since each disposition. The Company paid off the outstanding balance in full with Certificate resources.		—		394,113		654,969
On August 2, 2012, the Company entered into a contract for an unsecured loan agreement with BBVA for Ps. 242,747, with crossed guarantees among the individual airports to a variable interest rate of TIIE 91 days, plus 120 basis points at quarterly principal and interest, for a period of seven years since each disposition. The Company paid off the outstanding balance in full with Certificate resources.		—		167,372		202,050
On November 23, 2012, the Company signed an unsecured loan agreement, with crossed guarantees between the accredited airports, with BBVA for Ps. 287,799. The loan bears interest at a variable rate based on the 91-day TIIE plus 120 basis points at quarterly principal and interest for a period of seven years since each disposition. The Company paid off the outstanding balance in full with Certificate resources.		—		137,137		253,215

F-48

	December 31 2015				December 31 2014			December 31 2013
On April 10, 2013, the Company signed an unsecured loan agreement, with crossed guarantees between the accredited airports, with BBVA for Ps. 459,350. The loan bears interest at a variable rate based in the 91-day TIIE plus 133 basis points for dispositions of 2013 and annualized rate that will be equivalent to the rate TIIE plus 138 basis points for dispositions of 2014, with quarterly payments of principal and interest, for a period of seven years since each disposition. The Company paid off the outstanding balance in full with Certificate resources.		—				230,352			296,028
On November 28, 2014, the Company signed a simple unsecured loan with crossed guarantees between accredited airports, with Scotiabank for Ps. 1,741,000. The loan bears interest at a variable rate of 28-day TIIE plus 57 basis points, for a period of 6 months since each disposition. The disposition was made on December 3, 2014 by Ps. 730,000. The remaining was available for dispositions in January and February, however the Company paid off the outstanding balance in full with Certificate resources.		—				730,000			—
On May 19, 2015, GAP signed a simple unsecured loan, with The Bank of Nova Scotia (Nova Scotia) for USD$191,000,000, for a period of one year. The loan bears interest at a variable rate of LIBOR 1M plus 70 basis points. The disposition was made on May 19, 2015 for USD$191,000,000. With this loan the Company pre-paid banks loans used to finance DCA´s acquisition. During August 2015 the Company paid USD$95,000,000.		1,651,824				—			—
On August 19, 2015, GAP signed a simple unsecured loan, with BBVA for USD$95,000,000. The loan bears interest at a variable rate of LIBOR 1M plus 60 basis points, for a period of 6 months from each disposition. With this loan the Company prepaid a portion of the Scotiabank loan.		1,634,618				—			—
On September 14, 2007, MBJA signed a simple unsecured loan, with the International Finance Corporation (IFC) for up to USD$20,000,000. The loan bears interest at a variable rate of 6 month LIBOR plus 392 basis points, for a period of 12 months from this disposition. The balance amounted to USD$11,824,452.		203,457				—			—
MBJA signed a simple unsecured loan with its shareholder Vantage in June 2007 for USD$10,936,000, which is repayable at the same maturity date as the IFC´s loans but are subject to restrictions. Interest is accrued at an interest rate of 14% per annum and is payable semi-annually.		188,185				—			—
In February 2009 MBJA signed a simple unsecured loan with guarantees with its shareholder Vantage for USD$510,000 to finance expenses related to a construction project of MBJA. No prepayments have been made.		8,775				—			—
On December 12. 2012, MBJA signed a simple unsecured loan with IFC for USD$13,000,000. The loan bears interest at a variable rate of 6 month LIBOR plus 450 basis points, for a period of five years from each disposition. The balance amounted to USD$12,750,000.		219,383				—			—
In 2014 MBJA signed two finance lease arrangements, one with SITA Information Networking Computing BV for USD$1,792,096, for equipment and the other with SITA Information Networking BV for software support for USD$1,231,858. Both leases are for seven years with a fixed interest rate of 8% per annum. Monthly lease payment total USD$47,132. The balance amounted to USD$2,570,133.		44,223				—			—
				��
Total unpaid balance of bank loans and long-term debt		3,950,465				1,719,474			1,854,476
Less – Current portion		(3,529,102	)			(978,538	)		(637,577	)
Long-term portion	Ps.	421,363			Ps.	740,936		Ps.	1,216,899

F-49

b. Issuance of Debt Securities

	December 31 2015		December 31 2014		December 31 2013
Unsecured debt securities issued in the Mexican market on February 20, 2015, for Ps. 1,100,000 under the “GAP 15” name, at a variable interest rate of 28-day TIIE plus 24 basis points for a period of five years, maturing on February 14, 2020. At December 31, 2015, the rate is 3.58%.	Ps.	1,100,000	Ps.	—	Ps.	—
Unsecured debt securities issued in the Mexican market on February 20, 2015, for Ps. 1,500,000 under the name “GAP 2/15” at a fixed annual interest rate of 7.08% over a period of 10 years, maturing on February 7, 2025.		1,500,000		—		—
Long-term portion	Ps.	2,600,000	Ps.	—	Ps.	—

The proceeds from the issuance of the long-term debt securities were allocated to repay in full the Company’s outstanding bank debt in the amount of Ps.1,741,000 and the remainder was allocated to finance capital investments set forth in the Master Development Program for 2015. The difference of Ps. 6,500 corresponds to expenses related to the issuance.

The unpaid consolidated balances at December 31, 2015, 2014 and 2013, from the debt previously described, mature as follows:

Year	December 31, 2015		December 31, 2014		December 31, 2013
2015	Ps.	—	Ps.	978,538	Ps.	637,577
2016		3,529,102		207,325		300,720
2017		108,524		197,682		259,507
2018		161,146		175,702		249,863
2019		59,837		160,227		406,809
Thereafter		2,691,856		—		—
	Ps.	6,550,465	Ps.	1,719,474	Ps.	1,854,476

As disclosed in Note 34, the Scotiabank and BBVA loans were pre-paid for the months of January and February 2016 with proceeds from new loans, maturing in 5 years.

At December 31, 2015, 2014 and 2013, debts are payable by the following companies:

	At December 31, 2015
Company	Current		Long-Term		Total
GAP	Ps.	3,286,442	Ps.	2,600,000	Ps.	5,886,442
MBJA		242,660		421,364		664,024
Total	Ps.	3,529,102	Ps.	3,021,363	Ps.	6,550,465

	At December31,2014
Company	Current		Long-Term		Total
Bajio	Ps.	730,000	Ps.	—	Ps.	730,000
Guadalajara		15,217		43,747		58,964
Hermosillo		68,873		271,538		340,411
Puerto Vallarta		14,205		31,211		45,416
San Jose del Cabo		38,419		122,839		161,258
Total		111,824		271,601		383,425
Total	Ps.	978,538	Ps.	740,936	Ps.	1,719,474

F-50

	At December 31, 2013
Company	Current		Long-Term		Total
Bajio	Ps.	47,786	Ps.	73,023	Ps.	120,809
Guadalajara		205,527		450,406		655,933
Hermosillo		41,794		44,202		85,996
Puerto Vallarta		153,718		222,932		376,650
San Jose del Cabo		188,752		426,336		615,088
Total	Ps.	637,577	Ps.	1,216,899	Ps.	1,854,476

The loan agreements limit the Company’s use of proceeds for the financing of capital expenditures, working capital and prepayments of loans, in addition to prohibiting the merger of the airport creditors with any other entity, as well as the prohibition of sales or transfers of assets in an amount greater than Ps. 1,000, without previous authorization from the creditors and requires the Company to maintain certain financial ratios. If the individual airports are unable to fulfill their commitments and maintain the minimum financial ratios under the credit agreements, dividends cannot be declared.

As a result of the issuance of the debt securities, the Company has covenants, which have been complied with during 2015. The principal payment of the debt securities will be made at the end of the contractual term. Direct costs incurred in the issuance or incurrence of debt are deferred and amortized, as part of interest expense using the effective interest rate over the term of each transaction. These costs include commissions and professional fees.

17. Retirement employee benefits

a. Defined contribution plans – Under Mexican legislation, the Company makes payments equivalent to 2% of its workers’ daily comprehensive salary to a defined contribution plan that is part of the retirement savings system. The expense was Ps. 4,728, Ps. 4,418 and Ps. 4,214 in 2015, 2014 and 2013, respectively.

In Jamaica, the Company operates a defined contribution pension plan, which is managed by an independent trust. The Company has no further obligation other than its contribution mandated under the plan. The pension plan is financed primarily by payments from employees and the Company.

b. Defined benefit plans – According to the Federal Labor Law in Article 162, the Company is required to pay in Mexico a seniority premium as postemployment benefits if an employee leaves and if have at least 15 years of service, which consist of a payment of 12 days per worked year based on the last salary, not to exceed twice the legal minimum wage established by law. The present value of the retirement benefit obligation and the current service cost and past service costs were calculated using the projected unit credit method.

The defined benefit plans in Mexico usually expose the Company to actuarial risks such as: interest rate risk, longevity risk and salary risk.

Interest risk	A decrease in the interest rate of the 30 years bond will increase the plan liability.
Longevity risk	The present value of the defined benefit plan liability is calculated by reference to the best estimate of the mortality of the plan participants, during and after their employment. An increase in the life expectancy of the plan participants will increase the plan’s liability.
Salary risk	The present value of the defined benefit plan liability is calculated by reference to the future salaries of the plan participants. As such, an increase in the salary of the plan participants will increase the plan’s liability.

F-51

The amount included in the statement of financial position arising from the obligation of the entity for defined benefit plans on December 31, 2015, 2014 and 2013 is as follows:

	2015			2014			2013
Defined benefit obligation	Ps.	102,847		Ps.	81,326		Ps.	70,760
Past service cost		(9,480	)		(1,311	)		(128	)
Remeasurement on the net defined benefit liability	Ps.	93,367		Ps.	80,015		Ps.	70,632

The table below shows the movements in the present value of defined benefit obligations:

	2015		2014			2013
Opening defined benefit obligation	Ps.	80,015	Ps.	70,632		Ps.	60,290
Current service cost		13,352		11,736			10,576
Benefits paid		—		(2,353	)		(234	)
Ending defined benefit obligation	Ps.	93,367	Ps.	80,015		Ps.	70,632

Below are the amounts for the years ended December 31, 2015, 2014 and 2013 that were recognized in the consolidated statements of profit or loss and other comprehensive income:

	2015		2014			2013
Current service cost	Ps.	6,754	Ps.	6,268		Ps.	5,801
Interest cost		6,463		5,498			4,853
Actuarial losses (gains)		135		(30	)		(78	)
Total recognized as employee benefit cost (Note 23)	Ps.	13,352	Ps.	11,736		Ps.	10,576

The main actuarial assumptions at the reporting date (expressed as weighted average nominal rates) are shown below:

	2015			2014			2013
Discount of the projected benefit obligation at present value		7.4	%		7.3	%		7.0	%
Salary increase		5.0	%		5.0	%		5.0	%
Remaining labor life		20.8 years			23.4 years			24.1 years

The discount rate is determined based on the structure of the interest rate curve of government bonds for 30 years. The net interest cost on the retirement benefit obligation is recorded in profit and loss within the cost of services, in conjunction with the other components of liabilities for retirement benefits.

If the discount rate had a variation of 100 basis points upward or downward, the effect on the liability for retirement benefits would be impacted by Ps. 8,148.

Assumptions related to expected mortality are based on statistics and experience of the Mexican population. The average life expectancy of an individual retiring at age 65 is 17 years for men and 19 years for women (Demographic Mortality Experience for Active people, EMSSA 2009).

F-52

18. Stockholders’ equity

a. At December 31, 2015, common stock consists of the following:

	Number of shares		Nominal value
Fixed Capital
Series B		476,850,000	Ps.	10,649,462
Series BB		84,150,000		1,879,318
Total		561,000,000	Ps.	12,528,780

At December 31, 2014, common stock consists of the following:

	Number of shares		Nominal value
Fixed Capital
Series B		476,850,000	Ps.	11,846,723
Series BB		84,150,000		2,090,599
Total		561,000,000	Ps.	13,937,322

At December 31, 2013, common stock consists of the following:

	Number of shares		Nominal value
Fixed Capital
Series B		476,850,000	Ps.	13,130,223
Series BB		84,150,000		2,317,099
Total		561,000,000	Ps.	15,447,322

At December 31, 2015, all shares are fully subscribed and paid. The Company’s shares are represented by common ordinary shares and without nominal value. Series “BB” shares, which may represent up to 15% of common stock, may only be transferred upon prior conversion into Series “B” shares, based on certain time restrictions.

Each share of Series “B” and “BB” gives the holder the right to one vote at any Ordinary Stockholders’ Meeting. According to the Company’s bylaws, shareholders of Series “B” shares either individually or jointly with their related parties, cannot hold more than 10% of the total outstanding common stock of the Company, and therefore is prohibited from exceeding such limits by participating through trusts, agreements, social pacts or bylaws, pyramid schemes or any other mechanism that provides a larger share than legally allowed. Additionally, the Company’s bylaws provide that if a person individually or jointly with its related parties, acquires a percentage of shares exceeding the limits of participation previously mentioned, the person or group of persons will be required to sell the excess over what is allowed through a public offering, during which time, the shares owned over the 10% threshold by such individuals will not have voting rights and cannot be represented in any Stockholder Meeting. Furthermore, the shareholders of Series “BB” shares, either individually or jointly with their related parties, may also be owners of shares of Series “B” shares, regardless of the shares they hold in the aggregate of Series “B” and Series “BB”. However, those shareholders of the Series “BB” shares, their votes will be limited to no more than 10% of the voting common stock, and any additional participation is required to vote in the same way of the majority of the votes in any Stockholder Meeting.

Shareholders of Series “BB” shares are entitled to elect four members to the board of directors and their alternates, whereas shareholders of Series “B” shares with rights to vote, even limited or restricted, that individually or together owning 10% or more of the Company’s capital stock is entitled to elect one member to the board of directors at a Stockholders’ Meeting, an in such instances, such shareholder or group of shareholders may not exercise the right to vote for the board members corresponding to the majority. If any shareholder or group of shareholders representing at least 10% of the common shares of which the common stock is comprised, exercises the right to appoint a board

F-53

member, such shareholder will not have the right to vote in the designation of the board members that correspond to appointment by the majority of Series “B” shareholders. The total number of members of the Board of Directors of the Company is 11, therefore holders of Series “B” shares have the right to appoint only seven members.

The members of the Board of Directors appointed by the Shareholders of the Series “BB” will have the ability to make the following valid designations: (i) upon consultation with the Company’s Nomination and Compensation Committee, appointment and dismissal of the Chief Executive Officer and the top-level executive officers; (ii) appointment of three of the six members of the Operating Committee and three alternates, and the number of members and their alternates to the Audit Committee, including the acquisition, nominations and compensation corresponding to 20% (twenty percent) of the total members, with the understanding that there will be at least one member and alternate, for each of them, iii) in the creation and determination of the Operating Committee whom are not part of the Company, members of the Board of Directors or the Company’s officers.

In the case of the Audit Committee must also comply with the legal restrictions of independence.

b. In an Ordinary Stockholders’ Meeting held on April 16, 2013, the stockholders approved a dividend payment of Ps. 1,210,000 to be divided between the shares outstanding at the date of each payment, excluding shares repurchased in accordance with Article 56 of the Securities Market Law. The first payment was in cash on April 25, 2013 of Ps. 907,500 and the second payment was made on November 27, 2013 of Ps. 302,500. In the same stockholder´s meeting the reserve for repurchase of shares approved at Stockholder´s Meeting held on April 16, 2012 of Ps. 280,000 was canceled, and simultaneously shareholders approved a maximum amount of Ps. 640,000 for reserve for repurchase of shares to be executed in the next twelve-month period.

c. In an Ordinary Stockholders’ Meeting held on April 23, 2014, the stockholders approved a dividend payment of Ps. 1,590,000 to be divided between the shares outstanding at the date of each payment, excluding shares repurchased in accordance with Article 56 of the Securities Market Law. The first payment was in cash on May 22, 2014 of Ps. 1,192,500 and the second payment was made on July 4, 2014 of Ps. 397,500. In the same stockholder´s meeting the reserve for repurchase of shares approved at the Stockholders’ Meeting held on April 16, 2013 of Ps. 293,928 was canceled, and simultaneously shareholders approved a maximum amount of Ps. 400,000 for the reserve for repurchase of shares to be executed in the next twelve-month period.

d. In an extraordinary Stockholders’ Meeting held on April 23, 2014, the stockholders approved a capital reduction for Ps. 1,510,000. The payment was made on May 8, 2014.

e. During 2014, the Company repurchased a total of 1,017,561 shares, for Ps. 69,340 which represented 0.2% of outstanding shares at such time. The weighted average shares outstanding as shown in the consolidated statement of profit or loss and other comprehensive income, includes shares repurchased, It does not include in its calculation all repurchased shares.

f. In an Ordinary Stockholders’ Meeting held on April 21, 2015, the stockholders approved a dividend payment of Ps. 3.32 per shares outstanding at the date of each payment, excluding shares repurchased in accordance with Article 56 of the Securities Market Law. The first payment for Ps. 1.82 per share was in cash on August 21, 2015 of Ps. 956,547 and the second payment for Ps. 1.50 per share was made on November 4, 2015 of Ps. 788,364. In the same stockholder´s meeting the reserve for repurchase of shares approved at the Stockholders´ Meeting held on April 23, 2041 of Ps. 400,000 was canceled, and simultaneously the stockholders approved a maximum amount of Ps. 850,000 for the reserve for repurchase of shares to be executed in the next twelve-month period.

g. In an extraordinary Stockholders’ Meeting held on April 21, 2015, the stockholders approved a capital reduction for Ps. 1,408,542. The payment was made on May 15, 2015.

h. The General Corporate Law requires that at least 5% of the consolidated comprehensive income of the year, be transferred to the legal reserve until the reserve equals 20% of capital stock at par value (nominal pesos). The legal reserve may be capitalized but may not be distributed, except in the form of stock dividends, until the entity is dissolved. The legal reserve must be replenished if it is reduced

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for any reason. At December 31, 2015, 2014 and 2013, the legal reserve, in nominal pesos, was Ps. 840,743, Ps.735,491 and Ps. 635,914 respectively, corresponding to 6.7%, 5.3%, and 4.1%, of the common stock, respectively.

i. At December 31, 2015, the Company has a maximum amount of funds approved to repurchase shares of the Company for Ps. 2,583,374. From the approved amount, 35,424,453 shares have been repurchased for a total of Ps. 1,733,374, corresponding to repurchases made from September 2010 to February 2014. The remaining balance of Ps. 850,000 is available to repurchase shares. During the year 2015 no repurchases were made.

j. Stockholders’ equity distribution, except for the restatement amounts of the common stock contributed and the Net tax income account (CUFIN), will be subject to an ISR tax, calculated at the tax rate applicable to the distribution year. This corporate level dividend income tax on the distribution of earnings may be applied as a credit against ISR corresponding to the fiscal year in which the dividend was paid and the subsequent two fiscal years following the date in which the dividend was paid. Starting in 2014, dividends distributed to shareholders and coming from tax retained earnings generated from 2014 and later, will generate an additional income tax of 10% directly attributable to shareholders receiving the dividend.

k. The balances of stockholders’ equity tax accounts as of December 31 2014 and 2013 were as follows:

	2015		2014		2013
Contributed capital account (CUCA)	Ps.	27,415,833	Ps.	28,253,303	Ps.	28,648,014
CUFIN as of 2014		2,147,169		1,827,183		1,692,470
Total	Ps.	29,563,002	Ps.	30,080,486	Ps.	30,340,484

l. The balance of other comprehensive income consists of the reserve for foreign currency translation of DCA and MBJA from functional currency (euro and US dollars respectively) to the reporting currency (peso).

19. Non-controlling interest

	2015
DCA acquisition (Note 4) (i)		Ps  852,825
Dividend paid		(82,391	)
Non controlling interest:
Profit for the year		44,757
Other comprehensive income		66,901
Remaining balance		Ps  882,092

(i) On April 20, 2015 the Company acquired 100% of the shares of DCA, which owns 74.5% of the shares of MBJA and the remaining 25.5% is Vantage as a non-controlling shareholder.

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20. Revenues

According to the General Law on Airports and its regulations in Mexico, certain of the Company’s revenues are classified as airport, complementary and commercial services. Airport services generally include the use of airport runways, taxiways and parking areas for arriving and departing planes, use of passenger walkways, security services, hangars, and, in general, use of the space inside the terminal and other infrastructure by aircraft, passengers and cargo services. These services include rental of space that is vital for the operation of airlines and complementary service suppliers. Complementary services are ramps and handling services, catering, maintenance and repairs, and traffic and dispatch services. Commercial services include services that are not essential for the operation of an airport; therefore, these revenues are not regulated by TM, such as car parking services, lease of space to retailers, restaurants and banks, among others. The revenues of the subsidiary MBJA have the same classification, therefore consolidated in the area that correspond to the numbers of airports in Mexico.

A price regulation system establishes in Mexico a TM rate for airport services and complementary services for each airport for each year in a five-year period. The maximum rate is the maximum amount of revenues per “workload unit” that may be earned at an airport each year from regulated sources. Under this regulation, a workload unit is equivalent to one passenger (excluding transit passengers) or 100 kilograms (220 pounds) of cargo. As of December 2014, SCT authorized the Company’s maximum rates applicable for the period2015-2019.

The maximum rates of the Montego Bay Airport, were approved in November 2014 and are applicable from April 1, 2015 to March 31, 2020.

During the periods ended December 31, 2015, 2014 and 2013, the compliance with the TM by the Company’s Mexican airports was 100%, 99.9% and 100%, respectively.

The table below presents a summary for the years ended December 31, 2015, 2014 and 2013, of the Company’s revenues (these do not include revenues related to improvements to concession assets under IFRIC 12). Using the Airports Law classification, the information is sent to the SCT to comply with the Company’s reporting obligations with respect to regulated and unregulated revenues, which are classified as either aeronautical or non-aeronautical revenues. For this presentation, access fee are classified as airport services.

	2015		2014		2013
Regulated revenues
Airport operating services to airlines:
Landing	Ps.	284,275	Ps.	179,862	Ps.	176,995
Charges for not canceling extended stay reservations		3,412		1,849		1,443
Parking on embarking/disembarking platform		135,701		135,102		130,714
Parking on extended stay or overnight platform		35,663		29,965		29,598
Passenger walkways and shuttle buses		18,346		—		—
Airport security charges		113,579		52,475		49,661
Airports services		34,540		—		—
Airport real estate services to airlines:
Leasing of hangars to airlines		7,011		6,438		6,239
Leasing of shops, warehouses and stockrooms to airlines (operating)		3,884		2,318		2,209
Leasing of space and other terminal facilities to airlines within the terminal (operating)		43,559		40,071		40,577
Leasing of land and other surfaces to airlines outside the terminal (operating)		3,154		3,179		2,698
Leasing of check-in desks and other terminal space		4,090		7,559		9,585
Leasing of desks and other terminal space for ticket sale		6,292		6,212		5,613

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	2014		2013		2012
Airport passenger services:
Domestic passenger charges		2,078,059		1,823,481		1,706,158
International passenger charges		2,404,331		1,548,455		1,367,817
Airport real estate services and rights of access to other operators		28,709		28,882		29,668
Complementary services:
Catering services		16,601		8,352		5,109
Other third-party ramp services rendered to airlines		35,670		25,746		26,446
Traffic and/or dispatch		37,362		18,868		19,685
Fuel supply or removal		117,162		1,672		1,636
Third-party airplane maintenance and repair		7,620		5,250		4,765
Total regulated revenues included in the maximum rate		5,419,022		3,925,736		3,616,616
Regulated revenues not included in the maximum rate:
Car parking charges		251,468		230,039		221,037
Recovery of cost over aeronautical services		115,273		136,891		78,567
Recovery of cost over non-aeronautical services		31,976		17,364		15,798
Total regulated revenues not included in the maximum rate		398,717		384,294		315,402
Total regulated revenues		5,817,739		4,310,030		3,932,018
Unregulated revenues(1)
Commercial concessions:
Retail operations		125,481		78,924		77,845
Food and beverages		118,910		76,927		78,662
Duty free		226,226		103,857		102,577
VIP lounges		21,021		7,403		9,378
Financial services		28,671		17,873		16,181
Communications and networks		10,202		11,288		13,309
Car rentals		138,532		99,371		99,614
Commercial leasing		22,912		20,467		15,624
Advertising		129,244		100,190		87,304
Time sharing developers		139,124		109,297		107,733
Leasing of space to airlines and other complementary service providers (non-operating)		205,891		144,534		111,763
VIP Lounges		65,045		38,296		24,243
Revenues from sharing of commercial activities:
Retail operations		50,432		24,277		15,623
Food and beverages		50,537		35,434		24,476
Duty free		21,391		11,382		12,987
Financial services		721		297		289
Car rentals		8,904		6,185		1,501
Access fee for ground transportation		46,145		28,154		16,549
Non-airport access fees		28,696		21,571		23,818
Services rendered to ASA		3		21		40
Various commercial-related revenues		12,447		18,425		14,892
Others		—		75		682
Total unregulated revenues		1,450,535		954,248		855,090
Total aeronautical and non-aeronautical services	Ps.	7,268,274	Ps.	5,264,278	Ps.	4,787,108

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(1) Unregulated revenues are earned based on the terms of the Company’s operating lease agreements. Lease agreements are based on either a monthly rent (which generally increases each year based on the National Consumer Price Index (INPC) or the greater of a monthly minimum guaranteed rent or a percentage of the lessee’s monthly revenues. Monthly rent and minimum guaranteed rent earned on the Company’s operating lease agreements are included under the caption “Commercial concessions” above. Revenues earned in excess of the minimum guaranteed rent are included in the “Revenues from sharing of commercial activities” caption above (Note 32).

Revenues from improvements to concession assets are recognized with respect to the additions and improvements made for the Company in its airports, which are committed under the MDP, and is a requirement of fulfillment. Revenues for the years ended as of December 31, 2015, 2014 and 2013 accounted for Ps. 838,635, Ps. 281,874 and Ps. 440,728, respectively.

21. Cost of services

Cost of services for the years ended December 31, 2015, 2014 and 2013 was composed of the following:

	2015		2014		2013
Employee costs (Note 23)	Ps.	502,794	Ps.	393,537	Ps.	390,606
Maintenance		302,203		223,687		200,224
Safety, security and insurance		249,752		192,932		173,748
Utilities		192,158		147,793		141,855
Other		311,351		203,639		222,518
	Ps.	1,558,258	Ps.	1,161,588	Ps.	1,128,951

22. Depreciation and amortization

Depreciation and amortization for the years ended December 31, 2015, 2014 and 2013 were composed of the following:

	2015		2014		2013
Depreciation	Ps	206,724	Ps.	183,207	Ps.	164,606
Amortization		949,711		742,013		718,629
	Ps.	1,156,435	Ps.	925,220	Ps.	883,235

23. Employee Cost

Employee Cost for the years ended December 31, 2015, 2014 and 2013 was composed of the following:

	2015		2014		2013
Wages and salaries	Ps.	341,134	Ps.	257,824	Ps.	259,044
Other remunerations		47,612		43,238		41,200
Social benefits		42,354		39,812		38,255
Severance payments		5,102		4,343		7,476
Labor union fees		14,842		14,887		14,715
Taxes on employee benefits		6,053		5,716		5,775
PTU		2,917		3,882		3,754
Employee benefits		13,352		11,736		10,576
Others		29,348		12,099		9,811
	Ps.	502,794	Ps.	393,537	Ps.	390,606

24. Cost of improvements to concession assets

As disclosed in Note 3.o, in conformity with IFRIC 12, the Company must recognize the revenues and costs of additions and improvements to concession assets, which they are obligated to perform at the airports as established by the MDP. The cost for such additions and improvements to concession assets is based on actual costs incurred by the Company in the execution of the additions or improvements, considering the investment requirements in the MDP. Through bidding processes, the Company contracts third parties to carry out such construction. The amount of revenues for these services are equal to the amount of costs incurred, as the Company does not obtain any profit margin for these construction services. The amounts paid are set at market value.

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Cost of improvements to concession assets are comprised of the following at December 31, 2015, 2014 and 2013:

	2015		2014		2013
Cost of improvements to concession assets	Ps.	838,635	Ps.	281,874	Ps.	440,728

25. Other income – Net

Other (income) expenses is comprised of the following at December 31, 2015, 2014 and 2013:

	2015			2014			2013
Recovery insurance	Ps.	(200,884	)	Ps.	(76,192	)	Ps.	—
Bargain purchase gain		(189,744	)		—			—
Other services provided by DCA		(30,418	)		—			—
Sale of fixed assets		(5,672	)		(433	)		(6,078	)
Other income		(14,150	)		(17,888	)		(12,021	)
Total other income	Ps.	(440,868	)	Ps.	(94,513	)	Ps.	(18,099	)
Repair of damaged by natural disasters		176,073			43,822			2,384
Loss on sale of assets		4,310			1,241			3,240
Other expenses		5,873			6,026			5,022
Total other expenses		186,256			51,089			10,646
Other income – Net	Ps.	(254,612	)	Ps.	(43,424	)	Ps.	(7,453	)

In 2015 repairs due to Hurricane Odile at airports in San Jose del Cabo and La Paz, Baja California Sur were completed and the amount insured were received.

26. Finance cost – net

The net finance (cost) income is comprised of the following for the years ended December 31, 2015, 2014 and 2013:

	2015			2014			2013
Interest income from cash equivalents	Ps.	81,489		Ps.	51,782		Ps.	94,379
Interest on recovered taxes		3,465			4,113			6,519
Gain on financial investments held for trading purposes		—			3,375			20,926
Other		5,935			12,106			2,399
Total interest income		90,889			71,376			124,223
Interest cost from bank loans		(71,881	)		(65,730	)		(115,612	)
Loss on financial investments held for trading purposes		(242	)		(10,396	)		(51,721	)
Loss on derivative financial instruments		—			(340	)		(705	)
Commissions for bank loans		(1,901	)		(2,617	)		(3,019	)
Other financing costs		(8,594	)		(7,518	)		(8,088	)
Interest cost for debt securities		(126,686	)		—			—
Total interest expense		(209,304	)		(86,601	)		(179,145	)
Foreign exchange gains		222,292			15,868			76,569
Foreign exchange loss		(560,687	)		(8,633	)		(72,806	)
Foreign exchange gains (loss) – net		(338,395	)		7,235			3,763
Finance cost – net	Ps.	(456,810	)	Ps.	(7,990	)	Ps.	(51,159	)

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27. Commitments

a. On December 28, 2009, the SCT authorized the Company’s MDP update for the five-year period from 2010-2014.

b. On December 16, 2014, the SCT authorized in Mexico the Company’s MDP for the five-year period from 2015-2019. The table below shows the investments to be made during this period, as approved by the SCT:

Year	Amount committed		Amount invested
2015	Ps.	1,412,232	Ps.	1,424,533
2016		1,842,569		—
2017		1,157,684		—
2018		759,337		—
2019		306,792		—
	Ps.	5,478,614	Ps.	1,424,533

Amounts set forth above are expressed in pesos of purchasing power as of December 31, 2012, and have to be re-expressed using factors derived from the NCPI at the time of their execution. The amounts invested are expressed in thousands of pesos of each year, and include the improvements to concession assets and the machinery and equipment committed under the MDP.

c. In November 2014, the airport authority in Jamaica, approved capital investments to be made of USD$ 37,940,000 for the period April 2015 to March 2020. Compliance with MBJA capital investments must be made for the period rather than annually. During 2015 capital investments were USD$ 659,000.

28. Contingencies

a. Several municipalities have filed real estate tax claims against some airports in Mexico related to the land where the airports operate. Based on the opinion of its external legal counsel, the Company believes that there are no legal grounds for such claims. Therefore, the Company has initiated legal proceedings to invalidate the claims, and, where applicable, related foreclosures or other actions. Although no assurance can be given, the Company does not expect the resolutions to have any adverse effects on its consolidated financial position or profit or loss and other comprehensive income.

On November 26, 2014, the Tijuana municipal authority issued a requirement for payment of property tax for the period from 2000 to 2014 in the amount of Ps. 234,780, which was challenged again by the Company on December 19, 2014 and a jurisdictional court granted the Company the suspension against acts of municipal authority establishing the amount of Ps.234,780 for a bond as collateral, which has been challenged by judgement of invalidity as the Company believes that in previous proceedings it is already guaranteeing part of the amount set by the Court. This matter has not yet been resolved by the courts.

On February 26, 2013, the municipal authorities of Manzanillo, required the Manzanillo airport to exhibit several documents and answer several questionings in order to require a property tax payment for the past five years, related with commercial areas and parking lot. On March 20, 2013, the Manzanillo airport filed a judicial annulment lawsuit against this requirement. On June 3, 2015 the Administrative Court declared null and void the litigation procedure and the Company is waiting for the authority to comply with the final judgment.

As the Company and its legal counsel believe that these tax claims are not in accordance with the law, GAP proceeded to file an annulment against the municipal authorities, which is pending resolution. Because, previous judgments in this and other airports have been resolved favorably for the Company, GAP and its legal counsel believe an unfavorable outcome is remote, therefore the Company has not recognized any provision regarding these matters.

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b. In 1970, the Mexican Government expropriated a portion of land occupied by the Tijuana Airport, whereas in Guadalajara airport it occurred in 1975. Before such expropriations, a group of farmers called ejido, one in Tijuana and other different in Guadalajara, owned these lands. The farmers have raised claims against the indemnity payments received from the Mexican Government, and in Tijuana airport requested the reversion of the expropriation. During 2008, the Ejido Tampico in Tijuana airport received an unfavorable resolution, which was appealed. Subsequently the Ejido received a favorable resolution, which may affect the perimeter of the airport, due to the lack of information about the shape of the surface reverted in favor of the Ejido. The lawsuit is still pending to be resolved.

In the case of Guadalajara airport, theEjido El Zapote and Santa Cruz del Valle presented an appeal with jurisdictional authorities against the SCT and the Reforma Agraria, regarding the expropriation decrees issued to build the airport. In November 2010, the Court granted the protection of the federal justice to theejidos El Zapote and Santa Cruz del Valle, in Guadalajara airport, ordained to replace the administrative procedure of expropriation due to a lack of notification to theseEjidos and declared unsubsistence the Concession granted to the Guadalajara airport in 1998, in reference to manage, operate and develop the airport facilities. On July 10, 2012, the Court revoked this resolution and ordered the reinstatement of the actions in order to obtain more documentary evidence, for the trial with theEjido El Zapote, the trial is ongoing. However, on July 31, 2014, the court issued a favorable sentence for the Ejido El Zapote, which was challenged by the Company and is still pending to be resolved. In case of theEjido Santa Cruz del Valle the district court determinate the illegality of the expropriation decree against the Federal Government, which was confirmed by the appellate court and is currently under implementation. The legal advisors of the Company considered the Federal Government is working in a substitute compliance, consisting of the payment of compensation in favor of theejido Santa Cruz del Valle. Once it is completed the implementation process by the Government, the Company will not have any affectation in the operation or in the results of operations of the airport.

On October 1, 2013, the Company received notices for Grupo Aeroportuario del Pacífico and Puerto Vallarta airport and various federal authorities in connection with three legal proceedings filed by the participants in the Ejido Valle de Banderas. The Ejido is claiming the restitution or payment as a compensation in respect of 154 hectares of land comprising this airport, besides the partial cancellation of the concession granted to Puerto Vallarta airport. The Company attended the initial appointment on October 8, 2013, at which obtained a deferral until December 2, 2013 due to the lack of formal notice, which was again deferred, having the first audience on January 24, 2014, where the Ejido ratified the lawsuit and the Company demanded the suspension of this process due to the incompetence of jurisdiction. Therefore, the audience was delayed for three days, in order to give time to the Ejido to provide a rebuttal. The Company estimates that the court involved in this proceeding, located in the State of Nayarit, does not have jurisdiction, because the airport is located in the State of Jalisco, besides this court is not competent to nullify an administrative act, as it is related to the concession of title. The High Court declared competent the Court of Nayarit, which was challenged by the Company in federal court and is still pending to be resolved.

If the legal proceedings are resolved in such a way that adversely impact any of our airports, the Company’s management has other legal resources to challenge such resolutions. Additionally, under the Concession agreement, the Company has guarantees providing it with access to the airport’s land, and the Mexican government would be liable for any operating disruption caused by theEjidos and would have to restore the concessionaire the rights to use public property, and compensate any economic damage to the airport. Thus, in the opinion of the Company and its legal counsel, the possibility of an unfavorable outcome is remote.

c. Federal, state and environmental protection laws regulate the Company’s operations. According to these laws, the passing of regulations relating to air and water pollution, environmental impact studies, noise control and disposal of dangerous and non-dangerous material has been considered. The Federal Environmental Protection Agency has the power to impose administrative, civil and criminal penalties against companies violating environmental laws. It is also entitled to close any facilities that do not meet legal requirements. As of the date of these consolidated financial statements, the Company does not have any environmental sanctions against it.

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d. On April 25, 2011, the Company received a notice from the CNBV in which it initiated a proceeding for alleged violations of Mexican disclosure statutes primarily in connection with disputes among AMP’s Stockholders during 2010. This notice is the first stage of the procedure to impose a fine on the Company. On June 3, 2011, the Company exercised its right to appeal the determination of the CNBV and to file evidence to contest this determination. At of the issuance date of these consolidated financial statements, there is no response from the authority. In the opinion of the Company’s management and its legal counsel, the possibility of an unfavorable outcome is considered to be remote.

e. On June 17, 2015, the Mexican Supreme Court issued an ampa ro to the Company upholding the validity of Articles X and XII of the Company’s bylaws regarding the limitations on ownership of its capital stock. Consequently, the challenge initiated by Grupo México and ITM against these articles has been definitively concluded, with the ruling confirming the validity and effectiveness of these articles. On December 11, 2015, both parties were notified of the final judgment, ordering them to refer to the collegiate court of origin to the effect that the Second Civil Chamber of the High Court of Mexico City, who is ordered to confirm articles X and XII of the bylaws of the Company are valid based on Article 48, section III of the Mexican Securities Market Law. As of the issuance date of the consolidated financial statements, the Company is still awaiting final resolution by the court

29. Information by operating segment

The Company determines and evaluates its airports individual performances before allocating personnel-related costs and other costs incurred by SIAP, the subsidiary relating to the Company’s senior management. It is for this reason that the Company presents its segment information for airports, which are considered as strategic business units, not by type of service. All airports provide similar services to their customers. For each one of the strategic business the Chief Executive Officer and the Chief Financial Officer, review the internal management reports monthly.

The following table shows a summary of the Company’s financial information by segment as it relates to the Guadalajara, Tijuana, Puerto Vallarta, Los Cabos, Montego Bay, Hermosillo and Guanajuato airports. The financial information relating to the remaining six airports are comprised under “Other airports”. The corresponding information related with SIAP (company that provides technical assistance and professional services highly qualified), CORSA (company that provides operative services specialized in aeronautical industry), PCP (company that manages the parking lot operation), Fundación GAP, DCA, as well as the Company’s own operation (including investments in subsidiaries), was combined and included under “Other Companies”. The elimination of the investment of the Company in its subsidiaries is included under “Eliminations” along with any intersegment revenues and other significant intercompany operations. The performance of each segment is measured in relation to the income before income taxes, as is reported in the internal financial statements.

December 31, 2015	Guadalajara			Tijuana			Puerto Vallarta			San José del Cabo			Montego Bay			Hermosillo			Bajío			Other Airports			Others Companies			Eliminations			Total
Total revenues	Ps.	2,265,398		Ps.	1,171,362		Ps.	986,010		Ps.	1,240,376		Ps.	995,707		Ps.	315,929		Ps.	374,387		Ps.	757,740		Ps.	—		Ps.	—		Ps.	8,106,909
Total intersegment revenues		—			—			—			—			—			—			—			—			2,869,819			(2,869,819	)		—
Income from operations		1,351,741			483,094			576,686			663,087			531,608			110,333			205,163			117,646			2,552,892			(2,503,650	)		4,088,600
Interest income		23,683			351			14,533			11,409			28,625			8,319			5,427			13,882			165,823			(181,163	)		90,889
Interest expense		(60,567	)		(7,965	)		(25,625	)		(38,980	)		(65,446	)		(10,042	)		(8,757	)		(19,317	)		(153,768	)		181,163			(209,304	)
Depreciation and amortizacion for the year		(264,975	)		(133,100	)		(132,076	)		(169,624	)		(220,601	)		(45,364	)		(43,391	)		(137,814	)		(9,488	)		—			(1,156,435	)
Income before income taxes		1,317,731			477,628			573,763			651,470			425,071			109,166			202,117			109,591			2,255,199			(2,503,650	)		3,618,086
Income tax expense		(342,702	)		(96,375	)		(144,532	)		(143,253	)		(73,513	)		(39,829	)		(53,423	)		(10,180	)		56,500			—			(847,309	)
Total assets		7,721,569			4,678,483			3,451,306			3,574,307			3,268,824			1,336,608			1,194,583			3,505,736			31,013,292			(28,271,310	)		31,473,399
Total liabilities		1,568,853			482,440			693,596			1,085,814			1,733,160			274,784			290,126			595,828			6,328,704			(3,735,947	)		9,317,356
actividties		1,030,285			395,064			476,215			624,153			716,970			158,785			227,176			359,969			628,116			288,020			4,904,753
Net cash flows used in investing activities		(216,928	)		(190,172	)		(110,996	)		(162,116	)		(20,744	)		(75,239	)		(59,393	)		(331,656	)		901,976			(3,404,661	)		(3,669,927	)
Net cash flows used in financing activities		(540,728	)		(221,647	)		(292,556	)		(189,722	)		(761,266	)		33,105			(72,934	)		118,811			(1,234,888	)		3,327,995			166,171
Investmen in productive assets		5,397,740			3,125,835			2,447,205			2,608,721			5,322,545			891,345			788,939			2,334,419			144,514			—			23,061,263

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December 31, 2014	Guadalajara			Tijuana-			Puerto Vallarta			San José del Cabo			Hermosillo			Bajío			Other Airports			Other Companies			Eliminations			Total
Total revenues	Ps.	2,053,413		Ps.	737,619		Ps.	760,177		Ps.	977,427		Ps.	235,338		Ps.	264,324		Ps.	517,855		Ps.	—		Ps.	—		Ps.	5,546,152
Total intersegment revenues		—			—			—			—						—			—			2,471,308			(2,471,308	)		—
Income from operations		1,171,903			354,217			398,540			513,961			90,660			132,200			95,620			2,145,127			(2,137,139	)		2,765,089
Interest income		25,042			7,445			5,641			8,877			2,864			1,926			5,670			26,829			(12,918	)		71,376
Interest expense		(20,454	)		(5,854	)		(14,448	)		(33,207	)		(4,742	)		(4,097	)		(9,715	)		(7,002	)		12,918			(86,601	)
Depreciation and amortization for the year		(246,144	)		(135,101	)		(127,914	)		(187,048	)		(43,985	)		(41,806	)		(133,536	)		(9,686	)		—			(925,220	)
Income before income taxes		1,178,771			358,343			391,236			492,869			88,856			130,060			91,556			2,162,547			(2,137,139	)		2,757,099
Income tax expense		(243,267	)		(31,950	)		(71,543	)		(112,401	)		(8,902	)		(25,633	)		9,087			(29,969	)		—			(514,579	)
Total assets		7,369,286			4,406,170			3,287,883			3,140,330			1,161,357			1,036,630			3,073,329			26,878,666			(26,067,444	)		24,286,207
Total liabilities		1,037,484			191,378			454,079			690,460			103,823			125,937			285,208			1,415,500			(1,303,553	)		3,000,316
Net cash flows provided by operating activities		1,238,068			386,214			462,926			671,961			114,391			151,921			231,456			203,293			—			3,460,230
Net cash flows used in investing activities		(245,676	)		(108,031	)		(43,649	)		(113,894	)		(21,410	)		(12,240	)		(76,932	)		3,088,792			(3,100,000	)		(633,040	)
Net cash flows used in financing activities		(1,206,521	)		(550,000	)		(422,659	)		(653,959	)		(165,678	)		(154,538	)		(164,000	)		(3,182,519	)		3,100,000			(3,399,875	)
Investment in productive assets		5,432,563			3,038,143			2,465,765			2,589,679			845,792			759,490			2,206,645			34,395			—			17,372,472
December 31, 2013	Guadalajara			Tijuana			Puerto Vallarta			San José del Cabo			Hermosillo			Bajio			Other Airports			Other Companies			Eliminations			Total
Total revenues	Ps.	1,935,689		Ps.	692,155		Ps.	650,646		Ps.	953,427		Ps.	214,048		Ps.	210,827		Ps.	571,043		Ps.	—		Ps.	—		Ps.	5,227,836
Total intersegment revenues		—			—			—			—			—			—			—			2,315,843			(2,315,843	)		—
Income from operations		1,056,789			324,698			304,293			527,153			86,160			82,161			21,594			1,978,356			(2,008,027	)		2,373,177
Interest income		28,188			25,163			11,442			24,722			4,944			3,918			14,175			22,311			(10,639	)		124,223
Interest expense		(43,039	)		(20,308	)		(29,312	)		(63,226	)		(8,400	)		(8,738	)		(13,834	)		(2,928	)		10,639			(179,145	)
Depreciation and amortization for the year		(236,456	)		(130,842	)		(126,690	)		(165,055	)		(43,451	)		(40,780	)		(129,562	)		(10,400	)		0			(883,235	)
Income before income taxes		1,042,766			330,754			286,782			490,389			82,761			77,371			21,911			1,997,310			(2,008,026	)		2,322,018
Income tax expense		(131,484	)		20,124			(8,850	)		(88,308	)		8,740			861			76,830			46,300			0			(75,788	)
Total assets		7,674,175			4,646,736			3,392,347			3,410,018			1,260,185			1,090,061			3,161,276			26,744,080			(26,144,279	)		25,234,600
Total liabilities		1,010,641			208,337			549,585			841,589			145,701			176,253			309,646			197,655			(417,519	)		3,021,889
Net cash flows provided by operating activities		1,189,236			475,736			386,543			607,039			130,799			118,904			256,101			(199,645	)		0			2,964,713
Net cash flows used in investing activities		(264,420	)		(64,851	)		(40,817	)		(81,566	)		(5,574	)		(24,347	)		(192,329	)		2,177,952			(2,185,000	)		(680,951	)
Net cash flows used in financing activities		(1,099,426	)		(233,000	)		(374,791	)		(390,518	)		(102,835	)		(120,005	)		(156,950	)		(1,486,732	)		2,185,000			(1,779,258	)
Investment in productive assets		5,422,418			3,058,880			2,553,931			2,653,619			868,406			790,676			2,302,667			37,687			(69	)		17,688,217

Productive assets are comprised of Machinery, equipment, Improvements to leased buildings, Improvements to concession assets, Airport concessions, Rights of use of airport facilities, Other acquired rights and Other assets.

• Geographic information – All business units of the Company are operating in Mexico, Jamaica and Spain. The financial information presented above shows the different regions where these business units operate.

• Principal Customers – The Company has no dependence on a particularly client, as 55.3%, 60.8%, and 58.8% of the total revenues for 2015, 2014 and 2013, respectively, corresponds to the passenger charges that are paid for by passengers upon use of the Company’s airport facilities, that is collected by the airlines to be subsequently reimbursed to the airports, and are covered by the airlines through guarantees issued in favor of the airports. Without the revenues from passenger charges that airlines collect on behalf of the Company, no one client represents more than 10.0% of the consolidated revenues.

• Principal suppliers – The Company has no dependence of particularly supplier, due to, no one supplier represents more than 10% of its capital investments in productive assets and/or of the total operating costs.

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30. Foreign currency transactions

a. Transactions denominated in foreign currency for the years ended at December 31, 2015, 2014 and 2013 were as follows:

	2015		2014		2013
	(In thousands of U.S. dollars)
Revenues from aeronautical and non-aeronautical services		93,431		29,564		29,461
Revenues for recovery expenses		774		287		—
Technical assistance fee		5,682		5,539		5,457
Other expenses		36,616		4,610		5,159

The amounts for 2015 include the operations of MBJA.

b. The exchange rates in effect at the dates of the consolidated balance sheets and the issuance date of the consolidated financial statements were as follows:

	December31,						February 24,
	2015		2014		2013		2016
Mexican pesos per one U.S. dollar (Note 3.n)	Ps.	17.2065	Ps.	14.7180	Ps.	13.0765	Ps.	18.0568

31. Transactions with related parties

According to the definitions of control established in IFRS, the Company does not have a company controlling its operations, however, and according to these definitions, they are considered related parties the following companies:

a. Aeropuertos Mexicanos del Pacifico, S.A.P.I. de C.V.

AMP represents an entity with significant influence over the operation of the Company, as it has representation on the Board of Directors, participates in the policy-making processes, maintains material transactions, appoints officers and provides essential technical information, but without exercising control over the Company, no other Stockholder fulfills this definition.

Transactions with AMP, carried out in the ordinary course of business, were entered into at prices comparable to those for transactions with independent parties and were as follows:

	2015		2014		2013
AMP, entity with significant influence Expenses:
Technical assistance fees	Ps.	234,867	Ps.	194,228	Ps.	171,470
Services received	Ps.	2,289	Ps.	—	Ps.	1,496

In 1999, GAP and AMP entered into a technical assistance and transfer-of-technology agreement whereby AMP and its stockholders agreed to render administrative and advisory services and transfer industry technology and know-how to GAP in Mexico in exchange for consideration. The agreement’s original 15-year term may be automatically renewed for successive five-year terms, with the approval of the stockholders, unless one party gives a termination notice to the other at least 60 days prior to the effective termination date. Only the Stockholders’ Meeting has the authority to decide the non-renewal or deny the renewal of the agreement. If GAP decides to cancel or renew the agreement, GAP needs the approval of at least 51% of the holders of Series B shares other than AMP or any party related to AMP, accordingly to the participation agreement signed on August 25, 1999 among the SCT, GAP in Mexico, its strategic partner and the Stockholders of the strategic partner.

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On August 25, 2014, the initial term of the Technical Assistance agreement between the Company and Aeropuertos Mexicanos del Pacifico, S.A.P.I. de C.V. expired. However, the agreement was automatically renewed for an additional five years, pursuant to Clause 5.2 of the agreement. In relation to the agreement renewal, at a Board of Directors Meeting held on April 23, 2014, the opinion of each of the board’s independent directors was requested with respect to the continuation of the agreement, and the majority voted for the automatic renewal option.

According to the agreement, as of January 1, 2000, the Company committed to pay AMP annual consideration of U.S.D.$7,000,000 for the years 2000 and 2001 and, beginning in 2002, the greater of U.S.D.$4,000,000 (these amounts are subject to adjustment based on the CPI) or 5% of GAP’s consolidated operating income, defined as earnings before interest income or expense, calculated prior to deducting the technical assistance fee, income taxes, depreciation and amortization.

AMP is also entitled to the refund of expenses incurred in the rendering of services provided for in the agreement.

b. Otay-Tijuana Venture, L.L.C. (OTV)

As mentioned in Note 1.b, on December 9, 2015 the accesses to the new border crossing between Otay, USA and Tijuana, Mexico began operating at the airport in Tijuana. Facilities CBX terminal on the side of the United States of America, are operated by OTV, a related company, which is temporarily paying compensation for the loss of non-aeronautical revenue at the airport. Transactions in the normal course of business were made at prices comparable to those with independent third parties of Ps. 678.

The total amounts paid to key management personnel or directors, for the years ended at December 31, 2015, 2014 and 2013 were as follows:

	2015		2014		2013
Management	Ps.	28,001	Ps.	25,328	Ps.	28,890
Independent directors (7)	Ps.	5,168	Ps.	4,366	Ps.	4,137

32. Operating lease agreements

Leasing as the lessee – The rents of operating leases are payable as follows:

	2015		2014		2013
Less than one year	Ps.	18,306	Ps.	9,314	Ps.	8,990
Between one and 5 years		47,829		15,537		24,346
	Ps.	66,135	Ps.	24,851	Ps.	33,336

As described in Note 24.a, the Company has leased office space under one five-year operating lease agreement, which was renewed in February 2013 and concludes in January 2018. The monthly rental payments are U.S.$ 33,617. Base rent is subject to increases according to the NCPI and the CPI.

Rental expense in Mexican pesos amounted to Ps. 7,205, Ps. 5,335 and Ps. 5,187 for the years ended December 31, 2015, 2014 and 2013, respectively.

In addition to the monthly rent described above, the Company has entered into rental contracts for other assets, whose amounts are not material.

Leasing as the lessor

a. The Company receives payments from leasing of spaces inside the commercial area of the airports, which have been classified as operating leases. The future minimum lease payments associated with such leases is as follows:

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	2015		2014		2013
Less than one year	Ps.	554,505	Ps.	556,261	Ps.	568,183
Between one and 5 years		714,262		857,782		1,080,748
More than 5 years		35,452		54,200		105,428
	Ps.	1,304,219	Ps.	1,468,243	Ps.	1,754,359

b. Future minimum rental payments under non-cancellable leases in MBJA are as shown in the following table:

	2015
Less than one a year	USD$	1,223
Between one and five years.		5,374
	USD$	6,597

During the years ended December 31, 2015, 2014 and 2013, the Company recognized income from leasing activities of Ps. 1,249,644, Ps. 809,714 and Ps. 743,327, in the consolidated statements of profit or loss and other comprehensive income, respectively.

Future minimum rentals do not include the contingent rentals that may be paid under certain commercial leases on the basis of a percentage of the lessee’s monthly revenues in excess of the monthly minimum guaranteed rent. Contingent rentals for the years ended December 31, 2015, 2014 and 2013 are disclosed under the caption “Revenues from sharing of commercial activities” in Note 20.

33. New accounting principles not yet in effect

The Company has not applied the following new and revised IFRSs that have been issued but are not yet effective:

IFRS 9	Financial Instruments2
IFRS 14	Regulatory Deferral Accounts1
IFRS 15	Revenue from Contracts with Customers2
IFRS 16	Leases3
Amendments to IFRS 11	Accounting for Acquisitions of Interests in Joint Operations1
Amendments to IAS 1	Disclosure Initiative1
Amendments to IAS 16 and IAS 41	Agriculture: Bearer Plant1
Amendments to IFRS 10 and IAS 28	Sale or Contribution of Assets between an Investor and its Associate or Joint Venture1
Amendments to IFRS 10, IFRS 12 and IAS 28	Investment Entities: Applying the Consolidation Exception1
Amendments to IFRSs	Annual Improvements to IFRSs 2012-2014 Cycle1

1 Effective for annual periods beginning on or after 1 January 2016, with earlier application permitted.

2 Effective for annual periods beginning on or after 1 January 2018, with earlier application permitted.

3.Effective for annual periods beginning on or after 1 January 2019, with earlier application permitted.

IFRS 9Financial Instruments

IFRS 9 issued in November 2009 introduced new requirements for the classification and measurement of financial assets. IFRS 9 was subsequently amended in October 2010 to include requirements for the classification and measurement of financial liabilities and for derecognition and in November 2014 to include the new requirements for general hedge accounting. Another revised version of IFRS 9 was issued in July 2014 mainly to include a) impairment requirements for financial assets and b) limited amendments to the classification and measurement requirements by introducing a ‘fair value through other comprehensive income’ (FVTOCI) measurement category for certain simple debt instruments.

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Key requirements of IFRS 9:

• All recognized financial assets that are within the scope of IAS 39Financial Instruments: Recognition and Measurement are required 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. Debt instruments that are held within a business model whose objective is achieved both by collecting contractual cash flows and selling financial assets, and that have contractual terms that give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding, are generally measured at FVTOCI. All other debt investments and equity investments are measured at their fair value at the end of subsequent accounting periods. In addition, under IFRS 9, entities may make an irrevocable election to present subsequent changes in the fair value of an equity investment (that is not held for trading) in other comprehensive income, with only dividend income generally recognized in net income (loss).

• With regard to the measurement of financial liabilities designated as of fair value through profit or loss, IFRS 9 requires that 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. Under IAS 39, the entire amount of the change in the fair value of the financial liability designated as fair value through profit or loss is presented in profit or loss.

• In relation to the impairment of financial assets, IFRS 9 requires an expected credit loss model, as opposed to an incurred credit loss model under IAS 39. The expected credit loss model requires an entity to account for expected credit losses and changes in those expected credit losses at each reporting date to reflect changes in credit risk since initial recognition. In other words, it is no longer necessary for a credit event to have occurred before credit losses are recognized.

• The new general hedge accounting requirements retain the three types of hedge accounting mechanisms currently available in IAS 39. Under IFRS 9, greater flexibility has been introduced to the types of transactions eligible for hedge accounting, specifically broadening the types of instruments that qualify for hedging instruments and the types of risk components of non-financial items that are eligible for hedge accounting. In addition, the effectiveness test has been overhauled and replaced with the principle of an ‘economic relationship’. Retrospective assessment of hedge effectiveness is also no longer required. Enhanced disclosure requirements about an entity’s risk management activities have also been introduced.

The Company’s management anticipates that the application of IFRS 9 in the future may have a material impact on amounts reported in respect of the Company’s financial assets and financial liabilities. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 9 until the Company undertakes a detailed review.

IFRS 14,Regulatory Deferral Accounts

IFRS 14, “Regulatory Deferral Accounts”, was issued in January 2014 and applies to annual reporting periods beginning on or after 1 January 2016, earlier application is permitted. The standard specifies the financial reporting requirements for ‘regulatory deferral account balances’ that arise when an Company provides goods or services to customers at a price or rate that is subject to rate regulation. It permits an entity which is a first-time adopter of IFRS to continue to account, with some limited changes, for ‘regulatory deferral account balances’ in accordance with its previous GAAP.

IFRS 15Revenue from Contracts with Customers

In May 2014, IFRS 15 was issued which establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. IFRS 15 will supersede the current revenue recognition guidance including IAS 18 Revenue, IAS 11 Construction Contracts and the related Interpretations when it becomes effective.

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The core principle of IFRS 15 is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Specifically, the Standard introduces a 5-step approach to revenue recognition:

• Step 1: Identify the contract(s) with a customer

• Step 2: Identify the performance obligations in the contract

• Step 3: Determine the transaction price

• Step 4: Allocate the transaction price to the performance obligations in the contract

• Step 5: Recognize revenue when (or as) the Company satisfies a performance obligation

Under IFRS 15, an Company recognizes revenue when (or as) a performance obligation is satisfied, i.e. when ‘control’ of the goods or services underlying the particular performance obligation is transferred to the customer. Far more prescriptive guidance has been added in IFRS 15 to deal with specific scenarios. Furthermore, extensive disclosures are required by IFRS 15.

The Company’s management anticipates that the application of IFRS 15 in the future may have a material impact on the amounts reported and disclosures made in the Company’s consolidated financial statements. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 15 until the Company performs a detailed review.

IFRS 16, Leases

IFRS 16 “Leases” was issued in January 2016 and supersedes IAS 17 “Leases” and related interpretations. The new standard brings most leases on-balance sheet for lessees under a single model, eliminating the distinction between operating and finance leases. Lessor accounting, however, remains largely unchanged and the distinction between operating and finance leases is retained. IFRS 16 is effective for periods beginning on or after 1 January 2019, with earlier adoption permitted if IFRS 15 ‘Revenue from Contracts with Customers’ has also been applied.

Under IFRS 16 a lessee recognizes a right-of-use asset and a lease liability. The right-of-use asset is treated similarly to other non-financial assets and depreciated accordingly and the liability accrues interest. This will typically produce a front-loaded expense profile (whereas operating leases under IAS 17 would typically have had straight-line expenses) as an assumed linear depreciation of the right-of-use asset and the decreasing interest on the liability will lead to an overall decrease of expense over the reporting period.

The lease liability is initially measured at the present value of the lease payments payable over the lease term, discounted at the rate implicit in the lease if that can be readily determined. If that rate cannot be readily determined, the lessee shall use their incremental borrowing rate.

However, a lessee may elect to account for lease payments as an expense on a straight-line basis over the lease term for leases with a lease term of 12 months or less and containing no purchase options (this election is made by class of underlying asset); and leases where the underlying asset has a low value when new, such as personal computers or small items of office furniture (this election can be made on a lease-by-lease basis).

IFRS 16 establishes different transitional provisions, including retrospective application or the modified retrospective application where the comparative period is not restated.

The Company’s management anticipates that the application of IFRS 16 in the future may have a material impact on the amounts reported and disclosures made in the Company’s consolidated financial statements. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 16 until the Company performs a detailed review.

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Amendments to IFRS 11 Accounting for Acquisitions of Interests in Joint Operations

The amendments to IFRS 11 provide guidance on how to account for the acquisition of a joint operation that constitutes a business as defined in IFRS 3Business Combinations. Specifically, the amendments state that the relevant principles on accounting for business combinations in IFRS 3 and other standards (e.g. IAS 12Income Taxes regarding the recognition of deferred taxes at the time of acquisition and IAS 36Impairment of Assets regarding impairment testing of a cash-generating unit to which goodwill on acquisition of a joint operation has been allocated) should be applied. The same requirements should be applied to the formation of a joint operation if and only if an existing business is contributed to the joint operation by one of the parties that participate in the joint operation.

A joint operator is also required to disclose the relevant information required by IFRS 3 and other standards for business combinations.

The amendments should be applied prospectively to acquisitions of interests in joint operations occurring from the beginning of annual periods beginning on or after January 1, 2016.

Amendments to IAS 1 Disclosure Initiative

The amendments to IAS 1 give some guidance on how to apply the concept of materiality in practice.

The amendments to IAS 1 are effective for annual periods beginning on or after 1 January 2016.

Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortization

The amendments to IAS 16 prohibit entities from using a revenue-based depreciation method for items of property, plant and equipment. The amendments to IAS 38 introduce a rebuttable presumption that revenue is not an appropriate basis for amortization of an intangible asset. This presumption can only be rebutted in the following two limited circumstances:

a. When the intangible asset is expressed as a measure of revenue; or

b. When it can be demonstrated that revenue and consumption of the economic benefits of the intangible asset are highly correlated.

The amendments apply prospectively for annual periods beginning on or after January 1, 2016. Currently, the Company uses the straight-line method for depreciation and amortization for its property, plant and equipment, and intangible assets respectively. The Company’s management believes that the straight-line method is the most appropriate method to reflect the consumption of economic benefits inherent in the respective assets and accordingly, does not anticipate that the application of these amendments to IAS 16 and IAS 38 will have a material impact on the Company’s consolidated financial statements.

Amendments to IAS 16 and IAS 41 Agriculture: Bearer Plants

The amendments to IAS 16 and IAS 41 define a bearer plant and require biological assets that meet the definition of a bearer plant to be accounted for as property, plant and equipment in accordance with IAS 16, instead of IAS 41. The produce growing on bearer plants continues to be accounted for in accordance with IAS 41.

Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

The amendments to IFRS 10 and IAS 28 deal with situations where there is a sale or contribution of assets between an investor and its associate or joint venture. Specifically, the amendments state that gains or losses resulting from the loss of control of a subsidiary that does not contain a business in a transaction with an associate or a joint venture that is accounted for using the equity method, are recognized in the parent’s profit or loss only to the extent of the unrelated investors’ interests in that associate or joint venture.

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Similarly, gains and losses resulting from the remeasurement of investments retained in any former subsidiary (that has become an associate or a joint venture that is accounted for using the equity method) to fair value are recognized in the former parent’s profit or loss only to the extent of the unrelated investors’ interests in the new associate or joint venture.

The amendments should be applied prospectively to transactions occurring in annual periods beginning on or after 1 January 2016. The directors of the Company anticipate that the application of these amendments to IFRS 10 and IAS 28 may have an impact on the Company’s consolidated financial statements in future periods should such transactions arise.

Amendments to IFRS 10, IFRS 12 and IAS 28 Investment Entities: Applying the Consolidation Exception

The amendments to IFRS 10, IFRS 12 and IAS 28 clarify that the exemption from preparing consolidated financial statements is available to a parent that is a subsidiary of an investment entity, even if the investment entity measures all its subsidiaries at fair value in accordance with IFRS 10. The amendments also clarify that the requirement for an investment entity to consolidate a subsidiary providing services related to the former’s investment activities applies only to subsidiaries that are not investment entities themselves.

Annual Improvements to IFRSs 2012-2014 Cycle

The Annual Improvements to IFRSs 2012-2014 Cycle include a number of amendments to various IFRSs, which are summarised below.

The amendments to IFRS 5 introduce specific guidance in IFRS 5 for when an entity reclassifies an asset (or disposal group) from held for sale to held for distribution to owners (or vice versa). The amendments clarify that such a change should be considered as a continuation of the original plan of disposal and hence requirements set out in IFRS 5 regarding the change of sale plan do not apply.

The amendments also clarifies the guidance for when held-for-distribution accounting is discontinued.

The amendments to IFRS 7 provide additional guidance to clarify whether a servicing contract is continuing involvement in a transferred asset for the purpose of the disclosures required in relation to transferred assets.

The amendments to IAS 19 clarify that the rate used to discount post-employment benefit obligations should be determined by reference to market yields at the end of the reporting period on high quality corporate bonds. The assessment of the depth of a market for high qualify corporate bonds should be at the currency level (i.e. the same currency as the benefits are to be paid). For currencies for which there is no deep market in such high quality corporate bonds, the market yields at the end of the reporting period on government bonds denominated in that currency should be used instead.

The Company is evaluating the potential effects of IFRS 9, IFRS 15 and IFRS 16 in its consolidated financial statements. With regards to the other IFRS amendments and improvements, the impact of these accounting changes is not expected to have a material effect on the Company’s consolidated financial statements.

34. Subsequent events

• On January 19 and February 15, 2016, the Company paid off the loans entered into with Scotiabank and BBVA for USD$96,000,000 and USD$95,000,000, respectively. These loans were paid with funds obtained from new loans received on the same date from Scotia and BBVA for USD$95,500,000, each for a term of 5 years paying interest at Libor 1M plus 99 and 105 basis points, respectively.

• On January 29, 2016, the Company issued the first tranche of the GAP 15 long-term debt securities for a total of Ps. 1,100,000, which has the same characteristics as the original issuance, except for the issuance date and placement price. The GAP 15 debt securities’ interest will be payable every 28 days at a variable rate of TIIE-28 plus 24 basis points. Principal will be payable at maturity on February 14, 2020.

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• On February 18, 2016, the Company was notified of the decision of the Superior Court of Mexico City in accordance with the decision of Mexico’s Supreme Court, which confirmed the validity of the Company’s bylaws, declared that Grupo Mexico S.A.B. de C.V. (GM) and ITM are in violation of the Company’s bylaws, resulting from the fact that together they hold more than the 10% of the Company’s capital stock allowed under Article X of the bylaws, Therefore, it ordered the sale by GM and ITM of the Series “B” shares held in excess of 10% of the Company’s capital stock; and instructed them that the sale should be conducted through a public offer (Oferta Pública de Venta) in accordance with the laws of Mexico and Article XII of the Company’s bylaws.

35. Authorization to issue the financial statements

On February 24, 2016 the issuance of these consolidated financial statements was authorized by Fernando Bosque Mohino, and Saúl Villareal García, Chief Financial Officer. Consequently, these consolidated financial statements do not reflect events after this date and are subject to approval at the ordinary general stockholders’ meeting, where they may be modified based on provision set forth by the Mexican General Corporate Law.

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