inversiones alsacia s.a. and express de santigo uno …...transantiago expenses that are paid by all...

INVERSIONES ALSACIA S.A. AND EXPRESS DE SANTIGO UNO S.A. REPORTS

FIRST QUARTER 2011.

Alsacia and Express are the main trunk operators of the urban transport transporting around 1,2 million passengers daily. This report makes reference to both entities, Inversiones Alsacia S.A. and Express de Santiago Uno S.A. All figures were prepared in accordance with expressed in millions of Ch$. Express de Santiago Uno S.A. becomes controlled by the Rios group on March 1, 2011, before this, Express was controlled by its former owners. As of March 1 Alsacia takes administrative control of Express in order to implement all the good practices in Express administration. This is expected to achieve significant efficiencies in the operation and standards of excellence in meeting the ICPKH factor, a factor which directly depend the incomes. Today administration of both companies is taken as one, yet remains two separate entities in contract with the government. All areas of both companies have been modified to work and use the physical spaces efficient way to achieve synergies in the short term and o

INVERSIONES ALSACIA S.A. AND EXPRESS DE SANTIGO UNO S.A. REPORTS RESULTS

Alsacia and Express are the main trunk operators of the urban transport system of Santiago, Chile, transporting around 1,2 million passengers daily. This report makes reference to both entities, Inversiones Alsacia S.A. and Express de Santiago Uno S.A. All figures were prepared in accordance with

Express de Santiago Uno S.A. becomes controlled by the Rios group on March 1, 2011, before this, Express was controlled by its former owners. As of March 1 Alsacia takes administrative control of Express in order

actices in Express administration. This is expected to achieve significant efficiencies in the operation and standards of excellence in meeting the ICPKH factor, a factor which directly

of both companies is taken as one, yet remains two separate entities in contract with the government. All areas of both companies have been modified to work and use the physical spaces

to achieve synergies in the short term and operational excellence.

RESULTS FOR

system of Santiago, Chile, transporting around 1,2 million passengers daily. This report makes reference to both entities, Inversiones Alsacia S.A. and Express de Santiago Uno S.A. All figures were prepared in accordance with IFRS and are

Express de Santiago Uno S.A. becomes controlled by the Rios group on March 1, 2011, before this, Express was controlled by its former owners. As of March 1 Alsacia takes administrative control of Express in order

actices in Express administration. This is expected to achieve significant efficiencies in the operation and standards of excellence in meeting the ICPKH factor, a factor which directly

of both companies is taken as one, yet remains two separate entities in contract with the government. All areas of both companies have been modified to work and use the physical spaces in the most

(1) Total Passenger Validations received on buses during the applicable period (Validaciones).(2) Aggregate scheduled route distance in Operating Plans during the applicable period (Kilómetros del Programa de Operación). (3) Full-time and part-time bus drivers employed at the end of the applicable period (Personal de Conducción).(4) Aggregate passenger capacity of all buses, as registered with the Ministry, at the end of the applicable period (Plazas).(5) Ratio of actual passenger capacity and route distance serviced compared to the scheduled passenger capacity and route distance in Operating Plans during the applicable period (Índice de Cumplimiento Plaza Kilómetro Hora).

Reconciliation on Operating Income to Adjusted

EBITDA

Operating Income

Depreciation

Amortization

Adjusted EBITDA

Bus Passenger Validations (in millions) (1)

Alsacia

Express

Total Combined

Planned Bus Kilometers ordered by the Ministry (in

millions) (2)

Alsacia

Express

Total Combined

Bus Drivers (3)

Alsacia

Express

Total Combined

Bus Fleet Capacity (rounded to the nearest thousand)

(4)

Alsacia

Express

Total Combined

Service Fulfillment Ratio (5)

Alsacia

Express

Total Combined

(1) Total Passenger Validations received on buses during the applicable period (Validaciones). (2) Aggregate scheduled route distance in Operating Plans during the applicable period (Kilómetros del Programa de

time bus drivers employed at the end of the applicable period (Personal de Conducción).(4) Aggregate passenger capacity of all buses, as registered with the Ministry, at the end of the applicable period (Plazas).

passenger capacity and route distance serviced compared to the scheduled passenger capacity and route distance in Operating Plans during the applicable period (Índice de Cumplimiento Plaza Kilómetro Hora).

March 31,

2011

March 31,

2010

March 31,

2011


(189) (257) (5.076)

(2.213) (2.094) (3.741)

(646) (571) (1.325)

2.670 2.408 (10)

Q1, 2010 Q1, 2011

Bus Passenger Validations (in millions) (1)

30 30

42 47

72 76

Planned Bus Kilometers ordered by the Ministry (in

11 12

16 20

28 32

1.704 1.810

2.143 2.835

3.847 4.645

Bus Fleet Capacity (rounded to the nearest thousand)

69 69

117 131

185 200

96,7% 95,6%

92,7% 90,6%

94,7% 93,1%

For the 1th Quarter

As of or for the tree

month Ended

Alsacia


month Ended

(2) Aggregate scheduled route distance in Operating Plans during the applicable period (Kilómetros del Programa de

time bus drivers employed at the end of the applicable period (Personal de Conducción). (4) Aggregate passenger capacity of all buses, as registered with the Ministry, at the end of the applicable period (Plazas).

passenger capacity and route distance serviced compared to the scheduled passenger capacity and route distance in Operating Plans during the applicable period (Índice de Cumplimiento Plaza Kilómetro Hora).

March 31,

2011

March 31,

2010

(5.076) (2.243)

(3.741) (3.365)

(1.325) (969)

(10) 2.091

Express


month Ended

Alsacia—Comparison of Ended

Revenue

Revenue from passenger transportation services

Advertising revenue

Total revenue

Revenue from Passenger Transportation

Alsacia’s revenue from passenger transportation services increasedcompared to Ch$14,135 million in 20

Base Revenue

Variable Revenue

Potential revenue

Service Fulfillment Ratio

Realized revenue after Service Fulfillment Ratio

Discounts

Transantiago expenses

Revenue Price-level restatements and other adjustments

Total Revenue from passenger transportation services

Alsacia’s Base Revenue increased 7as a result of a 6.8 % increase in Alsacia’s average Cost Index between these two periods.

Alsacia’s Variable Revenue increased2010. The main reasons for this increase were: (i) an increase in average payment per passenger (Pasajero Transportado, or PPT) of 1increase in Passenger Validations of 0

The 17% increase in average PPT was substantially explained by the variation of the following components within its formula: a 3.9% increase in scheduled route distance under Alsacia’s Operating Plans60% factor); a 6.8% increase in the average Cost Index (6Passenger Validations, which have an inverse effect on

Comparison of Ended March 2010, to Ended March 2011

Ended March 31, %

Change

2010 2011

(Millions of

constant Ch$ as of

March, 2010)


14.135

15.089 6,7%

51 69 35,2%

14.186

15.158 6,9%


Alsacia’s revenue from passenger transportation services increased 6.7% to Ch$15,089 in 2010. The table below summarizes the major components of this change.

Third Months

ended March 31, %

Change 2010 2011

(Millions of constant Ch$ as March 31,

2011)

Base Revenue

5.797

6.254 7,9%

Variable Revenue

8.050

9.426 17,1%

Potential revenue

13.847

15.680 13,2% Service Fulfillment Ratio 96,7% 95,6% -1,1%


13.388

14.994 12,0%

Discounts

(163)

(359) 119,7%


1.410 - -100,0%

level restatements and other adjustments

(500)

454 -190,7%

Total Revenue from passenger transportation services

14.135

15.089 6,7%

increased 7.9% to Ch$6,254 million in 2011 compared to Ch$5,797% increase in Alsacia’s average Cost Index between these two periods.

Alsacia’s Variable Revenue increased 17.1% to Ch$9,426 million in 2011 compared to Ch$8,050 . The main reasons for this increase were: (i) an increase in average payment per passenger (

, or PPT) of 17% to Ch$323,7 in 2011 compared to Ch$276,7 in 20of 0.3% to 29,8 million in 2011 compared to 29,7 million in

% increase in average PPT was substantially explained by the variation of the following components increase in scheduled route distance under Alsacia’s Operating Plansase in the average Cost Index (6.8% x its 100% factor); and a 0

Passenger Validations, which have an inverse effect on PPT and led to a decrease of 0,98% in average PPT.

million in 2010 components of this change.

797 million in 2010,

2011 compared to Ch$8,050 million in . The main reasons for this increase were: (i) an increase in average payment per passenger (Pago por

in 2010 and (ii) an million in 2010.

% increase in average PPT was substantially explained by the variation of the following components increase in scheduled route distance under Alsacia’s Operating Plans (3.9% x its

0.3% increase in % in average PPT.

The increase in Alsacia’s average macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the ChilBank.

Service Fulfillment Ratio, which adjusts Base 95.6% in 2011 compared to an average of 9Ratio was modified to exclude any buses that did not board a new passenger for 30 minutes from Alsacia’s actual performance figures in order to include only buses moving in commercial service. This modification generally decreased Alsacia’s Service Fulfillment Ratio, even with Beginning in October 2009, the Ministry introduced another modification in the calculation of the Service Fulfillment Ratio, adding a distance (the October 2009 modification, the Service Fulfillment Ratio became known as Kilómetro Hora, or ICPKH, rather than made the Service Fulfillment Ratio more demanService Fulfillment Ratio in 2010 compared to 2009.methology. We should add that in November 20ICPKH (incorporating the service and direction), which requires further indicator and therefore the results are worse.

Alsacia’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry using the ICF and the ICR, which totaled Ch$359Transantiago expenses that are paid by all Transantiago service providers in proportion to their individual revenue, including, among others, the 2.0% AFT fee and the fees for the System (Sistema de Información al Usuario de Transantiago), which totaled Ch$7,577 million in 2010 and Ch$6,062 million in 2009. the AFT pays all Transantiago expenses owed by Alsacia. Nevertheless, Alsacia accounts for payments from the AFT for Transantiago expenses as revenue and the equal payments from Alsacia to the AFT as expenses. Here we must note that from this year changed the methodology for charging expenditures AFT, is not recorded in income is realized in the expennegative effect, nullifying the effect), keeping the zero effect margin, but not impacting income.

Advertising Revenue

Alsacia’s advertising revenue increased 35This increase was substantially explained routes and better preception of citizenship.

Operating Expenses

Alsacia’s operating expenses decreased 9in 2010. The table below summarizes the major components of this change.

CLP Millions Mar.11

Operating expenses

Labor

Fuel

Depreciation and amortization

Spare parts and maintenance

The increase in Alsacia’s average Cost Index was due to changes in the Cost Index’s underlying macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the Chil

which adjusts Base Revenue and Variable Revenue, increase 1.1% to compared to an average of 96.7% in 2010. In May 2009, calculation of the Service Fulfillment

exclude any buses that did not board a new passenger for 30 minutes from Alsacia’s actual performance figures in order to include only buses moving in commercial service. This modification generally decreased Alsacia’s Service Fulfillment Ratio, even with no change in its operational performance. Beginning in October 2009, the Ministry introduced another modification in the calculation of the Service Fulfillment Ratio, adding a distance (kilómetro) measurement for each half hour of bus service. As a result the October 2009 modification, the Service Fulfillment Ratio became known as Índice de Cumplimiento Plaza

, or ICPKH, rather than Índice de Cumplimiento Plaza Hora, or ICPH. These modifications made the Service Fulfillment Ratio more demanding and largely explain the decrease in Alsacia’s average Service Fulfillment Ratio in 2010 compared to 2009. This is valid to explain the year and the ICPKH methology. We should add that in November 2010 began implementing a new method for calculating thICPKH (incorporating the service and direction), which requires further indicator and therefore the results are

Alsacia’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry , which totaled Ch$359 million in 2011 and Ch$163 million in 20

Transantiago expenses that are paid by all Transantiago service providers in proportion to their individual revenue, including, among others, the 2.0% AFT fee and the fees for the Transantiago User Information System (Sistema de Información al Usuario de Transantiago), which totaled Ch$7,577 million in 2010 and Ch$6,062 million in 2009. the AFT pays all Transantiago expenses owed by Alsacia. Nevertheless, Alsacia

ts from the AFT for Transantiago expenses as revenue and the equal payments from Here we must note that from this year changed the methodology for charging

expenditures AFT, is not recorded in income is realized in the expense accounts (one positive and one negative effect, nullifying the effect), keeping the zero effect margin, but not impacting income.

ue increased 35,2% to Ch$69 million in 2011 compared to Ch$51ntially explained mainly due to higher sales, due to a more stable system with fixed

routes and better preception of citizenship.

creased 9.2% to Ch$13,929 million in 2011 compared to Ch$0. The table below summarizes the major components of this change.

CLP Millions Mar.11 1Q.10 1Q.11 % Change

Operating expenses

4.933 3.089 -37,4%

3.135 3.591 14,5%

Depreciation and amortization 2.288 2.618 14,4%

Spare parts and maintenance 1.678 1.311 -21,9%

Cost Index was due to changes in the Cost Index’s underlying macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the Chilean Central

% to an average of In May 2009, calculation of the Service Fulfillment

exclude any buses that did not board a new passenger for 30 minutes from Alsacia’s actual performance figures in order to include only buses moving in commercial service. This modification

no change in its operational performance. Beginning in October 2009, the Ministry introduced another modification in the calculation of the Service

) measurement for each half hour of bus service. As a result of Índice de Cumplimiento Plaza

, or ICPH. These modifications ding and largely explain the decrease in Alsacia’s average

is valid to explain the year and the ICPKH 10 began implementing a new method for calculating the

ICPKH (incorporating the service and direction), which requires further indicator and therefore the results are

Alsacia’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry million in 2010, and (ii)

Transantiago expenses that are paid by all Transantiago service providers in proportion to their individual Transantiago User Information

System (Sistema de Información al Usuario de Transantiago), which totaled Ch$7,577 million in 2010 and Ch$6,062 million in 2009. the AFT pays all Transantiago expenses owed by Alsacia. Nevertheless, Alsacia

ts from the AFT for Transantiago expenses as revenue and the equal payments from Here we must note that from this year changed the methodology for charging

se accounts (one positive and one negative effect, nullifying the effect), keeping the zero effect margin, but not impacting income.

51 million in 2010. mainly due to higher sales, due to a more stable system with fixed

compared to Ch$15,345 million

Change

37,4%

14,5%

14,4%

21,9%

Others

Total operating exprenses

Labor expenses decreased 37,4% to Ch$3decrease mainly due to reduction in the number of employees in maintenancethe mix of bus operators, hiring more part time operators and less full time.

Fuel expenses increased 14,5% to Ch$this period, the kilometers traveled by Alsacia’s buses increasedconsumption of 4.3%, which, combined with a period, explains the increase in fuel expenses. Alsacia implemented a fuel savingexplains the lower fuel consumption per kilometer traveled by Alsacia’s buses.

Depreciation and amortization expenses from operating assets increasedcompared to Ch$2.288 million in 20assets mainly due to the addition of 43 new buses in the last quarter 2010

Spare parts and maintenance expenses decreased million in 2010. This decrease was due primarily to Alsacia’s returns and delayed in corrective maintenance (overhaul) of the buses.

Other expenses decreased 41,4% to Ch$decrease was primarily due as a resultthe last quarter 2010.

Administrative and Selling Expenses

Alsacia’s administrative and selling expenses decreased 7Ch$6,778 million in 2009. The table below summarizes the major components of this change.

CLP Millions Mar.11

Administrative and selling

Labor


Other

Total administrative and selling

expenses

Labor expenses increased 361,7% to Ch$increase was principally increasing number of executives, fingering for attendance control.

Depreciation and amortization expenses from administrative and selling assetsmillion 2011 compared to Ch$243amortization of gastos diferidos, an affiliate of Alsacia, and fewer software amortizations.

3.310 1.939 -41,4%

Total operating exprenses 15.345 12.547 -18,2%

4% to Ch$3,089 million in 2011 compared to Ch$4,933 million in 20mainly due to reduction in the number of employees in maintenance(movilizers patio)

the mix of bus operators, hiring more part time operators and less full time.

to Ch$3,591 million in 2011 compared to Ch$3.135 million this period, the kilometers traveled by Alsacia’s buses increased 0,5%, leading to an decrease in diesel

%, which, combined with a 19,9% increase in the price of diesel fuel during the same ains the increase in fuel expenses. Alsacia implemented a fuel savings program in 2010, which

explains the lower fuel consumption per kilometer traveled by Alsacia’s buses.

Depreciation and amortization expenses from operating assets increased 14.4% to Ch$2,618in 2010. This was due to an increase in the value of Alsacia’s depreciable

assets mainly due to the addition of 43 new buses in the last quarter 2010.

penses decreased 21,9% to Ch$1,311 million in 2011 compared to Ch$This decrease was due primarily to Alsacia’s corrective maintenance associated with lower

corrective maintenance (overhaul) of the buses.

% to Ch$1,939 million in 2011 compared to Ch$3,310 million a result the replacement of lease buses with to the addition of 43 new buses in


and selling expenses decreased 7.9% to Ch$6,239 million in 2010 compared to in 2009. The table below summarizes the major components of this change.

CLP Millions Mar.11 1Q.10 1Q.11 % Cambio

Administrative and selling expenses

508 2.344 361,7%

Depreciation and amortization 243 140 -42,3%

539 314 -41,8%


1.290 2.799 116,9%

% to Ch$2,344 million in 2011 compared to Ch$508 million increasing number of executives, fingering for attendance control.

Depreciation and amortization expenses from administrative and selling assets decreased 42243 million 2010. This decrease was substantially explained by less

, an affiliate of Alsacia, and fewer software amortizations.

41,4%

18,2%

illion in 2010. This (movilizers patio) and change in

million in 2010. During crease in diesel fuel

% increase in the price of diesel fuel during the same program in 2010, which

618 million in 2011 This was due to an increase in the value of Alsacia’s depreciable

compared to Ch$1,678 corrective maintenance associated with lower

million in 2010. This to the addition of 43 new buses in

2010 compared to in 2009. The table below summarizes the major components of this change.

% Cambio

361,7%

42,3%

41,8%

116,9%

million 2010. This

42,3% to Ch$140 0. This decrease was substantially explained by less

Other expenses increased 41,8% to Ch$314increase was primarily the result of an increase in general expenses for services from third parties, due principally to Alsacia’s outsourcing an increase in the lease expense of Alsacia’s Maipu Terminal due to a contractual ramp up in the amount of monthly lease

Non-operating Income (Loss)

Alsacia’s non-operating income (loss) income of Ch$3,120 million in 2010

CLP

Non-opearating

Financial Expenses

Other non-operating

Price-level restatements

Foreign Exchange rate differences

Investment in related company

Total Non Operacional

The increase in interest expenses in outstanding debt. But the major increase (Ch$3.313 million) due to the 144a bond issue made because most of our loans that wereconditions are high.

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of our revenue and operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our assets and liabilities, decreases in the Chilean pesoforeign exchange rate differences that were treated as gains on our income statement. Conversely, increases in the exchange rate have historically resulted in foreign exchange rate differences that wour income statement.

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean peso/U.S. dollar exchange rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by adjustments to our revenue.

41,8% to Ch$314 million in 2011 compared to Ch$539 million result of an increase in general expenses for services from third parties, due

Alsacia’s outsourcing an increase in the lease expense of Alsacia’s Maipu Terminal due to a contractual ramp up in the amount of monthly lease payments.

operating income (loss) increased 45,1% to a loss of Ch$4,526 million in 20113,120 million in 2010. The table below summarizes the major components of this change.


Financial Expenses (977) (4.915) 403,2%

operating 284 3.695 1202,3%

level restatements 323 0 -100,0%

Foreign Exchange rate differences (1.799) (1.570) -12,7%

related company (951) (1.736) 82,5%

Operacional (3.120) (4.526) 45,1%

crease in interest expenses in 2011 compared to 2010 was a result of a increase in Alsacia’sBut the major increase in 2011 was due to the payment of prepayment penalties paid

bond issue made in February 2011. These penalties prepayment were high because most of our loans that were prepaid were a fixed rate which means that the costs to undo th

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of our revenue

operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our assets and liabilities, decreases in the Chilean peso/U.S. dollar exchange rate have historically resulted in foreign exchange rate differences that were treated as gains on our income statement. Conversely, increases in the exchange rate have historically resulted in foreign exchange rate differences that were treated as losses on

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean peso/U.S. dollar

ge rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by

million in 2010. This result of an increase in general expenses for services from third parties, due

Alsacia’s outsourcing an increase in the lease expense of Alsacia’s Maipu Terminal due to a

to a loss of Ch$4,526 million in 2011 compared to . The table below summarizes the major components of this change.

Change

403,2%

1202,3%

100,0%

12,7%

82,5%

45,1%

crease in Alsacia’s due to the payment of prepayment penalties paid

in February 2011. These penalties prepayment were high were a fixed rate which means that the costs to undo these

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of our revenue

operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our

/U.S. dollar exchange rate have historically resulted in foreign exchange rate differences that were treated as gains on our income statement. Conversely, increases in

ere treated as losses on

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean peso/U.S. dollar

ge rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by

Express—Comparison of Ended March 2010, to Ended March 2011

Revenue


Advertising revenue

Total revenue


Express’s revenue from passenger transportation services increasedcompared to Ch$18,000 million in 2

Express

Variable Revenue

Potential revenue

Service Fulfillment Ratio



Revenue Price-level restatements and other adjustments

Total revenue from passenger transportation services

Express’s Base Revenue increased 8This increase was substantially explained by a periods.

Express’s Variable Revenue increased in 2010.

This increase was substantially explained by two movements: (i) an increase in average PPTCh$367.7 in 2011 compared to Ch$47,6 million in 2011 compared to 43

The 28,7% increase in average PPT was substantially explained by the variation of the following components within its formula: a 25.1% increase in scheduled route distance under 60% factor); a 7.8% increase in the average Cost Index (7

Ended March 2010, to Ended March 2011

Ended March 31, %

Change

2010 2011

(Millions of

constant Ch$ as of

March, 2010)


18.000

22.340 24,1%

96 206 115,3%

18.096

22.546 24,6%


Express’s revenue from passenger transportation services increased 24,1% to Ch$22,340 2010. The table below summarizes the major components of this change.

Third Months ended

March 31,

2010 2011 % Change

(Millions of constant Ch$ as March 31, 2011)

Base Revenue 6.703 7.285 8,7%

Variable Revenue 11.770 16.984 44,3%

Potential revenue 18.473 24.268 31,4%

Service Fulfillment Ratio 92,7% 90,6% -2,2%

Realized revenue after Service Fulfillment Ratio 17.116 21.986 28,5%

Discounts (316) (678) 0,0%

Transantiago expenses 0 0 0,0%

level restatements and other adjustments 1.199 1.031 -14,0%

Total revenue from passenger transportation services 18.000 22.340 24,1%

8.7% to Ch$7,285 million in 2011 compared to Ch$6,703This increase was substantially explained by a 7.8% increase in the average Cost Index between these two

Express’s Variable Revenue increased 44.3% to Ch$16,984 million in 2011 compared to Ch$11

This increase was substantially explained by two movements: (i) an increase in average PPTcompared to Ch$285.6 in 2010 and (ii) a increase in Passenger Validations of

43,1 million in 2010.

% increase in average PPT was substantially explained by the variation of the following components increase in scheduled route distance under Express’s Operating Plansase in the average Cost Index (7.8% x its 100% factor); and a 1

million in 2011 below summarizes the major components of this change.

3 million in 2010. % increase in the average Cost Index between these two

compared to Ch$11,770 million

This increase was substantially explained by two movements: (i) an increase in average PPT of 28.7% to crease in Passenger Validations of 10.4% to

% increase in average PPT was substantially explained by the variation of the following components ’s Operating Plans (25.1% x its

0.4% increase in

Passenger Validations, which have an inverse effect on The decrease in Passenger Validations roverlaps, and therefore competes, services.

The increase in Express’s average Cost Index was due to changes in the Cost macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the Chilean Central Bank.

Service Fulfillment Ratio, which adjusts Base Revenue and Variable Revenue, 90.6% in 2011 compared to an average of 9Ratio was modified to exclude any buses that did not board a new pactual performance figures in order to include only buses moving in commercial service. This modification generally decreased Alsacia’s Service Fulfillment Ratio, even with no change in its operational performance. Beginning in October 2009, the Ministry introduced another modification in the calculation of the Service Fulfillment Ratio, adding a distance (kilómetro) measurement for each half hour of bus service. As a result of the October 2009 modification, the ServicKilómetro Hora, or ICPKH, rather than Índice de Cumplimiento Plaza Hora, or ICPH. These modifications made the Service Fulfillment Ratio more demanding and largely explain the decrease in AlsService Fulfillment Ratio in 2010 compared to 2009.methology. We should add that in November 2010 began implementing a new method for calculating the ICPKH (incorporating the service and direcworse.

Express’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry using the ICF and the ICR, which totaled Ch$678

As with Alsacia, the AFT pays Express for all Transantiago expenses. However, unlike Alsacia, Express accounts for payments from the AFTAFT in a single, offsetting account. Therefore, Express does not show any Transantiago expenses in the table above.

Advertising Revenue

Express’s advertising revenue increased 1152010. This increase was substantially explained fixed routes and better preception of citizenship.

Operating Expenses

Express’s operating expenses increasin 2010. The table below summarizes the major components of this change.

CLP Millions Mar.11

Operating expenses

Labor

Fuel


Spare parts and maintenance

Passenger Validations, which have an inverse effect on PPT and led to a decrease of 0.1% in average PPT.The decrease in Passenger Validations resulted following the extension of Line 1 of the Metro subway, which overlaps, and therefore competes, with some of Express’s services and compensation in part for ex

The increase in Express’s average Cost Index was due to changes in the Cost Index’s underlying macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the Chilean Central

which adjusts Base Revenue and Variable Revenue, decrease 2.2% to an average of .6% in 2011 compared to an average of 92.7% in 2010. In May 2009, calculation of the Service Fulfillment

Ratio was modified to exclude any buses that did not board a new passenger for 30 minutes from Alsacia’s actual performance figures in order to include only buses moving in commercial service. This modification generally decreased Alsacia’s Service Fulfillment Ratio, even with no change in its operational performance.

ginning in October 2009, the Ministry introduced another modification in the calculation of the Service Fulfillment Ratio, adding a distance (kilómetro) measurement for each half hour of bus service. As a result of the October 2009 modification, the Service Fulfillment Ratio became known as Índice de Cumplimiento Plaza Kilómetro Hora, or ICPKH, rather than Índice de Cumplimiento Plaza Hora, or ICPH. These modifications made the Service Fulfillment Ratio more demanding and largely explain the decrease in AlsService Fulfillment Ratio in 2010 compared to 2009. This is valid to explain the year and the ICPKH methology. We should add that in November 2010 began implementing a new method for calculating the ICPKH (incorporating the service and direction), which requires further indicator and therefore the results are

’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry , which totaled Ch$678 million in 2011 and Ch$316 million in 2010

pays Express for all Transantiago expenses. However, unlike Alsacia, Express AFT for Transantiago expenses and the equal payments by Express to the

in a single, offsetting account. Therefore, Express does not show any Transantiago expenses in the table

increased 115.3% to Ch$206 million in 2011 compared to Ch$ntially explained mainly due to higher sales, due to a more stable system with

fixed routes and better preception of citizenship.

creased 31.8% to Ch$25,275 million in 2011 compared to Ch$19The table below summarizes the major components of this change.


Operating expenses

4.873 7.410 52,1%

4.129 5.875 42,3%

Depreciation and amortization 4.231 4.587 8,4%

Spare parts and maintenance 2.962 3.392 14,5%

% in average PPT. esulted following the extension of Line 1 of the Metro subway, which

with some of Express’s services and compensation in part for ex-T3

Index’s underlying macroeconomic variables (including, among others, the CPI, the cost of fuel and labor and the Ch$/U.S.$ Exchange Rate), all of which are measured based on indices prepared by the INE and the Chilean Central

% to an average of 2010. In May 2009, calculation of the Service Fulfillment

assenger for 30 minutes from Alsacia’s actual performance figures in order to include only buses moving in commercial service. This modification generally decreased Alsacia’s Service Fulfillment Ratio, even with no change in its operational performance.

ginning in October 2009, the Ministry introduced another modification in the calculation of the Service Fulfillment Ratio, adding a distance (kilómetro) measurement for each half hour of bus service. As a result of

e Fulfillment Ratio became known as Índice de Cumplimiento Plaza Kilómetro Hora, or ICPKH, rather than Índice de Cumplimiento Plaza Hora, or ICPH. These modifications made the Service Fulfillment Ratio more demanding and largely explain the decrease in Alsacia’s average

This is valid to explain the year and the ICPKH methology. We should add that in November 2010 began implementing a new method for calculating the

tion), which requires further indicator and therefore the results are

’s revenue from passenger transportation services is reduced by (i) discounts applied by the Ministry 0

pays Express for all Transantiago expenses. However, unlike Alsacia, Express for Transantiago expenses and the equal payments by Express to the

in a single, offsetting account. Therefore, Express does not show any Transantiago expenses in the table

compared to Ch$96 million in mainly due to higher sales, due to a more stable system with

Ch$19,183 million

Change

52,1%

42,3%

8,4%

14,5%

Others

Total operating exprenses

Labor expenses increased 52,1% to Ch$increase was substantially explained by an increase of 32,0periods, resulting primarily from an increase in operation control personnel in the streets, who monitor the timing of buses, increased maintenance personnel, as Express internalizebus drivers for new buses (193 buses)

Fuel expenses increased 42,3% to Ch$5this period, the kilometers traveled by Express’s buses increased consumption of 16,3%, which, combined with theperiod, largely explains the increase in fuel expenses..

Depreciation and amortization expenses from operating acompared to Ch$4,231 million in 20Express’s depreciable assets and new buses

Spare parts and maintenance expensesmillion in 2010. This increase was mainly due to a new 193 Express’s buses.

Other expenses increased 44,8% to Ch$increase was mainly due to the rental of buses which were up 36.7% over the same period last year (first quarter).


Express’s administrative and selling expensesCh$6,624 million in 2009. The table below summarizes the major components of this change.

CLP Millions Mar.11


expenses

Labor


Other


expenses

Labor expenses decreased 38.9% to Ch$the result of increased staffing in Express Admin from 193 buses Volvo, and also was increased by compensation of executives (CEO, CFO, among others).

Other expenses increased 61,1% to Ch$increase was a mainly due to new deposits

2.989 4.328 44,8%

Total operating exprenses 19.183 25.593 33,4%

to Ch$7,410 million in 2011 compared to Ch$4,873 million explained by an increase of 32,0% in the number of employees

, resulting primarily from an increase in operation control personnel in the streets, who monitor the timing of buses, increased maintenance personnel, as Express internalized certain processes, and additional

3 buses).

3% to Ch$5,875 million in 2011 compared to Ch$4,129 million this period, the kilometers traveled by Express’s buses increased 24.9%, leading to an increase in diesel fuel

%, which, combined with the 19,8% increase in the price of diesel fuel during the same period, largely explains the increase in fuel expenses..

Depreciation and amortization expenses from operating assets increased 8.4% to Ch$4,587in 2010. This small increase was mainly due to an increase in the value of

and new buses.

Spare parts and maintenance expenses increased 14,5% to Ch$3,392 million in 2011 compared to Ch$0. This increase was mainly due to a 24.9% increase in the number of kilometers traveled by

% to Ch$4,328 million in 2011 compared to Ch$2,989 million increase was mainly due to the rental of buses which were up 36.7% over the same period last year (first


dministrative and selling expenses decreased 7.9% to Ch$6,104 million in 2010 compared to . The table below summarizes the major components of this change.



612 851 38,9%

Depreciation and amortization 104 138 33,1%

646 1.040 61,1%

Total administrative and selling 1.362 2.029 49,0%

% to Ch$851 million in 2011 compared to Ch$612 million in 20the result of increased staffing in Express Admin from 20.1% for the new terminals due to the purchase of

also was increased by compensation of executives (CEO, CFO, among others).

% to Ch$1,040 million in 2011 compared to Ch$646 million due to new deposits.

44,8%

33,4%

million in 2010. This % in the number of employees between these

, resulting primarily from an increase in operation control personnel in the streets, who monitor the d certain processes, and additional

million in 2010. During crease in diesel fuel

% increase in the price of diesel fuel during the same

587 million in 2011 0. This small increase was mainly due to an increase in the value of

compared to Ch$2,962 % increase in the number of kilometers traveled by

million in 2010. This increase was mainly due to the rental of buses which were up 36.7% over the same period last year (first

2010 compared to . The table below summarizes the major components of this change.

Change

38,9%

33,1%

61,1%

49,0%

million in 2010. This is due to the purchase of

also was increased by compensation of executives (CEO, CFO, among others).

million in 2010. This

Depreciation and amortization expenses from administrative and selling assets million in 2011 compared to Ch$104value of Express’s depreciable assets.

Non-Operating Income (Loss)

Express’s non-operating income (loss)loss of Ch$4,521 million in 2010. The table below summarizes the major components of this change.

CLP Millions Mar.11

No Operacional

Financial Expenses

Other non-operating

Price-level restatements

Foreign Exchange rate differences

Investment in related company

Total Non Operacional

The increase in interest expenses in 2011 compared to 2010 was outstanding debt. But the major increase in 2011 (Ch$4.013 millions) due to the 144a bond issue made high because most of our loans that were prepaid were a fixed rate which means that the costs to undo tconditions are high. Other important cost incurred in this item is the cost of unwind (cost of termination of hedge agreements), this cost is the payment of approximately the mark to market of the instruments, Express had two cross currency swaps that had to be ended before the bond emission.

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of oand operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our assets and liabilities, decreases in tforeign exchange rate differences that were treated as gains on our income statement. Conversely, increases in the exchange rate have historically resulted in foreign exchange rate difour income statement.

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean exchange rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by adjustments to our revenue.

Depreciation and amortization expenses from administrative and selling assets increased 331 compared to Ch$104 million in 2009. This increase was mainly due to an increase in the s’s depreciable assets.

operating income (loss) increased 205,7% to a loss of Ch$13,823 million 2010. The table below summarizes the major components of this change.


(1.791) (13.043) 628,3%

operating 659 223 -66,1%

level restatements (3.886) (223) -94,3%

Foreign Exchange rate differences 496 (780) -257,3%

in related company 0 0

Operacional (4.521) (13.823) 205,7%

The increase in interest expenses in 2011 compared to 2010 was a result of an increase in Alsacia’soutstanding debt. But the major increase in 2011 was due to the payment of prepayment penalties paid

due to the 144a bond issue made in February 2011. These penalties prepayment were high because most of our loans that were prepaid were a fixed rate which means that the costs to undo tconditions are high. Other important cost incurred in this item is the cost of unwind (cost of termination of

, this cost is the payment of approximately the mark to market of the instruments, Express had to be ended before the bond emission.

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of oand operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our assets and liabilities, decreases in the Chilean peso/U.S. dollar exchange rate have historically resulted in foreign exchange rate differences that were treated as gains on our income statement. Conversely, increases in the exchange rate have historically resulted in foreign exchange rate differences that were treated as losses on

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean exchange rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by

33,1% to Ch$138 million in 2009. This increase was mainly due to an increase in the

million 2011 compared to a 0. The table below summarizes the major components of this change.

Change

628,3%

66,1%

94,3%

257,3%

na

205,7%

increase in Alsacia’s due to the payment of prepayment penalties paid

in February 2011. These penalties prepayment were high because most of our loans that were prepaid were a fixed rate which means that the costs to undo these conditions are high. Other important cost incurred in this item is the cost of unwind (cost of termination of

, this cost is the payment of approximately the mark to market of the instruments, Express

Foreign exchange rate differences are caused by the net effect of revaluing our liabilities that are denominated in U.S. dollars using the prevailing exchange rate at the end of each period. Substantially all of our revenue and operating expenses have been denominated in Chilean pesos, except for payments under our existing debt, which are denominated in U.S. dollars. Because of this difference between the denominations of our

he Chilean peso/U.S. dollar exchange rate have historically resulted in foreign exchange rate differences that were treated as gains on our income statement. Conversely, increases in

ferences that were treated as losses on

However, our Concession revenue is adjusted based on changes in the Cost Index, which is a weighted average of several macroeconomic measures and commodity prices, including the Chilean peso/U.S. dollar exchange rate, which comprises 11% and 2.2% of the Cost Index for Alsacia and Express, respectively. As a result, we expect that changes in the Chilean peso/U.S. dollar exchange rate will be somewhat offset by

Income S tatement Data

Revenue

Operating income

Non-operating income

Income before income taxes

Income taxes

Net (loss) Income

Balance Sheet Data

Cash and cash equivalent

Total Current assets

Total fixed assets

Total assets

Total current liabilities

Total Long-term liabilities

Total shareholders’ equity

Cash Flow Data

Net cash flow from (used in) Operating Activities

Net cash flow from (used in) Financing Activities

Net cash flow from (used in) InvestingActivities

Reconciliation on Operating Income to Adjusted EBITDAOperating Income

Depreciation

Amortization

Adjusted EBITDA

March 31, 2011

March 31, 2010

March 31, 2011

MM$ MM$ MM$

15.158 14.186 22.546

(189) (257) (5.076)

(4.525) (3.592) (13.506)

(4.714) (3.849) (18.582)

1.622 1.574 2.517

(3.092) (2.275) (16.065)

6.322 1.267 1.616

38.402 16.629 10.912

55.252 59.425 79.203

263.800 96.555 133.766

5.987 34.597 15.546

255.427 60.184 108.453

2.386 1.774 9.767

Net cash flow from (used in) Operating Activities 545 71 1.877

Net cash flow from (used in) Financing Activities 226.978 (5.084) 165

Net cash flow from (used in) InvestingActivities (223.167) 2.347 (2.107)


(189) (257) (5.076)

(2.213) (2.094) (3.741)

(646) (571) (1.325)

2.670 2.408 (10)


month Ended

Alsacia


month Ended

March 31, March 31, 2010

MM$ MM$

22.546 18.032

(5.076) (2.243)

(13.506) (4.834)

(18.582) (7.077)

2.517 793

(16.065) (6.284)

1.616 530

10.912 28.407

79.203 75.214

133.766 140.476

15.546 29.113

108.453 84.552

9.767 26.811

1.877 910

165 (4.517)

(2.107) 4.116

(5.076) (2.243)

(3.741) (3.365)

(1.325) (969)

(10) 2.091


month Ended

Express

APPENDIX

“AFT” means the Transantiago Financial Administrator (Administrador Financiero de Transantiago S.A.), the collection agent and custodian of funds for Transantiago. “Bus Network” means the bus transportation and related operating systems Agreements. “Cost Index” means the weighted average of various price and cost indices, as specified in the Concession Agreements, used in the revenue formulas for Alsacia and Express. For a complete description of the formula for calculating the Cost Index, see “The Concessions “GAAP” means generally accepted accounting principles in Chile or IFRS to the extent then applicable, in each case as in effect on the date of the Indenture. “ICF” means the frequency fulfillment index (ICR, is used by the Ministry to measure the performance of Alsacia and Express in relation to their respective Operating Plans. Deviations from Operating Planbe received from the AFT. Alsacia currently accounts for such discounts as reductions to its revenue and Express currently accounts for such discounts as expenses. “ICR” means the regularity fulfillment indices (the ICF, is used by the Ministry to measure the performance of Alsacia and Express in relation to their respective Operating Plans. Deviations from Operating Plans decrease ICR, win funds to be received from the AFT. Alsacia currently account “Metro” means Metro S.A., a state-metropolitan area. “Ministry” means the Ministry of Telecomunicaciones), which regulates Transantiago, is our counterparty under the Concessions and is responsible for the administration, regulation and operation of the Concessions.“Operating Plan” means an operating plan agreed upon by all Transantiago bus concessionaires with the Ministry on a quarterly basis, which includes scheduled bus routes, route distances, times of service and number and types of buses on each route on weekdays, weekPlans is a critical factor in our revenue formulas under the Concession Agreements that impacts our Variable Revenue and our Service Fulfillment Ratio. For a more complete discussion regarding our Operating Plasee “The Concessions—Operating Plans.” “Service Fulfillment Ratio” (Índice de Cumplimiento Plaza Kilómetro HoraConcession Agreements and used by the Ministry to track actual passenger capacity and route distance againstOperating Plans. Prior to October 2009, the Service Fulfillment Ratio did not include a distance (requirement and was therefore referred to as Cumplimiento Plaza Kilómetro HoraFulfillment Ratio a more demanding measure of our performance. The Ministry reports a preliminary Service Fulfillment Ratio to each bus concessionaire on a semireview the preliminary Service Fulfillment Ratio and propose adjustments to it to reflect service interruptions or delays that are outside of a concessionaire’s control, such as road construction or traffic accidents along its routes. Once the proposed adjustments are reviewed and imposed by the Ministry, the Ministry publicly reports the adjusted Service Fulfillment Ratios for a period starting on the sixth day of each calendar month and ending on the fifth day of the following calendar montadjusted Service Fulfillment Ratio for each calendar month for their internal reporting purposes. All Service Fulfillment Ratios used in this Offering Memorandum refer to the internal, adjusted Service FRatios calculated by Alsacia and Express. For a more complete description of the Service Fulfillment Ratio, see “The Concessions— Concession Revenue

” means the Transantiago Financial Administrator (Administrador Financiero de Transantiago S.A.), the collection agent and custodian of funds for Transantiago.

” means the bus transportation and related operating systems subject to the Concession

” means the weighted average of various price and cost indices, as specified in the Concession Agreements, used in the revenue formulas for Alsacia and Express. For a complete description of the formula

calculating the Cost Index, see “The Concessions—Concession Revenue—Revenue Formulas.”

” means generally accepted accounting principles in Chile or IFRS to the extent then applicable, in each case as in effect on the date of the Indenture.

ans the frequency fulfillment index (Índice de Cumplimiento de Frecuencia), which, along with the ICR, is used by the Ministry to measure the performance of Alsacia and Express in relation to their respective Operating Plans. Deviations from Operating Plans decrease ICF, which in turn leads to discounts in funds to be received from the AFT. Alsacia currently accounts for such discounts as reductions to its revenue and Express currently accounts for such discounts as expenses.

fillment indices (Índices de Cumplimiento de Regularidad), which, along with the ICF, is used by the Ministry to measure the performance of Alsacia and Express in relation to their respective Operating Plans. Deviations from Operating Plans decrease ICR, which in turn leads to discounts in funds to be received from the AFT. Alsacia currently account

-owned enterprise that controls the subway system in the Santiago, Chile

” means the Ministry of Transportation and Telecommunication (Ministerio de Transportes y ), which regulates Transantiago, is our counterparty under the Concessions and is

for the administration, regulation and operation of the Concessions. g Plan” means an operating plan agreed upon by all Transantiago bus concessionaires with the

Ministry on a quarterly basis, which includes scheduled bus routes, route distances, times of service and number and types of buses on each route on weekdays, weekends and holidays. Adherence to our Operating Plans is a critical factor in our revenue formulas under the Concession Agreements that impacts our Variable Revenue and our Service Fulfillment Ratio. For a more complete discussion regarding our Operating Pla

Operating Plans.”

Índice de Cumplimiento Plaza Kilómetro Hora) is a measure set forth in the Concession Agreements and used by the Ministry to track actual passenger capacity and route distance againstOperating Plans. Prior to October 2009, the Service Fulfillment Ratio did not include a distance (requirement and was therefore referred to as Índice de Cumplimiento Plaza Hora, rather than Cumplimiento Plaza Kilómetro Hora. The addition of the distance requirement in 2009 made the Service Fulfillment Ratio a more demanding measure of our performance. The Ministry reports a preliminary Service Fulfillment Ratio to each bus concessionaire on a semi-monthly basis. Each bus concessioreview the preliminary Service Fulfillment Ratio and propose adjustments to it to reflect service interruptions or delays that are outside of a concessionaire’s control, such as road construction or traffic accidents along its

he proposed adjustments are reviewed and imposed by the Ministry, the Ministry publicly reports the adjusted Service Fulfillment Ratios for a period starting on the sixth day of each calendar month and ending on the fifth day of the following calendar month. Alsacia and Express also separately calculate the adjusted Service Fulfillment Ratio for each calendar month for their internal reporting purposes. All Service Fulfillment Ratios used in this Offering Memorandum refer to the internal, adjusted Service FRatios calculated by Alsacia and Express. For a more complete description of the Service Fulfillment Ratio,

Concession Revenue—Revenue Formulas.”

” means the Transantiago Financial Administrator (Administrador Financiero de Transantiago S.A.), the

subject to the Concession

” means the weighted average of various price and cost indices, as specified in the Concession Agreements, used in the revenue formulas for Alsacia and Express. For a complete description of the formula

Revenue Formulas.”

” means generally accepted accounting principles in Chile or IFRS to the extent then applicable, in

), which, along with the ICR, is used by the Ministry to measure the performance of Alsacia and Express in relation to their respective

s decrease ICF, which in turn leads to discounts in funds to be received from the AFT. Alsacia currently accounts for such discounts as reductions to its revenue and

), which, along with the ICF, is used by the Ministry to measure the performance of Alsacia and Express in relation to their

hich in turn leads to discounts

owned enterprise that controls the subway system in the Santiago, Chile

Ministerio de Transportes y ), which regulates Transantiago, is our counterparty under the Concessions and is

g Plan” means an operating plan agreed upon by all Transantiago bus concessionaires with the Ministry on a quarterly basis, which includes scheduled bus routes, route distances, times of service and

ends and holidays. Adherence to our Operating Plans is a critical factor in our revenue formulas under the Concession Agreements that impacts our Variable Revenue and our Service Fulfillment Ratio. For a more complete discussion regarding our Operating Plans,

) is a measure set forth in the Concession Agreements and used by the Ministry to track actual passenger capacity and route distance against Operating Plans. Prior to October 2009, the Service Fulfillment Ratio did not include a distance (kilómetros)

, rather than Índice de addition of the distance requirement in 2009 made the Service

Fulfillment Ratio a more demanding measure of our performance. The Ministry reports a preliminary Service monthly basis. Each bus concessionaire can then

review the preliminary Service Fulfillment Ratio and propose adjustments to it to reflect service interruptions or delays that are outside of a concessionaire’s control, such as road construction or traffic accidents along its

he proposed adjustments are reviewed and imposed by the Ministry, the Ministry publicly reports the adjusted Service Fulfillment Ratios for a period starting on the sixth day of each calendar month

h. Alsacia and Express also separately calculate the adjusted Service Fulfillment Ratio for each calendar month for their internal reporting purposes. All Service Fulfillment Ratios used in this Offering Memorandum refer to the internal, adjusted Service Fulfillment Ratios calculated by Alsacia and Express. For a more complete description of the Service Fulfillment Ratio,

inversiones alsacia s.a. and express de santigo uno …...transantiago expenses that are paid by all...

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