/raid1/www/Hosts/bankrupt/TCRLA_Public/020730.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
L A T I N A M E R I C A
Tuesday, July 30, 2002, Vol. 3, Issue 149
Headlines
A N T I G U A & B A R B U D A
LIAT: Names Two New Board Members
A R G E N T I N A
DIVEO BROADBAND: Unplugs Argentine Unit; Moving to Sell
B E R M U D A
GLOBAL CROSSING: Industry Execs to Testify Before Senate
TYCO INTERNATIONAL: Recent Events Leave CreditWatch Unchanged
TYCO INTERNATIONAL: Plans To Certify Financial Statements
B R A Z I L
CSN: Bear Stearns Cuts To Neutral; Sees Merger As Doubtful
EMBRATEL: Gets $25M, 5-Yr. Credit Line From European Bank
VARIG: To Create New Company, Take Over Airport's Administration
C H I L E
ENERSIS: Names New Board of Directors President
MADECO: To Sell 1.8B New Shares To Boost Capital
TELEFONICA CTC: One-Time Gains Shrink 2Q02 Losses
M E X I C O
CINTRA: 1H02 Net Loss Soars To $73M
CORPORACION DURANGO: Reports Second-Quarter 2002 Earnings
DAIMLERCHRYSLER: To Close Lago Alberto Plant August 11
GRUPO DINA: Trial On Case Against Canadian Firm Starts In October
GRUPO ALFA: SSB Ups Ratings On Better Performance, Restructring
GRUPO MEXICO: Reveals Net Loss Of MXN792.2M For 1H02
GRUPO SIMEC: 1H02 Results Suffer on Interest, Exchange Rates
GRUPO TMM: Reports Improved Revenue in the 2Q02, 1H02
GRUPO TMM: Sets Meeting Date for Reclassification of Shares
VITRO: 2Q02 Results Disappointing Despite Debt Reduction
VITRO: Shares Down After Weak 2Q02 Earnings Release
P E R U
EMPRESAS LUCCHETTI: Expects To Suspend Debt On Plant's Closure
T R I N I D A D & T O B A G O
BWIA: Draws Up Plan To Confront Financial Troubles
BWIA: CEO Admits Badly Hit By Pilots' Strikes
U R U G U A Y
BANCO COMERCIAL: S&P Puts On CreditWatch, Negative Implications
- - - - - - - - - -
=================================
A N T I G U A & B A R B U D A
=================================
LIAT: Names Two New Board Members
---------------------------------
Caribbean airline LIAT's board of directors, on Tuesday,
appointed two new members. The latest additions completed the
regional, public and private shareholding representation of the
committee, Antigua Sun reports.
The directors installed were Charles L. Smith of Barbados, the
Permanent Secretary in the International Transport Division of
the Ministry of Tourism; and Marius St. Rose, group managing
director of the Bank of St. Lucia.
In addition to representing the governments of Antigua & Barbuda
and St. Vincent & the Grenadines the two serve at the board level
and as directors representing the private sector, the airline's
major shareowners.
Chairman Wilbur Harrigan the significance of the wide
representation of its board and referred to LIAT as an example of
Pan-Carribean Co-operation in ownership and its alliance-building
business strategy.
In his speech, he also pointed out good impression of the board
towards the improvement in the airline's three-year development
plan, citing the LIAT/BWIA alliance, introduction of new routes
and new aircraft, and the plans of new corporate livery.
CONTACT: LIAT
P.O Box 819
VC Bird Int. Airport
Antigua
Tel: 462 0700
Fax: 462 2682/4765
Home Page: www.liat.com
=================
A R G E N T I N A
=================
DIVEO BROADBAND: Unplugs Argentine Unit; Moving to Sell
-------------------------------------------------------
Regional Internet Data Center (IDC) operator Diveo Broadband
Networks is looking to sell its Argentine subsidiary, Business
News Americas reports.
Diveo operates an IDC in the Buenos Aires borough of San Telmo
and offers telephone and data transmission services to corporate
customers. The Company has never seen a profit, which led its
U.S.-based parent to cut funding and, ultimately, prompted the
sale of the unit.
Diveo is now evaluating offers from local groups, including ISP
Netizen, the local unit of the US telecoms holding SkyOnline;
local systems integrator and corporate communications provider
Datco; and a consortium of unnamed partners.
Diveo Broadband Networks' major investors include GS Capital
Partners III, L.P. (an affiliate of Goldman, Sachs & Co), Texas
Pacific Group/Newbridge Latin America, Alta Communications, Booth
American, Columbia Management, Meritage Private Equity Fund L.P.,
Norwest Venture Partners, OneLiberty and the private equity arm
of the Rothschild Family.
CONTACT: DIVEO BROADBAND NETWORKS, INC.
(Corporate Headquarters)
3201 New Mexico Ave., NW, Suite 320
Washington, DC 20016
TEL: (202) 274.0040
FAX: (202) 274.0050
E-mail: info@diveo.net
URL: http://www.diveo.net
DIVEO BROADBAND NETWORKS, INC.
(Latin American Operations)
One Financial Plaza, Suite 1700
Fort Lauderdale, FL 33394
Tel: (954) 462.2210
Fax: (954) 462.4044
E-mail: info@diveo.net
URL: http://www.diveo.net
=============
B E R M U D A
=============
GLOBAL CROSSING: Industry Execs to Testify Before Senate
--------------------------------------------------------
Global Crossing confirmed Friday that John Legere, chief
executive officer, along with other telecommunications industry
executives, will testify before the U.S. Senate Committee on
Commerce, Science and Transportation on Tuesday, July 30, 2002 in
Washington, DC.
Mr. Legere will discuss the current state of the
telecommunications industry and how the industry can move forward
in a constructive manner to regain its financial health and
restore confidence in the marketplace.
"Global Crossing recognized the critical importance of responding
to the telecommunications industry's requirement to improve cost
structure and adjust to changing supply and demand conditions of
the marketplace in 2001. We began our restructuring nearly a year
ago, and we are now well on our way to completing a successful
reorganization," said Mr. Legere. "We have proven that with focus
and determination, it is possible to create efficiencies without
disrupting service to customers. We look forward to sharing our
insights with the Senate Commerce Committee and the American
public. I'm proud of the persistence and hard work that Global
Crossing's team has shown, and the results of those efforts are
evident in the progress we have made."
John Sidgmore, chief executive officer of WorldCom, and Afshin
Mohebbi, president and chief operating officer of Qwest
Communications International, are expected to testify. Michael
Powell, chairman of the Federal Communications Commission, is
expected to testify on a separate panel.
The hearing is scheduled for Tuesday, July 30 at 9:30 a.m., in
the Russell Senate Office Building, Room 253. For more
information, please visit: http://commerce.senate.gov/.
Mr. Legere's written testimony will be made available on Global
Crossing's Web site immediately after the hearing.
ABOUT GLOBAL CROSSING
Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network, which reaches
27 countries and more than 200 major cities around the globe.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services. Global Crossing operates throughout the Americas and
Europe, and provides services in Asia through its subsidiary,
Asia Global Crossing.
On January 28, 2002, certain companies in the Global Crossing
Group (excluding Asia Global Crossing and its subsidiaries)
commenced Chapter 11 cases in the United States Bankruptcy Court
for the Southern District of New York and coordinated proceedings
in the Supreme Court of Bermuda. On the same date, the Bermuda
Court granted an order appointing joint provisional liquidators
with the power to oversee the continuation and reorganization of
the Bermuda-incorporated companies' businesses under the control
of their boards of directors and under the supervision of the
U.S. Bankruptcy Court and the Supreme Court of Bermuda. On April
23, 2002, Global Crossing commenced a Chapter 11 case in the
United States Bankruptcy Court for the Southern District of New
York for its affiliate, GT UK, Ltd. Global Crossing does not
expect that any plan of reorganization, if and when approved by
the Bankruptcy Court, would include a capital structure in which
existing common or preferred equity would retain any value.
CONTACT:
GLOBAL CROSSING:
Press Contacts
Becky Yeamans
+1 973-410-5857
rebecca.yeamans@globalcrossing.com
Randy Slack
+1 973-410-5968
randall.slack@globalcrossing.com
Analysts/Investors Contact
Ken Simril
+1 310-385-3838
investors@globalcrossing.com
TYCO INTERNATIONAL: Recent Events Leave CreditWatch Unchanged
--------------------------------------------------------------
Standard & Poor's Ratings Services said Friday that its ratings,
including its triple-'B'-minus corporate credit rating, on Tyco
International Ltd. and its subsidiaries remain on CreditWatch
with negative implications following the company's recent
earnings announcement, appointment of a new CEO, and denial of
bankruptcy rumors.
Hamilton, Bermuda-based Tyco is a diversified company with total
debt of about $26 billion.
"Standard & Poor's believes that reports regarding a planned
bankruptcy filing by Tyco are unfounded", said Standard & Poor's
credit analyst Cynthia Werneth, "and the company strongly refuted
this rumor during the teleconference it hosted on July 25th". The
same day, Tyco announced the appointment of Edward Breen, former
president and chief operating officer of Motorola Inc., as
chairman and chief executive officer. "Standard & Poor's views
the appointment of Mr. Breen, who is generally well-regarded, as
a positive development", said Ms. Werneth.
Standard & Poor's noted that Tyco began the quarter with more
than $7 billion in cash following the recent IPO of its
commercial finance subsidiary. Management intends to use a
significant portion of this to reduce debt. Recent earnings were
broadly in line with expectations, but free cash flow was below
expectations due to tighter payment terms from suppliers that
reduced operating cash flow by more than $300 million.
Standard & Poor's said that the CreditWatch would be resolved
based on how management addresses the gap between cash balances
plus free cash flow and obligations coming due in the next 18
months.
Standard & Poor's said it will continue to monitor developments
in connection with the ongoing investigations of alleged tax
evasion by Tyco's former CEO, as well as corporate governance
issues. Standard & Poor's will also continue to monitor the
performance of Tyco's still well-diversified business portfolio
and its efforts to stem any damage recent events have had on
customer, supplier, or employee relationships.
TYCO INTERNATIONAL: Plans To Certify Financial Statements
---------------------------------------------------------
New U.S. regulations do not require Tyco International, Ltd. to
certify its financial statements. However, in a report released
by the Financial Times, the embattled Bermuda-based firm said it
would do so anyway, pending the results of an internal
investigation.
"While a new ruling from the U.S. Securities and Exchange
Commission stipulates that Tyco does not have to sign off on its
financial statements because it is based in Bermuda, Tyco said it
planned to do so anyway. However, it might miss the SEC's August
14 deadline," the report said.
"We want to make sure we have everything out there before we
attest to it," John Fort, the Company's interim chief executive
officer told the London-based newspaper. During an earnings
conference call, Fort said Tyco would hold a meeting on September
5 to increase its number of board members from 11 to 15,
including the chief executive. He said the company was consulting
major shareholders over the choices. Tyco this week reported
third quarter losses of US$2.31 billion, primarily due to a
US$2.23 billion charge resulting from the sale of CIT, its
finance subsidiary. The Company has been selling off assets as it
tries to reduce debt and restore investor confidence.
About Tyco International Ltd.
Tyco International Ltd. is a diversified manufacturing and
service company. Tyco is the world's largest manufacturer and
servicer of electrical and electronic components; the world's
largest designer, manufacturer, installer and servicer of
undersea telecommunications systems; the world's largest
manufacturer, installer and provider of fire protection systems
and electronic security services; and the world's largest
manufacturer of specialty valves. Tyco also holds strong
leadership positions in disposable medical products and plastics
and adhesives. Tyco operates in more than 100 countries and had
fiscal 2001 revenues from continuing operations of approximately
$34 billion.
To see financial statements:
http://bankrupt.com/misc/Tyco_International.htm
CONTACT: TYCO INTERNATIONAL LTD.
Media: Gary Holmes
Tel: +1-212-424-1314 or +1-212-424-1307
Investor Relations: Kathy Manning
Tel: +1-603-778-9700
===========
B R A Z I L
===========
CSN: Bear Stearns Cuts To Neutral; Sees Merger As Doubtful
----------------------------------------------------------
Bear Stearns on Friday, cut its equity recommendation on the
Brazilian steelmaker Companhia Siderurgica Nacional (CSN) to
"neutral" from "attractive," reveals Dow Jones Newswires.
News broke earlier this month that CSN plans to merge with its
Anglo-Dutch rival Corus Group PLC. However, Bear thinks that
Brazil's worsening economic outlook heightens the odds that Corus
may withdraw from or alter the merger's terms.
As reported earlier, Corus said it will buy CSN in an all-share
deal worth US$1.83 billion, implying a US$630-million premium on
the Brazilian company's US$1.2 billion market capitalization.
The merger, which is seen producing the fourth- or fifth-largest
steel company in the world, is expected to be concluded in the
first quarter of 2003.
Under the terms of the proposed merger, existing Corus
shareholders will hold 62.4% of the enlarged group. The operation
will be structured so that CSN shareholders will receive shares
in a new Brazilian listed holding company, called TopCo, which
will, in turn, hold 37.6% of the share capital of the enlarged
Corus.
The proposal is subject to a number of conditions. Corus and CSN
hope to be in a position to present shareholders with a
definitive proposal by late 2002.
The transaction will be implemented in two steps: CSN
shareholders will exchange their existing shares in CSN for
shares in TopCo, making CSN a wholly- owned subsidiary of TopCo.
Corus will then acquire CSN from TopCo in exchange for new Corus
shares, representing 37.6% of Corus' enlarged share capital.
The first step will require the approval of CSN's shareholders
while the second step will require the approval both of Corus and
TopCo's shareholders.
Although neither Corus nor CSN will pay an interim dividend for
the year ending December 2002, the enlarged Corus is expected to
adopt a policy of distributing 40% of its earnings to its
shareholders.
The companies estimate the merger will generate annual cost
savings of around US$250 million by the end of the third full
year of trading. The one-off cost of securing these savings is
estimated at approximately US$300 million.
To see CSN's latest financial statements:
http://bankrupt.com/misc/CSN.pdf
CONTACT: CIA SIDERURGICA NACIONAL (CSN)
Rua Lauro Muller 116-36 Andar, PO Box 2736
Rio De Janeiro, Brazil, 22299-900
Phone: +011-55-21-2586-1442
+011-55-21-2586-1347
Home Page: http://www.csn.com.br/english/index.htm
Contact:
Antonio Mary Ulrich, Exec. Officer - Investor Relations
EMBRATEL: Gets $25M, 5-Yr. Credit Line From European Bank
---------------------------------------------------------
Brazilian long-distance operator Embratel Participacoes announced
that European bank Fortis granted it a US$25 million, five-year
credit line, reports Agencia Estado.
Embratel, according to President Jorge Rodrigues, will use the
funds before mid-2003.
Including this latest credit line, Embratel has obtained US$305
million in loans so far this year, which boosted the Company's
cash position to US$617 million.
Embratel recently reported a second-quarter loss of BRL152.2
million, a whopping 292% rise over the year-earlier period. A
17.5%-depreciation in Brazil's currency, the real, was the main
villain as it magnified its overseas debt costs in local terms.
But revenue also dipped and provisions for nonpayment of bills
remained high.
The Company's loss in the first half totaled BRL188.6 million, a
160% increase.
The real slumped as Latin America's biggest economy was hit by
high interest rates, a global downturn, and market concerns about
October's general elections and Wall Street weakness.
Embratel's second quarter loss was smaller than many analysts
expected, thanks in part to an unexpected BRL193-million one-time
gain Embratel added from a tax rebate.
Embratel is a subsidiary of WorldCom, the troubled U.S. phone
giant hat filed for bankruptcy protection this weekend.
CONTACT: EMBRATEL PARTICIPACOES S.A.
Investor Relations
Silvia Pereira
Tel. (55 21) 2519-9662
Fax: (55 21) 2519-6388
Email: Silvia.Pereira@embratel.com.br
invest@embratel.com.br
or
Press Relations:
Helena Duncan/Mariana Palmeira
Tel: (55 21) 2519-3653/3654
Fax: (55 21) 2519-8010
Email: hduncan@embratel.com.br
mpalm@embratel.com.br
WORLDCOM
500 Clinton Center Drive
Clinton, MS 39056
1-877-624-9266
Phone: (601) 460-5600
Fax: (601) 460-8350
E-mail: http://www.worldcom.com/
Contact:
John Sidgmore, President and CEO
VARIG: To Create New Company, Take Over Airport's Administration
----------------------------------------------------------------
Varig SA, the largest airline in Latin America, is looking to
create a new company, which will administrate airports with a
high potential for cargo transportation. Varig will name this
company, Administracao de Aeroportos.
At the same time, the Company also plans to take over the
administration of Sao Jose dos Campos Airport (Sao Paulo state),
which is currently controlled by Infraero. The airport has a high
potential for cargo transportation, with capacity for 170,000
landings and take-offs per year, but ended 2001 with only 15,000
landings and take-offs and transported 769 m tons. The airport
needs a minimum investment of BRL32.5 million for facilities
upgrade work.
Earlier, Varig disclosed plans to consolidate regional operations
and return leased planes to cut costs. The move would result in
its three airlines, Rio Sul, Varig and Nordeste sharing flight
and airport facilities and to 11 leased Boeing-737s being
returned to General Electric Capital Corp. by the end of
September. In place of the returned units, the airline will lease
four Boeing-737s from other companies at lower prices.
The airline's management didn't disclose the amount that will be
saved from the measures. The airline company had earlier returned
seven planes to GE Capital and cut some daily flights to Buenos
Aires because of weak demand.
Varig is also planning to raise BRL850 million, BRL300 million of
which to be provided by BNDES (Banco Nacional de Desenvolvimento
Economico e Social) through the issuance of convertible
debentures.
Unable to post a profit in four years, Varig is yet to get back
on firm footing since the country's domestic air travel market
was opened to competition in the early 1990s and after a currency
devaluation in 1999
CONTACT: VARIG (Viacao Aerea Rio-Grandense, S.A.)
Rua 18 de Novembro No. 800, Sao Joao
90240-040 Porto Alegre,
Rio Grande do Sul, Brazil
Phone: (51) 358-7039/7040
(51) 358-7010/7042
Fax: +55-51-358-7001
Home Page: www.varig.com.br/english/
Contacts:
Dorival Ramos Schultz, EVP Finance and CFO
E-mail: dorival.schultz@varig.com.br
Investor Relations:
Av. Almirante Silvio de Noronha,
n 365-Bloco "B" - s/458 / Centro
Rio de Janeiro, Brazil
=========
C H I L E
=========
ENERSIS: Names New Board of Directors President
-----------------------------------------------
Chilean utility holding company Enersis SA named late Friday
Pablo Yrarrazaval as the new president of the Company's board of
directors, reveals Dow Jones Newswires.
Yrarrazaval, who resigned from his post as president at Chilean
electricity generator Empresa Nacional de Electricidad SA
(Endesa) at an unscheduled directory board meeting Thursday, will
replace Alfredo Llorente. Spanish power giant Endesa SA controls
Enersis.
Llorente, who was president at Enersis for more than three years,
relinquished his post to pursue new professional responsibilities
in Spain, Enersis said.
Yrarrazaval will be joined on Enersis' board by Jose Luis Palomo,
currently on Endesas' board, Enersis added.
The other two members of Enersis board of directors will Hernan
Somerville and Ernesto Silva.
CONTACT: ENERSIS S.A.
Santo Domingo 789
Santiago, Chile
Phone: (562) 688-6840
www.enersis.cl
Contacts:
Alfredo Llorente, Chairman
Enrique Garcia, CEO
Rafael Miranda, Vice Chairman
Mauricio Balbontin, CFO
Domingo Valdes, Gen. Counsel
ENDESA CHILE
Santa Rosa 76
Santiago, Chile
Tel. +56-2-530-9000
Fax. +56-2-535-4720
Contacts:
Pablo Yrarrazaval Valdes, Chairman
Hector Lopez Vilaseco, CEO
Mario Valcarce Duran, Finance & Administration Mgr./CFO
MADECO: To Sell 1.8B New Shares To Boost Capital
------------------------------------------------
As part of a CLP63.0-billion capital increase, Chilean industrial
conglomerate Madeco S.A. will issue 1.8 billion new nominal
shares at CLP35.00 ($1=CLP700.70) each, reports Dow Jones
Newswires.
Shareholders are yet to be informed of the details of the
issuance in a meeting to be held August 12.
Since the capital increase was announced July 10, Madeco's shares
have strongly fluctuated. At 1623 GMT, Madeco led decliners in
Chile's blue-chip IPSA index, falling 6.0% to CLP39.00, while the
IPSA was down 0.2%.
TELEFONICA CTC: One-Time Gains Shrink 2Q02 Losses
-------------------------------------------------
Telefonica CTC Chile, the Chilean unit of Spain's Telefonica SA,
reported a smaller net loss in the second quarter compared to the
loss in the same period last year. According to a report by
Bloomberg, Chile's largest telephone company said it narrowed its
net loss to CLP902 million (US$1.3 million) from a CLP10-billion
loss a year earlier due to cost reductions and one-time gains,
which amounted to CLP7.7 billion. The Company didn't specify how
these gains were obtained.
However, according to Cesar Perez, head of research at brokerage
Celfin SA, "Their growth prospects aren't that exciting" from
their local telephone business. The service accounts for half of
sales.
Earnings at the former state-run monopoly are unlikely to improve
much this year, in part because of declines in local telephone
use, its biggest business that has been earning less since 1999,
when the government imposed a rate reduction. An almost month-
long strike also will hinder the Company's efforts to reduce
salary expenses and its costs.
Telefonica CTC said that it reduced losses from its fixed
telephone services to CLP8.3 billion from CLP19.1 billion, and
that the Company's wireless services showed a profit of CLP1.7
billion compared with a loss of CLP9 billion last year.
CONTACT: Telefonica CTC (Corporacion Telefonica Chilena S.A.)
V. Providencia 111
Providencia - Santiago
(56)-Chile
Phone: (2) 2320511
(2) 6912020
Home Page: http://www.telefonicadechile.cl/
Contacts:
Mr. Bruno Philippi, President
Mr. Jacinto Daz, Vice President
Gisela Escobar, Head of Investor Relations
===========
M E X I C O
===========
CINTRA: 1H02 Net Loss Soars To $73M
-----------------------------------
Cintra, the state-owned holding company, which manages Mexico's
major airlines, increased its net loss to US$73 million in the
first six months of the year from a net loss of US$7.1 million in
the same period last year. Sales in the first half of the year
fell 11.3% to US$1.347 billion from the same period of 2001.
In Friday's press release, Cintra said that the five airlines it
controls carried 4.62% fewer passengers relative to the same six-
month period a year ago. In the second quarter, Cintra had
turnover of US$687 million, a 9.2% reduction from the same period
last year.
The Company, 85% of whose shares are held by the state,
attributed the drop in earnings to "the economic slowdown in
Mexico and the United States, the effects of the Sept. 11
terrorist attacks and unfair competition by other airlines."
Cintra is set to go on the auction block this year. The base
price for the proposed sale will be established by September.
Still unclear is the date at which further details of the sale
will be released.
Transparencia Mexicana, the Mexican division of Transparencia
Internacional, which will oversee the sale process, will be the
one to decide on the matter in collaboration with Cintra. The
final decision, however, must come within the previously
stipulated timeframe.
Cintra has seen its share value plunge 42.06% since the September
11 terrorist attacks. Its "A" series shares quoted on the BMV
have declined since August 31, 2001, when they were at MXN6.80
(US$0.68) each, to just MXN3.94 (US$0.39) by June this year.
In August 2001, the value of Cintra's stock was MXN6.74 billion
(US$677 million), but now, it's only worth MXN3.91 billion
(US$393 million), reflecting a loss of MXN2.83 billion (US$283
million) in just 10 months.
Cintra's stock price has been dropping since September, reaching
MXN6.09 in October, MXN5.50 in December, MXN3.00 in January,
MXN4.00 in February, March and April and slipped to MXN3.94 in
June.
Luis Gutierrez Ruvalcaba, president of Cintra, vowed that
although there have been several missed opportunities to sell
over the last seven years, the Company will not be sold cheaply.
Cintra is coveted by major airlines as Delta and Continental, as
well as by Mexican investors, for its strategic significance.
Merrill Lynch is the financial agent for the sale of Cintra.
To see Cintra's financial statements:
http://bankrupt.com/misc/Cintra.pdf
CONTACT: AEROMEXICO
Mayte Sera Weitzman of AeroMexico, +1-713-744-8446, or
mweitzman@aeromexico.com
MEXICANA DE AVIACION
Jenny Jenks, Marketing Director, International
Division of Mexicana Airlines, +1-210-491-9764, or
ennyjenks@mexicana.com
CINTRA
Xola 535, Piso 16, Col. del Valle
03100 M,xico, D.F., Mexico
Phone: +52-5-448-8050
Fax: +52-5-448-8055
Contacts:
Jaime Corredor Esnaola, Chairman
Juan Dez-Canedo Ruiz, CEO
Rodrigo Ocejo Rojo, CFO
OR
C.P. Francisco Cuevas Feliu, Investor Relations
Xola 535, Piso 16
Col. del Valle
03100 M,xico, D.F.
Tel. (52) 5 448 80 50
Fax (52) 5 448 80 55
infocintra@cintra.com.mx
MERRILL LYNCH & CO., INC.
World Financial Center,
North Tower, 250 Vesey St.
New York, NY 10281
Phone: 212-449-1000
Toll Free: 800-637-7455
Home Page: http://www.merrilllynch.com
Contact:
David H. Komansky, Chairman and CEO
E. Stanley O'Neal, President, COO, and Director
Thomas H. Patrick, EVP and CFO
MERRILL LYNCH MEXICO
Paseo de las Palmas No. 405
Piso 8
Col. Lomas de Chapultepec
11000 Mexico City, Mexico
Phone: 5255-5201-3200
Fax: 5255-5201-3222
TRANSPARENCIA MEXICANA
Dulce Olivia 71
Colonia Villa Coyoac n
DF, 04000
Contact:
Federico Reyes Heroles, President
Eduardo A. Boh>rquez, Executive Secretary
National Chapter
Phone/Fax: +52-5-5668 0955
Email: tmexican@data.net.mx
Home Page: www.transparenciamexicana.org.mx
CORPORACION DURANGO: Reports Second-Quarter 2002 Earnings
---------------------------------------------------------
Corporacion Durango, S.A. de C.V., a Mexican paper and packaging
concern, posted a net loss of MXN750.4 million in the second
quarter of 2002, against a net profit of MXN431.1 million in the
same period in the previous year, according to a report by Dow
Jones Newswires.
Sales fell to MXN2.31 billion in the period from MXN2.54 billion
in the previous year. Operating profit in the second quarter of
2002 also dropped to MXN269.2 million from MXN291.4 million in
the same year-ago period.
Corporacion Durango said shipments in the second quarter were
427,600 short tons, up 16% from the first quarter and 7% higher
than in the year-ago period. Average prices were $542 per ton,
down 17% from the like 2001 quarter, and 8% below the first
quarter.
Foreign exchange losses resulting from the weaker peso led to a
net loss for the period.
Corporacion Durango, S.A. de C.V., headquartered in Durango
Mexico, is an integrated producer of paper and corrugated
packaging products.
CONTACTS: CORPORACION DURANGO, S.A. DE C.V.
Mayela R. Velasco
+52 (1) 829 1008
mrinconv@corpdgo.com.mx
Arturo Diaz Medina
+52 (1) 829 1015
adiaz@corpdgo.com.mx
DAIMLERCHRYSLER: To Close Lago Alberto Plant August 11
------------------------------------------------------
German-American auto manufacturer DaimlerChrysler AG revealed
Friday it will close its Lago Alberto plant in Mexico City on
August 11 as part of a restructuring plan, reports EFE. The
plant, which produces Dodge trucks, employs some 1,600 people.
Production of the Dodge trucks in Mexico will be taken over by
the Company's northern Saltillo plant.
Closure of the Lago Alberto facility will be offset by additional
investments of US$300 million to expand the Toluca plant in
Mexico state and US$520 million to boost the productive capacity
of the Saltillo facility.
The largest exporter of Mexican-made automobiles, DaimlerChrysler
exported 196,999 units from Mexico between January and June of
this year.
GRUPO DINA: Trial On Case Against Canadian Firm Starts In October
-----------------------------------------------------------------
A Los Angeles court is set to hear on October a US$123-million
case lodged by Mexico's only truckmaker, Consorcio G Group Dina,
against Canada's Western Star Trucks for allegedly unilaterally
breaking a contract to purchase trucks, says Reuters, citing
Dina's in-house legal counsel, Mauricio Mendoza.
Dina claims it was significantly affected after it lost a
contract to build 9,000 trucks for Western Star Trucks in July
2000 when the Canadian company was acquired by Freightliner LLC,
a unit of Germany's DaimlerChrysler, the world's largest
truckmaker.
Dina is optimistic that it will win this case and said that it
will use any damages to get back on firm footing. According to
the Mexican company, a successful lawsuit against Western Star
Trucks could help put it on its way.
"We are very confident that we can win. We are sure that the law
is on our side. We feel that we are protected by both Mexican and
international trade legislation," Mendoza said.
Dina has been trying to avoid a bankruptcy that has threatened to
topple it since June 1999, when it had to sell off most of its
controlling stake in U.S. coachmaker Motor Coach to pay off more
than US$700 million in debt.
As part of its efforts, on July 19, the Company began to buy back
shares that had been delisted from the Mexican stock exchange
since August 2001 and which were in the hands of minority
shareholders.
The total cost of the buy-back, which includes the repurchase of
American Depositary Receipts (ADRs), is about US$2.6 million and
accounts for 45% of the Company's total outstanding shares.
Holders of ADRs have until Aug. 14 to convert their receipts to
Mexican peso-denominated shares.
However, despite the pay-out, Dina still holds US$164 million in
debt that comes due in the form of a convertible bond as of 2004.
Mendoza said that Dina has refused to declare bankruptcy and is
negotiating a liquidation of the bond in exchange for its
remaining stake in Motor Coach.
"By early August we could restructure the bond in such a way that
we would be practically debt-free," said Mendoza. "We may even be
able to get back into business."
CONTACT: CONSORCIO G GRUPO DINA SA DE C.V.
Tlacoquemecatl de Valle
No 41 Tlacoquemecatl
Mexico
Tel. +52 5 420 3900
+52 5 420 3987
Home Page: http://www.dina.com.mx/
GRUPO ALFA: SSB Ups Ratings On Better Performance, Restructring
---------------------------------------------------------------
Investment bank Salomon Smith Barney (SSB) has increased its
rating of the Mexican firm Grupo Alfa to "superior to market
average" from "neutral," citing the bank's improved financial
situation.
According to SSB, Alfa's financial troubles had decreased during
the second quarter as its subsidiary Hylsamex finished
restructuring its debts, and steel and chemical demand seemed to
be recovering faster than expected.
SSB also increase the object price of the firm's shares to MXN25
(US$2.57) each and is now revising the outlook for the rest of
2002 and for 2003.
On July 22, 2002, Hylsamex announced that its subsidiary Hylsa
reached a final agreement to restructure its debt obligations.
Hylsa's debt refinancing was based on the proposal presented to
creditors on December 11, 2001. As a result these agreement,
Hylsa's financial condition will be significantly enhanced,
reducing its total level of debt while extending debt maturities.
To see financial statements: http://bankrupt.com/misc/Alfa.pdf
CONTACT: ALFA, S.A. de C.V.
Ave. Gomez Morin 1111 Sur, Col. Carrizalejo
Garza Garcia, N. L. Mexico C.P. 66254
Tel: 52 8748-1111
Fax: 52 8748-2552
HYLSAMEX
Investor Relations
Margarita Gutierrez
E-Mail: mgutierrez@hylsamex.com.mx
Ricardo Sada
E-Mail: rsada@hylsamex.com.mx
Phone: (52) 81 8865 1224
(52) 81 8865 1201
Munich 101,
San Nicolas de los Garza N.L., 66452
Mexico
GRUPO MEXICO: Reveals Net Loss Of MXN792.2M For 1H02
----------------------------------------------------
Mexican copper mining concern Grupo Mexico SA posted an operating
profit of MXN1.61 billion for the first six months of 2002,
compared with MXN999.3 million in the year-ago period, Dow Jones
Newswires reports, citing a filing with the Mexican Stock
Exchange
During the 6-month period, Grupo Mexico reported a net loss of
MXN792.2 million, on sales of MXN12.22 billion. That compared to
net profit of MXN593.21 million on sales of MXN15.58 billion in
the same period a year ago.
In dollar terms, Grupo Mexico's earnings before interest, taxes,
depreciation and amortization, or EBITDA, was US$201.7 million in
the second quarter. Its EBITDA margin rose to 30.8% from 21.9% in
the like 2001 quarter, the Company said.
Net debt stood at US$2.47 billion at the end of June.
CONTACTS: GRUPO MEXICO S.A. DE C.V
Avenida Baja California 200,
Colonia Roma Sur
06760 Mexico, D.F.
Mexico
Phone: +52-55-5264-7775
Fax: +52-55-5264-7769
http://www.gmexico.com
Contacts:
German Larrea Mota-Velasco, Chairman & CEO
Xavier Garcia de Quevedo Topete, President & COO
GRUPO SIMEC: 1H02 Results Suffer on Interest, Exchange Rates
------------------------------------------------------------
Grupo Simec, S.A. de C.V. (Amex: SIM) ("Simec") announced Friday
its results of operations for the six-month period ended June 30,
2002. Net sales decreased 1% during the six months ended June 30,
2002, as compared to the six months ended June 30, 2001, from Ps.
1,004 million to Ps. 989 million. Primarily as a result of the
recording of an exchange loss in the 2002 period versus the
recording of an exchange gain in the 2001 period, Simec recorded
net income of Ps. 5 million in the six months ended June 30, 2002
versus net income of Ps.141 million for the comparable period of
2001.
Simec sold 297,647 metric tons of basic steel products during the
six- month period ended June 30, 2002 as compared to 276,441
metric tons in the same period of 2001. Exports of basic steel
products increased to 39,807 metric tons in the six-month period
ended June 30, 2002 versus 20,417 metric tons in the prior
comparable period. Additionally, Simec sold 20,442 tons of billet
in the six-month period ended June 30, 2002; in the six months
ended June 30, 2001, Simec had no sales of billet. Prices of
products sold in the first half of 2002 decreased 12% in real
terms versus the same period of 2001.
Simec's direct cost of sales was Ps. 660 million in the six-month
period ended June 30, 2002, or 67% of net sales, versus Ps. 668
million, or 67% of net sales for the same period of 2001.
Indirect manufacturing, selling, general and administrative
expenses (including depreciation) decreased 10% to Ps. 214
million during the six-month period ended June 30, 2002, from Ps.
238 million in the same period of 2001.
Simec's operating income increased 17% to Ps. 115 million during
the six- month period ended June 30, 2002 from Ps. 98 million in
the six months ended June 30, 2001. As a percentage of net sales,
operating income was 12% in the six-month period ended June 30,
2002 and 10% in the same period of 2001.
Simec recorded income from other financial operations of Ps. 7
million in the six-month period ended June 30, 2002 compared to
income from other financial operations of Ps. 34 million in the
same period of 2001. In addition, Simec recorded a reserve for
income tax and employee profit sharing of Ps. 18 million in the
six-month period ended June 30, 2002 versus a reserve of Ps. 39
million in the six-month period ended June 30, 2001.
Simec recorded financial expense of Ps. 99 million in the six-
month period ended June 30, 2002 compared to financial income of
Ps. 48 million in the same period of 2001 due principally to (i)
net interest expense of Ps. 34 million in the six-month period
ended June 30, 2002 compared to net interest expense of Ps. 101
million in the same period of 2001, reflecting lower debt levels
in the 2002 period; (ii) an exchange loss of Ps. 84 million in
the six-month period ended June 30, 2002 compared to an exchange
gain of Ps. 102 million in the same period of 2001, reflecting a
decrease of 9.4% in the value of the peso versus the dollar in
the six-month period ended June 30, 2002 compared to an increase
of 5.3% in the value of the peso versus the dollar in the same
period of 2001; and (iii) a gain from monetary position of Ps. 19
million in the six-month period ended June 30, 2002 compared to a
gain from monetary position of Ps. 47 million in the same period
of 2001, reflecting the domestic inflation rate of 2.6% in the
six-month period ended June 30, 2002 compared to the domestic
inflation rate of 2.1% in the same period of 2001 and the lower
amount of debt outstanding during the 2002 period.
In June 2002, Simec's parent company Industrias CH, S.A. de C.V.
"ICH" converted approximately $24.6 million of loans to Simec
plus accrued interest thereon (which loans were made principally
to fund the repayment of Simec bank debt described below) into
common shares of Simec at a conversion price equivalent to U.S.
$1.51 per American Depositary Share.
At June 30, 2002, Simec's total consolidated debt consisted of
approximately $63.8 million of U.S. dollar-denominated debt
(including $4 million of debt owed to ICH), while at December 31,
2001, Simec had outstanding $103 million of U.S. dollar-
denominated debt (including $14.8 million of debt owed to ICH);
Simec's lower debt level reflects the repayment of $24 million of
bank debt in the six-month period ended June 30, 2002 (Simec
financed $14 million of this repayment with loans from ICH) and
the amortization of $4.4 million of bank debt in May 2002.
Substantially all of Simec's remaining consolidated debt (other
than debt owed to ICH) matures in 2009 and amortizes in equal
semi-annual installments.
All figures were prepared in accordance with Mexican generally
accepted accounting principles and are stated in constant Pesos
at June 30, 2002.
Simec is a mini-mill steel producer in Mexico and manufactures a
broad range of non-flat structural steel products.
CONTACT: Grupo Simec, S.A. de C.V.
Adolfo Luna Luna, or Jose Flores Flores
Tel: +52-33-3669-5740
GRUPO TMM: Reports Improved Revenue in the 2Q02, 1H02
-----------------------------------------------------
Grupo TMM, S.A. de C.V. (NYSE: TMM and TMM/L), the largest Latin
American multi-modal transportation and logistics company and
owner of the controlling interest in Mexico's busiest railway,
TFM, reported second quarter 2002 revenues from consolidated
operations of $261.9 million, compared to $253.7 million for the
same period of 2001, an increase of 3.2 percent. Consolidated
EBITDA (Earnings Before Income, Taxes and Depreciation) was $83.1
million for the quarter, compared to EBITDA of $80.2 million in
the second quarter of 2001, a 3.6 percent increase.
Grupo TMM's consolidated second quarter 2002 operating income
increased $2.5 million, quarter-over-quarter, from $53.0 million
in 2001 to $55.5 million in 2002. Net income for the quarter
decreased $6.1 million from last year's results, from $2.5
million in 2001 to $(3.6) million in 2002. This quarterly
decrease was primarily affected by a devaluation of the peso,
which impacted both revenues on a monthly basis and receivables
in the form of exchange loss during the quarter, amounting to
$12.4 million.
Grupo TMM reported revenues from unconsolidated operations of
$80.5 million for the second quarter of 2002, compared to $69.8
million for the same period of 2001, an increase of 15.3 percent.
(Unconsolidated Grupo TMM includes its Specialized Maritime,
Logistics, Port and Terminal operations and now excludes Mex Rail
statistics.) Unconsolidated EBITDA was $14.7 million for the
quarter, compared to $16.7 million (excluding Mex Rail) in the
second quarter of 2001, a 12 percent decrease. The revenue
increases noted above reflect supply ship contract growth in
Specialized Maritime (17 percent), port services expansion (8.5
percent) and new logistics product offerings (19 percent) at the
border and within Mexico.
Grupo TMM's unconsolidated second quarter 2002 operating profit
decreased $1.3 million, quarter-over-quarter, from $9.5 million
in 2001 to $8.2 million in 2002. Net income for the quarter
decreased $6.1 million from last year's results, from $2.5
million in 2001 to $(3.6) million in 2002. The decrease in
operating profit quarter-over-quarter was impacted by a reduction
in port storage revenue, as the Manzanillo port became more tied
to transpacific shipments and less tied to South American
destinations, which traditionally required more storage; an
increase in costs at ports to prepare for contract volume
expansion announced in May at Manzanillo and an increase in costs
for logistics product offerings as revenues continue to increase.
First Six Months Results
Grupo TMM reported revenues from consolidated operations of
$505.6 million in the first six months of 2002, compared to
$491.4 million for the same period of 2001, an increase of 2.9
percent. Consolidated EBITDA was $152.8 million for the period,
compared to EBITDA of $145.4 million in the same period of 2001,
a 5.1 percent increase.
Grupo TMM's consolidated operating income during the first half
of 2002 increased $5.6 million quarter-over-quarter, from $91.7
million in 2001 to $97.3 million in 2002. Net income for the
first half of the year increased $1.4 million from last year's
results, from $7.0 million in 2001 to $8.4 million in 2002. The
first six months of 2002 were impacted by a one-time gain on the
sale of Mex Rail and Tex Mex to TFM.
Grupo TMM reported revenues from unconsolidated operations of
$170.1 million (excludes Mex Rail) for the first six months of
2002, compared to $138.3 million for the same period of 2001, an
increase of 23 percent. Unconsolidated EBITDA was $27.4 million
for the period, compared to $30 million in the first half of
2001, a 8.7 percent decrease. First half results reflect clear
improvement in Grupo TMM's revenues not related to its rail
investments.
As compared with 2001, Grupo TMM's unconsolidated operating
profit decreased $2.3 million in the first six months of 2002,
from $16.6 million in 2001, to $14.3 million in 2002. Net income
for the period increased $1.4 million from last year's results,
from $7.0 million in 2001 to $8.4 million in 2002. As noted
earlier, the first six months of 2002 were impacted by a one-time
gain on the sale of Mex Rail and Tex Mex to TFM.
Additional Equity at TFM
The company also reported that during the quarter, TFM has
exercised a call option to purchase an additional 24.6 percent of
equity interest in Grupo TFM from the Mexican government. The
company anticipates the transaction to close by the end of July.
Business Outlook
Jose Serrano, chairman of Grupo TMM, said, "As we have said in
the past, strengthening the balance sheet and matching financial
capabilities with the opportunities in our various operations is
a top priority. Once we do that, TMM's stock will become a
currency that reflects the economic potential of these
franchises. To that end, we placed a convertible issue during the
quarter, which reduced our commercial paper obligations, extended
the debt maturity profile of the company and raised the liquidity
necessary to address the 2003 obligation. The convertible gives
us flexibility to repay the issue in stock or cash, based upon
management's view of market conditions. To this point, we have
repaid the issue in cash due to the depressed price of our stock
and will continue to pay cash going forward, as long the stock
price remains depressed.
"We had multiple financing issues to accomplish for TMM and TFM
during the first half of this year, such as raising capital to
exercise the call option on the government's stake at Grupo TFM,
extending the maturities of TFM's commercial paper, which we
anticipate will be completed by mid August, receiving additional
commitments to increase TMM's securitization program and
addressing TMM's debt maturity profile at a reasonable cost far
in advance of maturities. The above actions demonstrate that TMM
is committed to improving its balance sheet and will allow us to
build a solid financial base to produce the capital that will be
needed to fund our growth.
"We have transformed this company from a container shipping liner
business to an integrated logistics company in a very short time,
and we remain confident that the asset-based franchises we have
built and developed will fulfill the vision we have described to
our investors," Serrano concluded. "The continued growth of our
assets and customer base, and the resulting improved revenue base
in this difficult economic environment, emphasizes that we are
continuing to make solid progress in building the fundamental
value of the company. The assets we possess are priceless,
irreplaceable, produce exceptional cashflow and serve as the
ultimate security for TMM's financial obligations and its future
interest as an investment. We continue to assure the fulfillment
of the company's financial commitments, as our asset values far
exceed the financial commitments and equity value that we
experience today."
Javier Segovia, president of Grupo TMM, commented, "There are
several key measures we are taking in the second half of 2002
that will fulfill many of the commitments we made to our
investors in the beginning of the year. These measures will focus
on shareholder interests, mitigating financial risk without
extraordinary events, pursuing the VAT settlement and pursuing
PEMEX opportunities.
"We expect that the remainder of the year will continue to show
revenue growth not only at Ports, Specialized Maritime and
Logistics, but at TFM, as the ground work has been laid with
PEMEX, automotive and intermodal customers to rapidly expand
their market share. These revenue enhancements, joined with
continued cost reductions, lead us to believe that our 2002
outlook remains stable."
2002 OUTLOOK
The company anticipates Grupo TMM to reach a consolidated EBITDA
of approximately $345 million in 2002 and a consolidated
operating profit of approximately $240 million. In addition,
corporate overhead and interest charges are projected to continue
to decline compared with 2001. All projections include
consolidated financials from TFM.
FIRST SIX MONTHS ACCOMPLISHMENTS POSITION GRUPO TMM
FOR GROWTH AND IMPROVING CASH RETURNS
-- Grupo TMM agreed with Kansas City Southern to sell Mex Rail
and Tex Mex to TFM. The two companies are working together to
better coordinate TFM's shipments over the two lines.
-- A proposed rail merger between Ferro Sur and Ferro Mex was
defeated.
-- TFM has broken ground in Toluca for a new 80-acre auto-mixing
center, which will change the face of automotive transportation
in Mexico, both in-bound and out-bound. Phase I is expected to be
completed in late 2002, and the entire facility by early 2003.
This facility, which will include an automotive terminal yard,
intermodal terminal, integrated logistics center and materials
warehouse, will be used by most major automotive manufacturers,
including Chrysler, General Motors, Nissan, Toyota, BMW and
Peugeot.
-- Ports and Terminals signed a contract with Mediterranean
Shipping and extended relationships with CP Ships, APL and Maersk
to increase volume by at least 66 percent over the next 18
months. A major expansion of the port at Manzanillo, now approved
by the government, will double capacity by the end of 2003.
-- TFM initiated a new four-year program with PEMEX to ship oil
related products, representing $30 million per year of additional
revenue, beginning in the second half of 2002. TFM is upgrading
PEMEX rail facilities to handle these products.
-- TFM exercised the call to acquire an additional 24.6 percent
of Grupo TFM equity from the Mexican government.
-- Grupo TMM raised $32.5 million through a non-mandatory
convertible note offering, which allowed the company to eliminate
$32.5 million of its outstanding commercial paper. The note is
being repaid in cash, but can be repaid in stock, depending on
market conditions.
-- Grupo TMM has received a $20 million commitment to increase
its securitization of receivables program, allowing the company
to raise additional liquidity.
-- Grupo TMM has set a date for a special shareholder meeting to
approve the reclassification of its share classes.
Segment Results
Grupo TMM's Mexican-based business components include: 1) multi-
modal logistics facilities throughout the country; 2) the TFM
Railroad; 3) the Texas Mexican Railway; 4) ownership and
management of key Mexican port facilities; 5) diverse trucking
operations; 6) a specialized marine transport division and 7) the
continuation of alliances with leading transportation and
distribution companies. These units collectively allow Grupo TMM
to continue to market a full range of non-owned alliance assets.
Grupo TFM
TFM's carload volume for the second quarter of 2002 increased by
8.3 percent, and net revenue increased by 1 percent, or $1.6
million over the same period of last year. Revenue was affected
by mix and length of haul changes. TFM attained EBITDA of $67.9
million for the quarter, and operating profit increased 8.4
percent in the quarter versus 2001. The quarter produced an
operating ratio of 72.8 percent (operating margin of 27.2
percent), an improvement of 1.8 percentage points compared to the
second quarter of 2001.
During the quarter at TFM, revenues by division were as follows:
chemicals increased by 17 percent; automotive increased by 2
percent; agroindustrial declined by 13 percent, due to a record
grain harvest in northwestern Mexico which reduced the need for
imports; industrials declined by 8 percent; cement and minerals
increased by 11 percent and intermodal increased by 13 percent.
Intermodal, which now receives 79 percent of its volume from the
automotive segment, continued to grow from all types of truck to
rail conversions, allowing for expansion of this segment.
TFM's net revenue increased $3.0 million in the first six months
of 2002 over the same period of last year, and EBITDA of $125.4
million in the period was 98.2 percent of plan for the first half
of the year. Operating profit increased 10.5 percent in the
period versus 2001. The first six months produced an operating
ratio of 74.9 percent (operating margin of 25.1 percent), an
improvement of 2.2 percentage points compared to the same period
of 2001.
Because of improving volume, expected recovery of the Mexican
economy, foreign trade growth and continued cost reductions, TFM
continued to affirm its EBITDA target of $280 million and an
operating ratio for the year in the low 70's.
TexMex
In the second quarter of 2002, the railroad's net revenue
decreased 11.9 percent over the same period of last year.
Operating profit increased, however, by $618,000 in the quarter
versus 2001. The quarter produced a positive operating ratio, an
improvement of 4.4 percentage points compared to the second
quarter of 2001. Most significantly, costs at TexMex have been
reduced by $4.7 million since last year, or 15.4 percent of
costs. EBITDA for the quarter was $533,000.
In the first half of 2002, the railroad's net revenue decreased
10.4 percent over the same period of last year. Operating profit
turned to a profit position, an improvement of 4.8 percentage
points in operating ratio compared to the same period of 2001.
EBITDA for the first six months was $1.3 million, an improvement
of $1 million over the same period last year.
Ports and Terminals
The division's revenues grew 8.5 percent in the second quarter of
2002 compared to 2001, in spite of a corridor mix change, which
reduced storage revenue. Due to recently signed customer
agreements and governmental approval of port facilities in
Manzanillo, the division has increased expenditures in the first
half of 2002 to prepare for this volume growth. In the second
quarter, the division further reduced SG&A by an annual run rate
of $500,000 at Mexico City corporate headquarters.
Grupo TMM believes that port and terminal volume will expand, as
the current Manzanillo terminal is operating at 95 percent of
capacity. Within the year, construction of the yard for the new
berth should be completed. Additionally, the division reported an
overall increase in the number of containers moved per crane, per
hour, of 25 percent. Finally, passenger activity at Cozumel and
Progreso for the first six months increased 67 percent compared
to the same period of last year.
Specialized Maritime
In its Specialized Maritime division, the company reported that
the application of the new Mexican Maritime law, which gives
preference to Mexican owned, Mexican flagged vessels, and the
elimination of previously unprofitable car carrier and bulk
routes in 2001, produced an increase of 52.6 percent in operating
profit in the second quarter, to $2.9 million in 2002, from $1.9
million in 2001. For the first six months of 2002, the division
produced an increase of 172 percent in operating profit over the
same period of 2001, to $6.8 million from $2.5 million.
Supply ship revenue in the second quarter of 2002 increased 80.1
percent compared to the same period of 2001, indicative of the
development of PEMEX oil production. Additionally, tugboat
revenue continues to grow and remains highly profitable. Finally,
the company has renewed two of its three oil tanker contracts
with PEMEX and should renew the third vessel in the near term.
Logistics
The company reported an increase in revenue for its logistics
division of 19 percent, or $3.2 million, in the second quarter of
2002 compared to the same period in 2001, due to new logistical
products at the border and within Mexico. Operating profit in the
quarter decreased due to extraordinary costs in maintenance and
leasing of equipment. In the first six months of 2002, revenue
increased 18.8 percent, or $6.2 million, compared to the same
period in 2001.
Headquartered in Mexico City, Grupo TMM is Latin America's
largest multimodal transportation company. Through its branch
offices and network of subsidiary companies, Grupo TMM provides a
dynamic combination of ocean and land transportation services.
Grupo TMM also has a significant interest in Transportacion
Ferroviaria Mexicana (TFM), which operates Mexico's Northeast
railway and carries over 40 percent of the country's rail cargo.
Visit Grupo TMM's web site at www.grupotmm.com.mx and TFM's web
site at www.gtfm.com.mx. Both sites offer Spanish/English
language options.
To see financial statements:
http://bankrupt.com/misc/Grupo_TMM.htm
CONTACT: Grupo TMM
Javier Segovia or Jacinto Marina
Tel. 011-525-55-629-8866
or
TFM
Mario Mohar, 011-525-55-447-5811
Investor Relations:
Brad Skinner, 011-525-629-8725
or
DRESNER CORPORATE SERVICES
Kristine Walczak (inquiries, analysts, media),
312/726-3600
kwalczak@dresnerco.com
GRUPO TMM: Sets Meeting Date for Reclassification of Shares
-----------------------------------------------------------
Grupo TMM (NYSE: TMM and TMM/L), announced Friday that a special
meeting of shareholders will be held on August 28, 2002, to vote
on the proposed reclassification of the company's shares. If the
reclassification is approved by the shareholders, each of the
company's Series "L" shares will be exchanged for Series "A"
shares, on a one-for-one basis. The meeting is scheduled to
commence at 5:00 p.m. at the company's offices in Mexico City.
ADS Shareholders of record as of the close of business on July
10, 2002, will be entitled to vote at the special meeting.
An Information Statement for this meeting will be mailed on or
about August 1, 2002, to shareholders of record on July 10, 2002.
Printed copies of the information statement can also be obtained
without charge by directing a request to Dresner Corporate
Services, 20 North Clark Street, Suite 3550, Chicago, Illinois
60602, Attention: Kristine Walczak, or at email address
kwalczak@dresnerco.com.
CONTACT: Grupo TMM
Jacinto Marina, 011-525-55-629-8790
jacinto.marina@tmm.com.mx
Investor Relations
Brad Skinner, 011-525-55-629-8725
brad.skinner@tmm.com.mx
Media Relations
Luis Calvillo, 011-525-55-629-8758
luis.calvillo@tmm.com.mx
Dresner Corporate Services
Kristine Walczak, 312/726-3600
kwalczak@dresnerco.com
VITRO: 2Q02 Results Disappointing Despite Debt Reduction
--------------------------------------------------------
Management championed the notion that the Company continued to
show a consistent level of sales on a YoY basis amounting to US$
608 million, resulting in a slight 1.6% decrease for the quarter
in dollar terms. The positive sales performance of Glass
Containers was offset by sales lost from the divestiture of
Ampolletas S.A. de C.V. that had sales of US$ 6.6 million during
the second quarter of 2001, and from a marginal decline during
the quarter of 1.6% at Flat Glass, which continued to be affected
by negative market conditions prevailing in Mexico and the United
States.
Increased capacity utilization, more efficient operating
conditions, and cost saving measures by Glass Containers and
Glassware generated in EBITDA increases of 1.6% and 18.1% for the
quarter, on a YoY basis, respectively, and which resulted in
Consolidated EBITDA of US$ 117 million for the quarter. The
EBITDA loss of US$ 1.6 million for the quarter arising from the
sale of Ampolletas, a non recurring gain obtained from natural
gas related hedges of US$ 5.5 million, recognized during the
second quarter of 2001, and a decrease in the EBITDA of Vitro
America, the United States subsidiary of Flat Glass, related to
the continued slowdown of the United States economy more than
offset the aforementioned increases resulting in a decline in
consolidated EBITDA of 8% on a YoY basis, in dollar terms.
Consolidated EBIT for the quarter was US$ 66 million, a decline
of 10.8% on a YoY basis. Operating income improved substantially
at Glass Containers and Glassware for the quarter.
A significant non-cash, Foreign Exchange Loss of US$ 129 million,
arising from the 10.4% depreciation of the peso against the U.S.
dollar during this quarter, resulted in a Consolidated Net Loss
for the quarter of US$ 60 million. This loss had no impact on
the Company's cash position.
Total Outstanding Debt stood at US$ 1,535 million as of June 30,
2002. This amount reflects a reduction of US$ 67.5 million of
indebtedness from Vitromatic and US$ 8 million from Ampolletas.
Aggregate debt of the Company has been further reduced after the
end of the quarter, by applying the proceeds of the Vitromatic
sale, as described below under Recent Developments.
On May 15, 2002, as previously announced, the Company repaid in
full a Yankee bond with an aggregate principal amount equal to US
$175 million, that was due. The bond was repaid with cash in
hand and financings obtained.
On July 3, 2002, the sale of the Company's 51% majority stake in
Vitromatic, S.A. de C.V., to Whirlpool Corporation was completed.
Consequently, for financial reporting purposes, the Company's
financial statements for fiscal year 2001 and for the six-month
period ended June 30, 2002, were recasted to recognize its
participation in Vitromatic and its results as discontinued
operations.
The consolidated financial results, balance sheet, income
statement, debt, and cash flows for the six-month period ended
June 30, 2002 and June 30, 2001, account for Vitromatic, S.A. de
C. V. as a discontinued operation. All figures provided in this
announcement are in accordance with Generally Accepted Accounting
Principles in Mexico. All figures are unaudited and are presented
in constant Mexican pesos as of June 30, 2002. Dollar figures are
in nominal US dollars and are obtained by dividing nominal pesos
for each month by the applicable exchange rate as of the end of
that month.
Vitro, S.A. de C.V. (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers. Vitro is a major participant in three principal
businesses: flat glass, glass containers, and glassware. Its
subsidiaries serve multiple product markets, including
construction and automotive glass; fiberglass; food and beverage,
wine, liquor, cosmetics and pharmaceutical glass containers;
glassware for commercial, industrial and retail uses; plastic and
aluminum containers. Vitro also produces raw materials, and
equipment and capital goods for industrial use. Founded in 1909
in Monterrey, Mexico-based Vitro has joint ventures with major
world-class partners and industry leaders that provide its
subsidiaries with access to international markets, distribution
channels and state-of-the-art technology. Vitro's subsidiaries
have facilities and distribution centers in seven countries,
located in North, Central and South America, and Europe, and
export to more than 70 countries worldwide. For further
information, please visit our website at: http://www.vitro.com
To see financial statements: http://bankrupt.com/misc/Vitro.htm
CONTRACT: VITRO, S.A. DE C.V.
Investor Relations:
Rodrigo Collada, +52-81-8863-1240
Email: rcollada@vitro.com
Media Relations:
Albert Chico, +52-81-8863-1335
Email: achico@vitro.com
BREAKSTONE & RUTH INTERNATIONAL for Vitro
Luca Biondolillo, +1-646-536-7012
Email: Lbiondolillo@breakstoneruth.com
OR
Susan Borinelli, +1-646-536-7018
Email: Sborinelli@breakstoneruth.com
VITRO: Shares Down After Weak 2Q02 Earnings Release
---------------------------------------------------
Following the release of dismal second-quarter earnings, which
showed a net loss of US$60 million, compared with net income of
US$36 million in the year-earlier period, Vitro SA saw the
biggest slump in its shares since June 26.
According to a Bloomberg report, shares of Mexico's biggest
glassmaker dropped 46 centavos, or 4.2%, to MXN10.56 pesos.
"Investors aren't going to hold shares that aren't profitable,"
said Rodrigo Quevedo, an analyst at Invex Casa de Bolsa SA.
Vitro said it reduced its outstanding debt at the end of June to
US$1.5 billion, which included the elimination of $67.5 million
from its liabilities after selling Vitromatic SA, Mexico's
second-largest appliance manufacturer and distributor, to
Whirlpool Corp. for $320 million in cash and assumed debt.
"The company will concentrate on its core business, and they have
a strong commitment to lower debt, but they haven't done it
significantly," Quevedo said.
=======
P E R U
=======
EMPRESAS LUCCHETTI: Expects To Suspend Debt On Plant's Closure
---------------------------------------------------------------
The closing down of Empresas Lucchetti SA's pasta factory in Peru
next month may force the Chilean company to miss meeting loan
agreement obligations. Empresas Lucchetti has been involved in
legal dispute with the Peruvian government over the Company's
pasta plant, which was built in the country's nature reserve.
The city of Lima had fought and lost a case against the
construction of the plant. Finally, it succeeded last August in
revoking the plant's license to operate. The Company was given
one year to move the plant, and August 3 is the legal deadline.
In a Securities and Exchange Commission filing, the holding
company Quinenco SA of Luksic group, which is the parent of
Lucchetti admitted that suspension of the operations of the plant
would have a negative impact on its finances, and would result to
the suspension of its obligations.
Lucchetti had earlier sold assets in Argentina and renegotiated
the Company's debts last year to reduce financing costs. The
Company hasn't posted a profit since 1997. As of December, it has
debts worth CLP56.4 billion (US$85 million), which is equivalent
to 120% of its net worth.
The Lucchetti plant in Peru reportedly involved about US$135
million in investments. The Company began investing in the mid-
1990s in the operation.
CONTACT: LUCCHETTI CHILE S.A.
Vicu¤a Mackenna 2600
Santiago - Chile
Phone: (56 2) 2382711
Home Page: http://www.lucchetti.cl
=================================
T R I N I D A D & T O B A G O
=================================
BWIA: Draws Up Plan To Confront Financial Troubles
--------------------------------------------------
BWIA is yet to reveal specific plans, but the Trinidad airline
admits it is in the process of drafting strategies to better deal
with its detriorating financial situation, The Trinidad Guardian
reports.
CEO Conrad Aleong said, the Company's main target is on
conserving cash for the year. It may consider further staff cuts
or route reduction. BWIA is also laying down plans to enter the
leisure market, inaugurating a flight to Manchester, England
recently.
The country's Minister of Trade and Industry Ken Valley, who was
among those on board of the inaugural flight, believes entering
the leisure market will help stabilize the Company and place the
airline in the international aviation market, the report added.
The airline announced a US$8.4 million loss in the first six
months of the year. Foreshadowing the fact, however, Aleong was
intent on considering the Company's performance for the last
three consecutive years.
In line with its primary target, Aleong said it would be in a
better position to reveal plans by next week.
CONTACTS: BWIA West Indies Airways
Phone: + 868 627 2942
E-mail: mailto:mail@bwee.com
Home Page: http://www.bwee.com/
Contacts:
Conrad Aleong, President and CEO (Trinidad)
Beatrix Carrington, VP Marketing and Sales (Barbados)
Paul Schutz, Chief Financial Officer (Trinidad)
BWIA: CEO Admits Badly Hit By Pilots' Strikes
---------------------------------------------
British West Indian Airways CEO Conrad Aleong admits the
Company's finances are affected by pilot strikes, The Trinidad
Guardian reports.
The Trinidad national airline was recently forced to cancel
several flights in its busiest season after a group of BWIA
pilots began to strike by "calling in sick."
The pilots are negotiating an average minimum salary of up to
US$77,500 a year, a senior industry source was quoted saying in
previous reports.
Meanwhile, the Aviation Communication and Allied Workers Trade
Union and the T&T Airline Pilots Association had denied their
members have been carrying out any industrial action.
Although not revealing any specific moves, Aleong vouched to look
at the problem. He also reassured that the pilots' unrest had
toned down. According to him, the problems were just with a
small group of pilots.
Aleong, at the Joint President's luncheon of the Caribbean
Association of Industry and Commerce and the T&T Manufacturing
Association, had scheduled a consultation with pilots on Monday.
CONTACTS: BWIA West Indies Airways
Phone: + 868 627 2942
E-mail: mailto:mail@bwee.com
Home Page: http://www.bwee.com/
Contacts:
Conrad Aleong, President and CEO (Trinidad)
Beatrix Carrington, VP Marketing and Sales (Barbados)
Paul Schutz, Chief Financial Officer (Trinidad)
=============
U R U G U A Y
=============
BANCO COMERCIAL: S&P Puts On CreditWatch, Negative Implications
---------------------------------------------------------------
Standard & Poor's Rating Services placed the ratings on Banco
Comercial S.A., which were on Creditwatch with developing
implications, indicating that the rating could be raised or
lowered, on Creditwatch with negative implications, as the
current sovereign ratings do not give room for a rating upgrade.
The action was a direct result of the downgrade of the ratings on
Uruguay (Oriental Republic of).
On Friday, S&P said it has lowered Uruguay's long-term local and
foreign currency sovereign credit ratings to B from BB-.
Concurrently, it affirmed Uruguay's B short-term local and
foreign currency sovereign credit ratings. The outlook remains
negative.
"The ratings downgrade and negative outlook reflect continued
pressures on Uruguay's financial system and the resulting policy
challenges for the new Minister of Finance and for the new
Central Bank Board," S&P said.
"A strong positive confidence shock engendered by the government
is needed to forestall further deterioration in the deposit
base," it added.
Plans by the government to strengthen the financial system with
the creation of a special purpose fund -- Fondo de
Fortalecimiento del Sistema Bancario (FFSB) -- to provide
assistance in terms of liquidity and capital to weakened banks is
a step forward to sustaining the banking system, but it makes
what was a private-sector banking problem a public-sector
problem, it said.
Discussions with the IMF and availability of funds from all
multilateral agencies are critical to Uruguay's creditworthiness,
it said.
Assuming ongoing multilateral support, S&P expects Uruguay to
meet its government financing needs (deficit and amortization) in
2002-2003 without tapping the private capital markets.
Banco Comercial is Uruguay's largest private sector bank and the
third largest overall with US$2.3 billion in assets as of
September 30, 2001.
CONTACT: BANCO COMERCIAL
Cerrito No. 400,
11100 Montevideo
Phone: 960-394/97
Fax: 963-569
Home Page: www.bancocomercial.com.uy/
***********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter Latin American is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ,
and Beard Group, Inc., Washington, DC. John D. Resnick, Edem
Psamathe P. Alfeche and Ma. Cristina Canson, Editors.
Copyright 2002. All rights reserved. ISSN 1529-2746.
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