/raid1/www/Hosts/bankrupt/TCRLA_Public/030501.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
Thursday, May 1, 2003, Vol. 4, Issue 85
Headlines
A N T I G U A & B A R B U D A
LIAT: Cash Crunch Predicted in August
A R G E N T I N A
NII HOLDINGS: Announces Strong Performance For 1Q03
PEREZ COMPANC: SDC Still Reviewing Petrobras Deal
TGS: Fitch Payment Missed; Ratings Downgraded to 'DD'
B E R M U D A
GLOBAL CROSSING: Security Considerations Cloud Hutchison Buyout
B R A Z I L
AES CORP.: Moody's Assigns B2 To Proposed $1B Bond Issue
ELETRONET: Begins Bankruptcy Proceedings
LIGHT SERVICOS: S&P Withdraws Ratings
ROYAL AHOLD: CBD Eyeing Potential Purchase of Bompreco
SABESP: Working Concession Contract Soon to be Official
* S&P Revises Brazil Outlook to Stable
C H I L E
SANTA ISABEL: Rival Threatens To Block Sale
C O S T A R I C A
* Fitch Revises Costa Rica Sovereign Debt Rating To Negative
M E X I C O
AHMSA: Posts $94.8M Loss In 2002
GF BITAL: 1Q03 Results Show Turnaround Underway
GRUPO IUSACELL: 1Q03 Earnings Show Lower Revenues
GRUPO MEXICO: Restructures Mining Unit's Debt
HYLSAMEX: Plunges Into Red In The 1Q03
MAXCOM TELECOMUNICACIONES: 1Q03 Numbers Positive, EBITDA Better
GRUPO TMM: Amended Exchange Offers Launched
ISPAT INTERNATIONAL: Swings Into Black for 1Q03 on Exports
TV AZTECA: Board OKs $140M Shareholder Distribution
P A N A M A
BLADEX: Reports 1Q03 Results; Reaffirms Recapitalization Plan
T R I N I D A D & T O B A G O
BWIA: Employees Set To Discuss New Salary Cut Date
- - - - - - - - - -
=================================
A N T I G U A & B A R B U D A
=================================
LIAT: Cash Crunch Predicted in August
-------------------------------------
St. Vincent & the Grenadines Prime Minister Ralph Gonsalvez said
that Antigua-based airline LIAT needs another $77 million by
August this year to stay alive. The Antigua Sun reported on
Monday that Dr. Gonsalves is on a crusade to ensure LIAT's
survival.
"There are people who tell me to leave LIAT alone. The
International Monetary Fund told me not to put too much money in
LIAT," he said. However, the Prime Minister is determined to see
LIAT through.
According to Dr. Gonsalves, it is more expensive to close LIAT
that to save it. Closing the airline would require $200 million,
$52 million of which would go to severance payments.
"I am absolutely confident that we will succeed, though I am not
sure how. What I do know if we do not succeed, matters will be
worst for the Caribbean," he said, adding, "If we cannot save
LIAT, I want to know where we are going with the Caribbean Single
Market and Economy. The CSME which comes on stream in 2005 is a
trade and economic arrangement where member countries will trade
their goods and services without any hindrance," he added.
"Some don't like the fact that Antigua has been subsidizing LIAT
all the time with so many people here are working for the
airline. I tell people who talk like that is true that you don't
like Lester Bird, if it is true that you have too many people
working here, those are side shows they are not the main event. A
leader must keep his focus and know what is essential and
fundamental and that which is peripheral," Dr. Gonsalves
explained.
Dr. Gonsalvez indicated that he will take the lead for air
transport in the Caricom, citing a leadership void for the
particular area. He admitted that the airline is indebted from he
ill disciples of the past.
St. Vincent & the Grenadines was the only government in the
Caribbean, which bought equity from LIAT when it placed available
shares on the market, said the report.
Other Caricom members are Antigua & Barbuda, the Bahamas,
Barbados, Belize, Dominica, Grenada, Guyana, Jamaica, St. Kitts &
Nevis, St. Lucia, Suriname and Trinidad & Tobago.
CONTACT: LIAT Corporate Headquarters
V.C. Bird International Airport,
P.O. Box 819,
St. John's, Antigua West Indies
Phone: 1 (268) 480-5600/1/2/3/4/5/6
Fax: 1 (268) 480-5625
Home Page: http://www.liatairline.com/
Contacts:
Garry Cullen, Chief Executive Officer
David Stuart, Vice President of Marketing
=================
A R G E N T I N A
=================
NII HOLDINGS: Announces Strong Performance For 1Q03
---------------------------------------------------
* Consolidated First Quarter Revenues Of $203 Million And
Consolidated EBITDA Of $57 Million
* Consolidated Net Income Of $9 Million Or $0.47 Per Basic Share
* $50 Million In Cash Raised During The First Quarter From Tower
Sale-Leaseback Transactions In Mexico And Brazil
NII Holdings, Inc. (Nasdaq: NIHD) announced Tuesday its
consolidated financial results for the first quarter of 2003,
including consolidated net income of $9 million, or $0.47 per
basic share, compared to a net loss of $155 million in the first
quarter of 2002. Consolidated operating revenues were $203
million, a 4% improvement over the $195 million reported during
the first quarter of 2002. The Company also reported consolidated
operating income before depreciation and amortization (EBITDA) of
$57 million during the first quarter, a 177% increase from the
first quarter of 2002, and consolidated operating income of $39
million, a $36 million increase from the first quarter of 2002.
As of March 31, 2003, NII Holdings reported approximately 1.29
million subscribers and consolidated cash balances over $293
million, including $8 million of restricted cash.
"Through increasing high quality net subscriber additions and
continued improvement in quarterly operating cash flow, we have
successfully added the key ingredient of profitable growth to our
continued focus on free cash flow generation and liquidity," said
Steve Shindler, NII Holdings' Chairman and CEO. "These strong
results are based on the premium value that Latin American
corporations and businesses ascribe to our differentiated
offering. Our mobile communications services help their bottom
line by enhancing their productivity beyond the capabilities of
traditional cellular-only services," he added.
Nextel Mexico, NII's largest subsidiary, reported $50 million in
first quarter 2003 EBITDA and $34 million of operating income.
These amounts represent significant improvements over first
quarter 2002 EBITDA of $27 million and operating income of $16
million. In addition, Nextel Mexico reported about 35,400 net
subscriber additions during the first quarter of 2003, increasing
its total subscriber base to about 552,800 units as of March 31,
2003. Each of NII's operating companies in Brazil, Argentina and
Peru also reported positive EBITDA and operating income during
the first quarter of 2003.
During the first quarter of 2003, the Company closed on several
communication tower sale-leasebacks in Mexico and Brazil under
its previously announced agreement with American Tower
Corporation raising $50 million in local currency-based proceeds.
During the second quarter of 2003, NII has continued to close on
additional tower sale-leasebacks under this agreement. Under U.S.
GAAP, the sale-leaseback transactions are accounted for as
financing transactions. As a result, these transactions are
classified as long-term debt on the Company's balance sheet. The
Company's total long-term debt as of March 31, 2003 was $487
million, including $49 million in tower financing obligations.
"During the first quarter, NII improved on its liquidity position
as a result of tower sale-leaseback financing transactions,
progress in building out its network in Baja California and
healthy performance in its operating markets. NII was able to
continue improving its consolidated EBITDA margin from 11% in
2002 to 28% in 2003. In addition to positive EBITDA and operating
income, all of our operating companies were also profitable in
the first quarter of 2003," said Byron Siliezar, NII's Vice
President and Chief Financial Officer.
Consolidated capital expenditures, including capitalized
interest, were $64 million during the first quarter of 2003,
representing a reduction of $4 million or 6% percent compared to
the first quarter of 2002.
In addition to the results prepared in accordance with accounting
principles generally accepted in the United States (GAAP)
provided throughout this press release, NII has presented
consolidated EBITDA which is a non-GAAP financial measure and
should be considered in addition to, but not as a substitute for,
the information prepared in accordance with GAAP. A
reconciliation from GAAP results to this non-GAAP financial
measure is provided in the notes to the attached financial table.
To view this and other reconciliations of non-GAAP financial
measures that the company uses and information about how to
access the conference call discussing NII's first quarter
results, visit the investor relations link at http://www.nii.com
.
About NII Holdings, Inc.
NII Holdings, Inc., a publicly held company based in Reston, Va.,
is a leading provider of mobile communications for business
customers in Latin America. NII Holdings, Inc. has operations in
Argentina, Brazil, Chile, Mexico and Peru, offering a fully
integrated wireless communications tool with digital cellular
service, text/numeric paging, wireless Internet access and Nextel
Direct Connectr, a digital two-way radio feature. NII Holdings,
Inc. trades on the Nasdaq market under the symbol NIHD. Visit the
Company's website at http://www.nii.com.
Nextel, the Nextel logo, Nextel Online, Nextel Business Networks
and Nextel Direct Connect are trademarks and/or service marks of
Nextel Communications, Inc.
CONTACTS: Investor Relations: Tim Perrott
(703) 390-5113
tim.perrott@nii.com
Media Relations: Claudia E. Restrepo
(786) 251-7020
claudia.restrepo@nii.com
PEREZ COMPANC: SDC Still Reviewing Petrobras Deal
-------------------------------------------------
Argentina's antitrust body, SDC, is yet to approve Brazil's
federal energy company Petrobras' acquisition of Argentine energy
giant Perez Companc. According to Business News Americas, the
approval was expected to come Tuesday but the deadline passed
without a decision from the Argentine regulator.
Petrobras has agreed with Perez Companc, otherwise known as
Pecom, to buy 58.6% of the Company for US$1bn. Pecom, in turn,
owns 98% of energy company Pecom Energia. The delay on the
approval from the SDC spurs uncertainty on the deal.
Petrobras wanted to complete the deal before last Sunday's
presidential elections, fearing that a new government could slow
the process. Outgoing President Eduardo Duhalde opposes the
inclusion of Pecom Energia's stake in power transmission company
Transener in the deal, because he is against foreign control of a
strategic asset such as power transmission.
Reports, however, revealed that Argentina's government and
Petrobras already reached a verbal agreement about the sale of
Transener. Under the agreement, Petrobras will sell Transener by
international auction once the company has regained its market
value, which will only occur once energy rates and contracts are
renegotiated by Argentina's new administration.
CONTACT: PECOM ENERGIA S.A. DE PEREZ COMPANC S.A.
Maipo 1 - Piso 22 - C1084ABA
Buenos Aires, Argentina
Phone: (54-11) 4344-6000
Fax: (54-11) 4344-6315
URL: http://www.pecom.com.ar/
Contacts:
Jorge Gregorio C. Perez Companc, Chairman
Oscar Anibal Vicente, Vice Chairman
TGS: Fitch Payment Missed; Ratings Downgraded to 'DD'
-----------------------------------------------------
Fitch Ratings downgraded the senior unsecured foreign currency
rating of Transportadora de Gas del Sur (TGS) to 'DD' from 'C'.
The rating action follows the non-payment of principal associated
with TGS' US$100 million Floating Rate Notes (FRN) issued under
the company's December 1997 US$500 million 'Obligaciones
Negociables' shelf registration with the Argentine Securities and
Exchange Commission. TGS has included the FRNs in its global
restructuring program.
TGS is seeking to restructure the majority of its obligations in
an effort to extend maturities and adjust payment terms to
reflect the company's limited financial flexibility. TGS' credit
profile has been adversely affected by the various emergency
measures implemented by the Duhalde administration following the
sovereign's default, including devaluation, 'pesofication' of
tariffs and elimination of price and/or tariff adjustments based
on foreign currency indexation. Fitch believes that parties
involved in TGS' restructuring efforts remain far apart,
precluding a rapid conclusion to the negotiations. In the
interim, management is focused on protecting the company's
operational integrity.
TGS is the operator of the largest pipeline transmission system
in Argentina, delivering an estimated 60% of the country's total
natural gas consumption. The company is owned (55.3%) and
operated by Compania de Inversiones de Energia (CIESA). CIESA is
50%-owned by Enron Argentina and Perez Companc. Both Enron and
Perez Companc also hold a direct 7.35% interest in TGS. The
remaining 30% is publicly traded on the NYSE and BCBA.
=============
B E R M U D A
=============
GLOBAL CROSSING: Security Considerations Cloud Hutchison Buyout
---------------------------------------------------------------
Hong Kong-based conglomerate Hutchison Whampoa, Ltd. is likely to
abandon its offer to buy fiber-optic carrier Global Crossing out
of bankruptcy because U.S. officials still have deep concerns
about the sale's national security implications, the Associated
Press reports, citing a source familiar with the situation.
The Committee on Foreign Investment in the United States (CFIUS)
has expressed concerns that the U.S.'s telecommunications traffic
might fall into unfriendly hands. Hutchison's offer to limit its
control on Global Crossing upon acquisition has failed to
convince CFIUS.
Hutchison, along with Singapore Technologies Telemedia offered to
buy 61.5 percent of Global Crossing for US$250 million. CFIUS
clarified that it has no qualms about Singapore Telemedia.
CFIUS fears are based on California Republican Representative
Dana Rohrabacher statements to U.S. President George Bush that
Hutchison should be prevented from acquiring fiber-optic networks
in the country as its owner, Hong Kong's richest man, Li Ka-Shing
is reputed to have ties with the Chinese government.
It was earlier reported that Global Crossing's network carries
data for the U.S. Justice Department, the CIA, and the FBI.
Hutchison received permission from the European Commission to go
ahead with its plans to purchase Global Grossing in January.
In February, long-distance carrier IDT Corp. said it was willing
to pay $255 million for Global Crossing because its valuable
assets should remain in American hands, the report recalls.
CONTACT: GLOBAL CROSSING
Press:
Becky Yeamans, +1-974-410-5857,
Email: Rebecca.Yeamans@globalcrossing.com
Tisha Kresler, +1-973-410-8666
Email: Tisha.Kresler@globalcrossing.com
Analysts/Investors:
Ken Simril, +1-310-385-5200
Email: investors@globalcrossing.com
Hutchison Whampoa Ltd
22nd Floor Hutchison House
10 Harcourt Road
Hong Kong
Phone: +852 2128 1188
Fax: +852 2128 1705
Home Page: http://www.hutchison-whampoa.com
Contacts:
Li Ka-shing, Chairman
Victor Li Tzar Kuoi, Deputy Chairman
Canning Fok Kin-ning, Group Managing Director
Susan Chow Woo Mo Fong, Executive Deputy Managing
Director
Frank John Sixt, Group Finance Director
===========
B R A Z I L
===========
AES CORP.: Moody's Assigns B2 To Proposed $1B Bond Issue
--------------------------------------------------------
AES Corporation's proposed US$1 billion senior secured bond issue
has been assigned a B2 rating by Moody's Investors Service. The
bonds would be secured by a second lien on the stock of domestic
subsidiaries and 65% of the stock of foreign subsidiaries.
The ratings agency's move reflects the weak cash flow in relation
to its total debt, structural subordination to large debt
balances at subsidiaries and projects owned by AES, and limited
financial flexibility. The rating also considers the benefits and
limitations of the collateral package, and recent improvements in
AES Corporation's liquidity profile following significant asset
sales.
However, the Company is reliant upon execution of additional
asset sales to meet its obligations in the near term, and this is
reflected in the negative outlook for all of the ratings for AES
Corporation, Moody's said.
ELETRONET: Begins Bankruptcy Proceedings
----------------------------------------
Lightpar, a unit of Brazil's federal electric company Eletrobras,
initiated bankruptcy proceedings for its carrier of carriers unit
Eletronet SA, Business News Americas reports, citing local
financial paper Valor Economico.
Eletronet's board of directors had hinted earlier in April that
the Company should file for bankruptcy, but the decision was made
at an extraordinary shareholders' meeting held last week.
In a statement to Brazil's Securities and Exchange Commission,
Eletrobras and LightPar also ratified a previous decision
expelling AES Bandeirante, a local unit of U.S. power group AES
Corp., from Eletronet's board.
Eletronet was created in 1999 by LightPar. Eletrobras, via
LightPar, took a 49% stake in Eletronet and auctioned off the
majority interest to sole bidder AES in August of that year. AES
offered the US$155 million minimum price for its stake and
committed to make its purchase payment in several installments
over four years, with the funds treated as paid-in capital to
Eletronet to help fund construction of the network.
The Company, which operates a 16,000km nationwide broadband
telecommunications network over Brazil's electrical transmission
grid, has a total debt load of BRL570 million. Its principal
creditors, with 85% of the total, are Lucent Technologies and
Brazilian aluminum cable maker Furukawa, while local banks
Bradesco and Safra hold another 10%.
LIGHT SERVICOS: S&P Withdraws Ratings
-------------------------------------
Standard & Poor's Ratings Services withdrew on Tuesday its 'CCC+'
global scale foreign and local currency ratings on Light Servicos
de Eletricidade S.A. (Light) at the client's request, as the
company does not expect to access the capital market debt
instruments in the near future. The outlook was negative.
Light has announced it will seek to renegotiate a significant
portion of its short-term debt. At this point, there is no public
information about what the terms and conditions of its debt
restructure package will be and how Light will conduct this
process. However, Standard & Poor's understands that the company
will focus on stretching existing maturities in order to
adequately meet debt requirements with cash flow generation. As
most of Light's obligations are private contracts with
relationship banks, renegotiations tend to be smoother than
public debt instruments, and normally will not characterize a
non-payment. Electricite de France Group (EDF)--Light's parent
company--is expected to continue to participate in Light's
financial decisions, as confirmed by its direct support of the
medium-term note repayment last February.
A change in the renegotiation conditions as anticipated today
could lead to a different rating outcome. For example, Standard &
Poor's would see unilateral or coercive offers as tantamount to
default; as well, a less active participation by EDF in the
negotiations could lead to a lower rating.
ROYAL AHOLD: CBD Eyeing Potential Purchase of Bompreco
------------------------------------------------------
Cia. Brasileira de Distribuicao Grupo Pao de Acucar (CBD),
Brazil's largest retailer, indicated that it will join the race
for the Brazilian assets of Royal Ahold, Bloomberg reports,
citing Valor Online newswire.
"We are assessing Ahold's Bompreco unit," Pao de Acucar's
president of the board Abilio Diniz said, according to Valor.
Diniz said that CBD's debt was no obstacle in carrying out
acquisitions.
"Our debt is ridiculously low," the CBD executive said,
acknowledging though that CBD had been working to reduce the
debt, as interest rates in Brazil were very high.
Ahold, which is struggling to overcome an accounting scandal,
announced in early April plans to divest all its South American
assets, including its Bompreco and G. Barbosa chains in
Northeastern Brazil.
Sources close to the sale said the process began in earnest this
week with the hiring of Dutch bank ABN AMRO, which is among
Ahold's creditors, to lead the deal. The sources said Ahold's
South American units would be sold separately.
SABESP: Working Concession Contract Soon to be Official
-------------------------------------------------------
Sabesp is about to operate in the municipality of Sao Paulo's
water supply and sewage collection and treatment system under a
concession contract.
The state water utility has been operating in the same
municipality without a contract for years now. But, according to
Andre Castro, the chief economic and financial advisor to the
city's urban infrastructure department, the Sao Paulo government
has submitted a bill to the city council to formalize a contract
with Sabesp.
At the same time, Castro highlighted the fact that Sabesp's
investment in the city - which according to him still lacks water
and sewerage coverage - has been inferior to its profit, and that
the state capital would be financing the utility's investment
program in the state's interior.
Sabesp is Brazil's largest water utility in terms of users,
serving 366 of Sao Paulo state's 645 municipalities. The utility
provides water to 25 million residents through a 54,000km
distribution network and sewerage service to 16.8 million
residents through a 34,000km collection network.
The Company posted a net loss of BRL651 million in 2002 due to
the devaluation of the Brazilian Real.
CONTACT: Helmut Bossert
(5511) 3388-8664
hbossert@sabesp.com.br
Marisa Guimaraes
(5511) 3388-9135
marisag@sabesp.com.br
www.sabesp.com.br
* S&P Revises Brazil Outlook to Stable
--------------------------------------
Standard & Poor's Ratings Services said on Tuesday that it
revised its outlook on its long-term local and foreign currency
sovereign credit ratings on the Federative Republic of Brazil to
stable from negative. Standard & Poor's also affirmed its 'BB'
long-term local, 'B+' long-term foreign, and 'B' short-term local
and foreign currency sovereign credit ratings on the republic.
"The stable outlook reflects recent progress and prospects for a
further strengthening of Brazil's fiscal position," said
sovereign analyst Lisa Schineller. "President Luiz In cio Lula da
Silva and his administration have thus far demonstrated a
commitment to stabilize the stock of government debt," she added.
According to Ms. Schineller, first, the government raised the
primary (noninterest) surplus target for the nonfinancial public
sector for 2003 to a new target of 4.25% of GDP, up from the
budgeted 3.75% of GDP (fiscal performance to date suggests the
target could be surpassed). Second, the budget directives law it
presented to Congress on April 15, 2003, maintains the higher
4.25% of GDP primary surplus target for 2004, and probably
through 2006.
"Reflecting an improved fiscal stance and some real appreciation
of the exchange rate, the net general government debt burden is
projected to decline this year," Ms. Schineller noted. "However,
the debt burden still remains high, leaving limited room for
countercyclical fiscal policy and entailing large primary
surpluses over the medium term," she said.
The quality of ongoing fiscal adjustment and the sustainability
of a decline in the government debt burden are also supported by
the government's commitment to pass social security and tax
reform, which is to be presented to Congress on April 30, 2003.
Standard & Poor's expects that this important reform will be
legislated, reflecting a broad political recognition that it is
needed to ensure Brazil's fiscal viability over the longer term.
Both the electorate and Congress are more inclined to support
this reform following several years of debate that has raised the
social consciousness of its importance.
Ms. Schineller said that, given Brazil's large fiscal and
external vulnerabilities, there is little room for policy
slippage. "Timely and resolute progress on pension and tax reform
should bolster the country's longer-term growth prospects by
addressing several structural weaknesses in the public sector,"
she explained. "Successful consolidation of reform and a
proactive debt management strategy that reduces the stock of
dollar- and interest-rate indexed securities and that extends
tenors could strengthen Brazil's credit standing. Brazil's
ratings could come again under downward pressure if there is
slippage in the current strong budgetary performance and the
commitment to a tight fiscal stance and structural reform
falters," Ms. Schineller concluded.
Analyst: Lisa M Schineller
New York
Phone: (1) 212-438-7352
Helena Hessel
New York
Phone: (1) 212-438-7349
=========
C H I L E
=========
SANTA ISABEL: Rival Threatens To Block Sale
-------------------------------------------
Chilean retailer D&S plans to go to court to force troubled Dutch
retail giant Ahold NV to pay back a US$90 million debt related to
the sale of Argentine assets in 2000, reports Reuters. D&S wants
the payment to be in its full dollar amount. But according to D&S
officials, Ahold has said it will pay the equivalent in the
devalued Argentine peso currency, or about US$46 million.
The suit may hinder Ahold's plan to sell Santa Isabel, which is
controlled by Ahold's Disco unit. The main rival of D&S - closely
held Cencosud SA - is in the final stages of buying the
operations for some US$150 million. However, D&S said it would
try to block the planned sale, adding that Disco shouldn't be
allowed to sell off any assets before the debt is settled.
===================
C O S T A R I C A
===================
* Fitch Revises Costa Rica Sovereign Debt Rating To Negative
------------------------------------------------------------
Fitch Ratings revised Monday the Outlook on Costa Rica's
sovereign ratings to Negative from Stable. Fitch also affirms the
foreign and local currency ratings of 'BB' and 'BB+'
respectively.
The negative outlook reflects fiscal slippage in recent years,
which, in the context of a crawling peg exchange rate and
increasing dollarization of the banking sector, has increased
Costa Rica's financial vulnerability. Costa Rica's foreign
exchange reserve position provides only a limited degree of
protection against balance of payments shocks, raising the
potential for pressure on the exchange rate. Supporting Costa
Rica's ratings are the country's modest external indebtedness, a
successful diversification of the export base through significant
foreign direct investment (FDI), robust democratic institutions,
and favorable social indicators.
The Costa Rican economy decelerated sharply from over 8% growth
in 1998 and 1999 to an average of 1.7% during 2000-2002. This was
driven by the global growth slowdown and lower commodity prices
which adversely affected exports, as well as high domestic
interest rates that have limited growth in domestic demand. The
country has also been unsuccessful in making significant progress
on structural reforms, such as privatization of state-monopolies
and large national banks.
High fiscal deficits (resulting from a low tax intake and a rigid
expenditure profile) in an environment of slow growth have led to
a build-up in government debt. General government debt has
increased from 39% of GDP in 1998 to over 50% at the end of 2002.
Interest payments consume one-third of government revenues. The
central government's fiscal deficit reached 4.3% of GDP last
year, while the public sector deficit was even higher at over 5%
of GDP. Government issuance of dollar-denominated domestic debt
has exposed public finances to exchange rate risk.
A low savings rate of 12.7% of GDP, versus 18% for the 'BB'
median, underpins Costa Rica's 'twin' fiscal and current account
deficit problem, resulting in pressure on the exchange rate.
Local currency interest rates have remained high in support of
the currency, limiting growth and resulting in a preference for
borrowing in U.S. dollars.
Fiscal consolidation represents the most direct way to raise
domestic savings; moreover, it could also provide room to manage
sizable contingent liabilities in the banking sector. Such
liabilities could arise from public sector banks, given the
blanket state guarantee on deposits in these banks. Likewise
private banks, given widespread dollar lending to borrowers with
local currency cash flows and a lack of sufficient supervision of
offshore-banking activities, could come under pressure.
Current account deficits have been significant over the past few
years, reaching 5.5% of GDP last year. Fortunately, FDI has been
robust as well, thereby limiting the increase in external
indebtedness. Moreover, the country is well positioned to attract
greater foreign capital if the Central American Free Trade
Agreement with the U.S. is successfully negotiated and
implemented.
The Pacheco administration has begun to address the fiscal
problem, dividing its strategy in two parts: 1) a temporary
Fiscal Contingency Plan implemented in 2003 to raise revenues by
1% of GDP, and 2) a Permanent Fiscal Reform that could raise at
least 2% of GDP by expanding the narrow tax base, minimizing tax
exemptions, implementing a value-added-tax and improving tax
administration. The temporary plan expires this year. Failure to
pass the Permanent Fiscal Reform this year in a divided Congress
would mean that either legislation continuing the temporary plan
will be required or further fiscal slippage would be in the
offing.
Going forward, a stabilization of Costa Rica's sovereign
creditworthiness will depend on the ability of the government to
tackle fiscal deficits and implement structural reform. A
comprehensive tax reform, further strengthening of bank
supervision, especially of off-shore banking activities, and
progress on privatization would be viewed favorably by Fitch. By
contrast, continued fiscal slippage and back-peddling on
structural reform could further undermine the credibility of the
policy framework and increase the pressures on the exchange rate
and for dollarization. A sudden exchange rate devaluation would
mean a higher government debt burden, given Costa Rica's
substantial level of dollar-denominated government debt.
Contact: Shelly Shetty
Phone: +1-212-908-0324
Theresa Paiz Fredel
Phone: +1-212-908-0534
Media Relations:
Matt Burkhard
Phone: +1-212-908-0540
===========
M E X I C O
===========
AHMSA: Posts $94.8M Loss In 2002
--------------------------------
Mexican iron and steel company Ahmsa reduced net losses last year
to MXN976 million (currently US$94.8mn), from a loss of MXN1.65
billion in 2001, reports Business News Americas. The Company
reported sales revenues of MXN11.0 billion for last year, just
about the same as MXN10.9 billion in the previous year.
Monclova-based Ahmsa, which describes itself as Mexico's largest
integrated steelmaker with capacity of some 3Mt, is controlled by
the GAN group. The Company has been in a form of bankruptcy
protection since May 1999.
In a shareholders meeting held April 28, Ahmsa made available to
shareholders various court rulings issued in its favor in its
long-standing dispute with creditor banks, to which it owes some
US$1.85 billion, the Company said. However, local press reports
suggested that creditors, including some banks that sent
representatives to the 30-minute meeting, were disappointed to
find debt-restructuring did not figure on the agenda.
CONTACT: AHMSA
Prolongacion B. Juarez s/n,
Monclova , Coahuila 25770
Mexico
http://www.AHMSA.com
Phone: +52 86 33 81 72
Fax: +52 86 33 65 66
Contacts:
Alonso Ancira Elizondo, CEO, Vice Chairman, Pres/CEO
Jorge Ancira Elizondo, Chief Financial Officer
Manuel Ancira Elizondo, Chief Operating Officer
GF BITAL: 1Q03 Results Show Turnaround Underway
-----------------------------------------------
Highlights
- Net income up 279 per cent to MXP 405 million for the first
quarter ended 31 March 2003, as compared to the first quarter
ended 31 March 2002.
- Operating income before provisions for loan losses up by 102
per cent to MXP 1,615 million.
- Cost:income ratio of 61 per cent, compared to 76 per cent for
the quarter ended 31 March 2002.
- Assets up 16 per cent to MXP 158 billion, compared with 31
March 2002.
- Total capital ratio of 11.98 per cent, compared to 10.96 per
cent at 31 December 2002.
Grupo Financiero Bital (GFBital) achieved net income of MXP 405
million for the first quarter ended 31 March 2003. This result
was 279 per cent higher than the MXP 107 million reported for the
same period of the previous year. The growth from the relatively
weak 2002 results reflected an improvement in net interest income
originating from higher interest rates, an increase in customer
deposits and a stronger capital base. The two principal
subsidiaries, Banco Bital, and Bital Seguros (joint venture with
ING), accounted for all of this improved performance.
Comment by Sandy Flockhart, CEO of GFBital:
"Our first quarter results were strong and ahead of expectations.
The core Personal Financial Services business lines continue to
grow and the Bank was well positioned to benefit from market
volatility and higher local interest rates.
"The Mexican economy has performed well in the light of world
events, with the higher price of oil leading to higher levels of
international reserves.
"We have made important strides in the integration of GFBital
into the HSBC network, although significant work remains to be
done. The existing HSBC Mexico operations will be merged into
GFBital in the second quarter subject to receipt of the necessary
regulatory approvals. The resulting business synergies will
contribute to the development within GFBital of traditionally
strong HSBC business lines such as Trade Finance, Corporate
Banking, Private Banking, and Treasury."
Financial Review
Total revenues increased by 22 per cent to MXP 4,098 million in
the quarter ended 31 March 2003, compared to MXP 3,363 million
for the same quarter of 2002. Most of the increase was driven by
higher net interest income as the net interest margin improved
from 6.13 per cent to 6.62 per cent in the first quarter of
2003. A 16 per cent increase in customer deposits and a stronger
capital base were the principal factors leading to these higher
revenues.
Fees and commissions of MXP 1,267 million were up 21 per cent
from 2002, due principally to higher transaction volumes on
Personal Financial Services and Commercial Banking related
products such as credit cards, deposit services, and ATMs.
Operating expenses decreased by 3.1 per cent compared to the
quarter ended 31 March 2002. The reduction resulted from
improved expense discipline and leveraging the HSBC Group's
expertise. The cost:income ratio was 61 per cent, which compared
favourably with the level of 76 per cent reported in the same
period of the previous year.
The size and composition of the balance sheet, up MXP 23.1
billion or 16.9 per cent from 31 March 2002, principally relates
to the addition of Banco Atlantico's assets and liabilities
effective 1 October 2002, which was prior to HSBC's acquisition
of GFBital. Credit quality has improved from year-end 2002 with
non-performing loans (NPLs) down 3.7 per cent and the ratio of
loan loss reserves to NPLs strengthening from 115.8 per cent to
121.5 per cent. The consumer loan portfolio has been steadily
growing and a number of corporate credit facilities have recently
been approved.
GFBital is one of the five largest banking and financial services
institutions in Mexico, with some 1,400 branches, 4,000 ATMs, and
over 17,000 employees. Subject to the receipt of the necessary
regulatory approvals, the existing HSBC Mexico banking operation
will be merged into GFBital in the second quarter of 2003. This
merger will add 100 HSBC employees and 1,500 corporate,
commercial and private banking client relationships to GFBital.
GFBital is a directly held, 99.76 per cent owned subsidiary of
HSBC Holdings plc. Headquartered in London, with over 9,500
offices in 80 countries and territories and assets of US$759
billion at 31 December 2002, the HSBC Group is one of the world's
leading banking and financial services organisations.
GRUPO IUSACELL: 1Q03 Earnings Show Lower Revenues
-------------------------------------------------
Grupo Iusacell, S.A. de C.V. (Iusacell or the Company) (BMV:CEL),
(NYSE:CEL) announced on Tuesday results for the first quarter
ended March 31, 2003(1).
Highlights
-- 1Q03 EBITDA reached $399 million, up 8% from the fourth
quarter of 2002
-- EBITDA margin improved to 34% from 32% in the first
quarter of 2002
-- Adjusted EBITDA margin(2) improved to 29% from 28% in the
first quarter 2002
-- Postpaid churn continues to improve, dropping 14%
compared to the first quarter of 2002
-- Enhanced pricing plans launched for prepaid and postpaid
segments
-- CDMA2000 1XRTT launch in January marks Mexico's most
advanced network deployment
"In the first quarter, we reaffirmed our commitment to the
customer's experience, launching a new set of postpaid and
prepaid value proposition price plans and the first high speed
wireless data application in Mexico using CDMA2000 1X technology.
At the same time, we continued implementing important cost-
cutting measures, as well as service and support initiatives that
will help us grow our high-value customer base over the long
term," said Carlos Espinal G., Chief Executive Officer of
Iusacell.
Operational Results
Subscribers as of March 31, 2003 totaled 2.0 million, a 2%
increase over the past 12 months. However, the subscriber base
decreased 2% when compared to year-end 2002. This decline is due
to fewer gross additions as the Company continues its focus on
high-value customers and constant deletions driven by the
turnover of low-usage Incoming Calls Only subscribers. Gross
additions in the first quarter of 2003 totaled 164,000, compared
to 294,000 in the first quarter of 2002, and 169,000 in the
fourth quarter of 2002.
(1) Unless otherwise noted, all monetary figures are in Mexican
pesos and restated as of March 31, 2003 in accordance with
Mexican GAAP, except for ARPU (which is in nominal pesos). The
symbols "$" and "US$" refer to Mexican pesos and U.S. dollars,
respectively.
(2) Adjusted EBITDA expenses rather than capitalizes postpaid
handset subsidies and excludes non-operational transactions, such
as severance costs and gains from fiber-optic and tower sales.
The Company's postpaid customer base declined 4% from the fourth
quarter of 2002 and 11% year over year, ending at 343,000 due
primarily to the fewer gross additions. Prepaid customers
decreased 2% from the fourth quarter of 2002 but increased 5%
year over year, totaling 1.7 million as of March 31, 2003. The
sequential decline in the prepaid subscriber base is the
anticipated result of the Company's efforts to replace low-usage
Incoming Calls Only customers with higher value prepaid
customers.
Blended churn in the first quarter of 2003 decreased to 3.4% from
the 4.1% per month registered in the fourth quarter of 2002, but
was up from the 2.7% reported in the first quarter of 2002.
Postpaid churn continued to improve at 3.2% in the first quarter
of 2003, compared to 3.6% in the fourth quarter of 2002 and 3.7%
in the first quarter of 2002. The improvement reflects the
Company's continued efforts to augment retention and renewal
programs; these efforts are designed to increase customer loyalty
with compelling proposals for high value postpaid subscribers.
Minutes of use (MOU) among postpaid customers increased 5% on a
year over year basis, while prepaid MOUs declined 10% over the
prior year. The proportionately higher number of prepaid
customers from the year ago period pushed down blended monthly
MOU per subscriber by 12%. Postpaid usage was up 2% from the
fourth quarter 2002 as a result of new packages that include more
minutes. Prepaid MOUs declined 7% sequentially in the first
quarter of 2003, reflecting the impact of special promotional
plans implemented in January and February that included non-
invoiced minutes. These special prepaid incentive promotions
ended on March 1, 2003.
Average revenue per user (ARPU) declined from $221 in the first
quarter of 2002 to $178 in the first quarter of 2003 primarily
due to a higher proportion of prepaid subscribers in the
Company's customer base. The increased proportion of hybrid
customers in the postpaid base impacted postpaid ARPUs, which
decreased 8% compared to the previous year. Prepaid ARPU
decreased 14% compared to the first quarter of 2002, driven
primarily by a higher proportion of lower-revenue generating
customers in the prepaid subscriber base. Sequentially, postpaid
ARPU increased 1% due to an improved postpaid subscriber mix and
higher postpaid MOUs.
Operating Highlights
-----------------------------------------------------------------
First Quarter
-----------------------------------------------------------------
2003 2002 % Change
-----------------------------------------------------------------
Cellular subscriber base 2,035,731 1,995,257 2%
Gross cellular additions 163,837 294,304 -44%
Net cellular additions (45,469) 140,091 -
Blended churn 3.4% 2.7% -
Avg. monthly MOU per subscriber(a) 61 69 -12%
Postpaid 227 217 5%
Prepaid 27 30 -10%
Monthly ARPU(1)(a) 178 221 -19%
Postpaid 681 740 -8%
Prepaid 75 87 -14%
-----------------------------------------------------------------
(1) ARPUs in pesos of each period.
(a) Total subscriber base, including Calling Party Pays Only
subscribers within Prepaid.
Commercial Initiatives
New service plans: In March 2003, Iusacell launched a new set of
compelling prepaid and postpaid value propositions aimed to
position the Company as the best alternative for the targeted
high-value market segment. Ten new postpaid plans grouped in
three targeted value propositions and 4 new prepaid options, all
supported by advertising and marketing campaigns, anchor the
effort to regain a leading position among high volume customers.
The three new postpaid value propositions include a NAFTA
proposition, in which local calls, as well as calls within
Mexico, the U.S. and Canada, are all priced at the same per
minute rate; an Unlimited Nights and Weekends proposition
designed to incent cellular traffic leveraging non-pick
utilization hours; and a Basic plan with affordable rates
designed to compete directly with competitors' plans by
incorporating higher baseline minutes. New prepaid cards with
aggressive prices per minute were launched in an effort to incent
airtime recharges and to respond to the new tax initiatives
implemented by the Mexican government in January 2003.
Furthermore, the Company launched international SMS service with
109 carriers in the U.S., Canada and 14 more countries in Latin
America, Europe and Asia, enabling the Company's customers to
send and receive messages worldwide.
Advanced services: In January 2003, the Company commercially
launched the country's first CDMA2000 1XRTT voice and high-speed
data network in Mexico City. With this advanced network, the
Company increased its voice capacity and offered subscribers new
data services such as high-speed instant messaging, e-mail and
Internet access at speeds of up to 144 kilobits per second
(kbps). Iusacell offers the corporate sector mobile office
capabilities and applications designed to meet the needs of
specific mobile users such as field sales and service personnel.
Verizon relationship: The Company continued to integrate network
services with Verizon Communications during the first quarter of
2003. As a Verizon Wireless Preferred Roaming Partner (PRP),
Iusacell's roaming airtime generated by Verizon Wireless
customers increased 320% over the first quarter of 2002.
Financial Results
Revenue in the quarter decreased 18% from the year ago period and
9% from the previous quarter to $1,176 million, as a result of
the lower subscriber base and lower ARPU. The Company believes
the initiatives taken since the latter part of 2002, combined
with attractive new product offerings, as well as high-value
customer retention programs, will drive high-value sales and stem
the negative revenue trend.
Revenue Breakdown
----------------
(In millions of constant pesos as of March 31, 2003)
----------------------------------------------------------------
First Quarter
----------------------------------------------------------------
2003 2002 % Change
----------------------------------------------------------------
Monthly fee 339 418 -19%
Airtime consumption 602 671 -10%
Long distance 92 141 -34%
Value-added services + roaming 74 93 -21%
----------------------------
Total service revenues 1,107 1,322 -16%
Equipment sales & other 69 116 -41%
----------------------------
Total revenues 1,176 1,438 -18%
----------------------------------------------------------------
Cost of sales in the first quarter of 2003 decreased 17% from the
year ago period, from $509 million to $420 million. Ongoing
headcount initiatives and cost controls enabled the Company to
realize better cost savings despite higher lease costs associated
with an increased number of non-strategic towers sold to (and
leased-back from) the Mexican subsidiary of American Tower
Corporation.
Operating expenses: Sales and advertising expenses in the quarter
declined 20% year over year due primarily to fewer gross
subscriber additions, however, as a percentage of revenues it
remained stable at 23%. Lower headcount and expense containment
helped reduce general and administrative expenses to $86 million,
a 34% decline from the previous year's first quarter. As a
percentage of revenues, general and administrative expenses
decreased from 9% in the first quarter of 2002 to 7% in the first
quarter of 2003.
EBITDA(3) in the quarter increased 8% sequentially to $399
million, from $370 million in the fourth quarter of 2002 due to
the tighter cost structure. EBITDA in the first quarter of 2002
was $462 million. EBITDA margin in the first quarter of 2003 was
34%, compared to 29% in the fourth quarter of 2002 and 32% in the
year ago period.
Adjusted EBITDA margin, which expenses rather than capitalizes
postpaid handset subsidies and excludes non-operational
transactions, was 29% in the first quarter of the year, improved
over the 28% margin recorded in the first quarter of last year
and the 24% registered in the fourth quarter of 2002.
Depreciation and amortization expenses of $625 million in the
first quarter of 2003 increased 1% from the first quarter of
2002, due to the capitalization of completed projects throughout
2002 and the first quarter of 2003.
Postpaid subscriber acquisition costs in the quarter improved
from US$237 per new subscriber in the first quarter of 2002 to
US$191 in the most recent quarter, due to restructured commission
plans aimed to support the new value proposition packages, more
efficient handset purchases and targeted subsidies.
Operating loss in the quarter increased from the $154 million
recorded in the year ago period to $226 million in the current
quarter driven by lower revenues, partially offset by continued
cost control and headcount initiatives.
Integral financing cost in the quarter totaled $429 million,
compared to $160 million in the same quarter of last year. The
higher cost in the first quarter of 2003 was mainly driven by a
$280 million foreign exchange loss resulting from the 4%
depreciation of the peso against the U.S. dollar during the
period, compared to a 1% peso appreciation against the U.S.
dollar registered in the first quarter of 2002 and the resultant
$33 million foreign exchange loss in that period, as well as a $9
million increase in interest expense in the first quarter of 2003
compared to the same period of 2002.
(3) This press release contains a reference to EBITDA and
provides the components of EBITDA on the face of the Consolidated
Income Statement. EBITDA is used by management for comparisons to
other companies within our industry as an alternative to GAAP
measures and is used by investors and analysts in evaluating
performance. EBITDA, which is earnings before interest, taxes,
depreciation and amortization, is computed by adding back net
interest expense, income and asset tax expense, depreciation
expense and amortization expense to net income (loss) before
minority interest and loss of subsidiaries as reported. EBITDA
should be considered in addition to, but not as a substitute for
other measures of financial performance reported in accordance
with accounting principles generally accepted in Mexico. EBITDA,
as defined above, may not be comparable to similarly titled
measures reported by other companies.
Integral Financing Cost
(In millions of constant pesos as of March 31, 2003)
---------------------------------------------------------------
First Quarter
---------------------------------------------------------------
2003 2002 % Change
---------------------------------------------------------------
Net interest expense (229) (220) 4%
Exchange loss (280) (33) -748%
Monetary correction gain 81 94 -14%
----------------------------------
Total integral financing loss (429) (160) -169%
---------------------------------------------------------------
Net loss in the quarter of $694 million reflected the higher
operating loss and integral financing costs. This compares to a
net loss of $353 million in the year ago period.
Liquidity: During the first quarter of 2003, the Company funded
its operations, capital expenditures, handset purchases,
principal and interest payments primarily with internally
generated cash flow. As of March 31, 2003, the Company's
operating cash balance was US$5 million.
Capital Expenditures: Iusacell invested approximately US$1
million in its cellular regions during the first quarter of 2003
to expand coverage. This capex reflects Iusacell's strategic
focus on maximizing existing capacity and prioritizing
investments that directly benefit the high-value customer base.
Debt: As of March 31, 2003, debt, including trade notes payable
and notes payable to related parties, totaled US$815 million,
compared to US$841 million registered in the first quarter of
2002 and US$822 in the fourth quarter of 2002. All of the
Company's debt is U.S. dollar-denominated, with an average
maturity of 2.7 years. As of quarter-end, Iusacell's debt-to-
capitalization ratio was 65%, versus 53% on March 31, 2002.
Recent Developments
Debt and Credit Facilities: As announced in December 2002, the
Company has begun a debt restructuring effort and has engaged
Morgan Stanley as its financial advisor. The Company has been in
continuous dialogue with its senior secured lenders.
As part of its debt restructuring effort, Grupo Iusacell Celular,
S.A. de C.V. ("Iusacell Celular") has requested and received a
temporary Amendment and Waiver (the "Amendment") of the
Debt/EBITDA ratio and certain other provisions and technical
defaults under its US$266 million Amended and Restated Credit
Agreement dated as of March 29, 2001 (the "Credit Agreement").
Unless extended, the Amendment is scheduled to expire on May 22,
2003. The lenders have agreed to consider extending the waiver
beyond May 22, 2003 based upon the progress of the Company's
restructuring plan. If the Amendment is not extended, upon its
expiration Iusacell Celular will be in default of the Debt/EBITDA
ratio, which will constitute an Event of Default under the Credit
Agreement, and the lenders under the Credit Agreement will have
the remedies they would otherwise have had if the Amendment had
not been executed.
The Amendment contains covenants which expire on June 30, 2003
which restrict Iusacell Celular from making any loans, advances,
dividends or other payments to the Company and require a
proportionate prepayment of the loan under the Credit Agreement
if it makes any principal payments on any of its indebtedness for
borrowed money, excluding capital and operating leases.
Listing standards on the NYSE: As previously reported, the
Company received notice from the New York Stock Exchange (NYSE)
that it was not meeting one of the NYSE's continued listing
standards because the 30 average trading day price of Iusacell's
ADRs was below US$1.00. After consultation with the NYSE, the
Company determined that it would remedy this non-compliance by
increasing the number of common shares represented by each ADR.
The Company obtained approval to implement a 1 for 10 ADR ratio
change at the Ordinary Shareholders Meeting held on April 21,
2003 and intends to implement the ratio change during the second
quarter of 2003.
New Telecommunications tax: In March 2003, the Company filed an
injunctive action ("amparo") to challenge the Mexican
government's implementation of a modified excise tax on certain
wireless telecommunications services approved by the Mexican
Congress. Until resolution, the Company will continue to pay the
full 10% additional tax to the Finance Ministry according to law,
although new monthly service offers increased airtime minutes in
an effort to mitigate the impact on the high-value postpaid
segment. In the prepaid segment, the 10% excise tax is being
applied to every prepaid plan with an airtime per-minute rate of
more than $3.50, which differs from the 2002 initiative that
taxed prepaid cards with a face value equal to or in excess of
$200.
About Iusacell
Grupo Iusacell, S.A. de C.V. (Iusacell, NYSE: CEL; BMV: CEL) is a
wireless cellular and PCS service provider in seven of Mexico's
nine regions, including Mexico City, Guadalajara, Monterrey,
Tijuana, Acapulco, Puebla, Leon and Merida. The Company's service
regions encompass a total of approximately 92 million POPs,
representing approximately 90% of the country's total population.
Iusacell is under the management and operating control of
subsidiaries of Verizon Communications Inc. (NYSE:VZ).
To see financial statements:
http://bankrupt.com/misc/GRUPO_IUSACELL.htm
CONTACT: Grupo Iusacell, S.A. de C.V.
Investor Contacts:
Russell A. Olson, (5255) 5109-5751
russell.olson@iusacell.com.mx
or
Carlos J. Moctezuma, (5255) 5109-5780
carlos.moctezuma@iusacell.com.mx
Web site at www.iusacell.com
GRUPO MEXICO: Restructures Mining Unit's Debt
---------------------------------------------
Mexico City-based Grupo Mexico announced Tuesday that it
completed an US$879.2-million credit restructuring at its Mexican
mining unit Grupo Minero Mexico. In a press release, the miner,
the third largest in the world, said that the unit, responsible
for mining operations in Mexico, concluded and signed the
restructuring with holders of its Secured Export Notes and with
banks led by Bank of America.
"The agreements restructure credits for US$608.9 million, now
payable in march 2007, and credits for US$270.3 million that will
be payable in quarterly installments starting in March 2004," the
company said in the statement.
The Company, which also said it would inject some US$110 million
into the Mexican mining unit to support its operations, said the
restructuring would allow it to increase productivity and
profitability at its mining units.
"Together with the recent payment of US$550 million credits owed
by its subsidiary Asarco Inc. which was made last March 31, G-
Mexico concludes its financial restructuring," the Company said.
CONTACT: GRUPO MEXICO S.A. DE C.V.
Avenida Baja California 200,
Colonia Roma Sur
06760 M,xico, D.F., Mexico
Phone: +52-55-5264-7775
Fax: +52-55-5264-7769
Home Page: http://www.gmexico.com
Contacts:
Germ n Larrea Mota-Velasco, Chairman and CEO
Xavier Garca de Quevedo Topete, President and COO
Alfredo Casar P,rez, COO, Ferrocarril Mexicano
Daniel Ch vez Carre>n, COO, Industrial Minera M,xico
Daniel Tellechea Salido, VP and Administration and
Finance President
HYLSAMEX: Plunges Into Red In The 1Q03
--------------------------------------
Mexican steelmaker Hylsamex, the steel-making unit of industrial
conglomerate Alfa S.A., reported red in the first quarter of this
year. According to a report by Business News Americas, the
Monterrey-based steelmaker posted a net loss of MXN376 million,
reversing a MXN108 million in the same period a year ago.
In a filing with the Mexico City bourse, the Company revealed
that sales revenues in the first three months of this year came
in at MXN3.87 billion, compared with MXN2.81 billion in same-
period 2002.
CONTACT: 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
MAXCOM TELECOMUNICACIONES: 1Q03 Numbers Positive, EBITDA Better
---------------------------------------------------------------
-Revenues increased 55% over 1Q02 and 4% over 4Q02
-EBITDA loss improved by 88% over 1Q02 and 83% from 4Q02
-Lines in service grew 52% over 1Q02 and 4% over 4Q02
-Number of customers increased 77% over 1Q02 and 4% over 4Q02
Maxcom Telecomunicaciones, S.A. de C.V. reports results for the
first quarter of 2003.
LINES:
The number of lines in service at the end of 1Q03 increased 52%
to 129,982 lines, from 85,339 lines at the end of 1Q02, and 4%
when compared to 125,231 lines in service at the end of 4Q02. Out
of the total outstanding lines at the end of 1Q03, 5,090 lines or
3.9% were from Wholesale customers, which compares to 4,310 lines
or 5.1% at the end of 1Q02, and 4,480 lines or 3.6% at the end of
4Q02.
During 1Q03 line construction was lower by 86% at 1,873 lines,
from 13,848 constructed lines in the same period of last year;
and, lower by 58% when compared to 4,414 constructed lines during
4Q02. As previously reported, the Company finished its cluster
construction program in 4Q02 and did not launch new clusters in
1Q03. Inventory of constructed lines for sale at the end of the
quarter was 56,010 lines.
During 1Q03, 14,911 new lines were installed, 10% below the
16,589 (17,259 as reported) (1) lines installed during 1Q02. When
compared to 4Q02, the number of installations decreased 35% from
22,983 lines.
During 1Q03, the monthly churn rate was 2.9%, which compares to
3.4% (4.0% as reported) (1) monthly average churn in 1Q02. When
compared to 4Q02, churn rate increased from 2.1%. Voluntary churn
in 1Q03 resulted in the disconnection of 2,697 lines, a rate of
0.7%, equivalent to the one registered in 4Q02 with 2,308
disconnected lines. Involuntary churn resulted in the
disconnection of 8,073 lines, a rate of 2.2%, which compares to
4,637 disconnected lines, or 1.4% during 4Q02.
During 1Q03, net additions for Wholesale customers were 610
lines, which compare to 1,380 net disconnections during 1Q02 and
710 net disconnections during 4Q02.
CUSTOMERS:
Total customers grew 77% to 93,702 at the end of 1Q03, from
53,059 at the end of 1Q02, and 4% when compared to 89,950
customers as of the end of 4Q02.
The growth in number of customers by region was distributed as
follows:
(i) in Mexico City customers increased by 105% from 1Q02
and 4% from 4Q02;
(ii) in Puebla the increase was 49% from 1Q02 and 4% from
4Q02; and, in Queretaro the increase was 22% from
4Q02, when we launched operations in that city.
The growth in number of customers by category was the following:
(i) business customers increased by 3% from 1Q02 and
decreased 2% from 4Q02; and,
(ii) residential customers rose by 82% from 1Q02 and 4%
from 4Q02.
REVENUES:
Revenues for 1Q03 increased 55% to Ps$169.7 million, from
Ps$109.6 million reported in 1Q02. Voice revenues for 1Q03
increased 53% to Ps$147.3 million, from Ps$96.6 million during
1Q02, mainly driven by a 54% increase in voice lines, and
partially offset by a 7% decrease in ARPU. Data revenues for 1Q03
were Ps$4.0 million and contributed with 2% of total revenues;
during 1Q02 data revenues were Ps$0.7 million. Wholesale revenues
for 1Q03 were Ps$18.4 million, a 49% increase from Ps$12.3
million in 1Q02.
Revenues for 1Q03 increased 4% to Ps$169.7 million, from Ps$163.8
million reported in 4Q02. Voice revenues were even quarter-over-
quarter, at Ps$147.3 million. Data revenues in 1Q03 increased 7%
to Ps$4.0 million, from Ps$3.7 million during 4Q02. During 1Q03,
revenues from Wholesale customers increased 46% to Ps$18.4
million, from Ps$12.7 million in 4Q02.
COST OF NETWORK OPERATION:
Cost of Network Operation in 1Q03 was Ps$65.1 million, a 38%
increase when compared to Ps$47.1 million in 1Q02. This increase
was generated by:
(i) Ps$18.6 million, or 66% increase in network operating
services, mainly driven by higher CPP and long distance
reselling costs due to higher traffic;
(ii) 2%, or Ps$0.2 million higher technical expenses; and,
(iii) lower installation expenses and cost of disconnected
lines in the amount of Ps$0.8 million.
Cost of Network Operation increased 6% when compared to Ps$61.6
million in 4Q02. This net increase was mainly generated by:
(i) Ps$2.8 million, or 6% increase in network operating
services, driven by higher long distance reselling costs
due to higher traffic;
(ii) 44% or Ps$3.7 million higher technical expenses, mainly
due to network maintenance expenses; and, (iii) lower
installation expenses and cost of disconnected lines in
the amount of Ps$3.0 million, or 33%, due to the
combination of lower installation charges and higher
disconnection costs.
SG&A:
SG&A expenses were Ps$109.0 million in 1Q03, which compares to
Ps$98.6 million in 1Q02. The 11% increase was mainly originated
by:
(i) severance costs of Ps$ 18.0 million;
(ii) higher leasing and maintenance costs of Ps$2.8 million;
(iii) higher bad debt provisioning of Ps$2.5 million;
(iv) higher consulting fees of Ps$2.3 million;
(v) higher advertising expenses of Ps$0.4 million; and,
(vi) higher general, administrative expenses and insurance
costs of Ps$0.3 million, which were partially offset by:
(i) lower salaries, wages and benefits of Ps$15.2
million; and,
(ii) lower external sales commissions of Ps$0.7 million.
SG&A expenses in 1Q03 decreased 14%, from Ps$127.3 million in
4Q02. This variation was mainly originated by:
(i) higher bad debt provisioning of Ps$ 2.9 million;
(ii) higher consulting fees of Ps$1.2 million; and,
(iii) higher general, administrative expenses and insurance
costs of Ps$0.5 million, which were partially offset
by:
(i) lower severance costs of Ps$8.7 million;
(ii) lower advertising expenses of Ps$4.9 million;
(iii) lower external sales commissions of Ps$4.6
million;
(iv) lower salaries, wages and benefits of Ps$2.9
million; and,
(v) lower leasing and maintenance costs of Ps$1.8
million.
EBITDA:
EBITDA for 1Q03 was a negative Ps$4.3 million, compared to
negative Ps$36.1 million reported in 1Q02 and negative Ps$25.1
million registered in 4Q02. EBITDA margin improved from a
negative 33% in 1Q02, and negative 15% in 4Q02, to negative 3% in
1Q03.
Before severance costs in 1Q03 and restructuring costs in 4Q02,
EBITDA for 1Q03 was positive Ps$13.7 million, representing a
positive EBITDA margin of 8%, which compares favorably to
positive Ps$1.7 million or 1% positive EBITDA margin in 4Q02.
CAPITAL EXPENDITURES:
Capital Expenditures for 1Q03 were Ps$32.5 million, a 47%
decrease when compared to Ps$61.4 million in 1Q02, and a 45%
decrease when compared to Ps$59.3 million in 4Q02.
CASH POSITION:
Maxcom's Cash position at the end of 1Q03 was Ps$46.2 million in
Cash and Cash Equivalents, compared to Ps$57.8 million in Cash
and Cash Equivalents, and Ps$197.3 million in Restricted Cash at
the end of 1Q02. Cash and Cash Equivalents at the end of 4Q02
were Ps$117.2 million.
(1) As of the third quarter of 2002, Maxcom started reporting
separately, results for each of its three business units: Voice,
Data and Wholesale. Revenues from Data and Wholesale are reported
separately and do not contribute to ARPU; Wholesale lines in
service are reported separately from Voice lines. For comparison
purposes and where applicable, this report includes adjusted
numbers after these changes as well as the originally reported
numbers (For a broader explanation see: "Maxcom
Telecomunicaciones announces third quarter unaudited results,"
released on October 29, 2002.)
Maxcom Telecomunicaciones, S.A. de C.V., headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart-build" approach to deliver last-mile connectivity
to micro, small and medium-sized businesses and residential
customers in the Mexican territory. Maxcom launched commercial
operations in May 1999 and is currently offering Local, Long
Distance and Internet & Data services in greater metropolitan
Mexico City, Puebla and Queretaro.
To see financial statements:
http://bankrupt.com/misc/MAXCOM_TELECOMUNICACIONES.htm
CONTACT: Jose-Antonio Solbes
MAXCOM TELECOMUNICACIONES
Mexico City, Mexico
(52 55) 5147 1125
investor.relations@maxcom.com
Lucia Domville
CITIGATE FINANCIAL INTELLIGENCE
New York, NY
(212) 840-0008 Ext. 268
lucia.domville@citigatefi.com
GRUPO TMM: Amended Exchange Offers Launched
-------------------------------------------
Grupo TMM, S.A. (NYSE: TMM and BMV: TMM A) ("Grupo TMM" or the
"Company") announced Tuesday that it has commenced its amended
exchange offers for all of its outstanding 9« percent Senior
Notes due 2003 ("2003 notes") and its 10 1/4 percent Senior Notes
due 2006 ("2006 notes" and together with the 2003 notes, the
"existing notes"). The amended offers are described in a
registration statement amendment, which Grupo TMM previously
announced it had filed with the Securities and Exchange
Commission and which has now become effective. The expiration
date for the exchange offers was extended at the time Grupo TMM
announced that it intended to amend the offers (in order to
provide time for the amendment to be finalized); the expiration
date is now being extended again, to midnight, New York City
time, on May 12, 2003, to allow investors time to consider the
amended offer.
Under the amended offers, Grupo TMM is offering a like principal
amount of its 12 percent Senior Notes due 2004 ("new notes"),
which are to be issued at the time the exchange offers close, for
the existing notes. The new notes will be guaranteed on a senior
unsecured basis by TMM Holdings, S.A. de C.V., a wholly owned
subsidiary that indirectly owns all of Grupo TMM's interest in
Grupo Transportaci˘n Ferroviaria Mexicana, S.A. de C.V. ("Grupo
TFM"), which operates the Company's rail operations. Both
exchange offers are being made upon the terms and subject to the
conditions set forth in the prospectus and letter of transmittal
related to the exchange offers, each dated April 29, 2003. The
purpose of the exchange offers is to extend the maturity of the
company's 2003 notes, which mature on May 15, 2003, and to
provide the company with sufficient time to complete the
previously announced sales of its interests in its ports and
terminals division and Grupo TFM.
Concurrently with the exchange offers, Grupo TMM is soliciting
consents from holders of the existing notes. The primary purpose
of the consent solicitations is to eliminate substantially all of
the restrictive covenants of the indentures governing the
existing notes and to permit the sale of the company's interests
in Grupo TFM. The elimination of the restrictive covenants will
also allow the intended application of the proceeds from the
company's other asset sales. Holders who tender their existing
notes in the exchange offers will be deemed, as a condition to a
valid tender, to have given their consent to the proposed
amendments applicable to the series of existing notes that they
are tendering.
The obligation of Grupo TMM to consummate either exchange offer
is conditioned upon, among other things, receipt of valid and
unrevoked tenders representing at least 80 percent in aggregate
outstanding principal amount of the 2003 notes and at least a
majority of the aggregate outstanding principal amount of the
2006 notes pursuant to the exchange offers.
The exchange offers will expire at midnight, New York City time,
on May 12, 2003, unless extended by Grupo TMM, with respect to
one or both series of existing notes. As of 5:00 p.m., New York
City time, on April 28, 2003, approximately 25.33 percent of the
outstanding 2003 notes, or $44,814,000 principal amount, had been
tendered and not withdrawn, and 78.46 percent of the outstanding
2006 notes, or $156,921,000 principal amount, representing a
majority of the 2006 notes, had been tendered and not withdrawn.
In conjunction with the amendment to the exchange offers, Grupo
TMM will promptly return all previously tendered existing notes
and any tender of existing notes made prior to the date of the
prospectus will be null and avoid. Any holder of existing notes
that wishes to participate in the exchange offers must tender
their existing notes on or after the date of the prospectus, even
if such existing notes have been previously tendered for
exchange. Tenders for exchange of existing notes and the related
consents made on or after Tuesday's date are irrevocable and may
not be withdrawn.
Citigroup Global Markets Inc. is acting as the dealer manager for
the exchange offers and consent solicitations.
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 TFM, S.A. de C.V.
("TFM"), which operates Mexico's Northeast railway and carries
over 40 percent of the country's rail cargo. Grupo TMM's web site
address is www.grupotmm.com and TFM's web site is www.tfm.com.mx.
Grupo TMM is listed on the New York Stock Exchange under the
symbol "TMM" and Mexico's Bolsa Mexicana de Valores under the
symbol "TMM A."
The exchange offers and consent solicitations are made solely by
the prospectus dated April 29, 2003, the related letter of
transmittal and consent, and any amendments or supplements
thereto. Copies of the prospectus and transmittal materials can
be obtained from Mellon Investor Services LLC, the information
agent for the exchange offers and consent solicitations, at the
following address:
Mellon Investor Services
44 Wall Street, 7th Floor
New York, NY 10005
(888) 689-1607 (toll free)
(917) 320-6286 (banks and brokers)
This announcement is neither an offer to purchase nor a
solicitation of an offer to sell Grupo TMM notes. The exchange
offers and consent solicitations are not being made to, nor will
tenders be accepted from, or on behalf of, holders of existing
notes in any jurisdiction in which the making of the exchange
offers and consent solicitations or the acceptance thereof would
not be in compliance with the laws of such jurisdiction. In any
jurisdiction where securities, blue sky laws or other laws
require the exchange offers and consent solicitations to be made
by a licensed broker or dealer, the exchange offers and consent
solicitations will be deemed to be made on behalf of Grupo TMM by
the dealer manager or one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
ISPAT INTERNATIONAL: Swings Into Black for 1Q03 on Exports
----------------------------------------------------------
Ispat International N.V., (NYSE: IST US; AEX: IST NA), reported
Tuesday a net income of $51 million or 41 cents per share for the
first quarter of 2003 as compared to a net loss of $39 million or
negative 32 cents per share for the first quarter of 2002.
Consolidated sales and operating income for the first quarter
were $1.3 billion and $75 million, respectively, as compared to
$1.1 billion and an operating loss of $9 million, respectively,
for the first quarter of 2002. The Company achieved a 15%
increase in steel shipments to 3.8 million tons, as compared to
3.3 million tons shipped in the same period last year.
Net debt at the end of first quarter was $2.2 billion. Capital
expenditure for first quarter of 2003 totaled $19 million. At
March 31, 2003 the Company's consolidated cash, cash equivalents
and short-term liquid investments totaled $71 million. The
Company also had approximately $285 million available to it under
various undrawn lines of credit and bank credit arrangements.
Ispat International N.V. is one of the world's largest steel
producers, with major steelmaking operations in the United
States, Canada, Mexico, Trinidad, Germany and France. The Company
produces a broad range of flat and long products with majority of
its sales in North American Free Trade Agreement (NAFTA)
participating countries and the European Union (EU) countries.
Ispat International is a member of The LNM Group.
To see financial statements: http://bankrupt.com/misc/Ispat.pdf
CONTACT: ISPAT INTERNATIONAL LIMITED
T.N. Ramaswamy
Director, Finance
+ 44 20 7543 1174/+31 10 282 9471
URL: http://www.ispat.com
CITIGATE DEWE ROGERSON
John McInerney
Investor Relations
+ 1 212 419 4219
TV AZTECA: Board OKs $140M Shareholder Distribution
---------------------------------------------------
TV Azteca, S.A. de C.V. (NYSE: TZA) (BMV: TVAZTCA), one of the
two largest producers of Spanish language television programming
in the world, announced Tuesday that its board of directors
approved management's proposal to declare distributions to
shareholders of approximately US$140 million. A US$125 million
distribution is scheduled to be made in June and another of US$15
million in December.
"We will distribute the benefits of our profitability in the same
time and manner as announced at the beginning of the year," said
Pedro Padilla, Chief Executive Officer of TV Azteca. "As
projected, we have focused on our internal cash generation, and
we have strictly adhered to a closely controlled management of
our cash balances, and we will continue to do so."
"We are just at the start up of our long term strategy to reduce
indebtedness and to make ongoing distributions, which we are
confident will increase value for all of our stakeholders on a
steady basis," Mr. Padilla concluded.
The shareholders' meeting to approve the distribution is
scheduled to occur on April 30, 2003.
Company Profile
TV Azteca is one of the two largest producers of Spanish-language
television programming in the world, operating two national
television networks in Mexico, Azteca 13 and Azteca 7, through
more than 300 owned and operated stations across the country. TV
Azteca affiliates include Azteca America Network, a new broadcast
television network focused on the rapidly growing US Hispanic
market; Unefon, a Mexican mobile telephony operator focused on
the mass market; and Todito.com, an Internet portal for North
American Spanish speakers.
Except for historical information, the matters discussed in this
press release are forward-looking statements and are subject to
certain risks and uncertainties that could cause actual results
to differ materially from those projected. Risks that may affect
TV Azteca are identified in its Form 20-F and other filings with
the US Securities and Exchange Commission.
CONTACT: TV Azteca, S.A. de C.V.
Investor Relations: Bruno Rangel
+011-5255-3099-9167
jrangelk@tvazteca.com.mx
or
Omar Avila
+011-5255-3099-0041
oavila@tvazteca.com.mx
Media Relations: Tristan Canales
+011-5255-3099-5786
tcanales@tvazteca.com.mx
Web site: http://www.tvazteca.com.mx
===========
P A N A M A
===========
BLADEX: Reports 1Q03 Results; Reaffirms Recapitalization Plan
-------------------------------------------------------------
Banco Latinoamericano de Exportaciones, S.A. (NYSE: BLX)
("BLADEX" or the "Bank"), a specialized multinational bank
established to finance trade in the Latin American and Caribbean
region, reported Tuesday results for the first quarter ended
March 31, 2003. The Bank reported net income for the first
quarter of 2003 of $10.4 million, or $0.58 per share, compared
with a net income of $474 thousand, or $0.01 per share reported
in the first quarter of 2002.
Commenting on the latest quarterly results, Jose Castaneda, chief
executive officer of BLADEX, said, "Our operating results in the
first quarter of 2003 reflect the continued solid performance of
the Bank which began in mid-2002, with consistent quarterly
profitability on a smaller capital base in a volatile market in
Latin America and the rest of the world. We remain focused on
our core business while operating with high liquidity, a low cost
base, and, outside of Argentina, a healthy credit portfolio. In
this context, the Bank is prudently and gradually taking
advantage of increasing business opportunities. During the last
12 months, the Bank has disbursed accumulated credits of $3.6
billion, consisting of mostly short-term trade financing to high
quality banks in the Region, of which, $1.9 billion was disbursed
during the last two quarters alone.
"It is important to emphasize that BLADEX is more focused than
ever on its core competence of trade finance. At March 31, 2003,
our trade credits outside of Argentina amounted to 62% of our
total credit portfolio, and we see this ratio increasing to close
to 75% by year-end. In our Brazilian portfolio, trade credits at
the end of the first quarter amounted to 66%, which we see rising
to 80% by the end of 2003.
"We are encouraged by the generally improving conditions in our
region and the resulting business opportunities for BLADEX.
However, we remain concerned about the degree of volatility
inherent in the markets. In Brazil, for example, the market-
oriented approach of the new administration has been well
received by the market, but questions still remain about the
timing and extent of the pending fiscal and social security
reforms. Similarly in Venezuela, while we are relieved to see
that country's costly general strike come to an end, a solution
to the underlying lack of constructive political dialogue is not
yet evident. And in Argentina, the outcome and business
implications of the second round of presidential elections remain
to be defined.
"While we are gratified by the Bank's ability over the last nine
months to operate profitably in this environment despite a
smaller capitalization, we remain convinced that the preservation
of our institution's financial health requires the injection of
new capital. Fresh capital will provide comfort to and fulfill
the requirements of our depositors and creditors, while
contributing to the protection of our critical remaining
investment grade ratings, improving our access to the capital
markets, and quite possibly adding new multilateral shareholders
to the Bank. These features are essential to strengthen our
business franchise and to provide a solid base for high-quality
growth. Based on these considerations, BLADEX is moving forward
with its re-capitalization plan.
"As announced on April 23, we negotiated the sale from our
Argentine portfolio of certain loans and bonds in the corporate
sector, which as previously announced, we are in the process of
exiting. On closing, these transactions will result in profits
of $56 million. Because part of the underlying appreciation in
bond prices had already been reflected in our equity, as of March
31, 2003 the incremental effect of the sales on our capital will
amount to $44 million. We view this as a very positive
development, as it provides evidence of the improving liquidity
and value in our Argentine portfolio. We continue to maximize
our collection efforts and focus on improving the value of our
Argentine exposure in the belief that we are positioned to
benefit from an eventual improvement in the macroeconomic and
political environment in the country. As further evidence of the
success of our portfolio management efforts in the country,
BLADEX collected 86% of the interest owed on the Argentine
portfolio for the twelve months ended March
31, 2003, and we remain confident in our ability to keep interest
collections at the same pace.
"While the group of shareholders and multilateral and development
banks are supporting our capitalization in an amount well in
excess of $100 million, the positive results of the recent
Argentine sales, combined with the retained earnings from the
past three quarters, allow us now to set our capital raising
target at $100 million, an amount that we had previously
considered as a minimum.
"The Registration Statement filed in December regarding the
proposed rights offering to the holders of the Bank's Class A,
Class B and Class E common stock is under review by the SEC and
we plan to launch the offering as soon as the Registration
Statement is approved. The record date for the offering will be
approximately 10 days after the "effective date" of the
Registration Statement. The Bank will announce these dates as
soon as they are known," Mr. Castaneda concluded.
SUMMARY ANALYSIS OF OPERATING RESULTS
The following table sets forth the condensed income statements of
the Bank for the first quarter of 2003 and the first and fourth
quarters of 2002.
(In $ millions)
1Q02 4Q02 1Q03
Net interest income (1) 23.0 15.2 13.8
Provision for loan losses and
off-balance sheet credit risk -20.0 1.2 -0.3
Net commission income, expense
and other charges 2.8 2.1 2.4
Derivatives and hedging
activities -0.3 -0.4 -0.8
Provision for fair
value guarantees 0.0 0.0 -0.1
Gain on the sale of loans,
securities available for sale
and foreign currency exchange 0.2 0.4 0.0
Other income 0.1 0.4 0.0
Operating expenses -4.7 -3.8 -4.6
Loss from operations and
disposal of business segment -0.6 -0.1 0.0
Cumulative effect of
accounting change -- -- --
Net income 0.5 15.0 10.4
(1) Interest income includes income received on non-accruing
assets of $1.9 million in 1Q02, $8.2 million in 4Q02 and $7.0
million 1Q03.
BLADEX, with $2.9 billion in assets, is a specialized
multinational bank established to finance trade in the Latin
American and Caribbean region. Its shareholders include central
banks from 23 countries in the region and 143 commercial banks
(from the region, as well as international banks) and private
investors. Its mission is to channel funds for the development
of Latin America and the Caribbean, and to provide integrated
solutions for the promotion of the region's exports. BLADEX is
listed on the New York Stock Exchange. Further investor
information can be found at http://www.blx.com.
CONTACT: BLADEX, Head Office
Calle 50 y Aquilino de la Guardia
Panama City, Panama,
Attention: Carlos Yap, Senior Vice President, Finance
Tel. No. (507) 210-8581, e-mail: cyap@blx.com
or
The Galvin Partnership
76 Valley Road, Cos Cob, CT 06807
Attention: William W. Galvin
Tel. No. (203) 618-9800,
E-mail: wwg@galvinpartners.com
=================================
T R I N I D A D & T O B A G O
=================================
BWIA: Employees Set To Discuss New Salary Cut Date
--------------------------------------------------
Employees of Trinidad & Tobago flag carrier BWIA, except pilots,
met with union leaders yesterday to discuss a new date for the
salary cut the airline is proposing. BWIA's management proposes
that the salary cuts at the airline to take effect today, reports
the Trinidad Guardian, citing unionists at BWIA.
Aviation Communication and Allied Workers Union (ACAWU) president
Christopher Abraham relates that BWIA's suggested pay cut date
was not unilateral, since it is still open to negotiation.
The salary cut, which would save BWIA US$335,000 monthly, is a
result of the government's precondition to review and revise
salaries at the airline. BWIA had recently gained the
government's nod to a $116.8 million state loan.
Originally, BWIA wanted to implement the pay cut on April 1,
2003, but unions representing its workers offered fierce
resistance by threatening to take the matter to the Industrial
Court.
Although the airline's management insists that it had the
authority to decide when the pay cuts take effect, the pay cut
date is moved to May 1, 2003.
CONTACT: BRITISH 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, CFO (Trinidad)
***********
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 Oona G. Oyangoren, Editors.
Copyright 2003. All rights reserved. ISSN 1529-2746.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.
Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.
The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail. Additional e-mail subscriptions for
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or balance thereof are $25 each. For subscription information,
contact Christopher Beard at 240/629-3300.
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