FORM 20-F Grupo Casa Saba, S.A.B. de C.V.

Table of Contents
Repurchase and resale of own shares (restricted earnings)
The Company may acquire the shares representative of its capital stock with a charge to stockholders’ equity, without reducing capital stock, or with a charge to capital stock. In this
last event, they become treasury shares, without requiring a resolution adopted by the stockholders’ meeting. The General Ordinary Stockholders’ Meeting determines the amount that
should be allocated toward share repurchases for each year. Those funds may not exceed the balance of the Company’s net earnings, including retained earnings. The amount of the
reserve for own share repurchases is appropriated from retained earnings.
At the General Ordinary Stockholders’ Meeting held on April 22, 2003, the stockholders resolved that the maximum amount geared toward the Company’s own share repurchases
should be equivalent to 15 percent of the Company’s stockholders’ equity at December 31, 2002, without exceeding retained earnings at that date. During 2011 and 2010, the
Stockholders’ Meetings resolved to maintain the same level of reserve approved by its similar on April 22, 2003. During 2011 and 2010, the stockholders resolved not to agree a specific
number of shares and Mexican peso amounts for repurchase of its own shares.
b) Legal reserve
Net income generated by the Company is subject to the legal provision that requires appropriating 5 percent of the Company’s income to a legal reserve until that reserve equals 20
percent of the Company’s capital stock. Equity in earnings of subsidiaries and associates is not considered for this purpose. Amounts from this reserve may not be distributed to the
Company’s stockholders, except as stock dividends. At December 31, 2011 and 2010, the Company’s legal reserve amounted to Ps. 251,995 and Ps. 238,491, respectively, which is
included in “retained earnings”.
c) Distribution of earnings and capital reductions
Any dividends distributed to stockholders must be paid out of the “Net taxable income account” (CUFIN-Spanish acronym). Any dividends paid out in excess of CUFIN are subject to
a 42.9 percent tax rate payable by the Company and its subsidiaries. The resulting income tax may be offset against income tax due in the same year and the subsequent two years
and/or IETU of the same period. At December 31, 2011 and 2010, the balance of CUFIN amounted to Ps. 4,325,797 and Ps. 3,990,781, respectively. Effective 2011, the balance of CUFIN
is determine in a consolidated manner due to the Company again was approved by the tax authorities to determine its consolidated taxable income as discussed in Note 3 r). In 2010, the
Company determined the balance of CUFIN individually for each entity due to the deconsolidation tax carried out in that year.
In April 2009, dividends were declared at the Company’s Stockholders’ Meeting in the amount of Ps. 170,000 to be paid out of retained earnings. Dividends paid did not exceed the
consolidated CUFIN balance at that date. Therefore, no income tax was due.
The excess of capital reimbursement per share paid to stockholders over the balance of the “Restated contributed capital per share account” should be treated as a distributed
dividend. The excess will be assessable as provided for in the Income Tax Law. The resulting income tax may be offset as referred to above. Effective 2011, the balance of CUCA is
determined in a consolidated manner by considering the new tax approval referred to above.
d) Dividends among companies of the Group
Dividends paid out of the CUFIN among companies of the Group are subject to the provisions sets forth by the 2010 tax reform (Note 18 d).
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