<PAGE>




                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 20-F
         ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934
                  For the fiscal year ended December 31, 2003
                        Commission File Number: 1-12736
                                    --------

                               SAVIA, S.A. DE C.V.
             (Exact name of Registrant as specified in its charter)

             SAVIA, S.A. DE C.V.                             MEXICO
 (Translation of Registrant's name into         (State or other jurisdiction of
                English)                        incorporation or organization)

                                Rio Sena 500 Pte.
                                Colonia del Valle
                          San Pedro Garza Garcia, N.L.
                                 CP 66220 Mexico
                                (52-81) 8173-5500
         (Address and telephone number of Registrant's principal office)
                                    --------

 SECURITIES REGISTERED OR TO BE REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT

                                                          NAME OF EACH
     TITLE OF EACH CLASS                         EXCHANGE ON WHICH REGISTERED
     -------------------                         ----------------------------
Class I Series A Common Stock, without             Mexican Stock Exchange
par value ("A Shares")
Ordinary Participation Certificates
American Depositary Shares (as evidenced
by American Depositary Receipts), each
representing four Ordinary Participation
Certificates

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:

      Class I Series A Common Stock, without par value - 470,592,934

      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 which financial statement Item the Registrant has
elected to follow:

                              Item 17 [ ] Item 18 [X]



<PAGE>

                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION                                                                                                    PAGE NO.
-------                                                                                                    --------
<S>                                                                                                        <C>
INTRODUCTION......................................................................................................1

ITEM 1.         IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS.............................................4

ITEM 2.         OFFER STATISTICS AND EXPECTED TIMETABLE...........................................................4

ITEM 3.         KEY INFORMATION...................................................................................4

ITEM 4.         INFORMATION ON THE COMPANY.......................................................................14

ITEM 5.         OPERATING AND FINANCIAL REVIEW AND PROSPECTS.....................................................24

ITEM 6.         DIRECTORS AND SENIOR MANAGEMENT..................................................................39

ITEM 7.         MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS................................................44

ITEM 9.         OFFER AND LISTING................................................................................45

ITEM 10.        ADDITIONAL INFORMATION...........................................................................48

ITEM 11.        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.......................................55

ITEM 12.        DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES...........................................57

ITEM 13.        DEFAULTS, DIVIDENDS, ARREARAGES AND DELINQUENCIES................................................58

ITEM 14.        MATERIAL MODIFICATIONS OF THE RIGHTS OF SECURITY HOLDERS AND USE of PROCEEDS.....................58

ITEM 15.        CONTROLS AND PROCEDURES..........................................................................58

ITEM 16A.       AUDIT COMMITTEE FINANCIAL EXPERT................................................................ 58

ITEM 16B.       CODE OF ETHICS...................................................................................58

ITEM 16C.       PRINCIPAL ACCOUNTANT FEES AND SERVICES ..........................................................58

ITEM 16D.       EXEMPTIONS FROM THE LISTING STANDARDS FOR THE AUDIT COMMITTEES ..................................58

ITEM 16E        PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS...........................59
</TABLE>


                                       i
<PAGE>

<TABLE>
<S>                                                                                                              <C>
ITEM 17.        FINANCIAL STATEMENTS.............................................................................59

ITEM 18.        FINANCIAL STATEMENTS.............................................................................59

ITEM 19.        EXHIBITS.........................................................................................61

ABOUT THE INTEGRATION OF THE BOARD OF DIRECTORS..................................................................67

ABOUT THE STRUCTURE OF THE BOARD OF DIRECTORS....................................................................68

ABOUT THE DIRECTORS' DUTIES......................................................................................69

ABOUT THE OPERATION OF THE BODY WHICH FULFILLS THE EVALUATION AND COMPENSATION FUNCTION..........................71

ABOUT THE AUDITORS' SELECTION....................................................................................71

ABOUT THE FINANCIAL INFORMATION..................................................................................72

ABOUT THE INTERMEDIATE BODY IN CHARGE OF THE FINANCE AND PLANNING FUNCTIONS .....................................74

ABOUT THE INFORMATION AND AGENDA OF THE STOCKHOLDERS MEETING.....................................................74

ABOUT THE INFORMATION AND COMMUNICATION BETWEEN THE BOARD OF DIRECTORS AND THE STOCKHOLDERS......................75

EXHIBIT INDEX ...................................................................................................77
</TABLE>

                                       ii

<PAGE>

                                  INTRODUCTION

      Savia, S.A. de C.V. ("Savia" or the "Company") is a corporation (sociedad
anonima de capital variable) organized under the laws of the United Mexican
States ("Mexico").

      In this Form 20-F, references to "pesos" and "Ps." are to Mexican pesos
and references to "dollars" or "$" are to U.S. dollars. Pursuant to generally
accepted accounting principles in Mexico ("Mexican GAAP"), financial data for
all periods in the financial statements included in Item 18 (the "Consolidated
Financial Statements") and, unless otherwise indicated, throughout this Form
20-F have been restated in constant pesos as of December 31, 2003. Unless
otherwise indicated, dollar amounts have been translated from Mexican pesos at
an exchange rate of Ps. 11.1998 to $1.00, the effective exchange rate on
December 31, 2003, as published by Banco de Mexico. As of June 18, 2004, as
published by Banco de Mexico, the effective exchange rate was Ps. 11.3523 to
$1.00.

FORWARD-LOOKING STATEMENTS

      This annual report contains a number of statements relating to future
results of Savia that are "forward-looking statements" as defined in the Private
Securities Litigation Reform Act 1995. Savia may also make forward-looking
statements in its periodic reports to the Securities and Exchange Commission on
Form 6-K, in its annual report to shareholders, in its offering circulars and
prospectuses, in press releases and other written materials and in oral
statements made by its officers, directors or employees to third parties. These
forward-looking statements include discussions about our beliefs, projections
and expectations and may include statements regarding various factors that may
be beyond the Company's control, including but not limited to competition,
weather and other growing conditions in our farming areas in Mexico, market
prices for fresh produce in the United States and Canada, significant economic
or political developments in Mexico, availability of mortgage financing in
Mexico, and changes in the regulatory environment in which the Company operates.
Savia can give no assurances that such results, including the various factors
discussed herein will not differ materially from the statements contained in
this annual report. Such forward-looking statements are not guarantees of future
performance and involve known and unknown risks, uncertainties and other
factors, many of which are beyond the control of Savia, which may cause actual
results to differ materially from those expressed in the statements contained in
this annual report. Some of these risks, uncertainties and factors are discussed
in Item 3.D "Risk Factors." Forward-looking statements speak only as of the date
they are made, and Savia undertakes no obligation to update publicly any of them
in light of new information or future events.

SUMMARY

I. SIGNIFICANT REDUCTION IN BUSINESS OPERATIONS - SALE OF BUSINESSES TO REPAY
HOLDING COMPANY INDEBTEDNESS

      Savia is a holding company and its assets are its equity interests in its
subsidiaries. As of December 31, 2003, its two principal subsidiaries, which
represent virtually all of its revenues and assets, were Bionova Holding
Corporation ("Bionova") and Desarrollo Inmobiliano Omega S.A. de C.V. ("Omega").

      On September 29, 2003, Savia completed the sale of all of its interest in
Seminis, Inc. ("Seminis"). In 2001, the Company completed the sale of its
packaging businesses and its remaining interest in Seguros Commercial America,
S.A. de C.V. ("SCA"). (See Note 13 to the Consolidated Financial Statements with
respect to certain tax matters relating to sales in 2001.) The sales of these

<PAGE>

businesses were part of a debt restructuring program the Company entered into in
2001, as a result of significant net cash outflows and operating losses. The net
proceeds from the sales of each business in 2001 were used to repay
indebtedness, and of the net proceeds from the sale of Seminis, $15 million
(together with the proceeds from a sale of Savia shares and a note receivable)
was used to repay all the remaining indebtedness of the Company (other than
indebtedness of Bionova), and $251 million was distributed as a cash dividend to
its shareholders. (See Note 3 to the Consolidated Financial Statements). The
Company's financial statements have been restated to reflect the net assets and
results of operations of each of Seminis, the packaging businesses and SCA as
discontinued operations from the date of disposition.

II. CONTINUING OPERATIONS - ABSENCE OF PROFITABILITY

      Bionova, engaged in the business of growing fresh produce in Mexico and
distributing fresh produce in the U.S. and Canada, has incurred significant
losses from operations in every year since its formation in 1996 through 2003.
In 2003 Bionova incurred a loss from operations of Ps. 71 million and a net loss
of Ps. 106 million. Bionova is continuing to incur operating losses during the
current fiscal year.

      Omega, engaged in the business of developing and selling parcels of land
located near Monterrey, Mexico for residential housing, had revenues of Ps. 181
million in 2003 and Ps. 205 million in 2002, and modest operating income of Ps.
23 million and Ps. 8 million in 2003 and 2002, respectively.

III. FINANCIAL CONDITION - ABSENCE OF LIQUIDITY

      The financial statements included in this annual report have been prepared
assuming that the Company will continue as a going concern. However: (a) for the
year ended December 31, 2003, the Company incurred consolidated losses of Ps.
2,362 million (Ps. 806 million in 2002); (b) in September, 2003, the sale of
Seminis, a subsidiary that represented 70% of the consolidated assets and income
as of that date, was completed; and (c) there is an impairment in cash flow
generation, which could eventually force the Company to liquidate the rest of
its assets. In addition, excluding Seminis, the Company incurred a loss from
continuing operations of Ps. 198 million in 2003 (Ps. 1,691 million in 2002).
These matters, among others, raise substantial doubts about the Company's
ability to continue as a going concern. The financial statements do not include
any adjustments related to the valuation and classification of the assets and
classification and amount of the liabilities that might result from the outcome
of these uncertainties.

      Over the past few years, Bionova has provided funds for its operations
from the sale of its assets. The Company is reviewing the operations of its
fresh produce business and is considering transactions that would provide
working capital to finance the continued operations of the fresh produce
business. There are no assurances that the Company will be successful in
completing a transaction to obtain financing for the fresh produce business, and
if the Company is unsuccessful in completing a transaction prior to the end of
this year, it may not have sufficient working capital to continue to conduct
this business.

IV. BIONOVA - RECENT CORPORATE DEVELOPMENTS

A.  PRIVATIZATION OF BIONOVA

      On March 29, 2004, Bionova completed a financial restructuring of its
inter-company indebtedness that resulted in Bionova becoming a private company
and a wholly-owned subsidiary of Savia. As part of this transaction, Ps.26.9
million of the principal amount of Bionova's debt to Savia was

                                       2
<PAGE>

converted into common shares of Bionova, and the remaining indebtedness of
Bionova and its subsidiaries to Savia was forgiven. The public stockholders of
Bionova received $0.09 for each share of Bionova's common stock. As a result of
the transaction, Bionova became a wholly-owned subsidiary of Savia, and its
requirements to file public reports in accordance with U.S. securities laws was
terminated.


B.  2003 YEAR-END FINANCIAL POSITION

      As of December 31, 2003, Bionova was in a position of technical
insolvency, as its current assets of Ps.404.3 million were significantly less
than its current liabilities of Ps.1,416.8 million. The Company's fresh produce
subsidiaries owed Ps.38.1 million in short-term debt to banks, all of which is
secured by assets of the fresh produce subsidiaries and guaranteed by Bionova
and Savia. As of December 31, 2003, Bionova and its subsidiaries were also
indebted to Savia in a total amount of Ps.1,149.1 million. As a part of the
financial restructuring of Bionova completed in March 2004, all of the
Ps.1,149.1 million indebtedness owed to Savia was either exchanged for equity or
forgiven. As of March 31, 2004, the only indebtedness of Bionova was obligations
to suppliers and borrowings under its bank agreements.

                                       3
<PAGE>


                                     PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

      Not Applicable.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

      Not Applicable.

ITEM 3. KEY INFORMATION

A.  SELECTED FINANCIAL DATA

      The following table presents selected consolidated financial data of the
Company and its subsidiaries. Savia is a holding company and operates
principally through its wholly-owned subsidiaries, Bionova and Omega. This data
should be read in conjunction with the Company's Consolidated Financial
Statements and the notes thereto, which are included elsewhere in this Annual
Report. Unless otherwise indicated, dollar amounts have been translated from
Mexican pesos at an exchange rate of Ps. 11.1998 to $1.00, the effective
exchange rate on December 31, 2003, as published by Banco de Mexico. As of June
18, 2004, as published by Banco de Mexico, the effective exchange rate was Ps.
11.3523 to $1.00.

      The Consolidated Financial Statements have been prepared in accordance
with Mexican GAAP, which differs in significant respects from U.S. GAAP. Note 16
to the Consolidated Financial Statements provides a summary description of
certain significant differences between Mexican GAAP and U.S. GAAP as they
relate to the Company, and a reconciliation to GAAP of net income and total
stockholders' equity. The financial information is derived from the Company's
audited Consolidated Financial Statements, restated in constant pesos as of
December 31, 2003. The Mexican Institute of Certified Public Accountants has
issued Bulletin B-10, "Recognition of the Effects of Inflation on Financial
Information", and Bulletin B-12, "Statement of Changes in Financial Position."
These bulletins outline the inflation accounting methodology employed by
companies preparing their financial statements in accordance with Mexican GAAP.
Inflation adjusted accounting is mandatory for all Mexican companies. Bulletin
B-10 requires that all financial information be presented in constant pesos
(having the same purchasing power for each period indicated taking into account
inflation) as of the date of the most recent balance sheet. The effect of these
inflation adjusting principles has not been reversed in the reconciliation to
U.S. GAAP.

      In 1997, the Company adopted the standards set forth in the Fifth
Amendment to Bulletin B-10 (Modified), "Recognition of the Effects of Inflation
on Financial Information", and Bulletin B-15, "Transactions in Foreign Currency"
and "Translation of Financial Statements of Foreign Operations", issued by the
Mexican Institute of Public Accountants.

      In accordance with the Fifth Amendment to Bulletin B-10, from 1997
onwards, property, plant and equipment are stated at cost, restated by applying
factors derived from the NCPI to the historical cost, except for machinery and
equipment of foreign origin, which are stated at cost, restated by applying
factors derived from the general inflation index of the country of origin to the
corresponding foreign currency amounts and translating those amounts to pesos at
the exchange rate prevailing at the closing date.

                                       4
<PAGE>

      Bulletin B-15 stipulates guidelines for the translation of the financial
statements of foreign subsidiaries on the following basis: (i) the figures of
such subsidiaries are restated by applying the general inflation index of the
country of origin and are translated to Mexican pesos at the rates of exchange
prevailing at the latest balance sheet date; (ii) when an investment in a
foreign subsidiary has been designated as an economic hedge of a foreign
currency liability, any exchange differences arising from such liability should
be recorded directly in stockholders' equity; (iii) the gain on monetary
position arising from hedged liabilities is calculated based on the general
inflation index of the country of origin of the foreign subsidiary and is
included in income as a part of the comprehensive financing cost; and (iv) the
net difference resulting from the translation of the financial statements of
foreign subsidiaries is included in stockholders' equity under the caption
"Effects of Translation of Foreign Subsidiaries."

      Major Dispositions

      In February 2000, the Company sold 49% of its interest in SCA and on June
22, 2001 the Company sold its remaining interest in SCA. In May 2001, the
Company completed the sale of its packaging businesses. Finally, on September
29, 2003, the Company completed the sale of all of its interest in Seminis. In
accordance with Mexican GAAP, the Company's Consolidated Financial Statements
are restated to reflect the net assets and results of operations of each of
these sold businesses as discontinued operations.


                                       5
<PAGE>

<TABLE>
<CAPTION>

                                                                           YEAR ENDED DECEMBER 31,
                                                                           -----------------------
SELECTED FINANCIAL DATA                        1999           2000           2001           2002           2003             2003
                                               ----           ----           ----           ----           ----             ----
                                             (MILLIONS OF CONSTANT DECEMBER 31, 2003 PESOS, EXCEPT SHARES AND PER     (U.S. DOLLARS
                                                                         SHARES DATA)                                IN MILLIONS)(1)
INCOME STATEMENT DATA:
MEXICAN GAAP:
<S>                                            <C>           <C>             <C>           <C>            <C>               <C>
Net sales                                      3,781.2       3,721.2         2,919.1       2,024.0        1,459.0           130.3
Cost of sales                                  3,455.4       3,138.2         2,440.2       1,694.0        1,221.0           109.0
                                               -------       -------         -------       -------        -------           -----
Gross margin                                     325.8         583.0           478.9         330.0          238.0            21.3

Operating expenses                             1,338.2       1,339.9           990.8         641.0          463.0            41.3
                                               -------       -------           -----         -----          -----            ----
Operating loss                                (1,012.4)       (756.9)         (511.9)       (311.0)        (225.0)          (20.1)
                                              --------        ------          ------        ------         ------           -----

Severance and other termination costs                           22.7           272.2


Comprehensive financing cost:
Financial expenses               (2)          (1,339.1)     (1,184.4)         (415.0)        (46.0)         (23.0)           (2.1)
Financial income                 (3)             394.0         383.3           168.2          68.0           69.0             6.2
Exchange (loss) gain, net        (4)             609.5         140.8           (95.3)        216.0          130.0            11.6
(Loss) gain on monetary position (5)             296.9         197.4            85.0         (54.0)         (10.0)           (0.9)
                                                 -----         -----            ----         -----          -----            ----
                                                 (38.7)       (396.9)         (257.1)        184.0          166.0            14.8
                                                 -----        ------          ------         -----          -----            ----


Other (expenses), net            (6)            (350.6)       (546.5)         (793.9)     (1,499.0)         230.0            20.5
                                                ------        ------          ------      --------          -----            ----
Loss from continuing operations before
provisions                                    (1,401.9)     (1,723.0)       (1,835.1)     (1,626.0)         171.0            15.3
                                              --------      --------        --------      --------          -----            ----

Provisions for:
Income tax and asset tax                          66.2        (912.8)         (130.0)        (65.0)        (369.0)          (32.9)

Employees' profit sharing                         (0.1)         (2.3)           (0.1)
                                                  ----          ----            ----
                                                  66.1        (915.1)         (130.1)        (65.0)        (369.0)          (32.9)
                                                  ----        ------          ------         -----         ------           -----

Loss from continuing operations before
extraordinary items                           (1,335.8)     (2,638.1)       (1,965.2)     (1,691.0)        (198.0)          (17.7)

Other extraordinary items
                                              --------      --------        --------      --------         ------           -----
Loss from continuing operations               (1,335.8)     (2,638.1)       (1,965.2)     (1,691.0)        (198.0)          (17.7)


Discontinued operations, net of income tax
and employees' profit sharing:
Net loss from discontinued operations           (102.9)     (1,573.2)       (3,065.1)        951.0         (466.0)          (41.6)
Gain (loss) on sale of subsidiaries                           (736.1)          771.9                     (1,889.0)         (168.7)
                                                ------        ------           -----         -----       --------          ------
                                                (102.9)     (2,309.3)       (2,293.2)        951.0       (2,355.0)         (210.3)
                                                ------      --------        --------         -----       --------          ------

Consolidated loss                             (1,438.7)     (4,947.4)       (4,258.4)       (740.0)      (2,553.0)         (227.9)
                                              --------      --------        --------        ------       --------          ------

Minority interest in:
Continuing operations                              3.6         858.0           405.7          48.0           20.0             1.8
Discontinued operations          (7)             (68.8)        533.2           675.5        (114.0)         171.0            15.3
                                                 -----         -----           -----        ------          -----            ----
                                                 (65.2)      1,391.2         1,081.2         (66.0)         191.0            17.1
                                                 -----       -------         -------         -----          -----            ----

Net loss corresponding to majority
interest                                      (1,503.9)     (3,556.2)       (3,177.3)       (806.0)      (2,362.0)         (210.9)
                                              ========      ========        ========        ======       ========          ======
</TABLE>

                                       6
<PAGE>

<TABLE>
<CAPTION>
                                                                           YEAR ENDED DECEMBER 31,
                                                                           -----------------------
SELECTED FINANCIAL DATA                           1999          2000           2001           2002           2003           2003
                                                  ----          ----           ----           ----           ----           ----
                                             (MILLIONS OF CONSTANT DECEMBER 31, 2003 PESOS, EXCEPT SHARES AND PER     (U.S. DOLLARS
                                                                         SHARES DATA)                                IN MILLIONS)(1)
<S>                                             <C>             <C>           <C>            <C>             <C>            <C>
Loss per share applicable to majority
interest, in Mexican pesos:
Continuing operations                              (2.84)        (3.79)        (3.37)        (3.54)        (0.38)        (0.03)
Discontinued operations                            (0.37)        (3.79)        (3.50)         1.80         (4.66)        (0.42)
                                                   -----         -----         -----          ----         -----         -----
Net loss per share                                 (3.21)        (7.58)        (6.87)        (1.74)        (5.04)        (0.45)
                                                   =====         =====         =====         =====         =====         =====

Weighted average number of common shares
outstanding                        (8)        468,889.1     469,202.1     462,634.2     463,752.0      469,626.7

INCOME STATEMENT DATA :
U.S. GAAP:
Loss from continuing operations                  (727.0)     (4,323.5)     (3,279.0)     (2,501.0)       (427.0)        (38.1)
Income from discontinued operations               205.9       5,898.7       4,046.0       1,860.0      (2,822.0)       (251.9)
Net income (loss)                                 521.1       1,575.2         767.0        (641.0)     (3,249.0)       (290.0)

Basic and diluted earnings per share from:
Continuing operations                              (1.5)         (9.2)         (7.1)         (5.4)         (0.9)         (0.1)
Discontinued operations                             0.4          12.5           8.7           4.0          (6.0)         (0.5)


BALANCE SHEET DATA (AT END OF PERIOD):
Mexican GAAP:
Assets
Current assets from continuing operations       4,082.0       3,541.0       2,819.1       2,432.0       2,440.0         217.9
Current assets from discontinued
operations
                                     (9)       38,171.8      41,349.2       5,319.7       5,478.0           0.0           0.0
Property, plant and equipment, net              1,462.7       1,409.1       1,175.0       1,065.0         884.0          78.9
Non current assets from discontinued
operations
                                     (9)       26,780.4      24,211.3       6,832.2       6,377.0           0.0           0.0
Other assets                                    3,995.1       3,116.9       1,469.2         220.0         151.0          13.5
                                                -------       -------       -------         -----         -----          ----

Total assets                                   74,492.0      73,627.5      17,615.3      15,572.0       3,475.0         310.3

Goodwill                                        1,266.0         650.7          10.9           0.0           0.0           0.0

Total assets                                   74,492.0      73,627.5      17,615.3      15,572.0       3,475.0         310.3
                                               ========      ========      ========      ========       =======         =====


Liabilities and Stockholders' Equity
Short-term debt                                 1,469.0       6,364.5         976.1       1,002.0          38.0           3.4
Current liabilities from
Discontinued
operations                           (9)       25,157.2      31,795.0       5,192.3       4,651.0           0.0           0.0
Long-term debt                                  7,639.7         363.8           6.5           5.0          10.0           0.9
Long-term liabilities from discontinued
operations
                                     (9)       10,728.6       9,771.5         392.0         332.0           0.0           0.0

Capital stock                                   1,663.0       1,663.0       1,663.0       1,663.0       1,663.0         148.5
Majority stockholders 'equity                  20,112.3      14,378.3       9,058.4       7,968.0       2,803.0         250.3
Minority stockholders' equity                   6,266.2       8,854.9         776.9       1,028.0        (249.0)        (22.2)
                                                -------       -------         -----       -------        ------         -----
Total stockholders' equity                     26,378.5      23,233.2       9,835.3       8,996.0       2,554.0         228.0
                                               --------      --------       -------       -------       -------         -----

U.S. GAAP:
Total assets                                   40.465.1      31,774.3      15,176.5      14,995.0       4,046.0        361.2
Total stockholders' equity                     11.288.3       7,970.0       8,367.9       8,140.0       2,554.0        228.0
</TABLE>

                                       7
<PAGE>

-------------------------

(1)   Peso amounts have been translated into U.S. dollars, solely for the
      convenience of the reader, at the rate of Ps. 11.1998 per U.S. $1.00, the
      exchange rate in effect on December 31, 2003, as published by Banco de
      Mexico.

(2)   Consists primarily of interest expense on borrowed funds.

(3)   Includes interest and dividends earned on cash, temporary investments and
      loans to related companies, appreciation or depreciation of marketable
      securities.

(4)   Assets and liabilities denominated in foreign currencies are stated in
      pesos at the closing rate of exchange. Exchange differences are recorded
      in results of operations.

(5)   The gain on monetary position represents the effect of inflation, as
      measured by the NCPI, on the Company's average monthly net monetary assets
      or liabilities during the period.

(6)   Other income (expenses) - net included amortization of goodwill of Ps.103,
      Ps. 155, Ps. 652, Ps. 17, and Ps. 1 in 1999, 2000, 2001, 2002 and 2003,
      respectively.

(7)   Loss from discontinued operations include the following results of
      operations:

      1999: 12 months of our packaging segment, 10 months of our insurance
      segment and 12 months of our seeds segment
      2000: The entire year of our packaging, insurance and seeds segment
      2001: 4 months of our packaging segment, 6 months of our insurance segment
      and 12 months of our seeds segment
      2002: Cancellation of reserve related to the divestiture of Empaq's
      subsidiaries and 12 months of our seeds segment
      2003: 9 months of our seeds segment

(8)   Net income per share is based on the weighted average number of shares
      outstanding during each period.

(9)   Assets and liabilities from discontinued operations of the following
      business divestitures:

      1999: Balances of our packaging, insurance and seeds segments
      2000: Balances of our packaging, insurance and seeds segments
      2001: Balances of our seeds segment
      2002: Balances of our seeds segment


                                       8
<PAGE>
B. CAPITALIZATION AND INDEBTEDNESS

      Not Applicable.

C. REASON FOR THE OFFER AND USE OF PROCEEDS

      Not Applicable.

D. RISK FACTORS

      Our business operations and financial condition are subject to various
risks. This section is a summary of certain material factors that may affect our
business. There are no assurances that the Company will be successful in
completing a transaction to obtain financial resources. If the Company is
unsuccessful in completing a transaction prior to the end of this year, it may
not have sufficient working capital to conduct its businesses.

SAVIA

GOING CONCERN

      The financial statements included in this annual report have been prepared
assuming that the Company will continue as a going concern. However: (a) for the
year ended December 31, 2003, the Company incurred consolidated losses of Ps.
2,362 million (Ps. 806 million in 2002); (b) in September, 2003, the sale of
Seminis, a subsidiary that represented 70% of the consolidated assets and sales
as of that date, was completed; and (c) there is an impairment in cash flow
generation, which could eventually force the Company to liquidate the rest of
its assets. In addition, excluding Seminis, the Company incurred a loss from
continuing operations of Ps. 198 million in 2003 (Ps. 1,691 million in 2002).
These matters, among others, raise substantial doubts about the Company's
ability to continue as a going concern. The financial statements do not include
any adjustments related to the valuation and classification of the assets and
classification and amount of the liabilities that might result from the outcome
of these uncertainties.

      Over the past few years, Bionova has provided funds for its operations
from the sale of assets. The Company is reviewing the operations of its fresh
produce business and is considering transactions that would provide working
capital to finance the continued operations of the fresh produce businesses.
There are no assurances that the Company will be successful in completing a
transaction to obtain financing for the fresh produce business, and if the
Company is unsuccessful in completing a transaction prior to the end of the
year, it may not have sufficient working capital to continue to conduct this
business.

HOLDING COMPANY; PROHIBITION ON DIVIDENDS AND DISTRIBUTIONS FROM SUBSIDIARIES

      Savia is a holding company and its only material assets are its equity
interests in its wholly-owned subsidiaries, Bionova and Omega. As a holding
company, the Company has no source of income or cash flow other than dividends
and distributions from its subsidiaries.

      Bionova has incurred operating losses since its formation in 1996, and
Omega generates modest operating profits. In addition, Bionova has over the past
few years utilized proceeds from the sale of assets to finance its working
capital requirements, and Omega utilizes any positive cash flow to finance


                                       9
<PAGE>
its business of improving raw land for sale to developers of residential homes.
Therefore, the Company does not receive any dividends from its subsidiaries.

TAX RISK

      There is no assurance that the Mexican tax authorities will not review
previous tax returns filed or tax returns that will be filed in future periods.
(See Note 13 to the Consolidated Financial Statements).

EXCHANGE RATE RISK

      In the past, the value of the peso has been subject to significant
fluctuations with respect to the dollar and may be subject to significant
fluctuations in the future.

      The following table sets forth, for the periods indicated, the period-end,
average, high and low Free Market Rate for the purchase of dollars, expressed in
pesos per dollar. The Federal Reserve Bank of New York does not report a noon
buying rate for pesos.

<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 2003                                          FREE MARKET RATE(1)
-----------------                  -----------------------------------------------------------------
                                    Period End         Average(2)            High                Low
                                    ----------         ----------            ----                ---
<S>                                 <C>                 <C>                 <C>                <C>
1999                                   9.499              9.557             10.154              9.245
2000                                   9.599              9.468              9.824              9.199
2001                                   9.169              9.335              9.683              9.090
2002                                  10.361              9.741             10.361              9.024
2003                                  11.199              10.817            11.338             10.320
January 2004                          11.084             10.925             11.237             10.817
February 2004                         11.072             11.012             11.131             10.906
March 2004                            11.210             11.004             11.154             10.933
April 2004                            11.407             11.263             11.343             11.160
May 2004                              11.413             11.512             11.633             11.389
June 2004                             11.352             11.400             11.485             11.331
</TABLE>

----------
(1)   Source: Banco de Mexico.

(2)   Average of month-end rates.

      In 1999, the peso strengthened to Ps. 9.50 per dollar at December 31,
1999. In 2000, the peso maintained its relative parity with the dollar and
traded at Ps. 9.60 per dollar on December 31, 2000. During 2001, the peso
strengthened, to Ps. 9.17 per dollar, a 4.48% increase as compared to the value
of the peso in 2000 generally reflecting the political conditions in Mexico.
During the first quarter of 2002, the peso remained strong, but the depreciation
of the dollar in comparison to the euro, the weakness of the U.S. economy and
uncertainty about the U.S. conflict with Iraq negatively effected the value of
the peso, commencing a 13.0% depreciation process that resulted in a rate of Ps.
10.361 per dollar at year end. This trend, together with a general weakening of
Mexico's economy, continued during 2003, and the peso depreciated 13% in 2003.
As of June 18, 2004 the exchange rate was 11.3523.

DIVIDEND RISK

      Under the Company's By-Laws and Mexican law, the annual net income of the
Company, according to its audited financial statements, is applied as follows:
first, an amount equivalent to at least


                                       10
<PAGE>
5% of net income is allocated to build a legal reserve until such reserve is
equal to 20% of the nominal capital stock of the Company; and second, additional
amounts may be allocated to other reserve funds or distributed as dividends.

      The declaration, amount and payment of dividends are determined by
majority vote of the holders of A Shares at the annual ordinary stockholders'
meeting, generally on the recommendation of the Board of Directors, and depends
on the Company's results of operations, financial condition, cash requirements,
the ability of the Company's subsidiaries to pay cash dividends to the Company,
future prospects and other factors deemed relevant by the holders of the A
Shares. The Company has not paid cash dividends for more than five years other
than an extraordinary cash dividend paid from the proceeds of the sale of the
Company's interest in Seminis.

      Based upon the financial condition of the Company, the Company does not
intend to pay any dividends.

RISKS OF DOING BUSINESS IN MEXICO - OMEGA

      Omega, which represents 12% of Savia's revenues in 2003, operates solely
in Mexico. Bionova, a U.S. company, comprises approximately 76% of Savia's
revenues in 2003, and distributes fresh produce grown in Mexico. For the year
ended December 31, 2003, Savia had 23% of total sales in pesos and the remaining
77% in foreign currencies.

      Mexico has experienced political changes and economic fluctuations in
recent years. This instability affects Mexico's business and investment climate.
As a Mexican company, the political and economic environment in Mexico has a
significant impact on the Savia's financial condition. The success of our real
estate business is significantly affected by general economic conditions in the
Monterrey area as well as the availability of Mexican financial markets to
provide mortgage financing of the properties we develop.

      The Mexican government has exercised, and continues to exercise,
significant influence over the Mexican economy. Economic plans of the Mexican
government in the past often have not fully achieved their objectives, and the
Company cannot assure you that current and future economic plans of the Mexican
government will achieve their stated goals. Similarly, the Company cannot
determine what effect these plans or their implementations will have on the
Mexican economy or on the Company's subsidiaries' businesses. Future Mexican
governmental actions could have a significant effect on Mexican companies,
including ours, and market conditions.

BIONOVA

RISKS RELATING TO BIONOVA'S FINANCIAL CONDITION

Insufficient cash to maintain operations during the upcoming months.

      Bionova's fresh produce business requires cash to harvest crops that have
been planted and to make advances to growers for crops to be planted in the next
season. Its fresh produce business does not have cash reserves, so it depends on
continued sales revenues and bank loans to generate the required cash to support
these needs. If sales revenues are below projected levels during 2004 (which
might be caused by low production volumes, lower than forecast customer demand
for the Company's vine sweet mini pepper, or low commodity prices), or if the
lender to the distribution companies does not continue to provide financing, the
produce business will not have sufficient cash to maintain its operations. In
that


                                       11
<PAGE>
event, the produce business would be required to curtail or suspend its
operations and to make other expense reductions.

Continued losses and deficits in the future.

      Bionova has sustained losses in every year of its existence from 1996
through 2003. As of December 31, 2003, its accumulated deficit was $221.3
million. For the year ended December 31, 2003, Bionova had a net loss of $11.3
million. The factors that caused these losses, including factors described in
this section, may continue to limit its ability to make a profit in the future.

Necessary financing to maintain business operations.

      Bionova will need additional capital to meet its growth objectives and
working capital requirements. Its projected cash flows from operations and
existing capital resources, including its existing credit lines, may not be
sufficient. Therefore, Bionova's ability to pursue these objectives may depend
on its ability to obtain additional capital, which could cause Bionova to incur
additional debt, issue equity securities, or other forms of participation in its
business. Bionova cannot assure you that additional capital will be available on
satisfactory terms, if at all, and, as a result, Bionova may be restricted in
its ability to maintain operations of the fresh produce business.

RISKS RELATING TO BIONOVA'S FARMING AND DISTRIBUTION BUSINESS

Bad weather and crop disease can affect the amount of produce we can grow, which
can decrease our revenues and profitability.

      Weather conditions greatly affect the amount of fresh produce we bring to
market, and, accordingly, the prices we receive for our produce. Storms, frosts,
droughts, and particularly floods, can destroy a crop, and less severe weather
conditions, such as excess precipitation, cold weather and heat, can kill or
damage significant portions of a crop. Crop disease and pestilence can be
unpredictable and can have a devastating effect on our crops, rendering them
unsalable and resulting in the loss of all or a portion of the crop for that
harvest season. Even when only a portion of our crops is damaged, the profits we
could have made on the crop will be severely affected because the costs to plant
and cultivate the entire crop will have been incurred although we may experience
low yields or may only be able to sell a portion of our crop.

Labor shortages and union activity can affect our ability to hire workers to
harvest and distribute our crops, which can hurt our financial condition.

      The production of fresh produce is heavily dependent upon the availability
of a large labor force to harvest crops. The turnover rate among the labor force
is high due to the strenuous work, long hours, necessary relocation and
relatively low pay. If it becomes necessary to pay more to attract labor to farm
work, our labor costs will increase.

      The Mexican farm work force is unionized. If the union attempts to disrupt
production and is successful on a large scale, labor costs will likely increase
and work stoppages may be encountered, which would be particularly damaging in
our industry where harvesting crops at peak times and getting them to market on
a timely basis is critical. The majority of fresh produce is shipped by truck.
In the United States and in Mexico, the trucking industry is largely unionized
and therefore susceptible to labor disturbances. As a result, delivery delays
caused by labor disturbances in the trucking industry or for any other reason
could limit our ability to get fresh produce to market before it spoils.


                                       12
<PAGE>
Reliance on leases and production associations could result in increased costs,
which could adversely affect Bionova's financial results.

      Bionova relies on agricultural land leased from others, production
associations with other growers, and contract production with third party
growers for a large part of its supply. The average term of the land leases is
two years and we expect to renew most of these land leases as they expire. If
the other parties to these leases were to choose not to renew their agreements
with Bionova, Bionova would be required to locate alternate sources of supply
and/or land or, in some cases, to pay increased rents for land. In addition to
increased rental rates, increases in land costs could result from increases in
water charges, property taxes and related expenses. Production associations and
contract production with third party growers are generally arranged three to six
months prior to each growing season. The provisions of the contracts with these
growers may change from year to year, which can affect the amount of supply, the
prices of the produce, and the cost and profit sharing arrangements among the
parties. If these other growers choose not to renew their contracts, Bionova
would be required to locate alternate sources of supply, which may or may not be
available.

Legal limitations could affect Bionova's ownership of rural land in Mexico,
which could decrease its supply of produce causing a decrease in its revenues
and profitability.

      Bionova owns a substantial amount of rural land in Mexico, which it uses
to grow fresh fruits and vegetables. Historically, the ownership of rural land
in Mexico has been subject to legal limitations and claims by residents of rural
communities, which in some cases could lead to the owner being forced to
surrender its land. Bionova has been involved in land dispute proceedings as
part of its ordinary course of business. Bionova has never lost any money in
these land disputes, but if Bionova were ever required to surrender any of its
land, the volume of fresh fruits and vegetables it produces would decline and
adversely affect our profitability.

RISKS RELATING TO BIONOVA'S INTERNATIONAL OPERATIONS

Currency fluctuations and inflation can increase the cost of Bionova's products
in the United States and abroad, which decreases its revenues and profitability.

      The value of the Mexican peso relative to the dollar has significantly
weakened over the past three years with respect to the dollar, and history has
demonstrated that the currency exchange rates of the peso per dollar can be
highly volatile. For example, in December 1994, the Mexican government announced
its intention to float the Mexican peso against the United States dollar and, as
a result, the peso devalued over 40% relative to the dollar during that month.
Exchange rate fluctuations impact Bionova's subsidiaries' businesses. If the
value of the peso decreases relative to the value of the dollar, then (i)
imports of produce into Mexico for distribution become more expensive in peso
terms and therefore more difficult to sell in the Mexican market and (ii)
inflation that generally accompanies reductions in the value of the peso reduces
the purchasing power of Mexican consumers, which reduces the demand for all
products including produce and, in particular, imported, branded or other
premium-quality produce. Conversely, if the value of the peso increases relative
to the value of the dollar, Mexican production costs increase in dollar terms,
which results in lower margins or higher prices with respect to produce grown in
Mexico and sold in the United States and Canada.

Volatile interest rates in Mexico can increase Bionova's capital costs.


                                       13
<PAGE>
      Historically, interest rates in Mexico have been volatile, particularly in
times of economic unrest and uncertainty. High interest rates restrict the
availability and raise the cost of capital for Bionova's Mexican subsidiaries
and for growers and other Mexican parties with whom we do business, both for
loans denominated in pesos and for loans denominated in dollars. Costs of
operations for Bionova's Mexican subsidiaries are higher as a result.

Trade disputes between the United States and Mexico can result in tariffs,
quotas and bans on imports, including our products, which can hurt our financial
condition.

      Despite the enactment of the North American Free Trade Agreement, Mexico
and the United States from time to time are involved in trade disputes. The
United States has, on occasion, imposed tariffs, quotas, and importation bans on
products produced in Mexico. U.S. tomato growers have brought dumping claims
against Mexican tomato growers and may do so again. Because some of Bionova's
subsidiaries produce products in Mexico, which it sells in the United States,
such actions, if taken, could adversely affect its business.

ITEM 4. INFORMATION ON THE COMPANY

A. HISTORY AND DEVELOPMENT OF THE COMPANY

      Savia, S.A. de C.V. was incorporated in 1971, and is organized under the
laws of Mexico. The Company's principal office is located at Rio Sena 500 Pte.
Colonia del Valle, San Pedro Garza Garcia, N.L., C.P. 66220, Mexico. Its
telephone number is (52-81) 8173-5500 and its internet address is
http://www.savia.com.mx. The Company is a holding company and as of December 31,
2003, its two principal subsidiaries, which represent virtually all of its
revenues and assets, were Bionova and Omega. As a holding company, the Company
has no source of income or cash flow other than dividends, distributions from
its subsidiaries and income received from the divestiture of the Company's fixed
assets or net investments. Savia's principal subsidiaries focus on growing fresh
produce in Mexico and exporting it to the United States and Canada, and
developing raw land for residential use. Omega is a wholly owned subsidiary and,
on March 29, 2004, Bionova became a wholly owned subsidiary as a result of the
financial restructuring of Bionova.

      On September 29, 2003, Savia completed the sale of all of its interest in
Seminis. In 2001, the Company completed the sale of its packaging businesses and
its remaining interest in SCA. (See Note 13 to the Consolidated Financial
Statements with respect to certain tax matters relating to sales in 2001.) The
sales of these businesses were part of a debt restructuring program as a result
of significant net cash outflows and operating losses. The net proceeds from the
sales of each business in 2001 were used to repay indebtedness, and of the net
proceeds from the sale of Seminis, $15 million (together with the proceeds from
a sale of Savia shares and a note receivable) was used to repay all the
remaining indebtedness of the Company (other than indebtedness of Bionova) and
$251 million was distributed as a cash dividend to its shareholders. (See Note 3
to the Consolidated Financial Statements). The Company's financial statements
have been restated to reflect the net assets and results of operations of each
of Seminis, the packaging businesses and SCA as discontinued operations.

      As of December 2003, the Company operates its fresh produce business
through its subsidiaries in the U.S. and Canada and its real estate business
through its subsidiaries in Mexico. Bionova, with its corporate offices in
California, grows fresh produce in Mexico and distributes and markets fresh
produce in the United States and Canada. Omega develops and sells land for high
income residential communities in the metropolitan area of Monterrey, N.L.,
Mexico.


                                       14
<PAGE>
      The following tables set forth certain consolidated and segment financial
information of Savia prepared in accordance with Mexican GAAP:

CONSOLIDATED:

<TABLE>
<CAPTION>
                                                     FOR THE YEARS ENDED DECEMBER 31,
                                          ----------------------------------------------------
                                           2001                   2002                   2003
                                          ------                 ------                  -----
                                            (MILLIONS OF CONSTANT DECEMBER 31, 2003 PESOS)
<S>                                      <C>                    <C>                    <C>
Net Sales (1)                              2,919                  2,024                  1,459
Operating Loss (1)                          (512)                  (311)                  (225)
Total Assets                              17,615                 15,572                  3,475
Total Liabilities                          7,780                  6,576                    921
Total Stockholders' Equity                 9,835                  8,996                  2,554
Total Majority Interest                    9,058                  7,968                  2,803
</TABLE>

SEGMENT:

<TABLE>
<CAPTION>
                                       FOR THE YEARS ENDED DECEMBER 31,
                      ---------------------------------------------------------------
                      2002        2003        2002        2003      2002         2003
                      ----        ----        ----        ----      ----         ----
                        FRESH PRODUCE           REAL ESTATE         OTHER BUSINESSES(2)
                      ----------------        ----------------      -----------------
                               (MILLIONS OF CONSTANT DECEMBER 31, 2003 PESOS)
<S>                   <C>         <C>         <C>         <C>       <C>          <C>
Net Sales (1)         2,422       1,113         205        181        308         165
Operating (Loss)
Income (1)             (105)        (71)          8         23       (214)       (177)
</TABLE>

----------
(1)   Does not include operating results of SCA, packaging businesses and
      Seminis, which are treated as discontinued operations.

(2)   Includes Agromod, a direct subsidiary of Savia, an agricultural company
      engaged in the business of growing papaya and other agricultural products
      in Southern Mexico, which is presented as "Other Agrobusinesses" in the
      Company's Consolidated Financial Statements. (See Note 12 to the Company's
      Consolidated Financial Statements.)


                                       15
<PAGE>
B. BUSINESS OVERVIEW

COMPANY REVENUES BY GEOGRAPHIC REGION

      Revenue information on the Company's operations by geographic area as of
and for the years ended December 31, 2001, 2002 and 2003 is summarized below:

<TABLE>
<CAPTION>
                             FRESH PRODUCE         REAL ESTATE      OTHER BUSINESSES (1)               CONSOLIDATED
                             -------------         -----------      --------------------               ------------
<S>                          <C>                   <C>              <C>                                <C>
2001
Mexico                          Ps. 1,018            Ps. 186               Ps. 311                       Ps. 1,515
United States                         901                                                                      901
Canada                                503                                                                      503
    Total                       Ps. 2,422            Ps. 186               Ps. 311                       Ps. 2,919
                                =========            =======               =======                       =========
2002
Mexico                          Ps.   113            Ps. 205               Ps. 308                       Ps.   626
United States                         762                                                                      762
Canada                                636                                                                      636
    Total                       Ps. 1,511            Ps. 205               Ps. 308                       Ps. 2,024
                                =========            =======               =======                       =========
2003
Mexico                          Ps.    44            Ps. 181               Ps. 165                       Ps.   390
United States                         380                                                                      380
Canada                                689                                                                      689
    Total                       Ps. 1,113            Ps. 181               Ps. 165                       Ps. 1,459
                                =========            =======               =======                       =========
</TABLE>

----------
(1)   Includes Agromod, which is presented as "Other Agrobusinesses" in the
      Company's Consolidated Financial Statements. (See Note 12 to the Company's
      Consolidated Financial Statements).

FRESH PRODUCE BUSINESS

BIONOVA

Corporate Structure

      Bionova Holding Corporation, a Delaware corporation, was formed in January
1996, and acts as a holding company for (i) Agrobionova, S.A. de C.V., a
corporation organized under the laws of Mexico, of which the Company owns 98.6%
("ABSA"), (ii) International Produce Holding Company, a Delaware corporation, of
which the Company owns 100% ("IPHC"), (iii) DNAP and (iv) VPP Corporation, a
Delaware corporation, of which the Company owns 100% ("VPP").

      ABSA engages in the business of growing fresh fruits and vegetables,
primarily tomatoes and peppers, in Mexico, and exporting fresh produce to the
United States and other markets. In recent years, ABSA has been concentrating on
the production and marketing of proprietary products, such as its patented vine
sweet mini pepper, that offer the potential to generate higher margins as
compared with commodity fresh produce items. IPHC is a holding company whose
subsidiaries are in the business of marketing and distributing fresh produce
primarily in the United States and Canada, including fruits and vegetables
produced by ABSA. DNAP and VPP were agribusiness biotechnology companies,



                                       16
<PAGE>
concentrating on the development of fruits and vegetables and related
intellectual properties until the Company closed these research and development
businesses in June 2002.

ABSA

      ABSA is a leading grower of fresh produce in Mexico, primarily tomatoes
and peppers, and, to a lesser extent, cucumbers, grapes and other fruits and
vegetables. Most of ABSA's farming operations are located in the Mexican states
of Sinaloa, Sonora and Baja California. Advanced technology is used to ensure
consistent quality and yields, including special hybrid varieties, integrated
pest management control, and computerized drip irrigation. ABSA's produce is
distributed in the United States, Mexico and Canada under the "Master's Touch"
and "Showcase" brands as well as other labels, depending on produce grades.

      ABSA's supply derives from (i) produce grown on land owned or leased by
ABSA, (ii) produce grown by producers with whom ABSA enters into a financing and
distribution contract and (iii) produce grown by producers with whom ABSA enters
into both a production association agreement and a distribution contract. When
ABSA enters into a financing and distribution contract only, it agrees to
provide the grower limited financial assistance for harvesting and/or packing in
exchange for exclusive distribution rights. When ABSA enters into a production
association agreement, ABSA finances up to 50% of the production cost in a
co-production contract with the grower. ABSA provides technical support and
agrees to handle the packing and distribution. Net proceeds are shared according
to the terms of the association agreement after ABSA recoups its investment.

      In 2003, approximately 43% of ABSA's supply came from land owned or leased
by ABSA. ABSA owns approximately 2,149 acres in Sinaloa, Sonora and Baja
California Sur, Michoacan and several other states in Mexico. ABSA leases
approximately 1,490 acres in Baja California Sur. During 2002, 34% of production
supplied by ABSA was sourced through production associations with growers and
through distribution contracts.

      The principle fresh produce sold by ABSA include vine sweet mini peppers
and other peppers, tomatoes, cucumbers, grapes and other vegetables. The
Company, in 2003 reflecting the difficult financial condition of its fresh
produce business significantly reduced its program of providing advances to
growers of produce for distribution by the Company, and most of Bionova's sales
are produce from fields it either owns or leases.

      Bionova's marketing and distribution activities are carried out by both
national and regional distributors. The Company's national distributors in the
United States are Bionova Produce, Inc., R.B. Packing of California, Inc. and
Bionova Produce of Texas, Inc., each of which is a wholly-owned subsidiary of
IPHC, and are referred to collectively as "Bionova Produce." The Company's
regional distributors are Premier Fruits and Vegetables BBL, Inc. in Montreal,
Quebec ("Premier") and Premier Fruits and Vegetables (USA), Inc. in
Philadelphia, Pennsylvania.

      National Distributors

      Bionova Produce, Inc., Bionova Produce of Texas, Inc. and R.B. Packing of
California, Inc. collectively had revenues of $29.6 million in 2003. The
majority of these sales were made by Bionova Produce, Inc., which is located in
Nogales, Arizona, a major point of entry for Mexican produce into the United
States, and the majority of the produce distributed by Bionova Produce, Inc. is
provided by ABSA (including produce grown by ABSA and produce grown by growers
with whom ABSA enters into production association contracts). Costco Wholesale
accounted for more than 35% of Bionova Produce,


                                       17
<PAGE>
Inc.'s sales in 2002. In 2003, Bionova Produce, Inc.'s sales were 58% to
supermarkets, 25% to wholesalers and 14% to brokers and 3% to others. Its main
selling season is December through May.

      R.B. Packing of California, Inc. is located in San Diego, California and
the majority of the produce it distributes is grown in California and the
Mexican states of Baja California and Baja California Sur. In 2003, its sales
were 48% to supermarkets, 37% to wholesalers, and 7% to brokers and 8% to
others. Its main selling season is July through November. Bionova Produce of
Texas, Inc. is a distributor located in McAllen, Texas that distributes produce
grown in Mexico and currently is concentrating on the importation and
distribution of papaya, melons and hothouse tomatoes.

      Regional Distributors

      Premier Fruits & Vegetables BBL, Inc. is an 80%-owned subsidiary of IPHC,
had revenues of $61.8 million in 2003. Premier distributes produce throughout
eastern Canada, and its sales were approximately 64% to supermarkets and 36% to
independent retailers, wholesalers and brokers in 2003.

      Premier Fruits and Vegetables (USA), Inc., an 80%-owned subsidiary of
IPHC, was formed in February, 2000 to market tomatoes and other vegetables,
including the Company's branded line of cherry tomatoes and peppers, in the
eastern United States. Premier Fruits and Vegetables (USA), Inc. sources its
products through and operates under the direction of Premier in Canada.

PROPRIETARY PROTECTION

      The Company uses trade secret protection for certain of IPHC's
distribution companies which market produce under the Master's Touch and
Showcase brand names. ABSA and Bionova Produce, Inc. have registered the
Master's Touch name as a trademark in Mexico and the United States,
respectively. Bionova Mexico has registered the Master's Touch name as a
trademark in the Benelux countries, the European Union, Canada, Hong Kong,
Indonesia, South Korea, Japan, Sweden and the United Kingdom.

      DNAP holds a U.S. patent and patents in a number of foreign countries on
its vine sweet mini pepper. In 2002 DNAP extended to Seminis a non-exclusive
license to produce on a worldwide basis, and an exclusive license to sell the
vine sweet mini pepper in Europe and Asia.

COMPETITION

      Though the fresh produce industry in general, and the tomato industry in
particular, are characterized by numerous competitors and low barriers to entry
at the production level, Bionova believes that a small group of participants
distributes a substantial portion of the tomatoes sold in the United States. In
the United States, Bionova competes directly with the larger tomato and pepper
growers in Florida during the winter, and in California in the summer and fall.
Both the Mexican and the tomato industries are characterized by numerous
competitors. Major Florida growers include Six L's, DiMare, Pacific Tomatoes
Growers and NTGargiulo. The major growers in California include DiMare,
NTGargiulo, Live Oak, Pacific Tomatoes Growers, Ocean Side, Giumarra Brothers,
and Central Tomato.

EMPLOYEES

      Bionova and its subsidiaries have a total of 2,450 employees.

      Other than approximately 30 full-time employees or ABSA, all of its other
services are performed by temporary workers, most of whom are hired during the
harvesting season January - April.


                                       18
<PAGE>
REAL ESTATE BUSINESS

OMEGA

Raw Land Development

      Omega is a wholly owned subsidiary of Savia. Omega is involved in the
development of real estate in the metropolitan area of Monterrey Nuevo Leon,
Mexico. Omega's business consists of buying raw land and developing the land (by
constructing roads, installing water, gas and other utilities) and selling the
developed lots to customers for construction of residential homes.

      In 1992, Omega acquired 820.5 hectares of land in an attractively situated
suburban area of Monterrey ("Sierra Alta Property") which the Company believes
will likely be an area for future expansion of Monterrey. Omega intends to
develop this property for residential housing and community services over a
period of five years, and therefore, annual capital expenditures related to the
property are not expected to be material. Commencing in 2000, Omega began
selling lots in this development and has sold 336 developed lots through
December 31, 2003. Currently Omega is in the third stage of developing the
Sierra Alta Property, which consists of an area of 32 hectares.

      Omega has been developing other properties in Monterrey which enabled the
Company to gain prominence as a successful real estate developer. In 1997, Omega
developed 350 lots for low income housing; in 1998, Omega developed 59 lots for
middle income housing; and in 1999, Omega completed a parcel of 42 lots and a
parcel of 37 lots in Rincon del Country.

      The Company believes that the retail price of new construction of
residential homes is significantly greater than prices in the resale home
market.

MEXICAN GOVERNMENTAL AND ECONOMIC FACTORS

LONG-TERM PERSPECTIVE

      In the past 20 years, the Mexican economy has undergone a significant
structural transformation. The Mexican economy has been transformed from one of
the most closed economies in the world to one of the most opened. In order to
achieve this change, the government has followed two clearly defined approaches:
stable management of economic policy and some structural reforms. This reform
includes an aggressive deregulation program that has reduced the role of the
public sector in the Mexican economy and entering into free trade agreements
with several nations.

      Additionally, Mexican authorities have applied fiscal and monetary
policies in order to assure macroeconomic stability. During President Zedillo's
administration, policy-maker's efforts were successful in securing a prompt
recovery of the Mexican economy after the 1995 financial crisis, and in
distinguishing Mexico from other emerging markets as one of the most open
economies. Transition to President Fox's administration happened without
major economic adjustments and economic stability has been reinforced. Till
date, the most important goal of the Federal Government has been to strengthen
the Mexican economy, in order to avoid any economic crisis and to achieve a
marked improvement in the standard of living of the Mexican population. The
Mexican Government's commitment to strict fiscal and monetary policies continues
to play an important role in the NAFTA capital inflows and direct foreign
investment.


                                       19
<PAGE>
ECONOMIC POLICY

      The Mexican Government has pursued the goals of balancing the budget and
gradually reducing public debt as a percentage of Gross Domestic Product
("GDP"). The intent has been to avoid making the public sector a source of net
demand on the financial system, and for monetary policy to assume the monitoring
of inflation as its primary goal.

      After a moderate recession - relative to past economic slowdowns in the
Mexican Economy, the Mexican economy began to show signs of recovery in 2003.
The GDP grew 0.9% in 2002 and 2.2% in 2003. Inflation converged successfully to
the Central Bank's inflation target of 3% (+/- 1pp) reaching 3.98% in 2003. The
exchange rate depreciated moderately, 8% in 2003, to close the year in 11.26
pesos per dollar. Interest rates decreased considerably and began to stabilize
at historic lows close to 4% (28 day Cetes).

I. PUBLIC FINANCES

      In the public finances front, the Government's approach has been to
contain growth in programmable budget spending, cut back on subsidies and
strictly control public spending, while reducing the proportion of funds devoted
to servicing public debt. As a result of these efforts, programmable spending
has remained at approximately 16.1% of GDP from 1995 to date. Interest expense
dropped from 4.6% of GDP in 1999 to 2.8% in 2003. As a result, more funds were
made available for education, health programs and fighting poverty.

      The Mexican government has worked to widen its revenue sources by
expanding the taxpayer base through the strict enforcement of tax laws and the
aggressive pursuit of tax evaders. Another key part of its strategy was the
semi-privatization of many state-owned and operated firms. Additionally, prices
and fees for public services were set so as to avoid a drain on public revenues.
The overall net effect of these policies has been a rise in public revenues to
23.7% of GDP in 2003.

      As a result of all these policies, from 1995 to 2003, the fiscal deficit
has averaged 0.8% of GDP. A balanced fiscal budget is clearly reflected in a net
reduction in public debt that has had a positive impact for the entire economy.
In 1995, public debt was 36.6% of GDP, which was comprised of domestic debt of
0.2% and external debt of 38.1%. In 2003, total public debt declined to 23.1% of
GDP, of which 10.6% is domestic and 12.5% is foreign.

II. MONETARY POLICY

      The main goal of monetary policy has been to strengthen the autonomy of
the central bank so as to allow it to fulfill its constitutional mandate of
preserving stable inflation and foreign exchange rates. To achieve this goal,
the central bank has committed itself to respecting the established limits on
the growth of domestic credit that are set each year and rigorously apportioned
to the amount of currency in circulation. At the same time, the central bank has
reserved the right to adjust its monetary policy should events take place that
affect inflationary expectations.

      At the beginning of 2003, Banco de Mexico released its Monetary Program
covering three main areas: (1) the basic operational rule of not generating
either an excess or a shortage of liquidity in the money market; (2) Banco de
Mexico's power to modify its monetary policy stance in the face of any event
that could put the attainment of inflation objectives at risk; and (3) a greater
effort to communicate with economic agents.


                                       20
<PAGE>
      In addition, Banco de Mexico has implemented a tightening monetary
mechanism known as "shorting" the banking system. This mechanism involves
running the banking system on a cumulative negative balance, which sent a signal
to the markets that interest rates should be raised. The restrictive signal in
monetary policy was an important element that allowed inflation to be only 3.98%
at the end of 2003.

      Finally, regarding the foreign-exchange policy, since March 1995, Banco de
Mexico has adopted a flexible exchange-rate system that allows it greater
control over its monetary policy so as to avoid a possible plunge in
international reserves when pressure is placed on Mexican currency. After a
4-year period of stability the peso depreciated 14% in 2002 and 8% in 2003,
mainly due to external risks that increased dollar demand. It is important to
mention that Banco de Mexico's medium term inflation goal is to attain an
inflation rate similar to the rates observed in the Mexico's main trading
partners economies.

III. STRUCTURAL CHANGE

      The second approach that the Mexican government has taken to bolster the
economy over the long-term has been structural change. The Mexican economy has
evolved from being one of the most closed economies in the world to one of the
most open. The main difference between Mexico and other emerging markets is that
Mexico is part of NAFTA, a free trade agreement with the United States and
Canada. Since 1994, NAFTA has brought many benefits to the Mexican economy. For
example, it allowed for unprecedented growth in manufacturing exports, from
$41.69 billion in 1993 to $142 billion in 2003, which represented 88.4% of the
country's global exports. Moreover, Mexico has moved ahead of Japan as the
United States trading partner. In 2003, Mexican goods accounted for 11.2% of
total U.S. imports. NAFTA has given Mexican products guaranteed access to the
U.S. market. For example, despite currency devaluations among what are called
"Asian Tigers" and the Euro Zone, Mexican exports to the U.S. have been on the
rise. Since the enactment of NAFTA, Mexico has amassed a $136.6 billion trade
surplus with the U.S.

      Another positive aspect of NAFTA is that it has encouraged foreign direct
investment in Mexico. Before NAFTA, Mexico received an average of $4.5 billion
per year in foreign direct investment. After NAFTA took effect, foreign direct
investment averaged an annual $14.1 billion. In 2003, foreign direct investment
totaled $10.7 billion. Foreign investment was the equivalent of 116% of the
current account deficit, reducing the vulnerability in the balance of payments.

      However, Mexico has not limited its global economic and trade strategies
to NAFTA. It is continually seeking to diversify its foreign trade by pursuing
free trade agreements with the European Union, Israel , Japan and Central and
South America.

      Another key structural measure that has been adopted is the privatization
of government owned and operated industries. This process began during the
previous presidential administration and has continued under the current
administration. Some of the sectors that have been privatized include the
railways, airports, and local telephone service. In addition, the administration
of President Vicente Fox has sought Congressional support for privatizing the
petrochemical industry.

      Reform of the Mexican pension system is an additional structural change
that the Mexican Economy is currently seeking. The government is focusing its
efforts in this area to increase the level of domestic savings, so as to ensure
a dignified standard of living for retired Mexican workers and to increase the
amount of long-term resources that can be channeled to the private sector. In
2003,


                                       21
<PAGE>
31.4 million workers were registered in the Mexican pension system, contributing
$34.9 billion that represented 5.8% of GDP.

      Finally, to prevent the effects of adverse economic conditions from being
magnified through the nation's banking system and threatening the Mexican
economy, a sweeping reform of the banking sector has taken place. In this
regard, the government has focused its efforts on protecting depositors'
savings, looking for ways to encourage bank capitalization, and relaxing laws to
allow Mexican banks to merge with foreign-owned banks. In addition, the
government is in the process of implementing programs to recover the assets
transferred to the Federal Savings Protection Funds ("IPAB") by banks as part of
their capitalization programs to reduce fiscal costs of the banking system to
benefit other sectors of the Mexican economy. In addition, regulatory
authorities imposed new capitalization rules to the banking system, with the
purpose of raising capitalization and accounting standards to international
levels. These rules started to prevail in 2003.

      After the financial crisis that afflicted the Mexican banking system in
the past few years, at this time the Mexican banking system has increased its
operating efficiency and has a higher quality of capital and assets. For these
reasons foreign banks increased their participation in the Mexican financial
system. In 2000, Spanish banks Banco Bilbao Vizcaya Argentaria and Banco
Santander Central Hispano purchased a majority stockholder position in Bancomer
and Serfin, the second and third largest banks in Mexico, respectively. In 2001,
Citigroup acquired all of the outstanding shares of Banamex and Bank of Nova
Scotia acquired a majority stockholder position in Inverlat. In November 2002
the British group HSBC purchased a 97% stockholder position in GFBital and at
the end of the year Bank of America purchased a 25% stake of shares of Santander
Mexicano. During 2003, Scotiabank purchased the final government stake in
Scotiabank Inverlat reaching a complete control of the group. As of September
2003, some Mexican shareholders of GFBancomer sold their position to BBVA and
the group announced its intention to acquire full ownership of GFB.

      At the end of 2003 the banking system past-due/total loans ratio was only
3.15%, the provision reserves to past-due/loans ratio increased from 123.5% in
2001 to 167.11% and the net capitalization ratio (net capital/assets under
market and credit risk) for the system was 14.2%.

      In summary, the combined application of prudent and sound economic
policies and ongoing structural reform are the main reasons for Mexico's
impressive recovery from the serious economic crisis that hit the country in
1995. Today, the outlook for the Mexican economy is very different from the one
that prevailed nine years ago. Led by the export sector, which has been joined
more recently by domestic industries, economic activity has made a remarkable
comeback. A total of $125.2 billion of foreign direct investment has flowed into
to the economy since 1995, and private investment now represents 19% of GDP.

RECENT EVENTS

      The fall registered by annual inflation in March 2004 put a break to the
deterioration in private analysts expectations for inflation for this year.
Nevertheless, whether or not the Central Bank's target of 3.0% (+/-1 pp) will be
achieved is still in doubt, as several risks remain, that could again cause
prices to bring about a rebound in inflation, especially during the summer
months.

      In the domestic financial markets, since March 2004, interest rates and
the exchange rate have been strongly influenced by the concerns regarding the
future FED monetary policy stance. Interest rates in Mexico have increased,
particularly long-run rates. While decreasing inflation has been a key element


                                       22
<PAGE>
in the past few years' decrease in interest rates, in the medium term, the
international yields' dynamics will be an important determinant of their
performance.

      The public finances registered positive results during the first months of
2004. The main factors contributing to the better position of the public
finances are non-oil revenues -which is responding gradually to the recovery of
the economy, high oil prices and the reduction in financial costs.

      In the early months of the year the economic recovery was consolidated,
the internal market (consumption and investment) has registered better dynamics
and it is supported mainly by the recovery in manufacturing exports, which have
responded favorably to the rebound in the U.S. market.

I. OUTLOOK

      The consensus estimate, among private sector analysts, for GDP growth in
2004 is 3.75%, above the 2.2% GDP growth in 2003 and the 0.9% rate in 2002.
Inflation is expected to continue to ease and finish 2004 at 4.0%, at the high
end of the target range provided by Banco de Mexico for the year. Experts tend
to concur that the Mexican economy is showing clear signs of a recovery, which
began in the second half of 2003, largely powered by the revived demand for
Mexican exports implied by the increasing dynamics of the U.S. economy, and the
likelihood of a fast-paced recovery in domestic spending.

II. PESO PERFORMANCE

      During 1999, 2000 and 2001, the peso strengthened against the dollar.
During 2002, however, the peso depreciated 13.0% due to the weakness of the
economy in the region. This depreciation continued, dipping an additional 9%
during the first months of 2003 as a result of the geopolitical risk of the war
in Iraq. Nevertheless, once this uncertainty factor waned and the Banco de
Mexico announced a program to sell international reserves, the peso rebounded to
its December 2002 value. In 2004, the expectation of an increase in the
international interest rates has put some pressure on the exchange rate. In May
it reached a maximum of 11.68. Although the long term upward trend, the good
balance in Mexico's external accounts, the important dollar oil revenues and the
high levels of remittances from Mexican workers abroad are some of the sources
of dollars into the country that sustain the parity stability.

III. INFLATION

      Beginning in December 1994, Mexico experienced an economic crisis
characterized by exchange rate instability and devaluation of the peso, high
inflation, high domestic interest rates, negative economic growth, reduced
consumer purchasing power and high unemployment. The economic crisis resulted in
part from a series of internal disruptions and political events that undermined
the confidence of investors in Mexico.

      These adverse conditions also resulted in an increase in the annual rate
of inflation from 7.1% in December 1994 to 52% in December 1995. Economic
conditions in Mexico improved after 1995. The inflation rate fell to 27.7% in
1996, 15.7% in 1997, 18.6% in 1998 and 12.3% in 1999. As of December 2000, the
rate of inflation was only 9.0%. During 2001, the inflation rate was 4.4%,
falling far from the official target of 6.5%. This was the result of the
relative stability of the Mexican currency and the first episodic bouts of
declining prices Mexico has seen in many years. In 2003, the annual inflation
was 3.98%. That year, the prices of public goods increased according to the
Ministry of Finance compromise not to raise the above 2.7%. Additionally,
orderly decreasing salaries contributed to pin down services inflation.


                                       23
<PAGE>
C. ORGANIZATIONAL STRUCTURE

      Savia is a holding company and operates through its subsidiaries. Savia's
principal subsidiaries are Bionova and Omega, and since March 2004, both are
wholly owned subsidiaries of the Company. Bionova is a privately owned U.S.
company with significant subsidiaries in Mexico. Omega is a Mexican company that
operates solely in Mexico.

D. PROPERTY, PLANT AND EQUIPMENT

      The Company's principal office is located at Rio Sena 500 Pte., Colonia
del Valle, San Pedro Garza Garcia, N.L., C.P. 66220, Mexico, and its telephone
number is (52-81) 8173-5500.

BIONOVA

      Bionova's subsidiary, ABSA, owns approximately 1,573 acres of agricultural
land in Sinaloa, Sonora, Michoacan, Baja California Sur and several other states
in Mexico. ABSA leases approximately 123 acres of land in Baja California.

      Bionova Produce, Inc. owns warehouse and office space in Nogales, Arizona.
The other subsidiaries of IPHC lease office and warehouse space.

OMEGA

      Omega owns a parcel of undeveloped land of approximately 708 hectares in
the metropolitan area of Monterrey, Mexico.

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

      The following discussion should be read in conjunction with, and is
qualified in its entirety by reference to, the Company's Consolidated Financial
Statements , and notes thereto, included elsewhere herein. The Company's
financial statements have been prepared in accordance with Mexican GAAP, which
differs in certain significant respects from U.S. GAAP. Note 16 to the
Consolidated Financial Statements provides a description of the principal
differences between Mexican GAAP and U.S. GAAP as they relate to the Company and
a reconciliation to U.S. GAAP of net income (loss) and stockholders equity.
Under Statement B-10, financial data for all periods in such financial
statements have been restated in constant pesos as of December 31, 2003. In
2001, the Company sold SCA and its packaging businesses and in September 2003
sold its interest in Seminis. In accordance with Mexican and U.S. GAAP the net
assets and results of operations of these business are included in the Company's
financial statements and are restated to reflect the net assets and results of
operations of these sold businesses as discontinued operations.

A. SAVIA RESULTS OF OPERATIONS

      The Company's two principal segments are fresh produce and real estate.
The discussion is based upon financial information prepared in accordance with
Mexican GAAP.

      The Company is engaged in the fresh produce business through Bionova, and
in the real estate business through Omega. Bionova is a U.S. company, and most
of its sales are in the United States and Canada, and therefore most of its
revenues are denominated in U.S. dollars. Omega is a Mexican company that
operates solely in Mexico, and all of its revenues are denominated in pesos.


                                       24
<PAGE>
      Mexican inflation accounting requires, among other matters, determination
of comprehensive financing (cost) income, which is composed of interest expense,
interest income, foreign exchange gains or losses and monetary position gain or
loss. The monetary position gain or loss account is used to reflect the effect
of inflation on a company's monetary assets and liabilities. By determining a
company's net monetary position (monetary assets minus monetary liabilities) and
applying inflation index for the period under consideration, the impact of
inflation on a company's balance sheet may be quantified. Thus, if monetary
liabilities are larger than monetary assets, the company will recognize a gain
from inflation as its liabilities will be worth less upon repayment due to the
reduced value of the currency from inflation. If monetary assets exceed monetary
liabilities, on the other hand, the company will recognize a loss as its
monetary assets will be worth less in terms of purchasing power.

      The dollar amounts contained in the following discussions have been
provided for convenience purposes only. Figures in pesos for 2003, 2002 and 2001
are translated at an exchange rate of Ps. 11.1998 to $1.00, the effective
exchange rate at the end of December 31, 2003, as published by Banco de Mexico.

      The following tables set forth selected income statement data (millions of
constant December 31, 2003 pesos) for the three years ended December 31, 2001,
2002 and 2003, expressed as a percentage of net sales and for the segments of
the Company's businesses:

<TABLE>
<CAPTION>
                                                                FOR THE YEAR ENDED DECEMBER 31,
                                        -----------------------------------------------------------------------------
                                               2001                        2002                          2003
                                        ------------------         --------------------         ---------------------
INCOME STATEMENT DATA                    PS.           %            PS.             %            PS.              %
                                        -----        -----         -----          -----         -----           -----
<S>                                     <C>          <C>           <C>            <C>           <C>             <C>
MEXICAN GAAP :
     Net Sales (1)                      2,919        100.0%        2,024          100.0%        1,459           100.0%
     Cost of Sales                      2,440         83.6%        1,694           83.7%        1,221            83.7%
     Gross Profit                         479         16.4%%         330           16.3%          238            16.3%
     Operating Expenses                   991         33.9%          641           31.7%          463            31.7%
     Operating Income (loss) (1)         (512)       (17.5)%        (311)         (15.4)%        (225)          (15.4)%
</TABLE>

<TABLE>
<CAPTION>
                                                             FOR THE YEAR ENDED DECEMBER 31,
                        ---------------------------------------------------------------------------------------------------------
                                         2001                              2002                             2003
                        ---------------------------------- ---------------------------------- -----------------------------------
                         FRESH        REAL      OTHER       FRESH        REAL      OTHER      FRESH        REAL        OTHER
                        PRODUCE      ESTATE  BUSINESSES(2) PRODUCE      ESTATE  BUSINESSES(2) PRODUCE      ESTATE   BUSINESSES(2)
                        -------      ------  ------------- -------      ------  ------------- -------      ------   -------------
<S>                     <C>          <C>     <C>           <C>          <C>     <C>           <C>          <C>      <C>
SEGMENT DATA (1)
Net Sales(1)             2,422         186        311       1,511         205        308       1,113         181        165
Operating Income
  (loss) (1)               (94)         47       (465)       (105)          8       (214)        (71)         23       (177)
</TABLE>

----------
(1)   Does not include operating results of SCA, packaging businesses and
      Seminis, which are treated for accounting as discontinued operations.

(2)   Includes Agromod, a direct subsidiary of Savia, an agricultural company
      engaged in the business of growing papaya and other agricultural products
      in Southern Mexico, which is presented as "Other Agrobusinesses" in the
      Company's Consolidated Financial Statements. (See Note 12 to the Company's
      Consolidated Financial Statements.)


                                       25
<PAGE>
YEAR ENDED DECEMBER 31, 2003 COMPARED TO DECEMBER 31, 2002

      NET SALES

      Net sales decreased 28.0% from Ps. 2,024 million ($181 million) in 2002 to
Ps. 1,459 million ($130 million) in 2003. Total revenues denominated in
currencies other than pesos in 2003 were approximately 77% of net sales, or $100
million, compared to 75% of net sales, or $136 million, in 2002. The fresh
produce business and real estate business accounted for 76%, and 12%,
respectively, of net sales in 2003 as compared to 75% and 10%, respectively, in
2002.

      Net sales of fresh produce decreased 26% from Ps. 1,511 million ($135
million) in 2002 to Ps. 1,113 million ($99 million) in 2003. The decline in
revenue reflects the closing by Bionova of its business in Obregon Sonora in
early 2003 and bad weather conditions which generally reduced crop yields in its
farming areas.

      Net sales of Omega decreased by 11% from Ps. 205 million ($18 million) in
2002 to Ps. 181 million ($16 million) in 2003, generally reflecting a decline in
the price of middle and low income real estate market in Monterrey, resulting
from the generally weaker economy in Mexico.

      COST OF SALES

      Cost of sales for 2003 decreased 28% from Ps. 1,694 million ($151 million)
in 2002 to Ps. 1,221 million ($109 million) in 2003. The fresh produce business
and the real estate business accounted for 85% and 8%, respectively, of cost of
sales in 2002, and 82% and 8%, respectively, in 2003.

      Bionova decreased its cost of sales by 30% from Ps. 1,436 million ($128
million) in 2002 to Ps. 1,007 million ($90 million) in 2003, mainly due to the
efficiencies resulting from the consolidation of its distribution facilities.

      Omega decreased its cost of sales by 26%, reflecting the lower level of
net sales of the business, as well as a reduction of administrative expenses.

      GROSS PROFIT

      The Company's gross profit decreased by 28% in 2003 to Ps. 238 million
($21 million) from Ps. 330 million ($29 million) in 2002, as a result of a
significant decrease of the gross profit of the Company's Other Businesses. The
Company incurred significant corporate overhead expenses and professional fees
in 2003 in connection with the sale of Seminis and completion of its debt
restructuring program, which are included in "Other Businesses".

      Gross profit of fresh produce increased 42% from Ps. 75 million ($7
million) in 2002 to Ps. 106 million ($10 million) in 2003, generally reflecting
the significant decline in cost of sales as a percentage of net sales as
compared to the prior year.

      Gross profit of real estate increased 18% from Ps. 69 million ($6 million)
in 2002 to Ps. 81 million ($7 million) in 2003, generally reflecting the
significant decline in cost of sales as a percentage of net sales as compared to
the prior year.


                                       26
<PAGE>
      OPERATING EXPENSES

      Operating expenses decreased by 28% from Ps. 641 million ($57 million) in
2002 to Ps. 463 million ($41 million) in 2003. Operating expenses of fresh
produce decreased slightly by 1% from Ps. 180 million ($16 million) in 2002 to
Ps. 178 million ($16 million) in 2003 and operating expenses of real estate also
decreased slightly by 4% from Ps. 60 million ($5 million) in 2002 to Ps. 58
million ($5 million) in 2003. The decreases in operating expenses of the Company
are a result of the simplification of the Company's corporate structure and the
sale of businesses in 2002 that were included in the Other Businesses'
operations of the Company.

      OPERATING INCOME (LOSS)

      Operating loss decreased 28% from Ps. 311 million ($28 million) in 2002 to
Ps. 224 million ($20 million) in 2003. Fresh produce losses decreased from Ps.
105 million ($9 million) in 2002 to Ps. 71 million ($6 million) in 2003.
Operating income of real estate increased from Ps. 8 million ($1 million) in
2002 to Ps. 23 million ($2 million) in 2003. The improvement in operating income
(loss) reflected improvement in the Company's gross profit as compared to the
previous year.

      COMPREHENSIVE FINANCIAL INCOME (COST) AND OTHER

      The Company's net comprehensive financing income decreased from Ps. 184
million ($16 million) in 2002 to Ps. 166 million ($15 million) in 2003. The
total debt of the Company decreased from $90 million in 2002 to $4 million in
2003 resulting in a 49% decrease in financial expenses, from Ps. 46 million ($4
million) in 2002 to Ps. 23 million ($2 million) in 2003. Financial income
increased 1.4% from Ps. 68 million ($6 million) in 2002 to Ps. 69 million ($6
million) in 2003. In 2003, the Company's monetary assets exceeded monetary
liabilities resulting in a loss in monetary position of Ps. 10 million ($1
million) compared to a loss in monetary position of Ps. 54 million ($5 million)
in 2002.

      Other income net in 2003 was Ps. 230 million ($21 million) compared to
other expenses net of Ps. 1,499 million ($134 million) in 2002. In 2003, the
Company recovered doubtful accounts for Ps. 180 million and obtained a gain in
sale of subsidiaries for Ps. 64 million.

      PROVISION FOR INCOME TAX AND EMPLOYEES' PROFIT SHARING

      The Company incurred a net income tax liability of Ps. 369 million ($33
million) in 2003 compared to Ps. 65 million ($6 million) in 2002. The deferred
income tax liability of the Company increased from Ps. 47 million ($4 million)
in 2002 to Ps. 343 million ($31 million) in 2003. The increase was mainly due to
reduction in the value of tax loss carry-forwards that resulted in a deferred
income tax charge. The current income tax liability increased from Ps. 18
million ($2 million) in 2002 to Ps. 26 million ($2 million) in 2003.

      LOSS FROM CONTINUING OPERATIONS

      Loss from continuing operations decreased from Ps. 1,691 million ($151
million) in 2002 to Ps. 198 million ($18 million) in 2003, due to the changes in
the Company's result of operations discussed above.


                                       27
<PAGE>
      DISCONTINUED OPERATIONS

      Loss from discontinued operations was Ps. 2,355 million ($210 million) in
2003, compared to an income of Ps. 951 million ($85 million) in 2002. During
2003, the Company recognized a loss from the sale of Seminis of Ps. 1,889
million ($169 million) and a net loss from discontinued operations (including
Seminis operations for the first nine months of 2003) of Ps. 466 million ($42
million).

      NET LOSS

      Net loss before minority interest was Ps. 2,553 million ($228 million) in
2003 as compared to a loss of Ps. 740 million ($66 million) in 2002. Minority
interest in earnings of subsidiaries changed from an income of Ps. 66 million
($6 million) in 2002 to a loss of Ps. 191 million ($17 million) in 2003.

YEAR ENDED DECEMBER 31, 2002 COMPARED TO DECEMBER 31, 2001

      NET SALES

      Net sales decreased 31.0% from Ps. 2,919 million ($261 million) in 2001 to
Ps. 2,024 million ($181 million) in 2002. Total revenues denominated in
currencies other than pesos in 2002 were approximately 75% of net sales, or,
$136 million, compared to 83% of net sales, or, $218 million in 2001. The fresh
produce businesses and real estate business accounted for 75% and 10%,
respectively, of net sales in 2002 as compared to 83% and 6%, respectively, in
2002.

      Net sales of fresh produce decreased 38% from Ps. 2,422 million ($216
million) in 2001 to Ps. 1,511 million ($135 million) in 2002. The revenue
decline was a consequence of the sale of Interfruver, in November 2001, which
sold $82 million for the ten months that it was a part of Bionova in 2001 and to
a significant reduction in both unit volume of sales and an average decline of
6.3% of prices.

      Net sales of real estate increased from Ps. 186 million ($17 million) in
2001 to Ps. 205 million ($18 million) in 2002 generally reflecting higher prices
for residential real estate as well as increased level of sales, including sales
of the company acquired in 2003 engaged in construction of housing for low
income people.

      COST OF SALES

      Cost of sales for 2002 decreased 31% from Ps. 2,440 million ($218 million)
to Ps. 1,694 million ($151 million) in 2001. The fresh produce business and the
real estate business accounted for 88% and 4%, respectively, of cost of sales in
2001 as compared to 85% and 8%, respectively, in 2002.

      Fresh produce decreased its cost of sales by 33% from Ps. 2,150 million
($192 million) in 2001 to Ps. 1,436 million ($128 million) in 2002, primarily
due to the lower level of operations reflecting the sale of Interfruver, as well
as the concentration of its growing program on vine sweet mini peppers and lower
levels of fresh produce harvested in 2002.

      Real estate increased its cost of sales by 29% from Ps. 106 million ($9
million) in 2001 to Ps. 136 million ($12 million) in 2002, reflecting the
acquisition of the lower income housing business.

      GROSS PROFIT

      The Company's gross profit decreased by 31% in 2002 to Ps. 330 million
($29 million) from Ps. 479 million ($43 million) in 2001.


                                       28
<PAGE>
      Gross profit of fresh produce decreased by 72% from Ps. 272 million ($24
million) in 2001 to Ps. 75 million ($7 million) in 2002 as a result of the
growing and selling of low yield fresh produce.

      Gross profit for real estate decreased 14% from Ps. 80 million ($7
million) in 2001 to Ps. 69 million ($6 million) in 2002, reflecting the
increased level of sales by the Company of lower income housing. Gross profit of
other business increased 48% from Ps. 126 million ($11 million) in 2001 to Ps.
186 million ($17 million) in 2002, reflecting nonrecurring payments for
financial and other professional services provided to other companies during
2002.

      OPERATING EXPENSES

      Operating expenses decreased by 35% from Ps. 991 million ($88 million) in
2001 to Ps. 641 million ($57 million) in 2002.

      Operating expenses of fresh produce decreased 51% from Ps. 366 million
($33 million) in 2001 to Ps. 180 million ($16 million) in 2002, mainly due to
the divestiture of Interfruver in 2001 and the closing of the research and
development businesses in June 2002.

      Real estate increased its operating expenses by 81% from Ps. 33 million
($3 million) in 2001 to Ps. 60 million ($5 million) in 2002, reflecting an
increase of the number of employees to support this business.

      OPERATING INCOME

      Operating loss decreased 39% from Ps. 512 million ($46 million) in 2001 to
Ps. 311 million ($28 million) in 2002. Fresh produce losses increased from Ps.
94 million ($8 million) in 2001 to Ps. 105 million ($9 million) in 2002.

      Operating income of real estate decreased from Ps. 47 million ($4 million)
in 2001 to Ps. 8 million ($1 million) in 2002. Operating loss of other
businesses decreased 54% from Ps. 464 million ($41 million) in 2001 to Ps. 214
million ($19 million) in 2002.

      SEVERANCE AND OTHER TERMINATION COSTS

      The Company recorded severance and termination costs for Ps. 272 million
($24 million) in 2001. This was mainly due to the reduction in staff of the
Company after the divestiture of SCA and the packaging businesses in 2001.

      COMPREHENSIVE FINANCIAL INCOME (COST) AND OTHER

      The Company's net comprehensive financing cost changed from Ps. 257
million ($23 million) in 2001 to an income of Ps. 184 million ($16 million) in
2002. The total debt of the Company increased slightly from $88 million in 2001
to $90 million in 2002; however, the 89% decrease in financial expenses, from
Ps. 415 million ($37 million) in 2001 to Ps. 46 million ($4 million) in 2002
resulted from the provision of interests paid during 2001 of the syndicated
credit for $500 million that the Company held with ING Bank and that was settled
in June 2001. Financial income decreased 59% from Ps. 168 million ($15 million)
in 2001 to Ps. 68 million ($6 million) in 2002 mainly due to a decrease of the
account receivables balance from related parties which were reserved in
September 2002. In 2002, the Company's monetary assets exceeded monetary
liabilities resulting in a loss in monetary position of Ps. 54 million ($5
million) compared to a gain in monetary position of Ps. 85 million ($8 million)
in 2001.


                                       29
<PAGE>
      Other expenses net in 2002 were Ps. 1,499 million ($134 million) compared
to Ps. 794 million ($71 million) in 2001. During 2002 the Company recorded
reserves for Ps. 1,486 million ($133 million) related to the divestiture of
Desarrollo Forestal ($39 million) and doubtful accounts with related parties
($94 million).

      PROVISION FOR INCOME TAX AND EMPLOYEES' PROFIT SHARING

      The Company incurred a net income tax liability of Ps. 65 million ($6
million) in 2002 compared to Ps. 130 million ($12 million) in 2001.

      The deferred income tax liability decreased from Ps. 76 million ($7
million) in 2001 to Ps. 47 million ($4 million) in 2002. The decrease was mainly
due to that during 2002, the Company recorded deferred tax related to net
operating loss carry forwards. The current income tax liability decreased from
Ps. 54 million ($5 million) in 2001 to Ps. 18 million ($2 million) in 2002.

      INCOME (LOSS) FROM CONTINUING OPERATIONS

      Losses from continuing operations decreased from Ps. 1,965 million ($175
million) in 2001 to Ps. 1,691 million ($151 million) in 2002, due to the reasons
set forth above.

      DISCONTINUED OPERATIONS

      Income from discontinued operations was Ps. 951 million ($85 million) in
2002, compared to a loss of Ps. 2,293 million ($205 million) in 2001. During
2002, the Company reversed an income tax liability provision recorded in 2001
related to the divestiture of Empaq's subsidiaries for Ps. 747 million and
recognized a net income in discontinuing operations, related to the divestiture
of Seminis' subsidiaries, for Ps. 204 million ($18 million).

      NET (LOSS) INCOME

      Consolidated loss before minority interest for the Company was Ps. 740
million ($66 million) in 2002 compared to a loss of Ps. 4,258 million ($380
million) in 2001. Minority interest in earnings of subsidiaries changed from a
loss of Ps. 1,081 million ($97 million) in 2001 to a profit of Ps. 66 million
($6 million) in 2002.

B. LIQUIDITY AND CAPITAL RESOURCES

      SAVIA LIQUIDITY AND CAPITAL RESOURCES

            Going Concern

      The financial statements included in this annual report have been prepared
assuming that the Company will continue as a going concern. However: (a) for the
year ended December 31, 2003, the Company incurred consolidated losses of Ps.
2,362 million (Ps. 806 million in 2002), (b) in September, 2003, the sale of
Seminis, a subsidiary that represented 70% of the consolidated assets and income
as of that date, was completed and (c) there is an impairment in cash flow
generation, which could eventually force the Company to liquidate the rest of
its assets. In addition, excluding Seminis, the Company incurred a loss from
continuing operations of Ps. 198 million in 2003 (Ps. 1,691 million in 2002).
These matters, among others, raise substantial doubts about the Company's
ability to continue as a going concern. The financial statements do not include
any adjustments related to the valuation and


                                       30
<PAGE>
classification of the assets and classification and amount of the liabilities
that might result from the outcome of these uncertainties.

            Bionova Liquidity

      Bionova has incurred significant losses from operations in every year of
its existence from 1996 through 2003. Over the past few years, Bionova has
provided funds for its operations from the sale of its assets. The Company is
reviewing the operations of its fresh produce business and is considering
transactions that would provide working capital to finance the continued
operations of the fresh produce business. There are no assurances that the
Company will be successful in completing a transaction to obtain financing for
the fresh produce business, and if the Company is unsuccessful in completing a
transaction prior to the end of this year it may not have sufficient working
capital to continue to conduct this business.

            Sources and Uses of Cash

      As of December 31, 2003, the Company had cash and temporary investments
totaling Ps. 165 million. The Company invests its cash balances primarily in
short-term instruments issued by major financial institutions.

      Net resources provided by operating activities were Ps. 283 million in
2003. Non-cash items reconciled to net income amounted to Ps. 79 in depreciation
and amortization and Ps. 343 million in deferred income taxes which were
slightly increased by Ps. 59 million in net resources provided by our working
capital. In 2003, we had (1) a decrease in accounts receivable and tax
recoverable of Ps. 148 million mainly due to efficiencies made in collecting
trade accounts receivables amounting to Ps. 100 million which were increased by
Ps. 48 million in asset tax recovered, (2) an increase in inventories of Ps. 8
million mainly due to the effect for holding of nonmonetary assets and (3) an
increase of Ps. 28 million in other assets mainly in prepaid expenses amounting
to Ps. 14 million, value added tax recoverable amounting to Ps. 11 million and
other assets for Ps. 3 million, (4) a net decrease in accounts receivable to
related parties and other accounts payable of Ps. 88, (5) an increase in other
accounts payable and accumulated expenses of Ps. 141 million.

      Net resources used in operating activities were Ps. (1,910) million in
2002. Non-cash items reconciled to net income amounted to Ps. 105 in
depreciation and amortization, Ps. 47 million in deferred income taxes and
cancellation of the investment in Desarrollo Forestal for Ps. 431 million which
partially offset the Ps. (802) million in net uses of our working capital. In
2002, we had (1) an increase in accounts receivable and tax recoverable of Ps.
96 million mainly due to increasses in trade accounts receivables amounting to
Ps. 29 million which were added to an amount of Ps. 67 million in increases of
asset tax recoverable, (2) an increase in inventories of Ps. 334 million mainly
due to the effect for holding of nonmonetary assets and (3) a decrease of Ps.
173 million in other assets mainly in prepaid expenses amounting to Ps. 97
million and assets held to be sold amounting to Ps. 44 million related to land
properties held to be sold in Bionova, (4) a net decrease in accounts receivable
to related parties and other accounts payable of Ps. 39, (5) a decrease in other
accounts payable and accumulated expenses of Ps. 584 million mainly due to
reverse an income tax liability provision recorded in 2001 related to the
packaging subsidiaries. The Company's packaging businesses.

      Net resources generated in investing activities were Ps. 3,775 million in
2003. Mainly due to the net proceeds for the sale of subsidiaries of Ps. 3,640
(see Note 3 of the Financial Statements); the Company also had a net decrease in
the sale of property, plant and equipment and intangible assets for Ps. 135
million.


                                       31



<PAGE>
      Net resources generated in investing activities were Ps. 689 million in
2002. The Company had a net increase in the sale of property, plan and equipment
and intangible assets for Ps. 3 million which were added with an increase of the
investment in discontinued operations, net of loss in discontinued operations
and goodwill of Ps. 692.

      Net resources used in financing activities were Ps. (3,950) million in
2003. For the year ended December 31, 2003, we paid mainly short-term syndicated
bank loans from Savia for Ps. 965 million and cash dividends of Ps. 2,774
million. The Company also had a decrease in other accounts receivable and long
term payable, net for Ps. 22 million; an increase of the reserve for repurchase
of own shares for Ps. 387 million; an increase in cumulative translation
adjustment for Ps. 466 million and the minority interest on continued operations
decreased Ps. 1,086 million.

      Net resources generated in financing activities were Ps. 1,150 million in
2002. For the year ended December 31, 2002, we had (1) an increase of long term
debt and other financings, net of long term notes receivables for Ps. 579 which
were integrated as follows: (a) collection of long term receivables with related
parties, belonging to Empaques, for Ps. 537, (b) increase of other long term
liabilities for Ps. 16 and (c) increase of short term bank debt in Savia due to
exchange rate effect of Ps. 56 and payment of short term revolving line of
credit in Bionova for Ps. 30; (2) an increase of other long term notes
receivable net of long term notes payable for Ps. 440 which correspond to the
collection of a long term note receivable with third party of Ps. 422, the
increase of income tax liability for Ps. 41 and the payment of seniority
premiums in Servasa of Ps. 23; (3) Minority interest on continued operations
increased to Ps. 185 million; and (4) we repurchased Ps. 54 million of owned
shares.

      Indebtedness

      As of December 31, 2003, our total debt was Ps. 48 million ($4.3 million),
consisting of Ps. 38 million ($3.4 million) in short-term debt, including the
current portion of long term-debt, and Ps. 10 million ($0.9 million) in
long-term debt.

      The following table sets forth the maturity profile of our indebtedness as
of December 31, 2003:

                                    BANK DEBT
                             AS OF DECEMBER 31, 2003

<TABLE>
<CAPTION>
            EXPECTED MATURITIES                                PS.
            -------------------                                ---
<S>                                                           <C>
                   2004                                        38
                   2005                                         4
                   2006                                         3
                   2007                                         2
            2008 and Thereafter                                 1
</TABLE>

      Repayment of Holding Company Indebtedness - Sale of Businesses

      On June 27, 2001, the Company successfully completed negotiations with its
creditors and entered into a Restructuring Agreement covering all of its
outstanding Holding Company (unconsolidated) indebtedness. The Company used the
available net proceeds from the sale of its interest


                                       32
<PAGE>
in SCA and the packaging businesses to repay approximately $300 million of this
indebtedness, and as of June 30, 2001, after giving effect to such repayment,
the Company (excluding the debt of Savia to Empaq, its subsidiaries, Seminis and
Bionova) had approximately $86 million of debt ("Restructured Debt").

      On May 20, 2003, Savia executed a Debt Settlement Agreement that (i)
extended the maturity date of the Restructured Debt until September 30, 2003,
(ii) provided for a fixed payment of $65.2 million as payment to the creditors
for the Restructured Debt and (iii) provided that the creditors waive certain
provisions of the Restructuring Agreement and other financing documents in order
to permit the contemplated sale of Seminis shares and other related
transactions. On September 29, 2003, the Company completed the sale of all of
its equity interest in Seminis for a purchase price of $266 million. Savia
retained approximately $15.0 million of the sale proceeds and paid a cash
dividend of $251.2 million, equivalent to $0.5338 per share. Simultaneously,
with the closing of the sale of Seminis, the Company completed the sale of 66
million shares of its common stock and a note receivable to an affiliate for
$50.2 million. The proceeds from these sale transactions, together with the
$15.0 million retained by Savia were used to pay the $65.2 million obligation
under the Restructured Debt Agreement. Finally, as part of the sale of its
interest in Seminis, Savia received $15 million as payment for accrued and
unpaid dividends on its equity interest in Seminis.

      Tax-Loss Carryforwards

      As of December 31, 2003, the Mexican subsidiaries of the company had
recorded tax-loss carryforwards of Ps 9,781 million and our foreign subsidiaries
had tax-loss carryforwards of Ps. 1,117 million ($99.7 million). The tax-loss
carryforwards of foreign subsidiaries can be used for tax purposes to offset its
future income and expire from 2004 through 2013. The tax-loss carryforwards of
the Mexican subsidiaries can be used for tax purposes to offset the future
income of the Mexican subsidiaries generating such tax-loss carryforwards. To
the extent that the Mexican tax-loss carryforwards cannot be used by the Mexican
subsidiaries, 60% of such tax-loss carryforwards can be used to offset the
company's future consolidated income. Based upon the operating losses the
Company has incurred over the past year, the Company does not recognize any
carrying value for its tax loss carryforwards on its financial statements.


                                       33
<PAGE>
            The tax-loss carryforwards of the Mexican subsidiaries expire as set
forth in the table below:

<TABLE>
<CAPTION>
  YEAR OF                               AMOUNT
EXPIRATION            (MILLIONS OF CONSTANT DEC. 31, 2003 PESOS)
----------            ------------------------------------------
<S>                   <C>
2009&2010                             Ps.   813
  2011                                    1,355
  2012                                    2,279
  2013                                    5,334
  ----                                    -----
  Total                               Ps. 9,781
</TABLE>

      Capital Expenditures

      The following table sets forth our capital expenditures for the periods
indicated:

<TABLE>
<CAPTION>
YEARS ENDED                                 CAPITAL EXPENDITURES
DECEMBER 31,                      (MILLIONS OF CONSTANT DEC. 31, 2003 PESOS)
------------                      ------------------------------------------
<S>                               <C>
   2001                                                82.4
   2002                                                45.1
   2003                                                19.6
</TABLE>

      In 2001, major investments were made by Bionova including the
reconstruction of a packaging shed in Mexico that was damaged by fire, the
acquisition and installation of a fully automatic, tomato sorting and packaging
line, and the purchase of land in Guerrero, Mexico. In addition, Omega invested
in the development of the project "Sierra Alta".

      In 2002, our capital expenditures related primarily to investments made by
Omega regarding the purchase of one floor in the Building Plaza Empresarial
Monterrey and by Bionova related to the acquisition of green houses, a packaging
line and a watering system.

      In 2003, our capital expenditures were minimal and come mainly from
Bionova regarding the purchase of machinery and equipment and computer
equipment.

      Critical Accounting Policies

      We have identified the policies below as critical to our business
operations and the understanding of our results of operations. The impact and
any associated risks related to these policies on our business operations is
discussed throughout "Item 5. Operating and Financial Review and Prospects"
where such policies affect our reported and expected financial results. For a
detailed discussion of the application of these and other accounting policies,
see Note 2 to the Consolidated Financial Statements. Note that our preparation
of consolidated financial statements requires us to make estimates and
assumptions that affect the reported amount of assets and liabilities,
disclosure of contingent assets and liabilities at the date of our financial
statements, and the reported amounts of revenue and expenses during the
reporting period. There can be no assurance that actual results will not differ
from those estimates.

      We believe that the following critical accounting policies, among others,
involve the more significant judgments and estimates used in the preparation of
our consolidated financial statements.


                                       34
<PAGE>
      We maintain allowances for doubtful accounts for estimated losses
resulting from the inability of our customers to make required payments. Many of
our customers are located in foreign jurisdictions where payment terms and the
timing of collections can differ from domestic transactions. If the financial
condition of our customers were to deteriorate, resulting in an impairment of
their ability to make payments, additional allowances may be required.

      In assessing the recoverability of our goodwill and long-lived assets,
significant assumptions regarding the estimated future cash flows and other
factors to determine the fair value of the respective assets must be made as
well as the related estimated useful lives. If these estimates or their related
assumptions change in the future as a result of changes in strategy and/or
market conditions, we may be required to record impairment charges for these
assets not previously recorded.

      Revenue from fresh produce sales is recognized when the product is
shipped, net of an allowance for estimated returns. Cost is determined by using
the first-in, first-out method for finished produce. Cost of growing crops
includes direct material and labor and an allocation of indirect costs and are
accumulated until the time of the harvest, subject to lower of cost or market
adjustments. The recognition of cost of sales for the delivered products is done
based upon estimates of the total cost of the crop for the growing season
divided by the number of units that are expected to be harvested, packed, and
sold. Under this approach, we compare costs incurred to date plus estimated
costs to complete and deliver the entire crop with the total net revenue
expected to be generated from the crop. Estimates of the net revenues from the
crop require projections of production yields from the field and the packaging
lines, quality grades of the product to be delivered, and market prices during
the months that constitute the crop harvest season. Each month, the Company
re-estimates the cost of sales per unit of product sold based on any revisions
to the estimated total cost of the crop and the units of output expected. If the
total cost of sales for the crop season is expected to be greater than the total
revenues to be generated, taking into account the units of production still
remaining to be harvested, the entire estimated loss is charged to operations in
the period the loss first becomes known. Such changes to these estimates have on
certain occasions been material to our quarterly results of operations during
the three year period ended December 31, 2003.

      Inventories are stated at the lower of cost or market. Our reserve for
excess or obsolete inventory is primarily based upon forecasted demand for our
products and any change to the reserve arising from forecast revisions is
reflected in cost of sales in the period the revision is made.

      The complexity of the estimation process and all issues related to the
assumptions, risks and uncertainties inherent with the application of the units
of output method of accounting affect the amounts reported in our financial
statements. A number of internal and external factors affect our revenue, cost
of sales estimates and inventory reserves, including weather conditions,
competitive production from different growing areas, labor availability and
costs, and customer demand for our products. If our business conditions were
different, or if we used different assumptions in the application of this and
other accounting policies, it is likely that materially different amounts would
be reported in our financial statements.

      Advances to growers are made for supplies, seed, and other growing and
harvesting costs. The advances are interest bearing and non-interest bearing and
repaid from amounts withheld from sales proceeds due to growers. All of the
growers' produce is sold by the Company's distribution subsidiaries. As sales
are made and collections from customers are generated, the Company's
distribution subsidiaries deduct their commissions, and the amount of money
advanced to the grower on a per unit basis before any monies from the sale and
collection process are passed along to the grower. If the Company determines
that the harvest of the grower will not generate sufficient output and revenues
to pay back any


                                       35
<PAGE>
advances that have been made to the grower, a review is then undertaken to
determine the likelihood that the grower will be able to pay back these
advances, plus any interest owed on the advances. If the Company determines that
the grower may not be able to pay the advances back to the Company, a reserve is
recorded in an amount that is determined to be at risk on the collection of the
grower advance. In 2002 and 2001, the Company recorded significant allowances
for doubtful accounts of grower receivables and in 2000, re-classified one
grower receivable to a long-term asset on which it is trying to collect through
a lawsuit it initiated earlier that year. The Company did not write off any
grower receivables in 2001.

      In accordance with the requirements of SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," we have an annual review policy
for triggering events of signs of possible impairments. The impairment
assessment is based on a comparison of the carrying value of the asset to the
undiscounted future net cash flows. Upon impairment, the asset is written down
to fair value as determined based on discounted cash flows or appraised value,
depending on the asset with the difference being charged to operations. In 2001,
impairment losses were recognized relating to the patents and trademarks of
Bionova Holdings technology business. No impairment losses were recognized in
2002 [or 2003].

      Differences between Mexican GAAP and U.S. GAAP

      Our consolidated financial statements are prepared in accordance with
Mexican GAAP, which differ in respects from U.S. GAAP. The principal differences
between Mexican GAAP and U.S. GAAP as they relate to us in our continuing
operations are the reversal of the goodwill amoritazation, purchase accounting
relating to acquisitions, pre-operating expenses, equity swaps, effect of
statement B-15, deferred income tax and profit sharing effect. Other differences
between Mexican GAAP and U.S. GAAP affecting our discontinued operations are the
effect of the divestiture of the insurance segment, the effect of fifth
amendment of statement B-10 and the gain on sale of subsidiaries. Each of these
differences affects both net income and shareholders' equity. Net loss under
U.S. GAAP from continuing operations was Ps. 2,351 million, Ps. 2.501 million
and Ps. 178 million for the years ended December 31, 2001, 2002 and 2003,
respectively. Net income (loss) under U.S. GAAP were Ps. 767 million, Ps. (641)
million and Ps. (2,999) million for the years ended December 31, 2001, 2002 and
2003, respectively. See Note 16 to our combined and consolidated financial
statements for a further discussion of the adjustments under U.S. GAAP.

      Mexican GAAP financial statements recognize the effects of inflation,
whereas financial statements prepared under U.S. GAAP are presented on a
historical cost basis. We are not required to reverse many of the Mexican
inflation accounting adjustments when reconciling Mexican GAAP to U.S. GAAP, as
these adjustments provide a means of measuring the effects of price-level
changes in the inflationary Mexican economy. Accordingly, these
inflation-adjusted figures are considered a more meaningful presentation than
historical cost-based financial reporting for both Mexican and U.S. accounting
purpose.

      New Accounting Pronouncements under U.S. and Mexican GAAP

1.    RECENT U.S. ACCOUNTING PRONOUNCEMENTS


                                       36
<PAGE>
      a.    In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN
            46"), "Consolidation of Variable Interest Entities, an
            Interpretation of ARB 51." FIN 46 requires the primary beneficiary
            of a variable interest entity to consolidate that entity. A Variable
            Interest Entity ("VIE") is created when (i) the equity investment at
            risk is not sufficient to permit the entity from financing its
            activities without additional subordinated financial support from
            other parties or (ii) equity holders either (a) lack direct or
            indirect ability to make decisions about the entity, (b) are not
            obligated to absorb expected losses of the entity or (c) do not have
            the right to receive expected residual returns of the entity if they
            occur. The primary beneficiary of a variable interest entity is the
            party that absorbs a majority of the variable interest entity's
            expected losses, receives a majority of the entity's expected
            residual returns, or both, as a result of ownership, contractual or
            other financial interest in the entity. In December 2003, the FASB
            issued a revision of FIN 46 ("FIN 46-R"), clarifying certain
            provisions of FIN 46. The Company was required to adopt the
            provisions of FIN 46-R on February 1, 2003 as they related to VIEs
            created on or after that date. For VIEs created before January 1,
            2003, FIN 46-R was deferred to 2004. The Company is currently
            evaluating the effect that the adoption of FIN 46 and FIN 46-R, will
            have on its consolidated financial statements.

      b.    In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain
            Financial Instruments with Characteristics of Both Liabilities and
            Equity". The statement requires issuers to classify as liabilities
            (or assets in some circumstances) three classes of freestanding
            financial instruments that embody obligations for the issuer.
            Generally, the statement is effective for financial instruments
            entered into or modified after May 31, 2003 and is otherwise
            effective at the beginning of the first interim period beginning
            after June 15, 2003. The adoption of SFAS No. 150 did not have a
            material impact on the Company's consolidated results of operations
            or financial condition.

      Management is currently evaluating the impact that the adoption of the
above-mentioned pronouncements will have on the consolidated financial
statements.

2.    RECENT MEXICAN ACCOUNTING PRONOUNCEMENTS

      a.    The provisions of Bulletin C-15, "Impairment of the Value of
            Long-Lived Assets and their Disposal" (Bulletin C-15), issued by the
            Mexican Institute Of Public Accountants, are effective January 1,
            2004. Bulletin C-15 establishes general criteria for the
            identification and, if applicable, the recognition of impairment
            losses or the decrease in value of long-lived tangible and
            intangible assets, including goodwill. Additionally, it provides the
            definition for net sale price and value in use for the valuation of
            long-lived assets. The Company is in the process of performing a
            study to assess the recoverability of its long lived assets and the
            amount of any possible impairment. However, management does not
            expect that it will have a significant impact upon adoption.

      b.    In May 2004, the Mexican Institute of Public Accountants issued
            Statement B-7, "Business Acquisitions," ("Statement B-7") which
            provides guidance for accounting of business acquisitions and
            investments in associated entities. Statement B-7 requires that all
            business acquisitions and investments in associates be accounted for
            by the purchase method of accounting, and supplements the accounting
            for the recognition of intangible assets as a part of a business
            acquisition. Upon adoption of Statement B-7, goodwill ceases to be
            amortized, and is rather tested for impairment at least annually.
            Statement B-7


                                       37
<PAGE>
            also provides guidance for the acquisition of a minority interest,
            and for asset transfers and business acquisitions among entities
            under common control. Bulletin B-7 is effective for periods
            beginning on January 1, 2005 with early adoption encouraged. We are
            currently evaluating the effects that this Bulletin will have on our
            financial position and results of operations.

      c.    In April 2004, Statement C-10, "Derivative Financial Instruments and
            Hedge Operations." ("Statement C-10) was issued. Statement C-10
            establishes enhanced accounting and reporting standards for
            derivative instruments, including certain derivative instruments
            embedded in other contracts, be recorded in the balance sheet as
            either an asset or a liability measured at its fair value. Statement
            C-10 also requires that changes in the derivative's fair value be
            recognized currently in earnings unless specific hedge accounting
            criteria is met. Special accounting for qualifying hedges allows a
            derivative's gain or loss to offset related results on the hedged
            item in the income statement. Bulletin C-10 is effective for periods
            beginning on January 1, 2005, with early adoption recommended. We
            are evaluating the effect of the adoption of Statement C-10 will
            have on consolidated financial statements.

      Management is currently evaluating the impact that the adoption of the
above-mentioned pronouncements will have on the consolidated financial
statements.

C.    RESEARCH, DEVELOPMENT, PATENTS AND LICENSES.

      Not Applicable.

D.    TREND INFORMATION

      Not Applicable.

E.    OFF-BALANCE SHEET ARRANGEMENTS.

      Not Applicable.

F.    CONTRACTUAL OBLIGATIONS

<TABLE>
<CAPTION>
                                                                 PAYMENTS DUE BY PERIOD
                                                             (IN THOUSANDS OF U.S. DOLLARS)
                                                             ------------------------------
                                                     LESS THAN       1-3        3-5      MORE THAN
                                           TOTAL      1 YEAR        YEARS      YEARS      5 YEARS
                                           -----      ------        -----      -----      -------
<S>                                        <C>       <C>            <C>        <C>       <C>
Long-Term Debt Obligations 1               1,183           300        629        255            --
Capital Lease Obligations 2                   17             7         10         --            --
</TABLE>


                                       38
<PAGE>
<TABLE>
<S>                                        <C>       <C>            <C>        <C>       <C>
Operating Lease Obligations 3              1,564           397        828        339            --
Purchase Obligations 4                        --            --         --         --            --
Other Long-Term Liabilities Reflected         --            --         --         --            --
TOTAL                                      2,764           704      1,467        594            --
</TABLE>

      1 Long Term Debt Obligation means a payment obligation under long-term
borrowings referenced in FASB Statement of Financial Accounting Standards No. 47
Disclosure of Long-Term Obligations (March 1981), as may be modified or
supplemented.

      2 Capital Lease Obligation means a payment obligation under a lease
classified as a capital lease pursuant to FASB Statement of Financial Accounting
Standards No. 13 Accounting for Leases (November 1976), as may be modified or
supplemented.

      3 Operating Lease Obligation means a payment obligation under a lease
classified as an operating lease and disclosed pursuant to FASB Statement of
Financial Accounting Standards No. 13 Accounting for Leases, as may be modified
or supplemented.

      4 Purchase Obligation means an agreement to purchase goods or services
that is enforceable and legally binding on the registrant that specifies all
significant terms, including: fixed or minimum quantities to be purchased;
fixed, minimum or variable price provisions; and approximate timing of the
transaction.

ITEM 6. DIRECTORS AND SENIOR MANAGEMENT

A. DIRECTORS

      Operation of the Company is entrusted to a Board of Directors. The
Company's By-Laws provide that the Board of Directors will consist of a minimum
of 5 and a maximum of 20 directors, from which, at least 25% must be independent
directors. The alternate director is named under the proprietary director. Each
proprietary director designates a corresponding alternate director, with the
understanding that the alternates for the independent directors must also be
independent. Directors are elected for a term of one year at the Company's
annual stockholders meetings. Alternate directors are authorized to serve on the
Board of Directors in place of directors who are unable to attend meetings. The
Company's operating subsidiaries operate in a decentralized form; however, the
corporate, financial, legal, personnel, information and planning services of
each operating subsidiary are provided to the operating subsidiaries by the
Company's wholly-owned service subsidiaries, of which there are three.


                                       39
<PAGE>
      At the Shareholders Meeting held on April 30, 2004, six directors were
elected to serve on the Company's Board of Directors and three directors were
deemed to be independent pursuant to Mexican laws. The Board of Directors is
composed of the following individuals:

<TABLE>
<CAPTION>
                                                                   DIRECTOR
            NAME                             BIRTHDATE               SINCE             STATUS
            ----                             ---------               -----             ------
<S>                                          <C>                   <C>              <C>
DIRECTORS

  Alfonso Romo Garza                         08-Oct-50                 1985         Proprietary (1)

  Arturo J. Quintero Trevino                 23-Dec-56                 2004          Alternate (1)

  Alejandro Garza Laguera                    10-Jun-26                 1990         Proprietary (2)

  Alejandro Garza Rangel                     14-Feb-65                 1996          Alternate (2)

  Juan Romero Huxley                         10-May-24                 1990         Proprietary (3)

  Eduardo Guerra Sepulveda                   23-Oct-39                 2004          Alternate (3)

  Alejandro Torres Quiroga                   26-Jul-40                 2004          Alternate (4)

  Alejandro Perez Elizondo                   26-Feb-49                 2002         Proprietary (4)

  Francisco Gonzalez Sebastia                22-Aug-31                 2004         Proprietary (5)

  Adrian Rodriguez Macedo                    7-Sep-49                  1990          Alternate (5)

  Bernardo Jimenez Barrera                   23-Apr-53                 1996         Proprietary (6)

  Jose Manuel Garcia Garcia                  23-Sep-51                 1990          Alternate (6)

  Arturo Estrada Treanor                     19-Nov-33                 2004         Proprietary (7)

  Tomas Cantu Gonzalez                       8-Oct-64                  2004          Alternate (7)

  Eugenio Najera Solorzano                   16-May-47                 1993         Proprietary (8)

  Gustavo Romo Garza                         12-Feb-54                 2002          Alternate (8)
</TABLE>


                                       40
<PAGE>
      The Secretary of the Board of Directors is Mr. Alejandro Francisco Sanchez
Mujica and the Alternate Secretary is Mr. Hector Gonzalez Trevino.

      The directors and officers of Savia have been associated in various
capacities with Savia and other corporations and institutions, and their
affiliates and predecessors thereof in the following principal occupations,
businesses and employment:

ALFONSO ROMO GARZA. Mr. Romo was born in Mexico City in 1950 and is Chairman and
Chief Executive Officer of Savia and Seminis, Inc. He is also Chairman of the
Board of ING Seguros Comercial America S.A. de C.V. He is a graduate of the
Instituto Tecnologico y de Estudios Superiores de Monterrey, where he received a
degree in Agricultural Engineering. Mr. Romo is member of the World Bank's
External Advisory Board for Latin America and the Caribbean, and of the Board of
Donald Danforth Plant Science Center. In addition, he is a member of the Board
of the Universidad Iberoamericana and the Universidad de Monterrey, and is
currently on the Board of Directors of several renowned national and
international companies.

ALEJANDRO GARZA LAGUERA. Mr. Laguera is a director of Vitro, S.A. de C.V. and
Cysda, S.A. de C.V. and other industrial groups. He is also the father-in-law of
Alfonso Romo Garza.

JOSE MANUEL GARCIA GARCIA. After the sale of Empaq's subsidiaries in May 2001,
he was appointed Corporate Project Director. He joined Savia in 1975, in 1989 he
was Chief Operating Officer at Aluprint and in 1994 he became the COO of Empaq.
He has previously held positions at the executive level in strategic planning,
logistics and marketing. Mr. Garcia holds an Industrial Engineering degree from
Instituto Tecnologico de Estudios Superiores de Monterrey and a Masters in
Business Administration.

ALEJANDRO GARZA RANGEL. Mr. Garza has been a Member of the Board at Centro de
Estudios en Economia y Educacion, since 1989.

BERNARDO JIMENEZ BARRERA. Since October 2003, Mr. Jimenez has been the Chief
Financial Officer of Seminis, Inc. He has been the Chief Executive Officer of
Bionova Holding Corporation since 1996. From 1993 to 1995, he served as the head
of the Industrial Banking Division at the Vector Group, a financial services
company in Mexico, which is affiliated with Savia, and the Vice President of New
Business Development for Pulsar Internacional.

ALEJANDRO TORRES QUIROGA. Mr. Torres was a Managing Director of Human Resources
at Savia from 1986-2001. He is currently retired.

ARTURO J. QUINTERO TREVINO. Mr. Quintero is a partner of the law firm Quintero y
Quintero Abagados, S.C.


                                       41
<PAGE>
EUGENIO NAJERA SOLORZANO. Mr. Najera is a private investor. He served as Chief
Operating Officer and as a director of Seminis from 2000 until March 2003.

EDUARDO GUERRA SEPULVEDA. Mr. Guerra is a partner in the law firm Bufete Legal
Asociados, S.C.

ADRIAN RODRIGUEZ MACEDO. Mr. Rodriguez was Marketing and Logistics Vice
President at Cerveceria Cuahutemoc from 1978 to 1988 and later served in the
same capacity at Cigarrera La Moderna until 1992. He was CFO at Pulsar
Internacional and had different executive positions at Vector Casa de Bolsa. He
is in charge of Monterrey Capital Partners, a financial company in Monterrey.

JUAN ROMERO HUXLEY. Mr. Romero has been President and Chairman of the Board of
Teneria Cuahutemoc since 1957 and President of the Board of R. Ro. S.A. de C.V.
since 1997.

TOMAS CANTU GONZALEZ. Mr. Cantu is a partner in the law firm of Cantu y Estrada
Abogados, S.C.

ARTURO ESTRADA TREANOR. Mr. Estrada is a director of Grupo Financiero BBVA,
Bancomer and other industrial companies.

FRANCISCO GONZALEZ SEBASTIA. Mr. Gonzalez is an Executive Director of
Comercializadora de Productos Ceramicos, S.A. de C.V. (Orion). He was Chief
Operating Officer of subsidiaries of Savia from 1987-2000.

ALEJANDRO PEREZ ELIZONDO. Mr. Perez is a director of Monterrey Capital Partners.
He was Managing Director of Business Development of Pulsar, S.A. de C.V., an
affiliate of Savia, from 1991-2002.

GUSTAVO ROMO GARZA. Mr. Gustavo Romo has been CEO of Grupo Krone, an affiliate
of Savia, a real estate group of companies since 1992. He holds a degree in
Industrial Engineering from the Universidad Anahuac and an MBA from the
Instituto Tecnologico Autonomo de Mexico.

B. COMPENSATION

      The aggregate amount of compensation paid by the Company and its
subsidiaries to all of the Company's directors and officers during 2003 was Ps.
33.6 million.

      As of December 31, 2003, the Company did not have any accrued pension
benefits.

C. BOARD PRACTICES

      The Company's By-Laws provide that the members of the Board of Directors
are appointed for a term of one year, or until their successors are elected by
another general ordinary stockholders meeting. The current term of each Director
will expire in April 2005. None of the Directors of the Company have service
contracts.

      The Company is in compliance with the "Better Practices Code" recently
adopted in Mexico. (See Annex A.) Savia has an Audit Committee and an Evaluation
and Compensation Committee to support the functions of the Board. At the Board
Meeting on June 4, 2004, the following directors were designated as members of
the Audit Committee: Messrs. Alejandro Perez Elizondo, as Chairman, Arturo
Estrada Treanor and Bernardo Jimenez Barrera. This Committee is charged with
evaluating (i) the relationship with the external auditors; (ii) the applicable
accounting policies; (iii) the principles, criteria, practices and controls
related to the proper disclosure of financial information for the Board and to
the


                                       42
<PAGE>
public; (iv) the internal control system, and; (v) the compliance with
applicable laws. The Board of Directors has determined that, at least one
member, Mr. Bernardo Jimenez Barrera, is a financial expert. Also at the Board
meeting on June 4, the following individuals were appointed as members of the
Evaluation and Compensation Committee: Messrs. Francisco Gonzalez Sebastia, as
Chairman, Alejandro Perez Elizondo and Bernardo Jimenez Barrera. This Committee
evaluates the applicable policies in connection with the evaluation,
compensation and hiring of top level executives.

D. EMPLOYEES

      As a holding company, Savia has no employees. As of December 31, 2003, the
Company's subsidiaries employed approximately 2,450 employees. Other than
approximately 30 full-time employees of ABSA, all of its other services are
performed by temporary workers, most of whom are hired during the harvesting
season January-April.

      To date, none of our subsidiaries have experienced any work stoppages or
any strikes by their employees. Management believes that we have good relations
with our employees and unions.

E. SHARE OWNERSHIP/CONTROL

      As of June 18, 2004, the following table sets forth the number of shares
owned by the Directors of the Company.

<TABLE>
<CAPTION>
DIRECTOR                           SHARES HELD        % OWNERSHIP
--------                           -----------        -----------
<S>                                <C>                <C>
Alfonso Romo Garza**                43 million            9%
Alejandro Garza Laguera            274 million            58%
Juan Romero Huxley                  45 million            10%
Pablo Escandon Cusi                     *                  *
David Noel Ramirez Padilla              *                  *
Bernardo Jimenez Barrera                *                  *
Ruben Martinez Donde                    *                  *
Eugenio Najera Solorzano                *                  *
Mateo Mazal Beja                        *                  *
Alejandro Garza Rangel                  *                  *
Eduardo Livas Cantu                     *                  *
Alejandro Perez Elizondo                *                  *
Adrian Rodriguez Macedo                 *                  *
Jose Manuel Garcia Garcia               *                  *
Adrian Paez Martinez                    *                  *
Gustavo Romo Garza                      *                  *
</TABLE>

-------------
* The director beneficially owns less than one percent of the class

** Includes shares owned directly or indirectly through companies Mr. Romo
controls. Also includes shares pledged as collateral for loans by certain of
these companies.

      As of June 18, 2004, the Company did not have any outstanding options,
grants, shares or securities of the Company issued to its Directors.


                                       43
<PAGE>
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. MAJOR SHAREHOLDERS

      As of June 18, 2004, Mr. Alfonso Romo Garza, the Chairman of the Board of
Directors and Chief Executive Officer of the Company, owns, directly or
indirectly, approximately 43 million shares, or approximately 9% of the A Shares
of the Company. Mr. Alejandro Garza Laguera, Member of the Board, owns directly,
approximately 274 million shares or approximately 58% of the A Shares of the
Company, and Mr. Juan Romero Huxley owns, directly or indirectly, approximately
45 million shares or approximately 10% of the A Shares of the Company. Mr.
Laguera's ownership of the A Shares of the Company increased from 17% to 58% in
2003, and Mr. Alfonso Romo Garza's ownership of the A Shares of the Company
decreased from 36% to 9%.

      The Company's major shareholders do not have different voting rights.

B. RELATED PARTY TRANSACTIONS

      Accounts receivable and payable to subsidiaries shown in Savia's
individual balance sheet bear interest at variable rates, similar to those
prevailing in the market.

      The Company sold all of its equity interest in Seminis for $266 million in
cash to a group of investors led by Fox Paine Seminis Holdings LLC, an affiliate
of Fox Paine & Company, LLC. The Company distributed $251 million of the
proceeds of the sale to its shareholders as a dividend. As part of the
transaction, certain affiliates of the Company that owned shares of Seminis
retained their equity interest in Seminis, and certain affiliates of the Company
utilized the proceeds from the cash dividend they received to acquire the shares
of Seminis. In addition, Savia received 3,844,117 shares of Seminis, after
giving effect to the sale, which shares were transferred to Pulsar
Internacional, S.A. de C.V. ("Pulsar") as repayment for indebtedness owed to
Pulsar under the Debt Settlement Agreement.

      Savia sold 66,814,318 of its shares of Series A common stock to Desarrollo
Consolidado de Negocios, S.A. de C.V. ("DCN") for $34,100,000, the market price
of Savia's shares on the Mexican Stock Exchange on the date of the sale.

      In May 2003, Servasa, S.A. de C.V. ("Servasa"), a subsidiary of the
Company, sold $16.1 million of a $41.3 million accounts receivable due from Mr.
Alfonso Romo Garza, Chairman of the Board of Directors and Chief Executive
Officer of Savia, to DCN for $16.1 million. This account receivable, on December
31, 2002, was fully reserved. (See Note 5 to the Consolidated Financial
Statements.)

      As of December 31, 2003 there were long-term accounts receivable from
related parties of Ps. 580 million, which were reserved as of December 31, 2002
by Savia's management, in order to recognize their risk of uncollectibility and
participate in the debt restructure programs of such parties. Of this amount,
Ps. 485 million related to Pulsar and Ps. 95 million related to Mandala
Internacional, S.A. de C.V.

C. INTEREST OF EXPERTS AND COUNSEL

      Not Applicable.


                                       44
<PAGE>
ITEM 8. FINANCIAL INFORMATION

A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION (GAAP, 3YRS)

      See ITEM 18.

ITEM 9. OFFER AND LISTING

MARKETS

      The Company's A Shares are listed on the Mexican Stock Exchange. From
February 2, 1994 until November 3, 2003, the Company's American Depositary
Shares (the "ADSs") were listed on the New York Stock Exchange, and since that
date have been traded on the over the counter market ("Pink Sheets"). The ADSs
are issued by The Bank of New York as depositary (the "Depositary"). Each ADS
represents four Ordinary Participation Certificates (a "CPO") issued by NAFIN,
as trustee (the "CPO Trustee") for a Mexican trust (the "CPO Trust"). Each CPO
represents a financial interest in one A Share held in the CPO Trust.

TRADING ON THE MEXICAN STOCK EXCHANGE

      The Mexican Stock Exchange ("MSE"), located in Mexico City, is the only
stock exchange in Mexico. Founded in 1894, it ceased operation in the early
1900s, and was reestablished in 1907. The MSE is organized as a corporation, the
shares of which are held by 27 brokerage firms. The firms enjoy exclusive
authorization to trade on the floor of the Exchange.

      MSE trading takes place principally on the floor of the Exchange, which is
open between the hours of 8:30 a.m. and 3:00 p.m. Mexico City time (Central
Standard Time), each business day. Trading is continuous during the
aforementioned session. Trades in securities listed on the MSE may, subject to
certain requirements, also be effected off the Exchange. Due primarily to tax
considerations, however, most transactions in listed Mexican securities are
effected through the Exchange.

      The MSE conducts trading over the BMV-Sentra technological platform
developed and managed directly by the Exchange. This entirely decentralized and
automated system allows for real-time trades to be effected through hundreds of
networked computer terminals controlled by the MSE that are located at
authorized financial institutions.

      Buy or sell orders are registered through on-screen forms that stipulate
the stock, stock series, number of shares engaged in the transaction, and the
price of the shares in question.

      MSE rules authorize the Exchange to take preventative measures to assure
transparent and orderly pricing, with the most significant of these involving
the suspension of trading of a specific stock.

      The MSE is authorized to suspend trading on an equity issue if it
concludes that the market need be informed of a relevant event, or if it
receives a request from the company in question ahead of the public release of
information regarding a relevant event.

      Should a buy or sell order be placed at a price that is 15% above or below
the share price's previous close, trading may be suspended on the stock owing to
extraordinary price fluctuations.


                                       45
<PAGE>
      When a stock's supply, demand or pricing experience changes in a manner
that is out of keeping with historical experience, and cannot be explained on
the basis of information available to the general public, the MSE may suspend
trading on the stock.

      In the event that an equity issue listed with the Exchange also trades in
markets outside of Mexico, the MSE may suspend trading locally in response to a
decision by another relevant securities market to suspend trading on the stock
in question.

      An order to suspend trading may extend until the close of that day's
session or until the MSE determines that the information that prompted the
suspension has been duly made known. Should the company fail to divulge the
requested information over the course of the session in question, the exchange
may impose sanctions.

      Upon lifting the suspension, the MSE will make its decision known to the
public and allow trading to resume based on an auction so as to assure the most
transparent and orderly resumption possible.

      Settlement takes effect two business days after a share transaction on the
Mexican Stock Exchange. Deferred settlement, even if by mutual agreement, is not
permitted without the approval of Comision Nacional Bancaria Valores. Most
securities traded on the MSE are on deposit with S.D. Indeval, S.A. de C.V.,
Institucion para el Deposito de Valores ("Indeval"), a privately owned central
depositary that acts as a clearinghouse, depositary, custodian, settlement,
transfer and registration institution for MSE transactions.

      The MSE is Latin America's second largest exchange by market
capitalization ($135.8 billion dollars as of May 31, 2004), but it remains
relatively small and illiquid compared to major world markets. As of December
2003, the shares of 160 Mexican companies, excluding mutual funds, were listed
on the Mexican Stock Exchange. During 2002, the ten most actively traded equity
issues represented approximately 45.3% of the total value of equity issues
traded on the Mexican Stock Exchange. Between January and May 2004, the ten most
liquid stocks accounted for 39.7% of total market trading volume. There is no
formal over-the-counter market for securities in Mexico.


                                       46
<PAGE>
PRICE HISTORY OF STOCK

      The following price table sets forth, for the periods indicated, the high
and low sale prices in nominal pesos for the A Shares as reported by the Mexican
Stock Exchange:

<TABLE>
<CAPTION>
                                           HIGH                  LOW
                                           ----                  ---
                                            Ps.                  Ps.
<S>                                        <C>                  <C>
1999                                       63.10                48.50

2000                                       56.10                40.00

2001                                       45.50                 1.39

2002
  First Quarter                             3.40                 2.06
  Second Quarter                            9.10                 2.96
  Third Quarter                             8.00                 5.50
  Fourth Quarter                            7.11                 5.15

2003
  First Quarter                             0.79                 0.62
  Second Quarter                            0.86                 0.62
  Third Quarter                             1.29                 0.83
  Fourth Quarter                            1.82                 1.21
  December, 2003                            1.68                 1.46

2004
  January, 2004                             1.70                 1.53
  February, 2004                            1.65                 1.50
  March, 2004                               1.58                 1.47
  April, 2004                               4.19                 1.48
  May, 2004                                 2.81                 2.40
  through June 18, 2004                     2.50                 2.31
</TABLE>

                                       47
<PAGE>

      The following price table sets forth, for the periods indicated, the high
and low sales prices in dollars for ADSs:

<TABLE>
<CAPTION>
                                             HIGH                    LOW
                                             ----                    ---
                                               $                      $
<S>                                          <C>                    <C>
1999                                         25.38                  20.19

2000                                         23.94                  17.00

2001                                         18.50                   0.55

2002
  First Quarter                               1.31                   0.99
  Second Quarter                              4.00                   1.30
  Third Quarter                               3.10                   2.25
  Fourth Quarter                              2.85                   1.95

2003
  First Quarter                               2.10                   1.49
  Second Quarter                              2.22                   1.61
  Third Quarter                               2.75                   2.01
  Fourth Quarter                              2.72                   0.35
  December, 2003                              0.56                   0.39


2004
  January, 2004                               0.65                   0.39
  February, 2004                              0.62                   0.40
  March, 2004                                 0.55                   0.45
  April, 2004                                 1.36                   0.40
  May, 2004                                   1.20                   0.74
  through June 18, 2004                       0.85                   0.85
</TABLE>




ITEM 10.         ADDITIONAL INFORMATION

A.    SHARE CAPITAL

      Not Applicable

B.    MEMORANDUM AND ARTICLES OF ASSOCIATION

      Information on the Articles of Association of Savia are addressed in
detail in the Company's Registration Statement on Form F-1 filed pursuant to the
Securities Act of 1933, as amended. The last amendment made to By-Laws
(estatutos sociales) of the Company was approved at the shareholder's meeting on
April 30, 2002. As of December 31, 2003, the Company's By-laws remained the
same.

      A director may not vote on a proposal, arrangement or contract in which
the director is materially interested. A director must disclose that there is a
conflict of interest, decline from participating in any discussion about the
merits of such proposal, arrangement or contract and refrain from voting.

      Directors' compensation may be voted upon only at the Shareholders'
Meeting.

      Pursuant to Article 22 of the Bylaws, the Audit Committee, composed of
independent directors, must approve a transaction in which a director wishes to
exercise borrowing powers.

      Pursuant to Article 32 of the Bylaws, all shareholders have the right to
receive a dividend. Once the right is declared and paid, such right expires in
5 years.

      Pursuant to Article 6 of the Bylaws, each shareholder has one vote per
share owned.

      The directors are elected by the shareholders at a shareholders meeting.
Each director has the same right to vote, except that in the case of a tie,
where the Chairman may cast the tie breaking vote pursuant to Article 22 of the
Bylaws.

      Shareholders have a right to share in the profits based upon an approval
to distribute dividends at a shareholders meeting.

      Shareholders have a right to share in a surplus in the event of a
liquidation. The redemption provisions are contained in Article 10 of the
By-Laws, which is applicable only to the variable capital shares or Class II
Shares, which have not been issued as of this date; since all the shares are
part of the fixed capital of the corporation, or Class I Shares. The redemption
value will be the lower of (i) 95% of the average stock market value during the
preceding 30 days to which the redemption must take place, and (ii) the book
value of the corporation corresponding to the fiscal year in which the
redemption takes place.

      Shareholders have a right to declare a capital increase at a shareholders
meeting. If a shareholder does not want to participate in the capital increase,
a non-participating shareholder may be diluted.

      The Board of Directors or the Statutory Auditors may call an Extraordinary
Meeting of Shareholders. However, the holders of at least 10% of the shares
have the right to call a General Meeting of Shareholders (Ordinary or
Extraordinary), by submitting such request to the Board of Directors and the
Statutory Auditor. If the Board and the Auditors fail to call a meeting within
15 days, then the holders of at least 10% of the shares may go before a judge to
request that such meeting be held.

      Any director or officer that owns more than one percent of the Company's
shares must disclose this information. Any shareholder that directly or
indirectly owns ten percent or more of the corporation must disclose such
ownership. Foreigners may not own Series "A" shares. As of this filing, the
corporation has only issued Series "A" shares. The Company has only issued
ordinary Series A, Class I shares which represent the Fixed Minimum Capital. As
of June 21, 2004, there are no shares without voting rights or a limited right
to vote. The company has executed a Trust with Nacional Financiera ("NAFIN"),
whereby the Fiduciary has issued Certificados de Participacion Ordinarios, which
in turn are converted into American Depositary Shares (ADSs) by the Bank of New
York. The voting rights of the shares are exercised through NAFIN, who is under
the obligation to vote in accordance with the vote cast by the majority
stockholders. Minority shareholders, which constitute 10% of the capital stock,
have the right to designate each Proprietary Director and each respective
Alternate.

      As of December 31, 2003, the rules regarding the installation quorum and
resolutions are included in the General Law on Mercantile Corporations (Ley
General de Sociedades Mercantiles), and the Securities Law (Ley del Mercado de
Valores).

      In order to change the rights associated with the shares, stockholders
must approve such change at the General Extraordinary Stockholders Meeting.
There is no limitation as to the acquisition of the shares of the Company by the
stockholders; provided, however, that Clause Ten of the By-Laws, which contains
certain rights for the holders of Class II shares, can only be amended by a vote
of 95% of the shareholders. Currently no Class II shares have been issued.

      Non-statutory agreements are in existence, which may have the effect to
delay, prevent, or make more onerous a change in control of the company.

      As of December 31, 2003, there are no statutory clauses or agreements
among the stockholders to limit or refrain the administration of the company or
its stockholders.

                                       48
<PAGE>

C. MATERIAL CONTRACTS

SAVIA SYNDICATED LOAN - RESTRUCTURING AGREEMENT

      On May 20, 2003, Savia executed a Debt Settlement Agreement that (i)
extended the maturity date of the Restructured Debt until September 30, 2003,
(ii) provided for a fixed payment of $65.2 million as payment to the creditors
for the Restructured Debt and (iii) provided that the creditors waive certain
provisions of the Restructuring Agreement and other financing documents in order
to permit the contemplated sale of Seminis shares and other related
transactions. On September 29, 2003, the Company completed the sale of all of
its equity interest in Seminis for a purchase price of $266 million. Savia
retained approximately $15.0 million of the sale proceeds and paid a cash
dividend of $251.2 million, equivalent to $0.5338 per share. Simultaneously,
with the closing of the sale of Seminis, the Company completed the sale of 66
million shares of its common stock and a note receivable to an affiliate for
$50.2 milion. The proceeds from these sale transactions, together with the $15.0
million retained by Savia were used to pay the $65.2 million obligation under
the Restructured Debt Agreement.

SALE OF SEMINIS

      The Company completed the sale of all of its equity interest in Seminis on
September 29, 2003. The following three agreements were the principal three
agreements covering the sale of Seminis by Savia:

Contribution Agreement

                                       49
<PAGE>

      On May 30, 2003, Savia, Seminis Chairman and Chief Executive Officer, Mr.
Alfonso Romo, DCN and certain affiliates of the Company entered into a
Contribution Agreement with Seminis Acquisition, a Company formed to acquire
Seminis. Pursuant to the terms of the Contribution Agreement, Savia contributed
to Seminis Acquisition an aggregate of 78,285,099 shares of Seminis common stock
(including the shares being exchanged under the Exchange Agreement) in exchange
for membership interests in Seminis Acquisition. Seminis Acquisition sold its
shares of Seminis common stock for $3.40 per share in cash following the merger
and distributed to Savia aggregate cash proceeds of approximately $266.2
million. Finally, as part of the sale of its interst in Seminis, Savia received
$15 million as payment for accrued and unpaid dividends on its equity interest
in Semnis.

Voting Agreement

      In order to approve the merger of Seminis Acquisition with Seminis, on May
30, 2003, Savia, Banca Afirme, S.A., Institucion de Banca Multiple, Afirme Grupo
Financiero, as trustee, under the Irrevocable Administration and Payment Trust
Number 167-5 (Fideicomiso Irrevocable Administracion y Pago Numero 167-5), a
Mexican Trust (the "ARG Trust"), Conjunto Administrativo Integral, S.A. de C.V.
("CAI"), Park Financial Group, Ltd ("Park"), Emprima S.A. de C.V. ("Emprima"),
Mr. Romo and Seminis Acquisition entered into a voting agreement with Fox Paine,
whereby each party to the voting agreement (other than Fox Paine) agreed, among
other things, to vote its shares of Seminis common stock to approve the Merger
Agreement, the merger and any actions reasonably and directly related thereto.
The parties to the voting agreement controlled shares of Seminis common stock
representing in the aggregate approximately 85.3% of the outstanding voting
power of Seminis common stock entitled to vote at the special meeting.

Exchange Agreement

      On May 30, 2003, Savia entered into an amended and restated Exchange
Agreement with Seminis. Seminis issued to Savia 37,669,480 shares of Seminis
Class A common stock and also paid to Savia an amount in cash equal to
$13,965,443 million in exchange for Savia's right, title and interest in and to
its 16,688 shares of Seminis Class C preferred stock; any right, title or
interest in and to any and all accrued and unpaid cash dividends on the shares
of Seminis Class C preferred stock held by Savia; any right, title or interest
in or to any and all accrued and unpaid cash obligations on additional paid in
capital; and any other right or claim with respect to any of the foregoing.

SAVIA SALE TO DCN

      Savia sold 66,814,318 of its shares to DCN for $34,100,000, the market
price on the Mexican Stock Exchange on the date of the sale.

SAVIA-BIONOVA AGREEMENT CONVERTING DEBT TO EQUITY

      On March 29, 2004 Bionova Holding completed a financial restructuring that
resulted in Bionova becoming a private company and a wholly-owned subsidiary of
Savia. As part of this transaction, $2.4 million of the principal amount of
Bionova Holding's debt to Savia was converted into common shares of Bionova
Holding and $77.4 million, which represented the remaining balance of the $79.8
million of Bionova Holding's debt to Savia, was forgiven. The public
stockholders were paid $0.09 for each share of Bionova Holding's common stock.

                                       50
<PAGE>

D.  EXCHANGE CONTROLS

      There are no such governmental laws, decrees, regulations or other
legislation of Mexico which affect the import or export of capital or the
remittance of dividends, interest or other payments to nonresident holders of
Savia's securities.


E.  TAXATION

GENERAL

      The following is a general summary of certain U.S. federal income and
Mexican tax consequences of the purchase, ownership and disposition of A Shares,
ADSs and CPOs. This summary is based upon laws, regulations, rulings, income tax
conventions (treaties), administrative practice and judicial decisions in effect
on the date of this annual report. Subsequent legislative, judicial or
administrative changes or interpretations may be retroactive and could affect
these tax consequences. The tax treatment of a holder of the A Shares or the A
Shares represented by ADSs and CPOs may vary depending upon the particular
situation of the holder. The discussion of U.S. tax considerations is limited to
investors who will hold the A Shares, ADSs and CPOs as "capital assets" and
whose "functional currency" is the dollar. Certain U.S. Holders (as defined
below) including, but not limited to, insurance companies, tax-exempt
organizations, financial institutions, persons subject to the alternative
minimum tax, broker-dealers, persons holding the A shares, ADSs or CPOs as part
of a hedge, straddle or conversion transaction, and holders of 10% or more of
the voting shares of the Company, may be subject to special rules not discussed
below. The discussion of Mexican tax considerations is limited to investors who
are not residents of Mexico (as defined below). The discussion does not address
U.S. federal estate and gift tax considerations or the effect of any U.S. state
or local tax law on a holder of the A Shares or the A Shares represented by ADSs
and CPOs. As used in this discussion, the term "U.S. Holder" means an individual
who is a citizen or resident of the U.S., a partnership, corporation or other
entity organized in or under the laws of the U.S. or any state thereof, an
estate that is subject to federal income taxation without regard to the source
of its income or a trust, the administration over which a U.S. court can
exercise primary supervision and for which one or more fiduciaries has the
authority to control all substantial decisions. The term "Non-U.S. Holder" means
any holder other than a U.S. Holder. As used herein, the term "U.S." means the
United States of America (including the 50 contiguous States and the District of
Columbia). Holders should consult their own tax advisors about the particular
tax consequences of the purchase, ownership and disposition of A shares, ADSs
and CPOs.

      The U.S. and Mexico are parties to an income tax treaty and accompanying
protocol (together, the "Treaty") that became effective on January 1, 1994. In
general, for U.S. federal income tax purposes, holders of ADSs and CPOs will be
treated as the owners of the underlying A Shares.

TAXATION OF DIVIDENDS

U.S. Tax Considerations

      Cash dividends paid out of current or accumulated earnings and profits
with respect to the A Shares represented by ADSs and CPOs will be includible in
the gross income of U.S. Holders as ordinary income when the dividends are
actually or constructively received by the CPO Trustee. Dividends paid to a U.S.
Holder that is a corporation will not be eligible for any dividends received
deduction available to corporations. Subject to a holder's satisfaction of
certain period requirements, dividends included in income by a noncorporate U.S.
Holder during the period ending on December 31, 2008 are subject to tax

                                       51
<PAGE>

at a maximum rate of 15% if the dividends are paid by a domestic corporation or
"qualified foreign corporation." A qualified foreign corporation generally
includes a foreign corporation if (i) it shares (or ADSs) are readily tradable
on an established securities market in the U.S. or (ii) it is eligible for
benefits under a comprehensive U.S. income tax treaty, provided that the
corporation is not a passive foreign investment company, foreign person holding
company or foreign investment company. The Company does not anticipate that the
ADSs or shares will qualify as readily tradable on an established securities
market. Based on the Company's eligibility for the benefits of the Mexico-U.S.
income tax treaty, however, the Company anticipates that it should be treated as
a qualified foreign corporation and, therefore, dividends paid to an individual
U.S. Holder of the ADSs should be taxed at a maximum rate of 15%. However,
holders should be aware that the eligibility requirements for being treated as a
qualified foreign corporation (in particular, the standards for determining
treaty eligibility for this purpose) are not entirely clear and, pending further
guidance from the Internal Revenue Service, no absolute assurance can be
provided that the special 15% maximum rate will apply to the dividends. To the
extent that a distribution exceeds earnings and profits, it will be treated
first as a return of the U.S. Holder's basis to the extent thereof, and then as
gain from the sale of a capital asset. Dividends paid in pesos will be
includible in the income of a U.S. Holder in a dollar amount calculated by
reference to the exchange rate in effect on the day the pesos are received by
the CPO Trustee. U.S. Holders should consult their own tax advisors regarding
the treatment of any foreign currency gain or loss with respect to any pesos
that are not converted into U.S. dollars on the day the pesos are received by
the CPO Trustee. Dividends generally will constitute foreign source "passive
income" (or in the case of certain holders, "financial services income") for
U.S. federal income tax purposes.

      A U.S. Holder will be entitled to a foreign tax credit for Mexican
withholding taxes that are imposed, subject to generally applicable limitations
and restrictions. In the case of U.S. individuals for whom the reduced rate of
U.S. tax on dividends applies, limitations and restrictions on claiming foreign
tax credits will appropriately take into account the rate differential under
rules similar to section 904(b)(2)(B) of the Internal Revenue Code. The rules
governing foreign tax credits are complex and U.S. Holders should consult their
tax advisors regarding their application to the particular circumstances of such
holder.

      Distributions of additional A Shares or ADSs to U.S. Holders with respect
to their predistribution ADS holdings that are made as part of a pro rata
distribution to all shareholders of the Company generally will not be subject to
U.S. federal income tax (except with respect to cash received in lieu of
fractional A Shares). The basis of the ADSs so received will be determined by
allocating the U.S. Holders' existing adjusted basis in the ADSs (less any
portion allocable to cash received in lieu of fractional shares) between the
predistribution ADSs and the ADSs so received.

      A portion of a dividend received from a non-U.S. corporation will be U.S.
source income unless less than 25% of the payor's gross income from all sources
for the three-year period ending with the close of its taxable year preceding
the declaration of the dividend was effectively connected with the conduct of a
trade or business in the United States. Such a dividend will be U.S. source
income generally in the same proportion as the payor's gross income that is
effectively connected with the conduct of a trade or business in the U.S. bears
to the payor's gross income from all sources. For 1999 and 2000, less than 25%
of the Company's gross income was effectively connected with the conduct of a
trade or business in the U.S. The Company can give no assurance that this will
continue to be true in the future.

      Distributions with respect to A Shares represented by ADSs and CPOs paid
to a Non-U.S. Holder generally will not be subject to United States withholding
tax if the holding of A shares is not effectively connected with the holder's
conduct of a trade or business in the United States.

                                       52
<PAGE>

Mexican Tax Considerations

      From January 1, 2002 holders of shares will accumulate to their other
revenues those perceived by dividends or capital gains, being the tax paid by
the society that distribute them a credit, if the holders accumulates in the
annual income tax the amount of the tax and the dividend.

      The Company will be required to pay a 34% tax on 1.5152 times (from 2004
to 2005, 33% on 1.4925 times to 32% on 1.4706 times) the amount of the dividend
if the dividend is not paid from earnings that have already been subject to
income tax (as shown in the required record of such earnings called "cuenta de
utilidad fiscal neta" or "previously taxed net earnings"). Effective January 1,
1999, the Mexican government raised corporate income tax rates from 34% to 35%.
Notwithstanding this increase, entities are allowed to defer 3% in 1999 and 5%
in 2000 and 2001, of their corporate tax so long as they reinvest such amount
into their company. The deferred tax must be paid when the Company distributes
its profits.

      By Law, the corporate income tax rates will be diminished in one percent
intervals yearly from 35% in 2002 to 32% in 2005.

      In addition, dividends paid from January 1, 1999 to December 31, 2001 are
subject to Mexican withholding. This tax is determined by applying a rate of 5%
to the amount by multiplying the dividends distributed by 1.5385 (1.515 in
instances where dividends are paid from earnings previously taxed prior to
December 31, 1998).

      Under Mexican tax law, the Mexican withholding tax rate may be reduced by
the Treaty. In order to gain such a reduction, a shareholder must provide the
Company with his name, address, Tax Identification number, and the amount of
shares he owns and the Company must certify that it has obtained from such
shareholder an official document from the Internal Revenue Service stating that
such shareholder is a U.S. tax resident for tax purposes. Furthermore, the
custodian must assume responsibility to pay the tax difference in case of
default. Foreign custodians must designate a legal representative in Mexico.

TAXATION OF CAPITAL GAINS

U.S. Tax Considerations

      A U.S. Holder will realize a gain or loss in an amount equal to the
difference between such Holder's basis in the ADSs or CPOs and the amount
realized on the disposition on the sale or other disposition of ADSs or CPOs.
Gain or loss realized by a U.S. Holder generally will be treated as capital gain
or loss from U.S. sources. Deposits and withdrawals of CPOs by U.S. Holders in
exchange for ADSs will not result in the realization of gain or loss for U.S.
federal income tax purposes. Holders that withdraw any CPOs should consult their
own tax advisors regarding the treatment of any foreign currency gain or loss on
any pesos received in respect of such CPOs.

      Gain realized by a Non-U.S. Holder on the disposition of A Shares, ADSs
and CPOs will not be subject to United States federal income tax unless (i) the
gain is effectively connected with the holder's conduct of a United States trade
or business or (ii) the holder is an individual present in the United States for
at least 183 days during the taxable year of disposition and certain other
conditions are met.

                                       53
<PAGE>

INFORMATION REPORTING AND BACKUP WITHHOLDING

      Dividends in respect of the A shares, ADSs or CPOs and the proceeds from
the sale, exchange, or redemption of the A shares, ADSs or CPOs may be reported
to the United States Internal Revenue Service and a backup withholding tax may
apply to such amounts unless the holder (i) is a domestic corporation (which may
be required to establish its exemption by carrying its status on U.S. Internal
Revenue Service Form W-9), (ii) in the case of a U.S. Holder other than a
corporation, provides an accurate taxpayer identification number in the manner
required by applicable law, (iii) in the case of a Non-U.S. Holder, provides a
properly executed U.S. Internal Revenue Service Form W-8BEN; or other successor
form, or otherwise, (iv) establishes a basis for exemption. The amount of any
backup withholding from a payment to a U.S. Holder generally will be allowed as
a credit against the U.S. Holder's United States income tax liability.

Mexican Tax Considerations

      The sale or other disposition of CPOs or ADSs by holders who are
non-residents of Mexico (as defined below) will not be subject to Mexican tax.
Deposits of A Shares in exchange for CPOs and withdrawals of CPOs in exchange
for ADSs will not give rise to Mexican tax or transfer duties.

      The sale or other disposition of CPOs or ADSs by nonresidents of Mexico
will not be subject to any Mexican tax if the sale is carried out through the
Mexican Stock Exchange or the New York Stock Exchange. Sales or other
dispositions of CPOs or ADSs made in other circumstances would be subject to
Mexican income tax. Under the Treaty, gains attributable to a permanent
establishment that a U.S. enterprise (as defined in the Treaty) has or had in
Mexico, or which are attributable to a fixed base which is or was available to a
U.S. resident (as defined in the Treaty) in Mexico for the purpose of performing
independent personal services, are taxable in Mexico. Also under the Treaty,
gains derived by a U.S. resident (as defined in the Treaty) may be taxed in
Mexico if such resident, during the 12-month period preceding the sale or
disposition giving rise to the gain, had a participation, directly or
indirectly, of at least 25% in the Company's capital. The Treaty further
provides that such gains shall be deemed to be Mexican sourced to the extent
necessary to avoid double taxation.

      For purposes of Mexican taxation, a natural person is a resident of Mexico
if he or she has established his or her home in Mexico, unless he or she has
resided in another country for more than 183 calendar days during a year and can
demonstrate that he or she had become a resident of that country for tax
purposes, and a legal entity is a resident of Mexico if it is incorporated under
Mexican law or its effective management is located in Mexico. A Mexican citizen
or a legal entity with its corporate domicile in Mexico and established under
Mexican law is presumed to be a resident of Mexico, unless the citizen or entity
can demonstrate otherwise. If a legal entity has a permanent establishment or
fixed base in Mexico, its permanent establishment or fixed base is required to
pay taxes in Mexico with respect to income attributable to such permanent
establishment or fixed base in accordance with relevant tax provisions.

OTHER MEXICAN TAXES

      Other than the income tax, there are no other taxes applicable to the
ownership, transfer or disposition of ADSs, CPOs or A Shares. There are no
Mexican stamp, issuer, registration or similar taxes or duties payable by
holders of ADSs, CPOs or A Shares.

       Reimbursement of capital pursuant to a redemption of shares will not be
subject to tax if (i) the corresponding amount is not more than the adjusted
contributed capital corresponding to the redeemed

                                       54
<PAGE>

shares and (ii) the equity of the Company does not exceed the total adjusted
contributed capital. Any excess distribution in excess of that amount will be
considered as a dividend for tax purposes and will be taxed.

F.  DIVIDENDS AND PAYING AGENTS

      Not Applicable.


G.  STATEMENT BY EXPERTS

      Not Applicable.


H.  DOCUMENTS ON DISPLAY

      Exhibits attached to this Form 20-F are also available for viewing at the
offices of Savia, Rio Sena Poniente No. 500, Col. Del Valle, San Pedro Garza
Garcia, N.L. CP 66220, Mexico, or on request to Savia at the telephone number
(5281) 8173-5500, attention Rolando Herrera. Copies of Savia's financial
statements and other continuous disclosure requirements required under Mexican
law are available for viewing at the same address.

I.  SUBSIDIARY INFORMATION

      Not Applicable.


ITEM 11.        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

      The Company is exposed to changes in financial market conditions in the
normal course of its business due to its use of certain financial instruments as
well as transactions in various foreign currencies and translation of foreign
subsidiaries financial statements to Mexican pesos. The Company from time to
time assesses its exposure and monitors opportunities to manage these risks.

      INTEREST RATE RISK

      The table below presents Savia's principal cash flows and related weighted
average interest rates by expected maturity dates.


                       SHORT-TERM AND LONG-TERM BANK DEBT
                             AS OF DECEMBER 31, 2003

<TABLE>
<CAPTION>
                                                                    AVERAGE
                                                 VARIABLE      VARIABLE INTEREST
   EXPECTED MATURITIES                          RATE DEBT             RATE
   -------------------                        -------------    -----------------
                                             (Ps. Millions)
<S>                                                   <C>             <C>
   2004                                               38              5.7%
   2005                                                4              6.8%
   2006                                                3              7.0%
   2007                                                2              5.9%
   2008 and Thereafter                                 1              5.5%
                                                       -              ----
   Total                                              48              5.9%
</TABLE>


                                       55
<PAGE>

FOREIGN CURRENCY EXCHANGE RISK

      Savia generally does not enter into foreign currency derivative
transactions to hedge against movements in exchange rates. Savia, however, is
exposed to foreign currency exchange risk associated with monetary assets and
liabilities, principally cash and cash equivalents, accounts receivable and its
short-term and long-term debt, held by Savia and its Mexican subsidiaries,
denominated principally in U.S. dollars, as summarized below (in millions of
U.S. dollars):

<TABLE>
<CAPTION>
                                             2002                         2003
                                             ----                         ----
<S>                                          <C>                          <C>
Monetary Assets                               11                           36
Current liabilities                          (93)                          (8)
Long term liabilities                         --                           (1)
Net foreign currency position                (82)                          27
</TABLE>

      The Company translates its non-Mexican investments into Mexican pesos
using the guidelines established by Bulletin B-15 which requires the restatement
of amounts of the foreign subsidiaries by applying the general inflation index
of the country and then translating to Mexican pesos at the exchange rates
prevailing at the latest balance sheet date. The net difference resulting from
the translation of the financial statements of foreign subsidiaries,
representing the cumulative effect of the Mexican peso and U.S. dollar exchange
rate fluctuations, on such foreign investments is included in stockholders'
equity.

      Certain subsidiaries of Savia operate outside of Mexico and have adopted
local currencies as the functional currencies for certain of its foreign
subsidiaries because their principal economic activities are most closely tied
to the respective local currencies. This exposes Savia to market risk from
changes in foreign exchange rates to the extent that transactions are not
denominated in Mexican pesos.

      At the year end December 31, 2002 and 2003, the net assets of its foreign
subsidiaries were as follows (in millions):

<TABLE>
<CAPTION>
                                                2002                   2003
                                                ----                   ----
<S>                                             <C>                    <C>
Cash and cash equivalents                       $2.1                   $5.8
Accounts receivable                             27.8                   20.0
Inventories                                     11.2                    5.9
Property, plant and equipment                   33.6                   30.7
Other assets                                     3.9                    3.9
                                              ------                 ------
Total Assets                                    78.6                   66.3
Current liabilities                           (128.5)                (128.8)
Long-term debt                                  (0.4)                  (0.9)
                                              ------                 ------
Net assets of foreign subsidiaries            $(50.3)                $(63.4)
                                              =======                =======
</TABLE>

                                       56
<PAGE>

      During 2002 and 2003 the condensed results of operations of the Company's
foreign subsidiaries were as follows (in millions):

<TABLE>
<CAPTION>
                                                 2002                    2003
                                                 ----                    ----
<S>                                             <C>                      <C>
 Net Sales                                      $131.3                   99.9
 Cost of Sales                                  (124.9)                 (89.6)
 Operating Expenses                              (15.7)                 (16.6)
 Financial Expenses                               (6.1)                  (6.3)
 Income Taxes and Other Expenses                  (2.8)                   3.4
 Consolidated Loss Income                        (18.2)                  (9.2)
 Minority Interest                                (0.2)                  (0.2)
 Majority Loss                                  $(18.4)                 $(9.4)
</TABLE>


      DERIVATIVE FINANCIAL INSTRUMENTS

      As of December 31, 2003, the Company had no outstanding derivative
financial instruments.

ITEM 12.         DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

      NOT APPLICABLE.



                                       57
<PAGE>
                                     PART II

ITEM 13. DEFAULTS, DIVIDENDS, ARREARAGES AND DELINQUENCIES

      Not Applicable.


ITEM 14. MATERIAL MODIFICATIONS OF THE RIGHTS OF SECURITY HOLDERS AND USE OF
PROCEEDS

      Not Applicable.

ITEM 15. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES (SARBANES-OXLEY ACT 2002)

      The Chief Executive Officer and the Chief Financial Officer have evaluated
the effectiveness of the Company's disclosure controls and procedures as of
December 31, 2003. Based on this evaluation, the Chief Executive Officer and the
Chief Financial Officer concluded that the disclosure controls and procedures
are effective in all material respects to ensure that material information
relating to the Company would be made known to them by others within the
Company.

      There have been no significant changes to the Company's internal controls
or in other factors that could materially affect these controls after the date
of their evaluation.

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

      The Board of Directors has determined that at least one director, Mr.
Bernardo Jiminez Barrera, is a financial expert. Mr. Jiminez has served as the
Chief Financial Officer of Seminis, Inc. since October 2003 where he gained
experience preparing, auditing, analyzing and evaluating financial statements.

ITEM 16B. CODE OF ETHICS

      The Board of Directors has adopted a Code of Ethics which is annexed
hereto as Exhibit 11. The Company will provide a copy of the Code of Ethics to
any person, without charge, upon request.

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

                                     2003           2002
                                     ----           ----
Audit fees                        5,354,681      12,220,388
Audit related fees                1,017,070         634,498
Tax fees                             60,000         188,000
Other fees                        1,290,197       1,347,000
                                  ---------      ----------
Total fees                        7,721,949      14,389,886
                                  =========      ==========


ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR THE AUDIT COMMITTEES

      Not Applicable.


                                       58
<PAGE>
ITEM 16E PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

<TABLE>
<CAPTION>

                                                             (c) Total Number        (d) Maximum Number
                                                            of Shares or (Units)      of Shares that May
              (a) Total Number                                 Purchased as            Yet Be Purchased
                 of Shares or        (b) Average Price       Part of Publicly          Under the Plans
Period         Units Purchased        Paid per Share        Announced Programs          or Programs
------         ---------------        --------------        ------------------          -----------
<S>           <C>                    <C>                    <C>                      <C>
May 2003         66,814,318              Ps. 5.57                    N/A                         N/A
</TABLE>


                                    PART III

ITEM 17. FINANCIAL STATEMENTS

      See ITEM 18.

ITEM 18. FINANCIAL STATEMENTS

A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION (U.S. GAAP, 3YRS)

      The Financial statements, together with the report of
PricewaterhouseCoopers, are filed as part of this Annual Report.

      Notes to the Financial Statements.


                                       59
<PAGE>

                     SaVIA, S. A. DE C. V. AND SUBSIDIARIES

                                    FORM 20-F

                               DECEMBER 31, 2003
<PAGE>
Savia, S.A. de C.V. and Subsidiaries

<TABLE>
<CAPTION>
                                                                            PAGE
                                                                            ----
<S>                                                                         <C>
Report of Independent Registered Public Accounting Firm...................   F-1
Consolidated Balance Sheets as of December 31, 2002 and 2003..............   F-3
Consolidated Statements of Operations for the years ended
  2001, 2002 and 2003.....................................................   F-4
Consolidated Statements of Changes in Shareholders' Equity
  for the years ended 2000, 2002 and 2003.................................   F-5
Consolidated Statements of Changes in Financial Position for
  the years ended 2001, 2002 and 2003.....................................   F-6
Notes to the Consolidated Financial Statements............................   F-7
</TABLE>



<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors
and Stockholders of SaVIA, S. A. de C. V

We have audited the accompanying consolidated and individual balance sheets of
SaVIA, S. A. de C. V. and subsidiaries (SaVIA or the Company) and of SaVIA, S.
A. de C. V. (parent company) as of December 31, 2003 and 2002, and the related
consolidated and individual statements of income, of changes in stockholders'
equity and of changes in financial position for the years then ended. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States of America) and auditing standards
generally accepted in Mexico. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the 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.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. However: (a) in the years ended
December 31, 2003 and 2002, the Company incurred consolidated losses of Ps2,362
million and Ps806 million, respectively, (b) in September 2003, Seminis, Inc.
(Seminis), a subsidiary, which prior to its disposition, represented a
significant portion of the consolidated assets and sales, was sold and (c) there
has been a deterioration in cash flow generation, which could eventually force
the Company to sell the remainder of its assets. These matters, among others,
raise substantial doubts about the Company's ability to continue as a going
concern. The accompanying financial statements do not include any adjustments
related to the valuation and classification of the assets and classification and
amount of the liabilities that might result from the outcome of these
uncertainties. Management's plans and actions in regard to these matters are
described in Notes 1 and 3.


                                      F-1
<PAGE>

As mentioned in Note 1 to the financial statements, on April 30, 2003, the
Company's stockholders ratified the proposal of the Board of Directors to sell
the shares of its subsidiary Seminis, which was concluded on September 29, 2003.
Consequently, as of that date Seminis ceased to be a subsidiary of SaVIA, and it
has been reflected as a "Discontinued Operation" in the accompanying financial
statements. The financial statements for 2002 and 2001 have been reclassified to
reflect this discontinuance on the same basis.

In our opinion, the aforementioned consolidated and individual financial
statements present fairly, in all material respects, the financial position of
SaVIA, S. A. de C. V. and subsidiaries and of SaVIA, S. A. de C. V. (parent
company) as of December 31, 2003 and 2002, and the results of their operations,
the changes in their stockholders' equity and the changes in their financial
position for the years then ended, in conformity with accounting principles
generally accepted in Mexico.

Accounting principles generally accepted in Mexico differ in certain significant
respects from accounting principles generally accepted in the United States of
America. Information relating to the nature and effect of such differences is
presented in Note 16 to the consolidated financial statements.

PricewaterhouseCoopers

April 14, 2003
Monterrey, N. L., Mexico


                                      F-2
<PAGE>

                     SaVIA, S. A. DE C. V. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

    Millions of Mexican Pesos of December 31, 2003 Purchasing Power (Note 1)

                                                                  December 31,
                                                                2002       2003
                                                              ------------------
Assets
Current assets:
Cash and cash equivalents                                        Ps 57    Ps 165
Accounts receivable (Note 5)                                       366       266
Accounts receivable from related parties and
other accounts receivable (Note 5)                                  18        30
Income tax and asset tax recoverable                                67        19
Inventories (Note 6)                                             1,899     1,907
Prepaid expenses                                                    25        53
                                                              --------   -------
Total current assets from continuing operations                  2,432     2,440
Current assets from discontinued operations (Note 3)             5,478
                                                              --------   -------
Total current assets                                             7,910     2,440
                                                              --------   -------
Investment in shares and other investments (Note 2.d.)              11         6
Other long-term accounts receivable (Note 5)                       114        92
Property, plant and equipment (Note 7)                           1,065       884
Intangible assets                                                   95        53
                                                              --------   -------
Total noncurrent assets from continuing operations               1,285     1,035
Noncurrent assets from discontinued operations (Note 3)          6,377        --
                                                              --------   -------
Total noncurrent assets                                          7,662     1,035
Total assets                                                  Ps15,572   Ps3,475
                                                              ========  ========

                                                                  December 31,
                                                                2002       2003
                                                              ------------------
Liabilities and Stockholders' Equity
Current liabilities:
Bank loans and other financing (Note 8)                     Ps  1,000   Ps    34
Current portion of long-term bank debt (Note 8)                     2          4
Accounts payable to related parties and other
accounts payable                                                  461        421
                                                            ---------   --------
Current liabilities from continuing operations                  1,463        459
Current liabilities from discontinued operations
(Note 3)                                                        4,651
                                                            ---------   --------
Total current liabilities                                       6,114        459
                                                            ---------   --------
Long-term liabilities:
Bank loans                                                          5          1
Long-term accounts payable to related parties
and other accounts payable                                         51         45
Deferred income tax (Note 11)                                      74        407
                                                            ---------   --------
Long-term liabilities from continuing operations                  130        462
Long-term liabilities from discontinued operations
(Note 3)                                                          332         --
                                                            ---------   --------
Total long-term liabilities                                       462        462
                                                            ---------   --------
Total liabilities                                               6,576        921
                                                            ---------   --------
STOCKHOLDERS' EQUITY (NOTE 9):
Nominal capital stock                                               7          7
Restatement of capital stock                                    1,656      1,656
                                                            ---------   --------
                                                                1,663      1,663
Additional paid-in capital                                      2,692      3,065
Retained earnings                                              11,305      5,717
Deficit on restatement of capital                              (7,213)    (7,629
Cumulative translation adjustment                                (479)       (13
                                                            ---------   --------
Total majority interest                                         7,968      2,803
Minority interest                                               1,028       (249
                                                            ---------   --------
Total stockholders' equity                                      8,996      2,554
Subsequent event, commitments and contingencies
(Notes 1 and 13)
                                                            ---------   --------
Total liabilities and stockholders' equity                  Ps 15,572   Ps 3,475
                                                            =========   ========

The accompanying notes are an integral part of these financial statements.

                                      F-3
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENT OF INCOME

                            Millions of Mexican Pesos
                      OF DECEMBER 31, 2003 PURCHASING POWER

<TABLE>
<CAPTION>
                                                                    Year Ended December 31,
                                                             2001             2002             2003
                                                       -------------    -------------    -------------
<S>                                                   <C>              <C>              <C>
Net sales                                              Ps      2,919    Ps      2,024    Ps      1,459
Cost of sales                                                 (2,440)          (1,694)          (1,221)
                                                       -------------    -------------    -------------
Gross margin                                                     479              330              238
Operating expenses                                              (991)            (641)            (463)
                                                       -------------    -------------    -------------
Operating loss                                                  (512)            (311)            (225)
                                                       -------------    -------------    -------------
Severance and other termination costs                           (272)
                                                       -------------
Comprehensive financing (cost) income:
Financial expenses                                              (415)             (46)             (23)
Financial income                                                 168               68               69
Exchange gain, net                                               (95)             216              130
Loss on monetary position                                         85              (54)             (10)
                                                       -------------    -------------    -------------
                                                                (257)             184              166
                                                       -------------    -------------    -------------
Other (expenses) income, net (Note 10)                          (794)          (1,499)             230
                                                       -------------    -------------    -------------
(Loss) income from continuing operations before
the following provisions                                      (1,835)          (1,626)             171
Income tax and asset tax (Note 11)                              (130)             (65)            (369)
                                                       -------------    -------------    -------------
Loss from continuing operations                               (1,965)          (1,691)            (198)
                                                       -------------    -------------    -------------
Discontinued operations, net of income tax (Note 3):
(Loss) income from discontinued operations                    (3,065)             951             (466)
Loss on sale of subsidiaries                                     772           (1,889)
                                                       -------------    -------------    -------------
(Loss) income from discontinued operations                    (2,293)             951           (2,355)
                                                       -------------    -------------    -------------
Consolidated net loss                                         (4,258)            (740)          (2,553)
                                                       -------------    -------------    -------------
Minority interest in:
Continuing operations                                            406               48               20
Discontinued operations                                          675             (114)             171
                                                       -------------    -------------    -------------
                                                               1,081              (66)             191
                                                       -------------    -------------    -------------
Net loss corresponding to majority interest            (Ps     3,177)   (Ps       806)   (Ps     2,362)
                                                       =============    =============    -------------
Loss per share applicable to majority interest,
in Mexican pesos (Note 2.l):
Continuing operations                                  (Ps      2.68)   (Ps       3.54)  (Ps      0.38)
Discontinued operations                                        (4.17)            1.80            (4.66)
                                                       -------------    -------------    -------------
Net loss per share                                     (Ps      6.85)   (Ps      1.74)   (Ps      5.04)
                                                       =============    =============    =============
Weighted average number of common shares outstanding     462,634,218      463,752,004      469,626,696
                                                       =============    =============    =============
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                      F-4
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER

<TABLE>
<CAPTION>
                                               Additional              Deficit on  Cumulative     Total                   Total
                                     Capital    paid-in     Retained   restatement translation  majority    Minority   stockholders'
                                      stock     capital     earnings   of capital  adjustment   interest    interest     equity
                                     --------   --------    --------    --------    --------    --------    --------    --------
<S>                                  <C>        <C>        <C>         <C>         <C>          <C>         <C>         <C>
Balances at December 31, 2001        Ps 1,663   Ps 2,782   Ps 12,076   (Ps 6,984)  (Ps   479)   Ps 9,058    Ps   777    Ps 9,835
                                     --------   --------    --------    --------    --------    --------    --------    --------
Changes in 2002:
Net loss for the year                      --         --        (806)         --          --        (806)         66        (740)
Loss from options on own shares            --        (90)         --          --          --         (90)         --         (90)
Reserve for relisting of shares            --         --          35          --          --          35          --          35
Loss from holding nonmonetary assets       --         --          --        (229)         --        (229)         --        (229)
                                     --------   --------    --------    --------    --------    --------    --------    --------
Comprehensive loss (Note 2.m)              --        (90)       (771)       (229)         --      (1,090)         66      (1,024)
                                     --------   --------    --------    --------    --------    --------    --------    --------
Changes in minority interest               --         --          --          --          --          --         185         185
                                     --------   --------    --------    --------    --------    --------    --------    --------
Balances at December 31, 2002           1,663      2,692      11,305      (7,213)       (479)      7,968       1,028       8,996
                                     --------   --------    --------    --------    --------    --------    --------    --------
Changes in 2003:
Net loss for the year (Note 3)             --         --      (2,828)         --         466      (2,362)       (191)     (2,553)
Gain from options on own shares            --        373          --          --          --         373          --         373
Reserve for relisting of shares            --         --          14          --          --          14          --          14
Loss from holding nonmonetary assets       --         --          --        (416)         --        (416)         --        (416)
                                     --------   --------    --------    --------    --------    --------    --------    --------
Comprehensive loss (Note 2.m)              --        373      (2,814)       (416)         --      (2,391)       (191)     (2,582)
                                     --------   --------    --------    --------    --------    --------    --------    --------
Dividends declared (Note 9)                --         --      (2,774)         --          --      (2,774)         --      (2,774)
                                                                                                                        --------
Changes in minority interest               --         --          --          --          --          --      (1,086)     (1,086)
                                     --------   --------    --------    --------    --------    --------    --------    --------
Balances at December 31, 2003        Ps 1,663   Ps 3,065    Ps 5,717   (Ps 7,629)  (Ps   13)    Ps 2,803   (Ps   249)   Ps 2,554
                                     ========   ========    ========    ========    ========    ========    ========    ========
Corresponding to:
   Parent Company                    Ps 1,663   Ps 3,065    Ps12,904   (Ps 7,629)  (Ps   13)    Ps 9,990          --    Ps 9,990
   Subsidiaries                            --         --      (7,187)         --          --      (7,187)  (Ps   249)     (7,436)
                                     --------   --------    --------    --------    --------    --------    --------    --------
                                     Ps 1,663   Ps 3,065    Ps 5,717   (Ps 7,629)  (Ps   13)    Ps 2,803   (Ps   249)   Ps 2,554
                                     ========   ========    ========    ========    ========    ========    ========    ========
</TABLE>

This statement is applicable to and also forms part of the individual financial
statements of the Parent Company.

The accompanying notes are an integral part of these financial statements.


                                      F-5
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             CONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITION

                            MILLIONS OF MEXICAN PESOS
                      OF DECEMBER 31, 2003 PURCHASING POWER

<TABLE>
<CAPTION>
                                                                    Year Ended December 31,
                                                                ------------------------------
                                                                   2001       2002       2003
                                                                --------    -------   --------
<S>                                                             <C>         <C>       <C>
OPERATIONS
Consolidated net loss for the year                              (Ps4,258)   (Ps 740)  (Ps2,553)
Loss (income) from discontinued operations                         2,565       (951)     2,355
                                                                --------    -------   --------
Loss from continuing operations                                   (1,693)    (1,691)      (198)
Items not affecting resources:
Depreciation and amortization                                        745        105         79
Deferred income tax                                                   76         47        343
Write-off of investment in Desarrollo Forestal, S. A. de C. V         --        431
                                                                --------    -------   --------
                                                                    (872)    (1,108)       224
Changes in:
Accounts receivable and recoverable taxes                            226        (96)       148
Current portion of accounts receivable from
   and payable to related parties, net                              (913)        39         88
Inventories                                                           (7)      (334)        (8)
Other assets                                                         (13)       173        (28)
Accounts payable and accrued expenses                               (521)      (584)      (141)
                                                                --------    -------   --------
Resources (used in) provided by operations                        (2,100)    (1,910)       283
                                                                --------    -------   --------
FINANCING
Bank loans and other financing, net                               (5,752)       579       (965)
Other long-term accounts receivable and payable                      726        440         22
Dividends declared                                                    --         --     (2,774)
Movements in reserve for repurchase of shares                     (2,394)       (54)       387
Cumulative translation adjustment                                    466
Changes in minority interest                                      (9,159)       185     (1,086)
                                                                --------    -------   --------
Resources (used in) provided by financing activities             (16,579)     1,150     (3,950)
                                                                --------    -------   --------
INVESTING
Sale of subsidiaries, net; includes cancellation of
   goodwill of Ps1,761 in 2003 (Note 3)                           17,856        692      3,640
Property, plant and equipment                                        163        (17)        94
Intangible assets                                                    254         14         41
                                                                --------    -------   --------
Resources provided by investing activities                        18,273        689      3,775
                                                                --------    -------   --------
(Decrease) increase in cash and cash equivalents                    (406)       (71)       108
Cash and cash equivalents at beginning of year                       534        128         57
                                                                --------    -------   --------
Cash and cash equivalents at end of year                         Ps  128    Ps   57    Ps  165
                                                                ========    =======   ========
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                      F-6
<PAGE>

                              SAVIA, S. A. DE C. V.
                                (Parent Company)

                                  BALANCE SHEET

MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER

<TABLE>
<CAPTION>
                                                                                         December 31,
                                                                                       2003       2002
                                                                                      -------    -------
<S>                                                                                  <C>        <C>
ASSETS
Current assets:
Cash and cash equivalents                                                             Ps   67    Ps   16
Accounts receivable from subsidiaries and related parties (Note 5)                      2,276      1,004
Other accounts receivable                                                                  16          2
Income tax recoverable                                                                     46         34
                                                                                      -------   --------
Total current assets                                                                    2,405      1,056
                                                                                      -------   --------
Deferred income tax                                                                        --        202
Investment in shares and other investments (Note 2.d)                                      19        147
Long-term account receivable from subsidiaries, SaVIA Holding, (Note 5)                    --      1,079
Investment in subsidiaries                                                              2,103      2,461
Property and equipment, net                                                                72         77
Other assets                                                                               37         42
                                                                                      -------   --------
Total non current assets from continuing operations                                     2,231      4,008
Non current assets from discontinued operations (Note 3)                                   --      5,423
                                                                                      -------   --------
Total non current assets                                                                2,231      9,431
                                                                                      -------   --------
Total assets                                                                          Ps4,636   Ps10,487
                                                                                      =======   ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term liabilities:
Bank loans and other financing (Note 8)                                                         Ps   866
Accounts payable to subsidiaries, related parties
and other accounts payable                                                            Ps  348        348
Accounts payable and accrued expenses                                                      27         73
                                                                                      -------   --------
Total current liabilities                                                                 375      1,287
Long-term accounts payable to subsidiaries, related parties
and other accounts payable                                                              1,458      1,232
                                                                                      -------   --------
Total liabilities                                                                       1,833      2,519
                                                                                      -------   --------
Stockholders' equity (Note 9):
Nominal capital stock                                                                       7          7
Restatement of capital stock                                                            1,656      1,656
                                                                                      -------   --------
                                                                                        1,663      1,663
Additional paid-in capital                                                              3,065      2,692
Retained earnings                                                                       5,717     11,305
Deficit on restatement of capital                                                      (7,629)    (7,213)
Cumulative translation adjustment                                                         (13)      (479)
                                                                                      -------   --------
Total stockholders' equity                                                              2,803      7,968
Subsequent events, commitments and contingencies (Notes 1 and 13)
                                                                                      -------   --------
Total liabilities and stockholders' equity                                            Ps4,636   Ps10,487
                                                                                      =======   ========
The accompanying  notes are an integral part of these financial statements
</TABLE>


                                      F-7
<PAGE>

                              SAVIA, S. A. DE C. V.
                                (Parent Company)

                               STATEMENT OF INCOME

MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER

                                                     Year Ended December 31,
                                                        2003      2002
                                                     --------    ------
Revenues from dividends, services and royalties        Ps  12    Ps 117
                                                     --------    ------
Operating expenses                                        (34)      (50)
Services rendered by subsidiaries                         (48)      (73)
                                                     --------    ------
                                                          (82)     (123)
                                                     --------    ------
Operating loss                                            (70)       (6)
                                                     --------    ------
Comprehensive financing income (cost):
Financial expense                                         (88)     (169)
Financial income                                          174       180
Exchange gain (loss), net                                 129       (34)
Loss on monetary position                                 (13)      (19)
                                                     --------    ------
                                                          202       (42)
                                                     --------    ------
                                                          132       (48)
Other income, net (Note 10)                                51       345
                                                     --------    ------
Income before the following provision                     183       297
Provision for income tax                                 (207)      (18)
                                                     --------    ------
(Loss) income before equity in loss of subsidiaries       (24)      279
Equity in loss of subsidiaries                           (154)   (1,922)
                                                     --------    ------
Loss from continuing operations                          (178)   (1,643)
                                                     --------    ------
Discontinued operations, net of income tax (Note 3):
(Loss) income from discontinued operations               (295)      837
Loss on sale of subsidiaries                           (1,889)       --
                                                     --------    ------
                                                       (2,184)      837
                                                     --------    ------
Net loss for the year                                Ps(2,362)   Ps(806)
                                                     ========    ======

The accompanying notes are an integral part of these financial statements.


                                      F-8
<PAGE>

                              SAVIA, S. A. DE C. V.
                                (Parent Company)

                   STATEMENT OF CHANGES IN FINANCIAL POSITION

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER

<TABLE>
<CAPTION>
                                                               Year Ended December 31,
                                                                   2003      2002
                                                                  ------    ------
<S>                                                               <C>      <C>
OPERATIONS
(Loss) gain from continuing operations,
before equity in loss of subsidiaries                             (Ps 24)   Ps 279
Items not affecting resources:
Depreciation and amortization                                          2       153
Deferred income tax                                                  207        30
                                                                  ------    ------
                                                                     185       462
Changes in:
Accounts with subsidiaries, net                                     (117)    1,612
Other                                                                (77)       52
                                                                  ------    ------
Resources (used in) provided by operations                            (9)    2,126
                                                                  ------    ------
FINANCING
Bank loans and other financing, net                                 (866)       59
Accounts with subsidiaries, affiliates and related parties, net      155    (1,094)
Dividends declared                                                (2,774)       --
Reserve for repurchase of share                                      387       (54)
Cumulative translation on adjustment                                 466        --
                                                                  ------    ------
Resources used in financing activities                            (2,632)   (1,089)
                                                                  ------    ------
INVESTING
Divestiture of subsidiaries, net; includes cancellation of
goodwill by Ps1,761 in 2003 (Note 3)                               2,685    (1,099)
Property and equipment                                                 4        --
Other assets                                                           4        21
                                                                  ------    ------
Resources provided by (used in) investing activities               2,693    (1,078)
                                                                  ------    ------
Increase (decrease) in cash and cash equivalents                      52       (41)
Cash and cash equivalents at beginning of year                        15        56
                                                                  ------    ------
Cash and cash equivalents at end of year                          Ps  67    Ps  15
                                                                  ======    ======
</TABLE>

The accompanying notes are an integral part of these financial statements.


                                      F-9
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                        DECEMBER 31, 2001, 2002 AND 2003

                 MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003
           PURCHASING POWER (except per share data and exchange rates)

NOTE 1 - DESCRIPTION OF BUSINESS

SaVIA carries out its activities through subsidiary companies, of which it owns
or controls, directly or indirectly, the majority of the common stock. The term
"the Company", as used in these financial statements, refers to SaVIA together
with its consolidated subsidiaries.

At December 13, 2002 SaVIA announced the signing of a letter of intent with Fox
Paine & Company LLC (Fox Paine), a U.S. investment fund, through which Fox Paine
and certain parties related to SaVIA agreed to purchase all outstanding shares
of Seminis, Inc. (Seminis), the Company's major subsidiary. The letter of intent
was not binding for the parties, so at December 31, 2002 the Company did not
write down its investment in Seminis to its expected realization value.

At an Extraordinary General Meeting on April 30, 2003 the stockholders approved
a proposal by the Board of Directors (a) to sell the Seminis shares owned by
SaVIA, and other related parties, (b) to settle the syndicated loan payable by
SaVIA and (c) to declare a dividend in cash to its stockholders. At September
29, 2003 SaVIA concluded the process of the sale of shares and as from that
date, Seminis is no longer its subsidiary. Consequently, this disinvestment has
been reflected as "Discontinued Operations". The financial statements for 2002
and 2001 have been reclassified on the same basis..

Accounting principles generally accepted in Mexico provide that when a
significant segment of an entity is discontinued, as in the case of Seminis (see
Note 3), the assets, liabilities, income and expenses of this discontinued
segment should be shown separately in the consolidated and individual financial
statements, under the description "Discontinued Operations". As a result, the
emphasis in the accompanying financial statements and the respective notes is on
the Company's continuing activities, and the concepts shown in the consolidated
and individual financial statements as "Discontinued Operations" for all
reported periods correspond to the financial information of Seminis and its
subsidiaries.

SaVIA's shares were listed in the Mexican Stock Exchange and the New York Stock
Exchange (NYSE). In October 2003, as a result of the aforementioned sale of
shares of Seminis, SaVIA received notification from the NYSE that its shares
would no longer be listed in that stock exchange. Its ADR's (securities issued
by an authorized bank supported by shares deposited by Mexican issuers) are
currently traded in the over the counter market.


                                      F-10
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

                 MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003
           PURCHASING POWER (except per share data and exchange rates)

SUBSEQUENT EVENT

At March 30, 2004, SaVIA announced that its subsidiary Bionova Holding Corp.
(Bionova Holding), concluded its financial restructuring consisting of the
partial capitalization of its debt of US$79.8 million with SaVIA and its merger
with Ag Biotech Capital Inc., a related party based in the United States of
America. Consequently, Bionova Holding became a private wholly- owned subsidiary
of SaVIA (see Note 3).

Following are the principal consolidated subsidiaries (most Mexican subsidiaries
are "S. A. de C. V.") and a description of the business segments in which they
operate:

                                                    % ownership at
                                                      December 31,
                                                    ---------------
                                                     2002     2003
                                                    ------   ------
CONTINUING OPERATIONS
REAL ESTATE DEVELOPMENT
Desarrollo Inmobiliario Omega                        100.0    100.0
Nuevos Desarrollos Regionales de Monterrey              --    100.0
      Vector Fondo Empresarial                        68.9     77.4
      Inmobiliaria Terra                             100.0    100.0
      Urbanizadora Las Arboledas                     100.0    100.0
FRESH PRODUCE
(Fresh produce and other agrobusiness)
AG-Biotech Capital LLC (1)                           100.0    100.0
      Bionova Holding Corporation (1)                 76.6     78.6
      DNA Plant Technology Corporation (1)           100.0    100.0
      Agrobionova                                    100.0    100.0
      International Produce Holding Company (1)      100.0    100.0
Agromod                                              100.0    100.0


                                      F-11
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                          % ownership at
                                            December 31,
                                          ---------------
                                            2002     2003
                                          ------   ------
OTHER BUSINESSES
Valores Asociados                          100.0    100.0
SaVIA Holding, B. V                        100.0    100.0
      Empaques Ponderosa (Empaq)            85.4     99.0
      Servicios Ponderosa                  100.0    100.0
DISCONTINUED OPERATIONS (NOTE 3)
Seminis, Inc. (1)                           63.4       --
      Seminis Vegetable Seeds, Inc. (1)    100.0       --
      Hungnong Seed Co., Ltd. (1)          100.0       --
      Choong Ang Seed Co. (1)              100.0       --

(1)     The financial statements of foreign subsidiaries have been conformed to
        accounting principles generally accepted in Mexico. The cumulative
        translation adjustment of those financial statements is recorded
        directly in stockholders' equity.

NOTE 2 - BASIS FOR PREPARATION OF THE FINANCIAL STATEMENTS

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. However: (a) in the years ended
December 31, 2003, 2002 and 2001, the Company incurred consolidated losses of
Ps2,362 million, Ps806 million, and Ps3,177 respectively, (b) in September 2003,
Seminis, Inc. (Seminis), a subsidiary representing a significant portion the
consolidated assets and sales was sold and (c) there has been a deterioration in
cash flow generation, which could eventually force the Company to sell the rest
of its assets. These matters, among others, raise substantial doubts about the
Company's ability to continue as a going concern. The accompanying financial
statements do not include any adjustments related to the valuation and
classification of the assets and classification and amount of the liabilities
that might result from the outcome of these uncertainties.

The consolidated financial statements include those of SaVIA and all its
subsidiaries. The individual financial statements of SaVIA are prepared to
comply with the legal requirements to which the parent company is subject to as
an independent legal entity. In the financial


                                      F-12
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

statements of the parent company the investment in shares of subsidiaries is
accounted for by the equity method.

The preparation of the financial information in conformity with accounting
principles generally accepted in Mexico (MEX-GAAP) requires that management make
estimates and assumptions which affect the figures in the balance sheet and in
the statement of income for the period. Actual results could differ from those
estimates.

The accompanying financial statements have been prepared in accordance with
accounting principles generally accepted in Mexico, including the standard
requiring comprehensive recognition of the effects of inflation on the financial
information. Consequently, all financial statements, including those of prior
periods presented for comparative purposes, are stated in constant pesos of
December 31, 2003 purchasing power.

The most important indexes (NCPI) used to recognize the effects of inflation on
the financial statements were (second half of June 2002 = 100):

                         December
                           2003               106.996
                           2002               102.904
                           2001                97.354

To recognize inflation in other countries, mainly the United States of America,
indexes published by the Banco de Mexico are used.

Following are the most significant accounting policies applied on a consistent
basis in the preparation of the Company's consolidated and individual financial
statements:

a.    FOREIGN CURRENCY TRANSACTIONS

      Assets and liabilities denominated in foreign currencies, mainly U. S.
      dollars (US$), are stated in Mexican currency at the rates of exchange in
      effect at the balance-sheet date. Exchange differences arising from
      changes in the exchange rates between the transaction and settlement
      dates, or the balance-sheet date, are charged or credited to income.

b.    CASH AND CASH EQUIVALENTS


                                      F-13
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     The Company classifies as cash equivalents all highly liquid investments
     purchased with an original maturity of three months or less. The Company
     invests its excess cash in deposits with major domestic and international
     banks, in government securities and in money market accounts with
     financial institutions.

c.   INVENTORIES AND COST OF SALES

     REAL ESTATE DEVELOPMENT

     Land is stated at acquisition cost, plus additional disbursements as shown
     in Note 6, restated by applying factors derived from the NCPI to
     appraisals made by independent experts in 1998.

     Land urbanization expenditures (adaptation, surfacing, public services,
     etc.) are stated at their restated value by applying factors derived from
     the NCPI to the historical cost.

     The cost of land sold represents the cost of land and the corresponding
     proportion of urbanization expenses, determined based on restated costs of
     land and as well as the restated cost of the urbanization expenses.

     The comprehensive financing cost of loans contracted to finance land in
     process of development is capitalized as part of those assets and included
     in cost of sales when such land is sold.

     FRESH PRODUCE

     Inventories are stated at the lower of estimated replacement cost or
     market. Estimated replacement cost is determined by the last purchase
     price and production costs for the period. Cost of sales is determined
     based on estimated replacement costs prevailing on the dates in which
     inventories are sold.

d.   INVESTMENT IN SHARES AND OTHER INVESTMENTS

     In the balance sheet of the Parent Company, the investment in subsidiaries
     is accounted for by the equity method. In accordance with this method,
     changes in the carrying amount of the shares derived from the changes
     occurring after the acquisition date in the stockholders' equity accounts
     of the investees.

                                      F-14
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     Other investments, which are individually insignificant and/or represent
     less than 10% of the capital stock of the issuers, are accounted for under
     the cost method and the balances are restated by applying factors derived
     from the NCPI to their original cost, less a valuation allowance where
     required.

     Losses on closing down subsidiary companies due to their inability to
     continue their normal operations are recognized by charging to operations
     of the year in which the decision is taken the book value of the related
     investments, including goodwill, in the books of the Parent Company at that
     date.

e.   PROPERTY, PLANT, EQUIPMENT AND DEPRECIATION

     These assets are stated at cost restated by applying factors derived from
     the NCPI to the historical cost, except for machinery and equipment of
     foreign origin owned by the Mexican subsidiaries, which are stated at cost
     restated by applying factors derived from the general inflation index of
     the country of origin to the corresponding foreign currency amounts and
     translating those amounts to pesos at the exchange rate prevailing at the
     balance sheet date.

     Depreciation is calculated by the straight-line method based on the
     estimated useful lives of the assets.

     The comprehensive financial cost arising from liabilities contracted to
     finance construction in process is capitalized as part of these assets
     until they begin their normal operations.

f.   ACQUISITIONS AND INTANGIBLE ASSETS

     Underlying assets and liabilities of acquired companies are recorded at
     fair market values and any excess purchase price is recorded as "Goodwill".
     Goodwill is indexed by applying factors derived from the NCPI to the
     original cost. Amortization is calculated at an annual rate of 5%.

     The intangible assets represent basically the cost of patents and
     trademarks, expenses identified with the acquisition of subsidiaries, costs
     relative to the development and installation of integrated software, etc.
     and are amortized over periods of 10 to 20 years.

g.   SEVERANCE COMPENSATION


                                      F-15
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     Seniority premiums to which employees of Mexican subsidiaries are entitled
     upon termination of employment after 15 years of service are recognized as
     expenses of the years in which the services are rendered through trust
     funds and liability provisions, based on annual actuarial reports made by
     independent experts.

     Other compensation based on length of service to which employees may be
     entitled in the event of dismissal or death, in accordance with the Federal
     Labor Law, is charged to income in the year in which it becomes payable.

h.   DERIVATIVE FINANCIAL INSTRUMENTS

     Assets and liabilities arising from derivative financial instruments are
     stated at fair value and are included in the balance sheet as other assets
     or liabilities. The differences between the fair value and the acquisition
     cost (including purchase expenses and premiums or discounts), as well as
     gains and losses incurred, are recorded directly in income, except for
     those arising from financial transactions on SaVIA's own shares, which are
     recorded directly in stockholders' equity.

i.   COMPREHENSIVE FINANCING (EXPENSE) INCOME

     This item is determined by grouping in the statement of income all interest
     and other financial income and expense, exchange gains and losses, and the
     gain or loss on monetary position.

     The gain or loss on monetary position represents the effect of inflation,
     as measured by the NCPI, on the Company's average monthly net monetary
     assets or liabilities during the year.

j.   REVENUE RECOGNITION AND RELATED COSTS

     REAL ESTATE DEVELOPMENT

     Revenue from sales of land is recognized upon the signing of the sales
     agreement. Financed sales of land are effected at a term exceeding thirteen
     months, under contracts that accrue interest at a fixed rate. Unearned
     interest derived from such sales is credited to income on an accrual basis.
     Income corresponding to land urbanization is recorded in conformity with
     the percentage-of-completion method.


                                      F-16
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     Contract work to be performed represents unearned income related to the
     urbanization in process of land sold.

     Costs of land sold and the corresponding urbanization costs are recorded as
     stated in paragraph c. above. The cost of sales of houses is determined by
     the specific cost of each unit sold.

     Income and costs are restated by applying factors derived from the NCPI.

     FRESH PRODUCE

     Companies in the Fresh produce segments recognize their revenues when the
     merchandise is delivered and billed to customers. The revenues and the
     accounts receivable are recorded net of allowances for returns and doubtful
     accounts, respectively.

k.   INCOME TAX AND EMPLOYEES' PROFIT SHARING

     SaVIA and Empaq and their respective Mexican subsidiaries file consolidated
     income tax returns.

     Income tax and employees' profit sharing are recorded under the accounting
     method requiring recognition of deferred tax assets and liabilities for the
     future tax consequences attributable to differences between the financial
     statement carrying amounts of all assets and liabilities and their
     respective tax bases.

l.   EARNINGS PER SHARE

     Earnings per share computations are based on the net income (loss)
     attributable to the majority interest divided by the weighted average
     number of shares outstanding during the year. There are no effects arising
     from potentially dilutive shares.

m.   COMPREHENSIVE LOSS

     The various captions relating to earned surplus for the year, other than
     dividends paid, are included in the statement of changes in stockholders'
     equity under the caption "comprehensive loss".

NOTE 3 - CHANGES IN SHARE OWNERSHIP


                                      F-17
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

AND INVESTMENT PORTFOLIO

Operations relative to the sale of shares of Seminis and the financial
restructuring of Bionova Holding, are described below:

SEMINIS

On September 29, 2003, the sale of the Company's investment in Seminis was
effected through the following simultaneous operations:

o    The shares in Seminis were sold for US$266 million, equivalent to Ps2,908.
     The Company recognized a loss on sale of shares in the amount of Ps1,889,
     resulting mainly from the write-off of goodwill amounting to Ps1,761, which
     had previously arisen from the acquisition of Seminis and from the
     repurchase of minority interest from ex-stockholders of Seminis.

o    Of the proceeds obtained from the sale of the shares, US$65 million were
     used to repay the syndicated loan and the debt with related parties owed by
     SaVIA, net of debt forgiveness of US$25 million, and to pay a dividend in
     cash to SaVIA's stockholders in the amount of US$251 million, equal to
     Ps2,774 (see Note 9).

The effect of the sale of Seminis was recorded in the consolidated statement of
income for 2003 under the item "Discontinued Operations". For this purpose, the
following is shown separately: (a) the loss incurred on the sale of the shares
of Seminis and (b) the recognition of the Company's equity in the results of
Seminis and its subsidiaries through the date of the sale. For comparative
purposes, the 2002 and 2001 financial statements have been reclassified to
reflect the same presentation.

The cumulative translation adjustment relating to Seminis included directly in
stockholders' equity in prior years was reclassified to retained earnings in the
statement of changes in stockholders' equity, so that the balance of this
adjustment at December 31, 2003 corresponds exclusively to the foreign
subsidiaries included in continuing operations.


                                      F-18
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

The Discontinued Operations amounts for the years ended December 31, were as
follows:

<TABLE>
<CAPTION>
                                                  2001           2002      2003
                                                --------       -------   --------
<S>                                             <C>            <C>        <C>
Net sales                                       Ps19,124       Ps5,206    Ps4,405
Cost and operating expenses                      (20,129)       (4,470)    (3,930)
 Comprehensive financing cost                       (387)         (255)      (218)
 Other expenses, net                                (369)         (301)      (626)
                                                --------       -------   --------
 (Loss) income before provisions                  (1,761)          180       (369)
 Provision for taxes                              (1,165)          771        (97)
                                                --------       -------   --------
Net (loss) income from Discontinued Operations    (2,926)          951       (466)
Extraordinary items, net                            (139)           --         --
Income (loss) on sale of shares of
subsidiaries sold                                    772            --     (1,889)
                                                --------       -------   --------
                                                (Ps2,293)      Ps  951   (Ps2,355)
                                                ========       =======   ========
</TABLE>

(1)  This amount is shown net of the cancellation of certain tax liability
     provisions recorded in 2001 for Ps747, as described in Note 13.

The net assets of the Discontinued Operations included in the consolidated
balance sheet at December 31, 2002 are analyzed as follows:

ASSETS
Current assets:
Cash and cash equivalents                  Ps   364
Accounts receivable, net                      1,773
Inventories                                   3,279
Other current assets                             62
                                           --------
Total current assets                          5,478
                                           --------
Investment in associated companies                3
Property, plant and equipment, net            1,909
Goodwill, net                                 3,801
Intangible assets, net                          664
                                           --------
Total noncurrent assets                       6,377
                                           --------
Total assets                               Ps11,855
                                           ========

                                      F-19
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

LIABILITIES AND STOCKHOLDERS' EQUITY
Short-term debt                            Ps 3,068
Other current liabilities                     1,583
                                           --------
Total current liabilities                     4,651
                                           --------
Long-term debt                                  180
Other long-term liabilities                     152
                                           --------
Total long-term liabilities                     332
                                           --------
Total liabilities                             4,983
Stockholders' equity                          6,872
                                           --------
Total liabilities and stockholders'
    equity                                 Ps11,855
                                           ========

BIONOVA HOLDING

At March 30, 2004, SaVIA announced that its subsidiary Bionova Holding had
concluded its financial restructuring and its merger with Ag Biotech Capital
Inc., a related party based in the United States of America.

In accordance with U.S. stock exchange regulations, the ownership percentage of
SaVIA after the capitalization and forgiveness of its debt (100%) allowed
Bionova Holding to merge with a subsidiary of SaVIA and simultaneously cease
being listed in the U.S. stock markets. As a result of this transaction, the
minority shareholders of Bionova Holding received US$0.09 per share.

The financial restructuring of Bionova Holding, whose accounting effects will be
recognized by SaVIA as of March 31, 2004, involved the following operations:

o    The issuance of 26,959,097 shares subscribed and paid for by SaVIA for an
     amount of US$2.5 million (US$0.01 per share), applied to reduce the debt
     owed by Bionova Holding to SaVIA totaling US$55.5 million.

o    SaVIA contributed the aforementioned 26,959,097 shares to its subsidiary Ag
     Biotech Capital LLC, which owned 18,076,839 shares of the capital stock of
     Bionova Holding, increasing its holding to 45,035,936 shares, representing
     90.1% of the capital stock of Bionova Holding. These shares were in turn
     contributed to a new entity, Ag Biotech Capital Inc., created for this
     purpose.


                                      F-20
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

o    SaVIA wrote-off the remaining balance of debt payable by Bionova Holding in
     the amount of US$53.0 million and the related accumulated interest of
     US$24.3 million.

o    Immediately after writing off the principal and interest, Ag Biotech
     Capital Inc. merged with Bionova Holding, the latter subsisting as the
     surviving entity; therefore, since that date, Bionova Holding is a private
     wholly-owned subsidiary of SaVIA.

In order to carry out those transactions, the Board of Directors of Bionova
Holding contracted the services of AgriCapital Securities Inc., an investment
bank with experience in agricultural companies, to act as the financial advisor
and assist the Board in analyzing the appropriateness of developing the exchange
strategy for the aforementioned debt write-off and merger, while safeguarding
the interests of the minority stockholders of the company. In its report,
AgriCapital concluded that the payment of US$0.09 per share to the minority
stockholders and the issuance of shares of the company in connection with the
exchange were fair from the financial point of view for both the minority
stockholders and Bionava Holding.

As a result of the aforementioned agreements, Bionova Holding ceased to be a
public company. Likewise, the registration of the company with the Securities
and Exchange Commission in the United States (SEC) was terminated, as well as
its obligation to report financial information thereto; therefore, at the date
of issuance of these financial statements, there is no public market for the
shares of Bionova Holding.

NOTE 4 - FLUCTUATION OF THE MEXICAN
PESO AND COMPANY'S FOREIGN CURRENCY POSITION

At December 31, the peso exchange rates with the U.S. dollar were as follows:

                    2003                        11.199
                    2002                        10.361
                    2001                         9.169

At April 14, 2003, date of issuance of the audited financial statements, the
exchange rate was Ps11.2702 pesos to the U.S. dollar.

Amounts in this note are expressed in thousands of U.S. dollars (US$), since
this is the currency in which most of the Company's foreign currency
transactions are carried out.


                                      F-21
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

At December 31, 2003, SaVIA and its Mexican subsidiaries had the following
foreign currency monetary assets and liabilities:

Assets                                    US$  35,903
                                          -----------
Current liabilities                            (8,141)
Long-term liabilities                          (1,127)
                                          -----------
                                               (9,268)
                                          -----------
Net foreign currency position             US$  26,635
                                          ===========

Following is a summary of the foreign currency transactions of SaVIA and its
Mexican subsidiaries:

                                      Year Ended December 31,
                                2001           2002             2003
                             ----------    ------------     -----------
Merchandise exports and
other sales in dollars       US$ 54,311    US$  129,225     US$  97,166
Interest income                   2,610               4              --
Imports of raw materials and
spare parts                      (4,393)         (5,217)         (4,319)
Interest expense                 (2,966)         (2,044)             --
Technical assistance, net        (6,385)           (562)         (3,961)
Other                              (443)           (490)             --
                             ----------    ------------     -----------
                             US$ 42,734    US$  120,916     US$  88,886
                             ==========    ============     ===========

Summaries of the financial position of the foreign subsidiaries of SaVIA are
shown below:

                                             December 31,
                                          2002           2003
                                      ----------     ----------
Cash and cash equivalents             US$  2,130     US$  5,796
Accounts receivable, net                  27,783         20,012
Inventories                               11,218          5,850
Property, plant and equipment, net        33,577         30,662
Other assets                               3,936          3,996
                                      ----------     ----------
                                          78,644         66,316
                                      ----------     ----------


                                      F-23
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                             December 31,
                                          2002           2003
                                      ----------     ----------
Current liabilities                      128,529        128,782
Long-term liabilities                        441            895
                                      ----------     ----------
                                         128,970        129,677
                                      ----------     ----------
Stockholders' equity                  (US$50,326)    (US$63,361)
                                      ==========     ==========

The following summarizes the results of operations of the foreign subsidiaries:

                                             December 31,
                                  2001           2002           2003
                              ----------     ----------      ---------
Net sales                    US$ 207,600    US$ 131,334     US$ 99,905
                              ----------     ----------      ---------
Cost of sales                    184,285        124,900         89,629
Operating expenses                28,610         15,675         16,640
Financial expenses                 7,530          6,115          6,308
Taxes and other expenses          55,178          2,819         (3,427)
                              ----------     ----------      ---------
                                 275,603        149,509        109,150
                              ----------     ----------      ---------
Consolidated net loss            (68,003)       (18,175)        (9,245)
Minority interest                   (461)          (230)          (205)
                              ----------     ----------      ---------
Majority net (loss) income   (US$ 68,464)   (US$ 18,405)    (US$ 9,450)
                              ==========     ==========      =========

NOTE 5 - ACCOUNTS RECEIVABLE

Consolidated current receivables, including accounts with related parties, are
comprised of the following:

                                                 December 31,
                                            2002              2003
                                         ---------         ---------
Trade, mainly Agrotechnology segment     Ps    329         Ps    226
Other accounts receivable                       84                80
                                         ---------         ---------
                                               413               306
Less - Allowance for doubtful accounts         (47)              (40)
                                         ---------         ---------
                                         Ps    366         Ps    266
                                         =========         =========
Accounts with related parties:

Notes receivable                         Ps     66           Ps   65
Other                                            9                20
                                         ---------         ---------


                                      F-24
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                                 December 31,
                                            2002              2003
                                         ---------         ---------
                                                75                85
Less - Allowance for doubtful accounts         (57)              (55)
                                         ---------         ---------
                                         Ps     18           Ps   30
                                         =========         =========

In addition to the above-mentioned accounts receivable at December 31, 2003 and
2002, there were the following fully reserved accounts receivable to related
parties:

a.   At December 31, 2003, long-term accounts receivable from related parties
     totaled Ps580, which were reserved as from December 31, 2002 by SaVIA's
     management, in order to recognize the risk of uncollectibility as result of
     the restructuring process of such companies. Of this amount, Ps485
     corresponds to Pulsar Internacional, S. A. de C. V. and Ps95 to Mandala
     Internacional, S. A. de C. V.

b.   At December 31, 2002, there was an account receivable by Servasa, S. A. de
     C. V. (Servasa) for Ps445 (US$41.3 million) due from Mr. Alfonso Romo
     Garza, Chairman of the Board of Directors and Chief Executive Officer of
     SaVIA. At that date, SaVIA's management decided to reserve this account as
     uncollectible, mainly due to the restructuring process which Mr. Romo's
     principal companies were going through.

In May 2003, Servasa entered into a transfer of rights agreement for US$16.1
million with Desarrollo Consolidado de Negocios, S. A. de C. V. (DCN), through
which it partially transferred the rights over the account receivable from
Servasa mentioned above. After the recovery of this account by DCN, SaVIA
collected an amount equal to the amount transferred.

Other long-term accounts receivable shown in the consolidated balance sheet at
December 31, 2003 and 2002 for Ps92 and Ps114, respectively, relate to a
receivable of Agrobionova due from a producer with which Agriobionova has
entered into Equity Partnership agreements. These receivables are collateralized
with fixed assets of Santa Cruz Empacadora S. A. de C.V., a company in which
company the producer is a stockholder.

NOTE 6 - INVENTORIES

                                                          December 31,
                                                   2002                   2003
                                                ----------            ----------
REAL ESTATE DEVELOPMENT:
Land available for sale                         PS   1,698            PS   1,767
                                                ----------            ----------
AGROTECHNOLOGY:

                                      F-25
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                                          December 31,
                                                   2002                  2003
                                                ----------            ----------
Finished products                                        6                     5
Production in process                                  138                   101
Direct materials, spare parts and other                 57                    34
                                                ----------            ----------
                                                       201                   140
                                                ----------            ----------
                                                Ps   1,899            Ps   1,907

The land inventories of the real estate development segment are analyzed as
follows:

                                                   2002                   2003
                                                ----------            ----------
Acquisition cost                                Ps     220             Ps    189
Notary expenses, fees, commissions,
taxes and location expenses                             90                    49
                                                ----------             ---------
                                                       310                   238
Increase from inflation restatement                  1,212                 1,210
                                                ----------             ---------
Restated amount                                      1,522                 1,448
Advances to suppliers                                   19                    17
                                                ----------             ---------
Total land                                           1,541                 1,465
Urbanization expenses                                  106                   142
                                                ----------             ---------
                                                     1,647                 1,607
Buildings in process of sale and other projects         51                   160
                                                ----------             ---------
Total land available for sale                   Ps   1,698             Ps  1,767
                                                ==========             =========

NOTE 7 - PROPERTY, PLANT AND EQUIPMENT

At December 31, this caption comprised the following:

                                                   2002                   2003
                                                ----------             ---------
Property                                        Ps     398             Ps    333
Machinery and equipment                                861                   634
Leasehold improvements                                 384                   384
Advances to machinery suppliers and other               19                    10
                                                ----------             ---------
                                                     1,662                 1,361
Less - Accumulated depreciation and
       amortization                                    597                   477
                                                ----------             ---------

                                      F-26
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                                   2002                   2003
                                                ----------             ---------
                                                Ps   1,065             Ps    884
                                                ==========             =========

Depreciation charged to income represented approximate average annual rates of
3% for buildings and 6% for machinery and equipment in both years. Leasehold
improvements are amortized over the duration of the agreement.

NOTE 8 - BANKS LOANS AND OTHER FINANCING

At December 31, bank loans and other short-term financing are comprised of the
following:

                                                  2002                    2003
                                                ---------               --------
Bank loans, contracted by Bionova Holding (1)   PS     83               PS    38
                                                ---------               --------
Syndicated loan:
Secured bank loans                                    184                      -
Financial institutions                                502                      -
Notes payable to related parties
   (Ps180 to Pulsar Internacional S. A. de C. V.
   and Ps53 to Conjunto Administrativo Integral

   S. A. de C. V.)                                    233                      -
                                                ---------               --------
                                                      919                      -
                                                ---------               --------
                                                Ps  1,002               Ps    38
                                                =========               ========

(1)      Guaranteed by SaVIA.

At December 31, 2003 the interest rate on the bank loans contracted by foreign
subsidiary was 8%.

As disclosed in Note 3, in September 2003, SaVIA repaid the syndicated loan,
which had been past due since December 6, 2002, as well as the notes payable to
related parties.

NOTE 9 - STOCKHOLDERS' EQUITY

At December 31, 2003, the subscribed and paid-in fixed minimum capital stock
without right of withdrawal of Ps7 was represented by 470,592,934 Class I,
Series "A", common, registered, non-par-value shares. According to the Company's
by-laws, the amount of the variable portion of the capital stock may not exceed
ten times the amount of the fixed minimum capital stock, and Series "A" shares
may be owned only by Mexican investors.


                                      F-27
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

At December 31, 2003, SaVIA placed in the stock market 3,305,075 shares of its
capital stock previously repurchased, as indicated in the statement of changes
in stockholders' equity. At that date, the retained earnings included a legal
reserve of Ps333 and a reserve for repurchase of shares of Ps1,074.

Dividends paid from retained earnings which have not previously been taxed are
subject to an income tax payable by the Company, which may be credited against
the income tax payable by the Company in the three following years. At December
31, 2003, consolidated previously taxed earnings amounted to Ps2,173.

As mentioned in Note 3, in a General Extraordinary Meeting held on April 30,
2003, the Company's stockholders declared a dividend equal to US$0.5338 per
outstanding share of SaVIA, as part of the agreements related with the sale of
shares of Seminis referred to above. The statement of changes in stockholders'
equity shows the payment of dividends made at September 30, 2003 in the amount
of Ps2,774.

Deficit on restatement of capital comprises mainly the gain or loss from holding
nonmonetary assets. This gain or loss represents the difference between the
specific restatement of these assets and their restatement based on inflation
measured in terms of the NCPI.

NOTE 10 - OTHER INCOME (EXPENSES), NET

The net (expense) income is composed of the following:

                                                   Year Ended December 31,
                                               2001         2002         2003
                                              ------       ------       ------
Write-off of investment in Desarrollo
   Forestal, S. A. de C. V                        --       (Ps431)          --
Bad debt recovery (provision) (Note 5)            --       (1,055)      Ps 180
Profit on sale of shares of subsidiaries          --           --           64
Other expenses, net                           (Ps164)         (13)         (14)
                                              ------      -------       ------
                                              (Ps164)    (Ps1,499)      Ps 230
                                              ======      =======       ======

                                      F-28
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

NOTE 11 - INCOME TAX, ASSET TAX AND EMPLOYEES' PROFIT SHARING

SaVIA and Empaq and their respective subsidiaries file a consolidated their
income for tax purposes.

The net charge to consolidated income for taxes was as follows:

                                                 Year Ended December 31,
                                                2001      2002      2003
                                               -----      ----     -----
Income tax and asset tax:
Income tax-current                             (Ps51)    (Ps12)    (Ps19)
Asset tax- current                               (10)      (21)      (29)
Benefit from tax consolidation for the year        7        15        22
                                               -----      ----     -----
Total income and asset tax payable               (54)      (18)      (26)
Deferred income tax                              (76)      (47)     (343)
                                               -----      ----     -----
Total tax provision                           (Ps130)    (Ps65)   (Ps369)
                                               =====      ====     =====

Charges to income for income tax in the year ended December 31, 2003 were
analyzed as follows:

Income from Continuing Operations, before
taxes                                           Ps   171
                                                ========
Income tax at statutory rate (34%)                               (Ps    58)
Add (deduct) effect of income tax on:
Differences in deductibility of interest        Ps    73
Benefit from tax consolidation                        22
Bad debt recovery                                     61
Tax credit write-offs                               (142)
Allowance for recoverability of tax losses          (174)
Other permanent differences                         (132)             (292)
                                                --------          --------
                                                                      (350)
Effects from Bionova Holding and its
foreign subsidiaries                                                   (19)
                                                                  --------
Total provision charged to income                                (Ps   369)
                                                                  ========


                                      F-29
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

At December 31, the principal temporary differences requiring recognition of
deferred income taxes, and for which the statutory rate (32%) was applied in
accordance with their estimated reversal was as follows:

                                                     2002               2003
                                                   ---------          --------
Inventories                                       (Ps     74)        (Ps   114)
Investment in shares                                     120                 -
Asset and liability provisions                           197               577
Tax loss carryforwards and loss on sale of shares      2,531             3,888
Property, plant and equipment, net                      (321)             (293)
Other                                                    (23)              (17)
                                                   ---------          --------
Deferred income tax                                    2,430             4,041
Recoverable tax credits and tax recoverable              169                37
                                                   ---------          --------
                                                       2,599             4,078
Valuation allowance, mainly for tax losses            (2,673)           (4,485)
                                                   ---------          --------
Net deferred income tax (liability)               (Ps     74)        (Ps   407)
                                                   =========          ========

At December 31, 2003, the deferred income tax liability was analyzed as follows:

<TABLE>
<CAPTION>
                                                  Intangible      Stockholders'     Results of
                                                    assets           equity         operations       Total
                                                   --------         ---------        --------      ---------
<S>                                                <C>            <C>               <C>           <C>
Balances at December 31, 2001                      (Ps   66)       (Ps  1,049)       Ps 1,072     (Ps     43)
Effect for the year:
Charge to income                                          -                 -             (47)           (47)
Effect from foreign subsidiary                            -                 -             (50)           (50)
Write-off of investment in Desarrollo
   Forestal, S. A. de C. V.                              66                 -               -             66
                                                   --------         ---------        --------      ---------
Balances at December 31, 2002                             -            (1,049)            975            (74)
Effect for the year:
Charge to income                                          -                 -            (343)          (343)
Effect of sales subsidiaries                              -                 -              10             10
                                                   --------         ---------        --------      ---------
Balances at December 31, 2003                      Ps     -        (Ps  1,049)       Ps   642     (Ps    407)
                                                   ========         =========        ========      =========
</TABLE>

At December 31, 2003, the Company had unused tax loss carryforwards, which may
be restated for inflation through the date they are applied against future
taxable profits, expiring in the following years:


                                      F-30
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

2009 and 2010                                     Ps    813
2011                                                  1,355
2012                                                  2,279
2013                                                  5,334
                                                  ---------
                                                  Ps  9,781

At December 31, 2003, Bionova Holding and its foreign subsidiaries had tax loss
carryforwards of Ps1,117, expiring from 2004 to 2013.

In conformity with the standards contained in Statement D-4 and due to the
remote possibility of SaVIA's generating sufficient taxable profits to realize
these loss carryforwards.

Asset tax is payable by the Mexican companies at the rate of 1.8% on the net
amount of certain assets and liabilities, but only when the amount of asset tax
exceeds the current income tax due. Asset tax paid may be recovered in the
following ten years, to the extent income tax exceeds asset tax in those years;
additionally, effective 1995 the income tax paid in excess of asset tax in the
three preceding years may be credited against the asset tax payable for the
year.

Employees' profit sharing was determined at the rate of 10% on the taxable
income of the Mexican companies, adjusted as prescribed by the Income Tax Law.

NOTE 12 - INFORMATION ON SEGMENTS AND OPERATIONS
IN DIFFERENT GEOGRAPHIC AREAS

The Company evaluates the performance of its different business segments based
on several factors. However, the most significant measure used to evaluate
business performance is business segment operating income.

As a consequence of the sale of Seminis described in Notes 1 and 3 and of the
presentation of the financial information of Seminis and its subsidiaries as
"Discontinued Operations", the Company has classified its continuing business
segments into three basic areas: Real estate development, Fresh produce (Fresh
produce and Other agrobusiness segments) and Other businesses (service
companies, etc.).


                                      F-31
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                              Fresh Produce
                                                        --------------------------
                                       Real estate       Fresh          Other          Other
                                       Developments     Produce     Agrobusinesses   Businesses    Eliminations   Consolidated
                                       ---------------------------------------------------------------------------------------
<S>                                       <C>          <C>              <C>            <C>            <C>         <C>
2001
Revenues from unaffiliated
        customers                         Ps 185          2,422            177            135             --          2,919
Inter-segment revenues                        --             23             90             37           (150)
                                          ------        -------         ------         ------         ------        -------
Total revenues                            Ps 185          2,445            267            172           (150)         2,919
                                          ======         ======         ======         ======         ======         ======
Operating income (loss)                   Ps  47        (Ps  94)        (Ps113)       (Ps 351)            --       (Ps  511)
Depreciation and amortization                  3            588            113             41             --            745
Financial income                              13             23              1            217            (86)           168
Financial expenses                             3           (113)            (6)          (383)            84           (415)
Income tax and asset tax (1)                  (6)            (8)            (8)           (32)            --            (54)
Deferred income tax                            1             --              4            (81)            --            (76)
Identifiable long-lived assets (2)             5            430            161            625             --          1,221
Acquisition of long-lived assets              --             57              3            113             --            173

2002
Revenues from unaffiliated customers      Ps 205        Ps1,511         Ps  86         Ps 222             --        Ps2,024
Inter-segment revenues                        --              6             21              3            (30)            --
                                          ------        -------         ------         ------         ------        -------
Total revenues                            Ps 205        Ps1,517         Ps 107         Ps 225        (Ps  30)       Ps2,024
                                          ======        =======         ======         ======         ======        =======
Operating income (loss)                   Ps   8        (Ps 105)       (Ps  69)       (Ps 145)            --        (Ps 311)
Depreciation and amortization                (22)            21             44             62             --            105
Financial income                               8              8              5            171           (124)            68
Financial expenses                             5           (214)           (27)            56            134            (46)
Income tax and asset tax (1)                 (11)            (7)            --             --             --            (18)
Deferred income tax                          (11)            --             (1)           (35)            --            (47)
Identifiable long-lived assets (2)            33            412            102            550             --          1,097

2003
Revenues from unaffiliated customers      Ps 181        Ps1,113         Ps 100         Ps  65             --        Ps1,459
Revenues inter-segments                       --             --             11             46            (57)            --
                                          ------        -------         ------         ------         ------        -------
Total revenues                            Ps 181        Ps1,113         Ps 111         Ps 111        (Ps  57)       Ps1,459
                                          ======        =======         ======         ======         ======        =======
Operating income (loss)                   Ps  23         (Ps 71)       (Ps  24)       (Ps 153)            --           (225)
Depreciation and amortization                  5             34             11             30             --             80
Financial income                              12             14              5            186           (148)            69
Financial expenses                            --           (197)           (21)            47            148            (23)
Income tax and asset tax (1)                  (2)           (19)            --             (5)            --            (26)
Deferred income tax                          (18)            --           (153)          (172)            --           (343)
Identifiable long-lived assets (2)            25            355             73            444             --            897
</TABLE>


                                      F-32
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

(1)  Income tax and asset tax benefit (expense) include non-recurring items
     corresponding to the tax benefit from consolidation of a Mexican
     subsidiary, income tax reduction from realization of tax loss carryforwards
     and asset tax credits.

(2)  Identifiable long-lived assets are defined as those other than financial
     instruments and deferred tax assets located in the Company's country of
     origin and in all foreign countries in which the Company holds assets.

Revenue and identifiable long-lived asset information on the Company's
operations by geographic area as of and for the years ended December 31, 2001,
2002 and 2003, is summarized below:

Revenues:

<TABLE>
<CAPTION>
                                                 Fresh Produce
                                          ---------------------------      Other
                          Real estate       Fresh          Other         businesses
                         Developments      Produce     Agrobusinesses and Eliminations Consolidated
                         --------------------------------------------------------------------------
<S>                        <C>            <C>              <C>             <C>            <C>
2001
Mexico                     Ps 185         Ps 1,003          Ps177         Ps  135         Ps 1,500
United States                                  910              -               -              910
Canada                          -              508              -               -              508
                           ------          -------          -----         -------         --------
Total                      Ps 185         Ps 2,421          Ps177         Ps  135         Ps 2,918
                           ======         ========          =====         =======         ========

2002
Mexico                     Ps 205          Ps  113          Ps 86         Ps  222         Ps   626
United States                   -              762              -               -              762
Canada                          -              636              -               -              636
                           ------          -------          -----         -------         --------
Total                      Ps 205          Ps1,511          Ps 86         Ps  222         Ps 2,024
                           ======          =======          =====         =======         ========

2003
Mexico                     Ps 181          Ps   44          Ps100         Ps   65         Ps   390
United States                   -              380              -               -              380
Canada                          -              689              -               -              689
                           ------          -------          -----         -------         --------
Total                      Ps 181          Ps1,113          Ps100         Ps   65         Ps 1,459
                           ======          =======          =====         =======         ========
</TABLE>


                                      F-33
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

Identifiable long-lived assets:
<TABLE>
<CAPTION>
                                                 Fresh Produce
                                          ---------------------------      Other
                          Real estate       Fresh          Other         businesses
                         Developments      Produce     Agrobusinesses and Eliminations Consolidated
                         --------------------------------------------------------------------------
<S>                        <C>            <C>              <C>             <C>            <C>
2001
Mexico                     Ps   5           Ps161         Ps 339          Ps  625         Ps 1,130
United States                   -               -             85                -               85
Canada                          -               -              6                -                6
                           ------          ------         ------          -------         --------
Total                      Ps   5          Ps 161         Ps 430          Ps  625         Ps 1,221
                           ======          ======         ======          =======         ========

2002
Mexico                     Ps  33           Ps343         Ps 102          Ps  550         Ps 1,028
United States                   -              61              -                -               61
Canada                          -               8              -                -                8
                           ------          ------         ------          -------         --------
Total                      Ps  33          Ps 412         Ps 102          Ps  550         Ps 1,097
                           ======          ======         ======          =======         ========

2003
Mexico                     Ps  25           Ps288         Ps  73          Ps  444         Ps   830
United States                   -              47              -                -               47
Canada                          -              20              -                -               20
                           ------          ------         ------          -------         --------
Total                      Ps  25           Ps355         Ps  73          Ps  444         Ps   897
                           ======           =====         ======          =======         ========
</TABLE>

NOTE 13 - COMMITMENTS AND CONTINGENCIES

COMMITMENTS

Bionova Holding has entered into rental agreements relative to buildings,
machinery and equipment. The rental expense was Ps4, Ps3, and Ps 10 in 2003,
2002 and 2001 (US$0.4 million, US$0.3 million and US$ 0.10, respectively).

Future commitments, in thousands of US dollars, for annual payments under these
agreements are as shown below:

Year ending December 31:

2004                                                 US$      397
2005                                                          414
2006 and thereafter                                           753
                                                     ------------
                                                     US$   1,564


                                      F-34
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

CONTINGENCIES

At December 31, 2003, there were the following contingencies:

o    For tax purposes, the Company consolidates its own income and that of its
     Mexican subsidiaries. Under this procedure, the flows for the payment of
     taxes and the offsetting of tax losses are consolidated in the income of
     the Parent Company. As a consequence of the divestiture of subsidiaries
     during 2001 and due to its related effect in the tax consolidation, Empaq
     requested official confirmation from the Mexican tax authorities of an
     interpretation related to the divestiture procedure in the consolidation
     process. At December 31, 2001, this issue was pending confirmation by the
     Mexican tax authorities and therefore, management decided to create a
     provision in 2001 for Ps747, which was charged to net income of
     discontinued operations to cover any possible contingency.

     In July 2002, the Mexican tax authorities declined to resolve the
     above-mentioned confirmation request, and the Company decided to cancel the
     provision recorded in 2001, which was credited in the amount of Ps 747 in
     the statement of income for the year ended December 31, 2002 under the
     caption "Gain on sale of discontinued operations".

o    At December 31, the Company has appealed various tax assessments by the
     Ministry of Finance for the years 1990 through 1999. Although management
     cannot anticipate the final outcome of these matters, in the opinion of the
     Company's legal advisers the final resolution will be favorable; therefore,
     no provision has been made for these contingencies.

o    The consolidated tax result for 2003 and 2002 includes a deduction for tax
     losses from the sale of shares, even though no tax profits were determined
     for the same concept, in conformity with several rulings issued by the
     Mexican Supreme Court of Justice, which maintains that when an entity's
     objects include the purchase-sale of shares, losses resulting from these
     transactions are deductible for income tax purposes.

o    In its asset tax calculation, the Company has not considered investments in
     foreign subsidiaries as assets and has deducted the amount of debts
     contracted with foreign banks not resident in Mexico. This situation is
     currently being litigated in the tax courts.


                                      F-35
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

o    During 2003 and 2002, the Company made the disincorporation of controlled
     companies effective in the year of disincorporation.

It is the opinion of Management that the ultimate resolutions of these matters
will no have a material adverse effect on the Company's consolidated financial
position or results of operations.

NOTE 14 - NEW ACCOUNTING STANDARDS

The provisions of Bulletin C-15, "Impairment of the Value of Long-Lived Assets
and their Disposal" (Bulletin C-15), issued by the Mexican Institute OF Public
Accountants, are effective January 1, 2004. Bulletin C-15 establishes general
criteria for the identification and, if applicable, the recognition of
impairment losses or the decrease in value of long-lived tangible and intangible
assets, including goodwill. Additionally, it provides the definition for net
sale price and value in use for the valuation of long-lived assets. The Company
is in the process of performing a study to assess the recoverability of its long
-lived assets and the amount of any possible impairment. However, management
does not expect that it will have a significant impact upon adoption.

NOTE 15 - CONDENSED FINANCIAL INFORMATION FOR SAVIA

Regulation S-X, Rule 5-04, requires that SEC registrants include a condensed
balance sheet as of the end of the two most recent years and condensed income
statements and statements of cash flows for the three most recent year end
December 31, 2003, when more than 25% of the net assets of a consolidated
subsidiary are restricted.

1.   Parent Company condensed balance sheet at December 31, 2002 and 2003 are as
     follows:

<TABLE>
<CAPTION>
                                                                            2002               2003
                                                                         ----------         ---------
<S>                                                                      <C>               <C>
     ASSETS
     Cash and cash equivalents                                           Ps      16         Ps     67
     Accounts receivable from related parties,net                             1,004             2,276
     Other                                                                       36                62
                                                                         ----------         ---------
     Total current assets                                                     1,056             2,405
                                                                          ---------          --------
     Investment in subsidiaries                                               3,540             2,122
     Other noncurrent assets                                                    468               109
                                                                         ----------         ---------
     Total noncurrent assets from continuing operations                       4,008             2,231
                                                                         ----------         ---------
</TABLE>


                                      F-36
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                                            2002               2003
                                                                         ----------         ---------
<S>                                                                      <C>               <C>
     Noncurrent assets from discontinued operations                           5,423                 -
                                                                         ----------         ---------
     Total noncurrent assets                                                  9,431             2,231
                                                                         ----------         ---------
     Total assets                                                        Ps  10,487         Ps  4,636
                                                                         ==========         =========
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Debt                                                                Ps     866                 -
     Short-term account payable to related parties                              348          Ps   348
     Other                                                                       73                27
                                                                         ----------          --------
     Total current liabilities                                                1,287               375
     Long-term accounts payable to related parties                            1,232             1,458
                                                                         ----------          --------
     Total liabilities                                                   Ps   2,519          Ps 1,833
                                                                         ==========          ========
     Net Assets                                                          Ps   7,968          Ps 2,803
                                                                         ==========          ========
</TABLE>

2.   Parent Company condensed income statements for the years ended December 31,
     2001, 2002 and 2003 are as follows:

<TABLE>
<CAPTION>
                                                                           2001        2002       2003
                                                                         ---------   --------   ---------
<S>                                                                      <C>        <C>          <C>
     Revenues:
     Services and royalties                                              Ps    205   Ps   117   Ps     12
     Operating expenses                                                        282        123          82
                                                                         ---------   --------   ---------
     Operating loss                                                            (77)        (6)        (70)
     Comprehensive financing                                                  (156)       (42)        202
     Other (expenses) income, net                                             (232)       345          51
                                                                         ---------   --------   ---------
     (Loss) income from continuing operations, before taxes                   (465)       297         183
     Income tax expense                                                        (94)       (18)       (207)
                                                                         ---------   --------   ---------
     Equity participation of subsidiaries                                   (2,052)    (1,922)       (154)
     Loss from continuing operations                                        (2,611)    (1,643)       (178)
     Discontinued operations, net of income tax:
     Loss from discontinued operations                                        (475)       837      (2,184)
                                                                         ---------   --------   ---------
     Net loss                                                            (Ps 3,086)  (Ps  806)  (Ps 2,362)
                                                                          ========    =======    ========
</TABLE>

3.   Parent Company condensed statements of cash flows for the years ended
     December 31, 2001, 2002 and 2003 are shown below:


                                      F-37
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                                 2001       2002         2003
                                                              ----------   -------     -------
<S>                                                           <C>         <C>         <C>
     Cash flows from operating activities
     Net (loss) income from continuing
     operations before
     equity participation in subsidiaries:                    Ps    (559)  Ps  279     Ps  (24)
     Items not affecting cash                                        166       183         209
     Changes in:
     Related parties, net                                         (3,410)    1,612        (117)
     Other                                                           (37)       52         (77)
                                                              ----------   -------     -------
     Net cash (used in) provided by operating activities          (3,840)    2,126          (9)
                                                              ----------   -------     -------
     CASH FLOWS FROM FINANCING ACTIVITIES
     Related parties, net                                            (37)   (1,094)        155
     Long-term debt and other loans, net                          (5,086)       59        (866)
     Dividends declared                                                -         -      (2,774)
     Cumulative translation adjustment                                 -         -         466
     Derivative instruments                                       (2,396)      (54)        387
                                                              ----------   -------     -------
     Net cash used in financing activities                        (7,519)   (1,089)     (2,632)
                                                              ----------   -------     -------
     Cash flows from investing activities
     Investment in shares                                            717    (1,099)      2,685
     Investment in subsidiaries                                       27         -           -
     Discontinued operations, net                                 10,369         -           -
     Plant and equipment                                              (2)        -           4
     Other                                                           (17)       21           4
                                                              ----------   -------     -------
     Net cash provided by (used in) investing activities          11,094    (1,078)      2,693
                                                              ----------   -------     -------
     (Decrease) increase in cash and cash equivalents               (265)      (41)         52
     Cash and cash equivalents at beginning of year                  321        56          15
                                                              ----------   -------     -------
     Cash and cash equivalents at end of year                 Ps      56   Ps   15     Ps   67
                                                              ==========   =======     =======
</TABLE>


                                      F-38
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

4.   Related party transactions as of and for the years ended December 31, 2003

i)   BALANCE SHEET:

<TABLE>
<CAPTION>
                                                          2002             2003
                                                       ----------       ----------
<S>                                                    <C>            <C>
     SHORT TERM ACCOUNTS RECEIVABLE
     Notes receivable from Bionova Holding
       and subsidiaries                                Ps     969            1,062
     Account receivable from SaVIA Holding                      -            1,154
     Other accounts receivable from related parties            92              115
                                                       ----------       ----------
                                                            1,061            2,331
     Less - Allowance for doubtful accounts                   (57)             (55)
                                                       ----------       ----------
                                                       Ps   1,004       Ps   2,276
</TABLE>

<TABLE>
<CAPTION>
                                                          2002             2003
                                                       ----------       ----------
<S>                                                    <C>            <C>
ACCOUNTS PAYABLE
Services rendered                                      Ps      31               29
Account payable to Valores Asociados                            -              238
Account payable to subsidiary derived from
   a research and development agreement                        10                -
Account payable to AG-Biotech                                  78               81
Account payable to related party derived from the
   purchase of Elocansa shares                                 28               27
Interest accrued to related party
   payable at original due                                    200                -
                                                       ----------        ---------
                                                       Ps     347        Ps    375
                                                       ==========        =========
</TABLE>

ii)      Income Statement:
                                    2001          2002          2003
                                    ----          ----          ----
         Income:
         Services                    32            48            12
         Financial income           146           175             3
         Other                      102             -             -

         Expense:
          Services                  188            73             -
         Financial expenses         178           116             -
         Other                      539             -             -


                                      F-39
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

NOTE 16 - RECONCILIATION BETWEEN MEXICAN (MEX-GAAP) AND
UNITED STATES (US-GAAP) GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

The Company's consolidated financial statements are prepared in accordance with
MEX-GAAP, which differ in certain significant respects from US-GAAP. The
MEX-GAAP consolidated financial statements include the effects of inflation as
provided for under Statement B-10, "Recognition of the Effects of Inflation on
Financial Information" as discussed in Note 2. The application of this Statement
represents a comprehensive measure of the effects of price level changes in the
Mexican economy, and is considered to result in a more meaningful presentation
than historical cost-based financial reporting for both Mexican and U.S.
accounting purposes. Therefore, the following reconciliations to US-GAAP do not
include the reversal of such inflationary effects.

The principal differences between MEX-GAAP and US-GAAP are presented in the
following pages with an explanation, where appropriate, of the effects on
consolidated net income and stockholders' equity. The various reconciling items
are presented net of any gain or loss on monetary position.

I.  RECONCILIATION OF CONSOLIDATED NET INCOME (LOSS)

<TABLE>
<CAPTION>
                                                                                  Years Ended December 31,
                                                                            2001          2002          2003
                                                                         ----------    ----------    ----------
<S>                                                                  <C> <C>           <C>           <C>
Net loss from continuing operations, net of minority interest,
under MEX-GAAP                                                           (Ps  1,559)   (Ps  1,643)   (Ps    178)
Pre-operating expenses                                               a           (1)          168             -
Loss on equity swap agreements                                       b       (2,176)          (90)            -
Restatement effect of Statement B-15                                 c          488          (856)            -
Minority interest                                                    d            -             -          (249)
Deferred income tax effect                                           e          (31)          (80)            -
                                                                         ----------    ----------    ----------
Net loss from continuing operations under US-GAAP                            (3,279)       (2,501)         (427)
                                                                         ----------    ----------    ----------
Net (loss) income from discontinued operations, net of minority
   interest under MEX-GAAP                                                   (1,618)          837        (2,184)
Effect of Statement B-15 restatement                                 c         (264)          851             -
Purchase accounting adjustments relating to acquisitions             g          (16)          172             -
Adjustment to gain (loss) on sale of subsidiaries                    h        5,944             -          (638)
                                                                         ----------    ----------    -----------
</TABLE>


                                      F-40
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                                                  Years Ended December 31,
                                                                            2001          2002          2003
                                                                         ----------    ----------    ----------
<S>                                                                      <C>           <C>           <C>
Net income (loss) from discontinued operations under US-GAAP                  4,046         1,860        (2,822)
                                                                          ---------     ---------     ----------
Net income (loss) under US-GAAP                                          Ps     767    (Ps    641)  (Ps   3,249)
                                                                         ==========     =========    ==========
Weighted average number of common shares
outstanding (in thousands)                                                  462,634       463,752       469,627
                                                                         ==========    ==========    ==========
Basic and diluted earnings (loss) per share (in pesos) from:
Continuing operations                                                    (Ps    7.09)  (Ps   5.40)   (Ps   0.38)
Discontinued operations                                                         8.75         4.02         (5.64)
                                                                         -----------   ----------    ----------
Basic and diluted earnings (loss) per share (in pesos) under US-GAAP     Ps    1.66    (Ps   1.38)   (Ps   6.02)
                                                                         ==========     =========     =========
</TABLE>

II.  RECONCILIATION OF CONSOLIDATED STOCKHOLDERS' EQUITY:

<TABLE>
<CAPTION>
                                                                                    As of December 31,
                                                                          2001             2002             2003
                                                                       ---------        ---------        ---------
<S>                                                            <C>     <C>             <C>             <C>
Majority stockholders' equity under MEX-GAAP                           Ps  9,058        Ps  7,968        Ps  2,803
Pre-operating expenses                                         a            (168)               -                -
Effect of Statement B-15 restatement                           b            (603)            (316)               -
Minority interest                                              d               -                -             (249)
Deferred income taxes                                          e              81                -                -
Goodwill - difference in basis                                 h               -              172                -
                                                                       ---------        ---------        ---------
Stockholders' equity under US-GAAP                                     Ps  8,368        Ps  7,824        Ps  2,554
                                                                       =========        =========        =========
</TABLE>

III.  CHANGES IN STOCKHOLDERS' EQUITY UNDER US-GAAP:

<TABLE>
<CAPTION>
                                                                                  Years Ended December 31,
                                                                          2001             2002             2003
                                                                       ---------        ---------        ---------
<S>                                                                    <C>             <C>             <C>
Balance at beginning of year - January 1,                              Ps  7,970        Ps  8,368       Ps   7,824
Net income (loss)                                                            767             (641)          (3,249)
Hedges on foreign subsidiaries net investment                                263                -                -
Reserve for repurchase of shares                                            (219)              36               14
Dividends paid                                                                 -                -           (2,774)
Loss from holding nonmonetary assets                                           -                -             (416)
Cumulative translation adjustment  (Statement B-15)                         (413)              61            1,155
                                                                       ---------        ---------       ----------
Balance at end of year - December 31,                                  Ps  8,368        Ps  7,824       Ps   2,554
                                                                       =========        =========       ==========
</TABLE>


                                      F-41
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

ADJUSTMENTS RELATED TO CONTINUING OPERATIONS:

a)   PRE-OPERATING EXPENSES

     MEX-GAAP permits the deferral and amortization of pre-operating costs
     whereas US-GAAP requires that pre-operating costs be expensed in the period
     incurred. The US-GAAP adjustment for the year ended December 31, 2002
     reflects the reversal of pre-operating expenses written-off for MEX-GAAP
     purposes in 2002, which had been previously written-off for US GAAP
     purposes. There were no pre-operating expenses incurred in 2003.

b)   EQUITY SWAP AGREEMENTS

     Under MEX-GAAP, derivative contracts that are indexed to, and potentially
     settled in, the Company's stock or cash are accounted as equity
     transactions. Under US-GAAP, these instruments would be considered assets
     or liabilities when the settlement is in cash and in equity when the
     settlement is in Company's own stock. For MEX-GAAP, all financing costs
     related to these instruments are recorded in stockholders' equity. For
     US-GAAP purposes the financing costs related to these derivative
     instruments would be recorded in results of operations. All equity swap
     transactions were terminated in 2002.

c)   RESTATEMENT EFFECT OF STATEMENT B-15

     As disclosed in Note 2, the Company applies Statement B-15, "Transactions
     in Foreign currency and Translation of Financial Statements of Foreign
     Operations" which requires the restatement of prior year reported amounts
     of foreign subsidiaries to be determined by first re-expressing prior year
     amounts by the inflation of the foreign country and then translating such
     amounts at the exchange rate at the date of the latest balance sheet. Under
     US-GAAP, the primary financial statements should be presented in the same
     reporting constant currency for all periods.

     The methodology established by Statement B-15 separates the adjustment
     process for the effects of inflation on prior year amounts for foreign and
     domestic subsidiaries which results in the presentation of amounts which
     are not in a constant unit of measure.


                                      F-42
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     The difference in the methodologies used to re-express prior year balances
     is included as a one line adjustment in the reconciliation to US-GAAP of
     net income and stockholders' equity as follows:

<TABLE>
<CAPTION>
                                                             As of and for year ended
                                                                    December 31,
                                                              2001                 2002
                                                          -----------          -----------
<S>                                                       <C>                  <C>
     Stockholders' equity:
     As indexed using the NCPI for Mexico                 Ps    8,455          Ps    7,652
     As reported under Statement B-15                           9,058                7,968
                                                          -----------          -----------
                                                         (Ps      603)        (Ps      316)
                                                          ===========          ===========
     Net income (loss) of majority stockholders':
     As indexed using the NCPI for Mexico                 Ps    1,071         (Ps    2,499)
     As reported under Statement B-15                          (1,559)              (1,643)
                                                          -----------          -----------
     Net effect of Statement B-15 applicable to
     continuing operations:                               Ps      488         (Ps      856)
                                                         ============          ===========
</TABLE>

d)   MINORITY INTEREST

     Under Mexican GAAP income or losses are allocated to minority interest
     based on the legal presumption that each shareholder is responsible for its
     proportionate gain or loss. Under US GAAP when losses applicable to the
     minority interest in a subsidiary exceed the minority interest in the
     equity capital of the subsidiary, such excess and any further losses
     applicable to the minority interest should be charged against the majority
     interest, as there is no obligation of the minority interest to make good
     such losses.

e)   DEFERRED INCOME TAXES

     SFAS No. 109, "Accounting for Income Taxes" ("SFAS No. 109"), requires an
     asset and liability approach for financial accounting and reporting for
     income tax under the following basic principles: (a) a current tax
     liability or asset is recognized for the estimated taxes payable or
     refundable on tax returns for the current year, (b) a deferred tax
     liability or asset is recognized for the estimated future tax effects
     attributable to temporary differences and tax loss carryforwards and asset
     tax credits, (c) the measurement of current and deferred tax assets and
     liabilities is based on provisions of the enacted tax law; the effects of
     future changes in tax laws or rates are not anticipated, and (d) the
     measurement of deferred income


                                      F-43
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     tax assets is reduced, if necessary, by the amount of any tax benefits for
     which available evidence indicates that it is more likely than not that the
     tax benefit will not be realized. Under this method, deferred tax and
     employee profit sharing are recognized with respect to all temporary
     differences, and the benefit from utilizing tax loss carryforwards and
     asset tax credits is recognized in the year in which the losses or credits
     arise (subject to a valuation allowance with respect to any tax benefits
     which, in management's opinion, are more likely than not to be realized).
     The subsequent realization of this benefit does not affect the income tax
     provision. Temporary differences under SFAS No. 109 are determined based on
     the difference between the indexed tax-basis amount of the asset or
     liability and the related restated amount reported in the financial
     statements.

     The deferred income tax expense or benefit is calculated as the difference
     between (a) the deferred tax assets and liabilities at the end of the
     current period, and (b) the deferred tax assets and liabilities reported at
     the end of the prior period remeasured to units of current general
     purchasing power at the end of the current period. Under MEX-GAAP Statement
     D-4, "Accounting Treatment of Income Tax, Tax on Assets and Employee
     Statutory Profit Sharing," the change in the deferred tax asset or
     liability is first measured on a historical cost basis and the components
     of the change, including monetary gains or losses, are allocated between
     the tax provision, deficit from restatement and monetary gain or loss.

     The significant components of income tax and asset tax benefit (expense)
     under US-GAAP for the years ended December 31, 2001, 2002 and 2003 were as
     follows:

<TABLE>
<CAPTION>
                                                      2001          2002        2003
                                                   ---------     ---------   ---------
<S>                                                <C>           <C>         <C>
      Income tax benefit (expense):
      CURRENT
      Mexico                                       (Ps    46)   (Ps     12) (Ps     26)
      Foreign                                            (67)          (24)          -
                                                   ---------     ---------   ---------
      Total current provision (benefit)                 (113)          (36)        (26)
                                                   ---------     ---------   ---------
      DEFERRED
      Mexico                                              14           (46)       (343)
      Foreign                                            (61)          (62)          -
                                                   ---------     ---------   ---------
      Total deferred provision (benefit)                 (47)         (108)       (343)
                                                   ---------     ---------   ---------
</TABLE>


                                      F-44
<PAGE>
'
                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
<S>                                               <C>           <C>         <C>
                                                      2001          2002        2003
                                                   ---------     ---------   ---------
      Net income tax provision from
      continuing operations                        (Ps   160)   (Ps    144) (Ps    369)
                                                    ========     =========   =========
</TABLE>

      The effect of inflationary components is attributable primarily to the
      difference in the manner in which monetary gains and losses are computed
      for financial and tax reporting purposes. Non-deductible expenses were
      attributable primarily to certain promotional and public relations
      expenses, executives' automobile expenses and certain travel and
      entertainment expenses, which were not deductible for Mexican income tax
      purposes. The non-taxable income was principally comprised of a profit on
      sale of securities.

      The significant items comprising the Company's net deferred income tax
      assets and liabilities under US-GAAP at December 31, 2002 and 2003 are as
      follows:


                                      F-45
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

                                               2002               2003
                                            ----------         ---------
      DEFERRED INCOME TAX LIABILITIES
      Property, plant and equipment         Ps     321         Ps    292
      Other                                          8                 -
      Inventories                                   74               114
                                            ----------         ---------
      Total deferred income tax liabilities        403               406
                                            ----------         ---------
      DEFERRED INCOME TAX ASSETS
      Accounts receivable                         (192)             (572)
      Tax loss carryforwards                    (2,532)           (3,912)
      Tax credit carryforwards                    (153)             (157)
      Valuation allowance                        2,674             4,626
      Other                                       (126)              (44)
                                            ----------         ---------
      Total deferred income tax assets            (329)              (59)
                                            ----------         ---------
      Net deferred income tax liability     Ps      74         Ps    347
                                            ==========         =========

      For the years ended December 31, 2002 and 2003, the difference in net
      deferred income tax liability between MEX-GAAP and U.S. GAAP was as
      follows:

<TABLE>
<CAPTION>
                                                           MEX-GAAP            US-GAAP          DIFFERENCE
                                                           --------            -------          ----------
<S>                                                        <C>               <C>                <C>
      Deferred income tax (asset) liability:
      At December 31, 2001                                 Ps    225          Ps    145         Ps      80
      At December 31, 2002                                        74                 74                  -
                                                           ---------          ---------          ----------
      Net change                                           (Ps   151)        (Ps     71)        (Ps     80)
                                                            ========          =========          =========
</TABLE>

<TABLE>
<CAPTION>
                                                           MEX-GAAP            US-GAAP          DIFFERENCE
                                                           --------            -------          ----------
<S>                                                        <C>               <C>                <C>
      Deferred income tax liability:
      At December 31, 2002                                 Ps     74          Ps     74          Ps      -
      At December 31, 2003                                       407                347                 60
                                                           ---------          ---------          ---------
      Net change                                           Ps    333          Ps    273          Ps     60
                                                           =========          =========          =========
</TABLE>

      The net change in the deferred income tax liability during 2002 and 2003
      was allocated to the following components:


                                      F-46
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                           MEX-GAAP            US-GAAP          DIFFERENCE
                                                           --------            -------          ----------
<S>                                                        <C>               <C>                <C>
      Deferred income tax liability in 2002:
      Deferred tax expenses (income)                       Ps      6          Ps     74         (Ps     65)
      Write-off of investment                                    (65)                 -                (65)
      Effect of foreign subsidiary                                50                  -                 50
                                                           ---------          ---------         ----------
      Net change                                           (Ps     9)         Ps     74         (Ps     80)
                                                            ========          =========          =========
      Deferred income tax liability in 2003:
      Deferred income tax                                  Ps    343          Ps      -         Ps     343
      Discontinued operations                                    (10)                 -                (10)
                                                           ---------          ---------         ----------
      Net change                                           Ps    333          Ps      -        (Ps     333)
                                                           =========          =========         ==========
</TABLE>

ADJUSTMENTS RELATED TO DISCONTINUED OPERATIONS:

f)   STATEMENT B-10 FIXED ASSET RESTATEMENT

     Under Statement B-10, under MEX-GAAP, the Company restates its nonmonetary
     assets of foreign origin based on the devaluation of the Mexican peso
     against the foreign currencies by applying inflation rates of the countries
     from which they originate. This methodology is not consistent with Rule
     3-20 of Regulation S-X regarding the use of the same reporting currency for
     all periods. Under US-GAAP the assets that are of foreign origin would be
     adjusted by the Mexican NCPI. Consequently, the US GAAP net income
     adjustment reflects the difference in depreciation due to the difference in
     carrying basis of the assets due to the different restatement
     methodologies.

 g)  PURCHASE ACCOUNTING ADJUSTMENTS

     Purchase accounting methods under MEX-GAAP and US-GAAP differ in certain
     respects. Under MEX-GAAP no value is assigned to intangible assets acquired
     (purchased research and development costs, patents and licenses),
     inventories are valued at their estimated replacement costs rather than
     fair market value and deferred taxes are not established for the respective
     purchase price adjustments. Intangible assets under US-GAAP are capitalized
     and amortized over their estimated useful lives and purchased research and
     development costs ("Purchased R&D") are written off immediately.

h)   US GAAP ADJUSTMENT TO GAIN (LOSS) ON SALES OF DISCONTINUED OPERATIONS


                                      F-47
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     Under US-GAAP, the book basis of the Company's investment in the
     subsidiaries sold during 2001 and 2003 for, SCA and Seminis respectively,
     differed from the basis under MEX-GAAP due to following differences:

                                                    2001         2003
                                                 ---------      -------
     Cancellation of goodwill                    Ps  4,958     (Ps. 172)
     Effect of incorporation                           900           --
     Deferred income tax                               157           --
     Cumulative translation adjustment                   -         (466)
     Effect of Statement B-10 - fixed assets           (72)
                                                 ---------      -------
                                                 Ps  5,943      (Ps 638)
                                                 =========      =======

--------------------------------------------------------------------------------

     During 2002, there were no differences between the book basis as per
     US-GAAP, and that used for MEX-GAAP on the discontinued operations. Under
     MEX-GAAP, the Company maintained a policy of amortizing goodwill over
     periods ranging from 15 to 20 years. Under US-GAAP, in 2002, the Company
     discontinued the amortization of goodwill in accordance with the adoption
     of Statement of Financial Accounting Standard ("SFAS") No. 142, "Goodwill
     and Other Intangible Assets", thereby necessitating a US-GAAP adjustment
     for the reversal of the amortization recognized under MEX-GAAP for that
     year related to Seminis. In 2003, the remaining carrying basis difference
     related to goodwill was written-off.

     SUPPLEMENTAL CONDENSED CONSOLIDATED US-GAAP FINANCIAL DATA:

     The basis of presentation under US-GAAP varies from that of MEX-GAAP.
     Provided below are condensed balance sheets, income statements and cash
     flow statements under US-GAAP which incorporate the adjustments and
     reclassifications previously identified.

1.   Consolidated balance sheet amounts at December 31, 2002 and 2003 under
     US-GAAP are as follows:

<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                            2002               2003
                                                                         ----------         ---------
<S>                                                                      <C>               <C>
     ASSETS
     Cash and cash equivalents                                           Ps      57         Ps    165
     Accounts receivable, net                                                   366               266
     Accounts receivable from related parties and
       other accounts receivable                                                 18                30
     Income tax and asset tax receivable                                         67                19
     Inventories, net                                                         1,899             1,907
</TABLE>


                                      F-48
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

<TABLE>
<CAPTION>
                                                                                  December 31,
                                                                            2002               2003
                                                                         ----------         ---------
<S>                                                                      <C>               <C>

     Deferred income tax                                                        297               572
     Prepaid expenses                                                            25                53
                                                                         ----------         ---------
     Total current assets from continuing operations                          2,729             3,012
     Current assets from discontinued operations                              5,478                 -
                                                                          ---------          --------
     Total current assets                                                     8,207             3,012
                                                                          ---------          --------
     Deferred income tax                                                        270                 -
     Investment in shares and other investments                                  11                 6
     Other long-term accounts receivable                                        114                92
     Property, plant and equipment, net                                       1,065               884
     Other assets                                                                95                52
                                                                         ----------         ---------
     Total noncurrent assets from continuing operations                       1,555             1,034
     Noncurrent assets from discontinued operations                           5,233                 -
                                                                         ----------         ---------
     Total noncurrent assets                                                  6,788             1,034
                                                                         ----------         ---------
     Total assets                                                        Ps  14,995         Ps  4,046
                                                                         ==========         =========
     LIABILITIES AND STOCKHOLDERS' EQUITY
     Bank loans                                                          Ps   1,000          Ps    34
     Current portion of long-term debt                                            2                 3
     Accounts payable to related parties and
     other accounts payable                                                     463               481
                                                                          ---------          --------
     Current liabilities from continuing operations                           1,465               518
     Current liabilities from discontinued operations                         4,679                 -
                                                                          ---------          --------
     Total current liabilities                                                6,144               518
                                                                          ---------          --------
     Deferred income tax and profit sharing                                     783               919
     Long-term debt                                                               5                10
     Long-term accounts payable to related parties and others                    51                45
                                                                         ----------          --------
     Long-term liabilities from continuing operations                           839               974
     Long-term liabilities from discontinued operations                         188                 -
                                                                         ----------          --------
     Total long-term liabilities                                              1,027               974
                                                                         ----------          --------
     Total liabilities                                                        7,171             1,492
                                                                         ----------          --------
     Minority interest                                                         (316)                -
                                                                         ----------          --------
     Stockholders' equity                                                     8,140             2,554
                                                                         ----------          --------
     Total liabilities and stockholders' equity                          Ps  14,995          Ps 4,046
                                                                         ==========          ========
</TABLE>


                                      F-49
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

2.   Condensed income statements under US-GAAP for the years ended December 31,
     2001, 2002 and 2003 are as follows:

<TABLE>
<CAPTION>
                                                                                   Year Ended December 31,
                                                                            2001            2002             2003
                                                                         ---------       ---------        ---------
<S>                                                                      <C>             <C>              <C>
     Net sales                                                           Ps  2,586       Ps  1,940        Ps  1,459
     Cost of sales                                                           2,146           1,620            1,221
                                                                         ---------       ---------        ---------
     Gross margin                                                              440             320              238
     Operating expenses                                                      1,244             630              463
                                                                         ---------       ---------        ---------
     Operating loss                                                           (804)           (310)            (225)
                                                                         ---------       ---------        ---------
     Comprehensive financing cost:
     Financial expense                                                      (2,952)           (130)             (23)
     Financial income                                                          450              68               69
     Exchange gain (loss), net                                                 (13)            216              130
     Gain (loss) on monetary position                                           96             (57)             (10)
                                                                         ---------       ---------        ---------
                                                                            (2,419)             97              166
                                                                         ---------       ---------        ---------
     Other income (expenses), net                                              365          (2,071)             230
                                                                         ---------       ---------        ---------
     Loss (income) from continuing operations, before taxes                 (2,858)         (2,284)             171
     Income tax expense                                                       (160)           (144)            (369)
                                                                         ---------       ---------        ---------
     Loss from continuing operations                                        (3,018)         (2,428)            (198)
     Discontinued operations, net of income tax and
     employees' profit sharing:                                              2,795           1,849           (2,993)
                                                                         ---------       ---------        ---------
     Loss before minority interest                                            (223)           (579)          (3,191)
     Minority interest in earning of subsidiaries:
     Continuing operations                                                    (261)            (73)            (229)
     Discontinued operations                                                 1,251              11              171
                                                                         ---------       ---------        ---------
                                                                               990             (62)             (58)
                                                                         ---------       ---------        ---------
     Net income (loss)                                                   Ps    767       (Ps   641)       (Ps 3,249)
                                                                         =========        ========         =========
</TABLE>


                                      F-50
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

3.   The statement of cash flows prepared under US-GAAP is shown below:

<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                 2001              2002             2003
                                                              ----------         --------        ----------
<S>                                                           <C>              <C>             <C>
     CASH FLOWS FROM OPERATING ACTIVITIES
     Net income (loss):                                       Ps     767         (Ps  641)       (Ps  3,249)
     Items not affecting cash:
     Monetary (gain) loss                                            (67)              58                17
     Depreciation and amortization                                   745              105             1,830
     Cancellation of investment in shares                              -              431                 -
     Minority interest                                            (1,081)              66              (191)
     Deferred income tax and employees' profit sharing                76               46               343
     Gain from sale of subsidiaries                                5,806                -                 -
     Changes in:
     Accounts receivable                                            (752)            (165)              161
     Inventories                                                      (7)            (334)               (8)
     Other assets                                                    (31)            (129)              (50)
     Accounts payable and accrued expenses                           592             (407)              (64)
                                                              ----------         --------        ----------
     Net cash provided by (used in) operating activities           6,048             (970)           (1,211)
                                                              ----------         --------        ----------
     CASH FLOWS FROM INVESTING ACTIVITIES
     Investment in shares                                            501               46             3,640
     Long-term bank deposits                                           1                -                 -
     Purchases of property, plant and equipment                      254               14                43
     Proceeds from sale of property, plant and equipment             163              (17)              102
                                                              ----------         --------        ----------
     Net cash provided by investment activities                      919               43             3,785
                                                              ----------         --------        ----------
</TABLE>


                                      F-51
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

     Cash Flow continued:

<TABLE>
<CAPTION>
                                                                         Year Ended December 31,
                                                                 2001              2002             2003
                                                              ----------         --------        ----------
<S>                                                           <C>              <C>               <C>
     CASH FLOWS FROM FINANCING ACTIVITIES
     Accounts receivable from subsidiaries
     and related parties                                             (71)             407               (23)
     Short-term loans received                                       127               26              (964)
     Other long-term accounts receivable and payable                 721              439                 -
     Current portion of long-term debt                            (5,403)              40                19
     Long-term loans received                                       (347)               -                 5
     Minority interest                                                 -                 -             (249)
     Dividends declared                                                -                -            (2,774)
     Cumulative translation adjustment                                 -                -               638
     Reserve for repurchase of shares                               (219)              36                14
     Proceeds from sale of shares, net of repurchase              (2,176)             (90)              373
                                                              ----------         --------        ----------
     Net cash (used in) provided by financing activities          (7,368)             858            (2,463)
                                                              ----------         --------        ----------
     Effect of exchange rate changes and inflationary
     effects on cash and cash equivalents                             (5)              (2)               (3)
                                                              ----------         --------        ----------
     (Decrease) increase in cash and cash equivalents               (406)             (71)              108
     Cash and cash equivalents at beginning of year                  534              128                57
                                                              ----------         --------        ----------
     Cash and cash equivalents at end of year                 Ps     128         Ps    57        Ps     165
                                                              ==========         ========        ==========
     SUPPLEMENTAL DISCLOSURES
     Cash paid during the year for:
     Interest                                                Ps     626          Ps   346        Ps     33
     Income tax                                              Ps      18                 -        Ps     10
</TABLE>

     ADDITIONAL US-GAAP DISCLOSURES

1.   ADVANCES TO GROWERS

     Under US-GAAP, the advances to fresh produce growers would be classified as
     non-interest bearing loans receivable.


                                      F-52
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

2.   MINORITY INTEREST

     Under MEX-GAAP, the minority interest in consolidated subsidiaries is
     presented as a separate component within stockholders' equity on the
     consolidated balance sheet. For US-GAAP purposes, the minority interest is
     presented as a separate item before stockholders' equity.

3.   EMPLOYEES' PROFIT SHARING

     Under US-GAAP, employees' profit sharing would be considered operating
     expenses. The corresponding amounts were reclassified for US-GAAP purposes.

4.   FAIR VALUE INFORMATION

     The following disclosure of the estimated fair value of financial
     instruments amounts have been determined by the Company, using available
     market information and appropriate valuation methodologies. However,
     considerable judgment is required in interpreting market data to develop
     estimates of fair value.

     Cash and cash equivalents, accounts receivable and accounts payable. The
     carrying value of these items is a reasonable estimate of their fair value.

     Bank loans and other debt. The Company's bank loans and other debt, bear
     interest at variable rates and their terms, are generally representative of
     those which are currently available to the Company at each respective
     balance sheet date for the issuance of debt with similar terms and
     remaining maturities and therefore, the carrying values of these items are
     a reasonable estimate of their fair value.

5.   RETAINED EARNINGS

     In 1994, the Board of Directors approved the appropriation of Ps1,500 from
     retained earnings for a future repurchase of some of the Company's
     outstanding stock. This amount would be disclosed as a separate component
     of equity for US-GAAP purposes as it is not available for dividends.


                                      F-53
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

6.   ACCOUNTING FOR EFFECT OF CHANGES IN FOREIGN EXCHANGE RATES

     Under MEX-GAAP and US-GAAP, as described in Note 2.a, exchange losses
     relating to borrowings incurred to acquire foreign subsidiaries are
     recorded directly in stockholders' equity in the component, "Cumulative
     translation adjustment". This gain amounted to Ps263 in 2001. During 2002
     and 2003, none of the loans were considered hedges of the Company's net
     investments of foreign subsidiaries. In 2003, the cumulative translation
     adjustment related to Seminis was reversed into earnings and increased the
     reported loss on sale of the business by Ps. 466 (See adjustment g above).

7.   VALUATION AND QUALIFYING ACCOUNTS

The following table represents the roll-forward of the allowance for doubtful
accounts for the years ended December 31, 2001, 2002 and 2003

                                          2001      2002      2003
                                         ------    ------   -------
Balance at the beginning of the period   Ps 115    Ps 126   Ps1,167
Inflation and foreign
   currency translation effects              (1)       --        --
Increases in the allowance                   55     1,071       264
Write offs(1)                               (43)      (30)   (1,075)
Recoveries                                   --        --        --
                                         ------    ------   -------
Balance at the end of the period         Ps 126   Ps1,167    Ps 356
                                         ======   =======    ======

(1)      Includes the sale of Agrosem.

The following table represents the roll-forward of the inventory obsolescence
reserve for the years ended December 31, 2001, 2002 and 2003

                                        2001   2002  2003
                                         ---    ---   ---
Balance at the beginning of the period  Ps12    Ps2   Ps2
Inflation and foreign

   currency translation effects           --     --    --
Increases in the allowance                --     --    --
Write offs(1)                            (10)    --    --
                                         ---    ---   ---
Balance at the end of the period         Ps2    Ps2   Ps2
                                         ===    ===   ===


                                      F-54
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

(1)  Includes the sale of Agrosem.

8.    RESEARCH AND DEVELOPMENT EXPENSES

Research and development costs are charged to operations as incurred. For the
years ended December 31, 2001, 2002 and 2003, the Company had Ps560, Ps - and Ps
-, respectively in research and development expenses.

9.   NEW ACCOUNTING PRONOUNCEMENTS

Recent U.S. GAAP  pronouncements

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of Both Liabilities and Equity". The statement
requires issuers to classify as liabilities (or assets in some circumstances)
three classes of freestanding financial instruments that embody obligations for
the issuer. Generally, the statement is effective for financial instruments
entered into or modified after May 31, 2003 and is otherwise effective at the
beginning of the first interim period beginning after June 15, 2003. The
adoption of SFAS No. 150 did not have a material impact on the Company's
consolidated results of operations or financial condition.

In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
"Consolidation of Variable Interest Entities, an Interpretation of ARB 51." FIN
46 requires the primary beneficiary of a variable interest entity to consolidate
that entity. A Variable Interest Entity ("VIE") is created when (i) the equity
investment at risk is not sufficient to permit the entity from financing its
activities without additional subordinated financial support from other parties
or (ii) equity holders either (a) lack direct or indirect ability to make
decisions about the entity, (b) are not obligated to absorb expected losses of
the entity or (c) do not have the right to receive expected residual returns of
the entity if they occur. The primary beneficiary of a variable interest entity
is the party that absorbs a majority of the variable interest entity's expected
losses, receives a majority of the entity's expected residual returns, or both,
as a result of ownership, contractual or other financial interest in the entity.
In December 2003, the FASB issued a revision of FIN 46 ("FIN 46-R"), clarifying
certain provisions of FIN 46. The Company was required to adopt the provisions
of FIN 46-R on February 1, 2003 as they related to VIEs created on or after that
date. For VIEs created before January 1, 2003, FIN 46-R was deferred to 2004.
The Company is


                                      F-55
<PAGE>

                     SAVIA, S. A. DE C. V. AND SUBSIDIARIES

                              SAVIA, S. A. DE C. V.
                             (SaVIA, Parent company)

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
                        DECEMBER 31, 2001, 2002 AND 2003

         MILLIONS OF MEXICAN PESOS OF DECEMBER 31, 2003 PURCHASING POWER
                   (except per share data and exchange rates)

currently evaluating the effect that the adoption of FIN 46 and FIN 46-R, will
have on its consolidated financial statements.


                                      F-56
<PAGE>
ITEM 19. EXHIBITS

1.1   The Articles of Incorporation are incorporated by reference to the
      Company's registration statement on Form F-1.

1.2   The Bylaws are incorporated by reference to the Company's Form 20-F filed
      on June 30, 2003.

4.1   Amendment dated July 31, 2002 to the Savia Restructuring Agreement.*

4.2   Amendment dated October 31, 2002 to the Savia Restructuring Agreement.*

4.3   Debt Settlement Agreement dated May 20, 2003.*

4.4   Exchange Agreement dated July 1, 2002, and amended and restated as of May
      30, 2003.*

4.5   Contribution Agreement dated May 30, 2003.*

4.6   Voting Agreement dated May 30, 2003.*

4.7   Exchange and Stock Issuance Agreement by and between Bionova Holding
      Corporation and Savia, S.A. de C.V. dated March 29, 2004.

4.8   Receipt for Credit dated March 29, 2004

4.9   Forgiveness of Debt and Cancellation of Note dated March 29, 2004.

8.1   List of Significant Subsidiaries.

11.1  Savia Code of Business Conduct and Ethics for Senior Financial Officers.

12.1  Chief Executive Officer Certification Pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350).

12.2  Chief Financial Officer Certification Pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350).

* previously filed with the SEC


                                       61
<PAGE>
ANNEX A. MEXICAN APPLICATION OF THE BETTER CORPORATE PRACTICES CODE


       DISCLOSURE ABOUT THE DEGREE OF COMPLIANCE TO THE PRINCIPLES OF THE
                         BETTER CORPORATE PRACTICES CODE


QUESTIONNAIRE ABOUT THE ISSUER CORPORATE GOVERNANCE

BOARD OF DIRECTORS

i) ABOUT THE BOARD OF DIRECTORS FUNCTIONS

This section describes the function of the Board of Directors and establishes
the Board's vision and how it relates to the administrative process. A
description of the specific functions carried out by the Board is included in
this general framework.

      The Board of Directors is the body in charge of the administration and
      representation of the Company, ensuring good management of the company.
      Board is expected to assure that the Company adheres to its objectives and
      satisfies the legitimate interests of shareholders, employees, customers
      and other sectors interested in the company.

      The Board of Directors is responsible to the shareholders in the
      performance of the business. It determines the strategic plan, supervises,
      controls and evaluates the performance of the executive team, which
      supervises the day to day operations of the Company.

      In addition to the powers-conferred by applicable law, the Board of
      Directors is empowered to: a) establish the strategic planning; b) supply
      the shareholders and, if necessary, the market, with information on the
      Company; c) establish mechanisms of internal control and compliance with
      applicable laws; and d) evaluate the performance of key executives.

ii) ABOUT THE STRUCTURE OF THE BOARD OF DIRECTORS

This section describes the structure of the Board of Directors. This section
also lists whether there are intermediate bodies which support the Board in
fulfilling its functions and how the intermediate bodies report to the Board
regarding its activities.

The Board of Directors is comprised of 8 Proprietary Directors and 8 Alternate
Directors.

The Board has designated the following intermediate bodies to support it in the
fulfillment of its functions:


                                       62
<PAGE>
      The Evaluation and Compensation Committee is comprised of Proprietary
Directors Francisco Gonzalez Sebastia as Chairman, Alejandro Perez Elizondo and
Bernardo Jimenez Barrera. This Committee analyzes the applicable policies in
connection with the evaluation, compensation and hiring of top level executives,
and reports periodically to the Board. The Committee is also supported by the
executives in the Human Resources area.

      The Audit Committee is comprised of Proprietary Directors Alejando Perez
Elizondo as Chairman, Arturo Estrada Treanor and Bernardo Jimenez Barrera. This
Committee analyzes: (1) the Company's relationship with the external auditors;
(2) the applicable accounting policies; (3) the principles, criteria, practices
and controls related with the elaboration of the financial information for the
Board and the public; (4) the internal control system; and (5) the compliance
with applicable laws, reporting periodically to the Board. This Committee is
supported by the financial executives and the external auditors.

      The Finance and Planning Committee is comprised of Proprietary Directors
Messrs. Ruben Martinez Donde (in process of being substituted), Jose Manuel
Garcia Garcia and Bernardo Jimenez Barrera. This Committee analyzes the
strategic plan including: 1) the principal financial investments and
transactions; 2) the position of the company in accordance with the plan; 3) the
congruence of the financial and investment policies, and 4) the financial
projections and reports periodically to the Board. This Committee is also
supported by the financial executives.

<TABLE>
<CAPTION>
ABOUT THE INTEGRATION OF THE BOARD OF DIRECTORS                                     YES     NO                COMMENTS
-----------------------------------------------                                     ---     --                --------
<S>   <C>                                                                           <C>    <C>     <C>
1)    The Board of Directors is comprised by a number not less than five and not
      above fifteen proprietary directors? (Principle 2)                             X

2)    * Are there only proprietary directors? (Principle 3)                                 X

3)    The alternate directors can only substitute the corresponding proprietary
      director previously designated? (Principle 3)                                  X

4)    The proprietary director proposes to the Board the designation of the
      person who will be his corresponding alternate? (Principle 3)                  X
</TABLE>


                                       63
<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
5)    The independent and patrimonial directors, as a whole, constitute at least
      40% of the Board of Directors? (Principle 7)                                   X

6)    The independent directors represent at least 20% of the total of
      directors? (Principle 7)                                                       X

7)    Does the annual report of the Board of Directors indicate which directors                    Not in the Annual Report
      are independent and which are patrimonial? (Principle 8)                                     presented to the Stockholders
                                                                                                   Meeting held on April 30, 2004.

8)    Does the annual report of the Board of Directors indicate the kind of                        Not in the Annual Report
      category to which the patrimonial directors belong to? (Principle 8)                         presented to the Stockholders
                                                                                                   Meeting held on April 30, 2004.

9)    Does the annual report of the Board of Directors indicate the main                           Not in the Annual Report
      position of each director as of the date of the report? (Principle 9)                 X      presented to the Stockholders
                                                                                                   Meeting held on April 30, 2004.
</TABLE>

      * In case of an affirmative answer to this question, it should be answered
"DOES NOT APPLY" to questions (3) and (4) in the comments column.



<TABLE>
<CAPTION>
ABOUT THE STRUCTURE OF THE BOARD OF DIRECTORS                                       YES     NO                COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
10)   The Board of Directors carries out the Functions of Compensation and
      Evaluation, Audit and Planning and Finance? (Principle 10)                     X

11)   Are the intermediate bodies only conformed by proprietary directors?
      (Principle 12)                                                                 X

12)   Each intermediate body is comprised by at least 3 members as minimum and 7
      as maximum? (Principle 13)                                                     X
</TABLE>


                                       64
<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
13)   Each independent director, besides complying with its functions in the
      Board, participates in at least one of the intermediate bodies? (Principle
      16)                                                                            X

14)   Is the intermediate body which carries out the Audit function presided
      over by an independent director? (Principle 17)                                X

15)   Does the Board of Directors hold meetings at least 4 times a year?
      (Principle 18)                                                                 X

16)   Does the Board of Directors dedicate at least one of its meetings to the
      definition of the medium and long term strategies of the company?
      (Principle 18)                                                                 X

17)   Do at least 25% of the directors have the right to call for a Board
      meeting? (Principle 19)                                                        X

18)   Do the directors have access to all the relevant information at least 5
      business days prior to the meeting date? (Principle 20)                        X

19)   * Is there a mechanism to assure that the directors can evaluate inquiries
      about strategic matters, even though they do not receive the necessary
      information at least 5 business days in advance? (Principle 20)                   (X)

20)   * The director elected by the first time is induced, explaining him his                      A presentation is made on the
      responsibilities and the company's situation? (Principle 21)                   X             First Board Meeting following
                                                                                                   their designation and a manual
                                                                                                   containing a description of
                                                                                                   their duties is provided to all
                                                                                                   members.
</TABLE>


                                       65
<PAGE>
<TABLE>
<CAPTION>
ABOUT THE DIRECTORS' DUTIES                                                         YES     NO                 COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
21)   The directors inform the President and the Secretary of the Board any
      conflict of interest which imply they should abstain of voting and, in
      such a case, do they abstain from participating in the corresponding
      deliberation? (Principle 22)                                                   X
</TABLE>

<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
22)   The directors only use the assets and services of the company solely to
      the fulfillment of the social object? (Principle 23)                           X

23)   When the directors use exceptionally the assets of the company for
      personal matters, are there defined clear policies to such effect?
      (Principle 23)                                                                               Not applicable.

24)   * The directors devote time to their functions attending at least 70% of                     The Proprietary Directors do
      the meetings to which they have been called? (Principle 24)                    X             comply with this principle.




25)   * The directors maintain absolute confidentially about the social matters                    They are reminded of such
      they have knowledge through the meetings they attend? (Principle 25)           X             obligation and there has not
                                                                                                   been any known disclosure of
                                                                                                   files information.

26)   The proprietary and alternate directors maintain themselves mutually                         The Alternate Directors are
      informed about the matters discussed in the board meetings? (Principle 26)     X             invited to attend most of the
                                                                                                   meetings.

27)   The Board of Directors receives support through opinions, recommendations
      and guidelines derived from the analysis of the company's development?
      (Principle 27)                                                                 X
</TABLE>

      -     In the event the answers to these questions are affirmative, the
            answer should be enlarged in the comments column.

FUNCTION OF COMPENSATION AND EVALUATION

iii) ABOUT THE EVALUATION AND COMPENSATION COMMITTEE

This section describes the process in which the evaluation and compensation
decisions of the General Director and high level executives are handled.

      The evaluation and compensation of top level executives of the
subsidiaries are administered using the following tools: (1) description of
positions; (2) valuation of positions; (3) payroll and fringe benefits surveys
in the market; (4) performance evaluation of the executive; (5) company's
results evaluation; and (6) the compensation is integrated with fixed
remuneration, benefits and bonuses.


                                       66
<PAGE>
<TABLE>
<CAPTION>
ABOUT THE OPERATION OF THE BODY WHICH FULFILLS THE EVALUATION AND
COMPENSATION FUNCTION.                                                              YES     NO                COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
28)   The intermediate body which performs the Evaluation and Compensation
      functions determines whether the hiring conditions of the high level
      executives and the probable payment due to separation from the company are
      in accordance with the guidelines approved by the Board? (Principle 29)        X

29)   The structure and policies used to determine the packages of directors and
      executives are disclosed? (Principle 30)                                             (X)
</TABLE>

AUDIT FUNCTION

iv) ABOUT THE AUDIT FUNCTION

This section describes how the Audit function is fulfilled. Specifically, this
section describes how the intermediate body interacts with the Board regarding
the accounting practices of the Company and the mechanisms which assure accurate
financial information.

Periodic reviews are carried out regarding the accounting procedures and
operations of the Company, and results are reported to the Financial and
Comptroller areas. The Audit Committee examines the traditional policies applied
and, with respect to the financial restructuring, it has held meetings to ensure
that the financial information complies with generally accepted accounting
principles.

<TABLE>
<CAPTION>
ABOUT THE AUDITORS' SELECTION.                                                      YES     NO                COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
30)   The income of the external auditor as well as any other external audit,
      derived from the audit of the company, represents a percentage equal or
      minor to 20% of the net income of the accounting firm in charge?
      (Principle 32)                                                                 X

31)   The partner who audits the company is rotated at least every 6 years?
      (Principle 33)                                                                 X
</TABLE>


                                       67
<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
32)   The person who signs the opinion of the audit for the annual financial
      statements of the company is different from the one who acts as Statutory
      Examiner? (Principle 34)                                                       X

33)   The annual report includes information regarding the professional profile
      of the Statutory Examiner of the company? (Principle 35)                       X

                         ABOUT THE FINANCIAL INFORMATION

34)   Does the Company have an internal audit area? (Principle 36)                          X

35)   The intermediate body in charge of the Audit function submits the
      accounting principles to the approval of the Board? (Principle 37)                    X

36)   The intermediate body in charge of the Audit function ascertains that the
      public intermediate financial information is carried out in accordance
      with the same principles, criteria and practices which the annual report
      will be performed? (Principle 39)                                              X

                           ABOUT THE INTERNAL CONTROLS

37)   Is there an internal control system? (Principle 41)                            X

38)   Are the guidelines of the internal control system submitted for the
      approval of the Board? (Principle 41)                                          X

39)   The intermediate body in charge of the Audit function evaluates and issues
      an opinion about the effectiveness of the internal control system?
      (Principle 42)                                                                 X
</TABLE>


                                       68
<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>

40)   Do the external auditors validate the effectiveness of the internal
      control system and issue a report with respect to such controls?
      (Principle 43)                                                                 X
</TABLE>

<TABLE>
<CAPTION>
FULFILLMENT DISPOSITIONS REVIEW                                                     YES     NO     COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
41)   The intermediate body in charge of the Audit function verifies the
      existence of controls in order to determine if the company complies with
      the dispositions applicable to it and reports the same to the Board
      periodically? (Principle 44)                                                   X

42)   The examination of the fulfillment of all applicable dispositions is
      carried out at least once a year? (Principle 44)                               X

43)   The Board of Directors is informed periodically about the legal situation
      of the company? (Principle 45)                                                 X
</TABLE>

FINANCE AND PLANNING FUNCTION

v) ABOUT THE FINANCE AND PLANNING FUNCTION

This section describes how the Finance and Planning function is fulfilled and
the processes followed to perform such functions. Specifically, it describes how
the intermediate body interacts with the Board to support its decisions.

As a consequence of the financial restructuring, the planning function has been
subject to periodic meetings to evaluate the progress of the negotiations, while
continuing to evaluate the projections and financial transactions of the
Company.

<TABLE>
<CAPTION>
ABOUT THE INTERMEDIATE BODY IN CHARGE OF THE FINANCE AND PLANNING FUNCTIONS         YES     NO     COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
44)   The intermediate body in charge of the Finance and Planning functions                        Due to the financial restructure
      issues an evaluation about the feasibility of the main investments and                       meetings have been held without
      financial transactions of the Company? (Principle 47)                                        formalizing them in Minute
                                                                                     X             format.
</TABLE>


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<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
45)   The intermediate body in charge of the Finance and Planning function
      evaluates periodically the strategy position of the Company in accordance
      with the strategy plan. (Principle 48)                                         X

46)   The intermediate body in charge of the Finance and Planning functions
      supports the Board with the surveillance of the congruence of the
      investment and financing policies with the strategic vision of the
      Company? (Principle 49)                                                        X

47)   The intermediate body in charge of the Finance and Planning functions                        Due to the financial restructure
      support the Board by examining the financial projections of the company                      meetings have been held without
      assuring the congruence with the strategic plan of the Company? (Principle                   formalizing them in Minute
      50)                                                                            X             format.
</TABLE>

iv) OPTIONAL QUESTION

If there are corporate governance issues in addition to those recommended by the
Better Corporate Practices Code (Codigo de Mejores Practicas Corporativas), in
this section an option is given to the issuer to disclose such information.

              QUESTIONNAIRE ABOUT THE GENERAL STOCKHOLDERS MEETING

<TABLE>
<CAPTION>
STOCKHOLDERS' RIGHTS                                                                                       (SEE SECTION V)
--------------------                                                                                       ---------------
ABOUT THE INFORMATION AND AGENDA OF THE STOCKHOLDERS MEETING                        YES     NO                COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>
1)    Was it omitted from the Agenda of the Stockholders Meeting the item
      referred to as "Various Matters"? (Principle 51)                               X

2)    Was it avoided to group matters related to different subjects in only one
      item of the Agenda? (Principle 51)                                             X

3)    Is all the information about each item of the Agenda of the Stockholders
      Meeting available 15 days in advance? (Principle 52)                           X

4)    Do the stockholders receive detailed information and possible alternatives
      of voting regarding the items of the Agenda, so they may provide
      instructions to their mandataries on how to vote? (Principle 53)                      X
</TABLE>

                                       70
<PAGE>
<TABLE>
<S>   <C>                                                                           <C>    <C>     <C>
5)    Does the information delivered to the stockholders include the proposal to
      comprise the Board of Directors, accompanied with information regarding
      the professional profile of the candidates? (Principle 54)                            X
</TABLE>

<TABLE>
<CAPTION>
ABOUT THE INFORMATION AND COMMUNICATION BETWEEN
THE BOARD OF DIRECTORS AND THE STOCKHOLDERS                                         YES     NO                COMMENTS
<S>   <C>                                                                           <C>    <C>     <C>

6)    In its annual report to the Stockholders Meeting, the Board of Directors
      includes relevant aspects of the performance of each intermediate body and
      the names of its members? (Principle 55)                                              X

7)    Are the reports of each intermediate body presented to the Board of
      Directors available to the stockholders together with the material for the
      Stockholders Meeting? (Principle 55)                                           X

8)    Does the company have policies, mechanisms and responsible persons to
      inform the investors and keep channels of communication with the
      stockholders and potential investors? (Principle 56)                           X
</TABLE>


                                       71
<PAGE>
SIGNATURES

      Pursuant to the requirements of Section 12 of the Securities and Exchange
Act of 1934, the registrant certifies that it meets all of the requirements for
filing on Form 20-F and has duly caused this annual report to be signed on its
behalf by the undersigned, thereunto duly authorized.

                                        SAVIA, S.A.  DE C.V.


                                        By: /s/Enrique Osorio
                                            -----------------------------------
                                        Name: Enrique Osorio
                                        Title: Chief Financial Officer of Savia

Date: June 30, 2004


                                       72
<PAGE>
                                  EXHIBIT INDEX

1.1   The Articles of Incorporation are incorporated by reference to the
      Company's registration statement on Form F-1.

1.2   The Bylaws are incorporated by reference to the Company's Form 20-F filed
      on June 30, 2003.

4.1   Amendment dated July 31, 2002 to the Savia Restructuring Agreement.*

4.2   Amendment dated October 31, 2002 to the Savia Restructuring Agreement.*

4.3   Debt Settlement Agreement dated May 20, 2003.*

4.4   Exchange Agreement dated July 1, 2002, and amended and restated as of May
      30, 2003.*

4.5   Contribution Agreement dated May 30, 2003.*

4.6   Voting Agreement dated May 30, 2003.*

4.7   Exchange and Stock Issuance Agreement by and between Bionova Holding
      Corporation and Savia, S.A. de C.V. dated March 29, 2004.

4.8   Receipt for Credit dated March 29, 2004

4.9   Forgiveness of Debt and Cancellation of Note dated March 29, 2004.

8.1   List of Significant Subsidiaries.

11.1  Savia Code of Business Conduct and Ethics for Senior Financial Officers

12.1  Chief Executive Officer Certification Pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350).

12.2  Chief Financial Officer Certification Pursuant to Section 906 of the
      Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350).

* previously filed with the SEC


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