/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/031029.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 Wednesday, October 29, 2003, Vol. 4, Issue 214 Headlines A R G E N T I N A BANCO BISEL: $354M in Bonds Rated `raD' by Local S&P BANCO HIPOTECARIO: Extends Debt Offer Once Again BANCO HIPOTECARIO: Turns to Westbrook to Solve Paper Problems BANCO SUQUIA: S&P Rates $36M of Bonds `raD' BLANCO Y SALGADO: Creditor's Motion For Bankruptcy Approved CRM: S&P Assigns Default Ratings To $150M of Bonds CROSS MATCH: Court Approves Creditor's Petition For Bankruptcy DESTINY: Court Assigns Receiver For Reorganization Process DIRECTV LATIN AMERICA: Files Motion To Release Confidential Info EASA: Receiver Closes Credit Verifications in Bankruptcy Process HARINARG: Credit Verification Deadline Expires Today MARMAK: Receiver Verifies Claims in Bankruptcy Proceedings MATPLASS: Enters Bankruptcy On Court Orders OSHIMA: Individual Reports Filing Due Today REJEANS: Court To Decide on Reorganization Petition RIO LINDO: Files "Concurso Preventivo" Motion SATNET: Credit Check in Bankruptcy Process Closes Today TRANSENER: Argentine S&P Rates $525M of Bonds `raD' B R A Z I L BANCO RURAL: Moody's Assigns LTFC Debt B2 Rating BOMBRIL: Close To An Accord With Creditors EMBRATEL PARTICIPACOES: Reports 3Q03 Results TELEMAR: Oi Reaches 3 Million Subscribers C H I L E ENDESA CHILE: Places Bonds for Over $200M on the Local Market TELEFONICA CTC: S&P Unlikely To Up Ratings Despite Improvements C O L O M B I A * S&P Affirms Republic of Colombia's Long-Term Ratings * Fitch Affirms Republic of Colombia's Long-Term Ratings E C U A D O R ECUADORIAN BANKS: AGD Kicks Off Liquidation Process J A M A I C A AIR JAMAICA: Expands Codeshare Offerings With Delta Air Lines M E X I C O GRUPO TMM: TFM Wants Judge to Interpret Purchase-Sale Accord TFM: S&P Lowers Ratings on KCS P E R U ESSALUD: Settles Wage Dispute With Workers V E N E Z U E L A IVSS: Commences Medical Debt Repayment Program PDVSA: Files 2002 Annual Report With the U.S. SEC - - - - - - - - ================= A R G E N T I N A ================= BANCO BISEL: $354M in Bonds Rated `raD' by Local S&P ---------------------------------------------------- A total of US$354 million in corporate bonds issued by Banco Bisel S.A. received junk ratings from the Argentine arm of Standard & Poor's International Ratings, Ltd. The `raD' rating was based on the Company's finances as of June 30 this year. The Comision Nacional de Valores, Argentina's securities regulator said that the bonds matured in June 2000. Some US$300 million of these were described as "Programa de Emisi¢n de T¡tulos de Deuda a Mediano Plazo", which are classified under "Program", while the rest are called "Obligaciones Negociables Subordinadas", under "Series and/or Class". According to S&P an obligation is rated `raD' when it is in payment default, or the obligor has filed for bankruptcy. The `raD' rating is used when interest or principal payment are not made on the date due even if the applicable grace period has not expired, unless the ratings agency believes that such payments will be made during such grace period. BANCO HIPOTECARIO: Extends Debt Offer Once Again ------------------------------------------------ Banco Hipotecario SA has extended its offer to restructure US$1.2 billion of defaulted debt until Dec. 3, reports Dow Jones. The Company had previously set Nov. 3 as deadline for international offers. However, due to a slight delay in approval for the documentation of its offer from the Italian securities regulator, Banco Hipotecario said in a statement to the Buenos Aires stock exchange that it is extending the debt-restructuring offer by a month. In a filing to the stock exchange at the end of September, the bank said it expected approval from the Italian authorities Oct. 10. But approval did not come until Oct. 13, relates Dow Jones. The Dec. 3 deadline also applies to an early payment date that had previously been set for Sept. 15, then extended to Oct. 24, Banco Hipotecario said. "The bank is extending the expiry date for offers to grant Italian bondholders additional time to consider the offers," Banco Hipotecario said in its statement Monday. "As a result of the delay in the launching of the debt swap in Italy, Italian bondholders have had a significantly shorter time period than bondholders outside Italy to consider the offers." The extension is subject to approval from the Italian securities regulator. Banco Hipotecario has said Italian residents represent more than US$185 million in face value of outstanding bonds. Banco Hipotecario is 44% owned by the Argentine government. The other main shareholders are local real estate giant IRSA Inversiones y Representaciones S.A. and an investment fund owned by financier George Soros. Prior to the Argentine financial crisis, the bank was a leader in the individual residential mortgage loans segment, with a total portfolio of more than US$4 billion, and a market share of around 40%. BANCO HIPOTECARIO: Turns to Westbrook to Solve Paper Problems ------------------------------------------------------------- Westbrook Technologies, makers of Fortis and File Magic document management software, announced Monday that their customer, Banco Hipotecario in Buenos Aires, Argentina, has achieved Westbrook's largest daily volume capture of scanned documents, which now totals more than 10,000 per day. Banco Hipotecario's Fortis installation is digitally managing more than 50 million documents. Banco Hipotecario has a long-standing reputation as Argentina's largest mortgage bank, having assets approaching $5 billion, in addition to a 40-plus percent share of the entire mortgage market in Argentina. With more than 1,500 employees in two dozen-plus branch offices, the bank required technology that could manage future growth of its massive file base. The building holding Banco Hipotecario's mortgage files was literally starting to collapse under the weight of too much paper. They turned to Westbrook Technologies to find a scalable document management solution that could solve their paper problem and interface effectively with the bank's existing Informix database platform. Thanks to the Fortis' powerful capabilities, Banco Hipotecario managers were able to reduce their daily capture task personnel to only six persons. Bank officials realized a return on investment within 60 days of Fortis' full implementation. "The time saved alone has been worth the cost," said Mariano Lores, a certified Westbrook Technologies reseller who installed Banco Hipotecario's Fortis system. "Westbrook Technologies' software suite was made for an organization with this many documents. As our international business continues to grow, Banco Hipotecario, in partnership with File Solution, is one to watch, as they make the most of cutting edge technology in their day-to-day operations," said Westbrook Technologies' President Sean Donegan. Westbrook Technologies' document management products, Fortis, Inflo, PowerWeb and File Magic, are currently assisting customers in 40 countries streamline business processes and work smarter. Partners and customers commend Westbrook Technologies' software suite for its ease of use, scalability and strong contingent of professionals that ensure success out of our Branford, Conn.- based headquarters. BANCO SUQUIA: S&P Rates $36M of Bonds `raD' ------------------------------------------- Standard & Poor's International Ratings, Ltd. Sucursal Argentina rated a total of $36 million of Banco Suquia S.A.'s corporate bonds `raD'. The rating is assigned to obligations that are currently in default, or whose obligor has filed for the bankruptcy according to S&P. The rating was based on the Company's finances as of the end of June this year. The affected bonds were classified under "Simple Issue". About US$13 million of these are called "Obligaciones Negociables subordinadas convertibles, autorizadas por AGE de fecha 19.9.97", said the Comision Nacional de Valores, Argentina's securities regulator. These mature on May 23, 2005. The remaining US$23 million are described as "Obligaciones Negociables subordinadas, autorizadas por AGO de fecha 19.12.97". The maturity date was given as November 7, 2005. BLANCO Y SALGADO: Creditor's Motion For Bankruptcy Approved ----------------------------------------------------------- A creditor of Blanco y Salgado successfully sought for the Company's bankruptcy. Argentine newspaper La Nacion relates that Judge Ballerini of Buenos Aires' Court No. 24 issued the bankruptcy order. The receiver designated for the proceedings is Mr. Eduardo Cosoli. He will verify creditors' claims until December 17. This part of the bankruptcy process determines the amount and nature of the Company's debts. The results will then be used as basis for payments the Company might make at the end of the process when its assets are liquidated. The receiver is also required to prepare the individual and general reports. However, La Nacion did not mention whether the court, which works with Clerk No. 47, Dr. Medina, on the case, has set the deadlines for the filing of the receiver's reports. CONTACT: Blanco y Salgado S.A. Traful 3707 Buenos Aires Eduardo Cosoli 1st Floor, Room H Lavalle 1948 Buenos Aires CRM: S&P Assigns Default Ratings To $150M of Bonds -------------------------------------------------- Corporate Bonds issued by Compa¤¡a de Radiocomunicaciones Moviles S.A. were assigned default ratings by Standard & Poor's International Ratings, Ltd. Sucursal Argentina. The rating, issued Thursday, was based on the Company's finances as of June 30, 2003. The bonds were described as "Serie emitida bajo el Programa de Ons por hasta U$S 350 millones, vencido el 9-02-03", according to the Comision Nacional Valores, Argentina's securities watchdog. The bonds, worth a total of US$150 million, were classified under "Series and/or Class", and their maturity date was given as May 28, 2008. CROSS MATCH: Court Approves Creditor's Petition For Bankruptcy -------------------------------------------------------------- Buenos Aires Insolvency Judge Garibotto, of Court No. 2, approved a motion for the bankruptcy of local medical services company Cross Match S.A. recently. The Company's creditor, Bioquimica Medica S.R.L., filed the petition after the Company failed to honor its debts. The credit verification process ends on December 29 this year. Proofs of claim must be presented to the receiver, Mr. Fernando Aquilino, for authentication before the said date. The receiver is also required to prepare the individual and general reports, whose deadlines were not revealed by the report. Clerk No. 3, Dr. Vassallo, works with the court on the case. CONTACT: Cross Match S.A. Laprida 1857 Buenos Aires Fernando Aquilino Lavalle 1459 Buenos Aires DESTINY: Court Assigns Receiver For Reorganization Process ---------------------------------------------------------- Court No. 4 of the Civil and Commercial Tribunal of Zarate Campana assigns Ms. Martha Magdalena Comba as receiver for the reorganization proceedings Destiny S.A. is undergoing. Local news portal Infobae relates that the Court recently approved the Company's motion for "Concurso Preventivo". Creditors must have their claims authenticated by the receiver before November 10 this year. Results of the verifications will be submitted to the court on December 23 through the individual reports, which are prepared upon completion of the verification process. After the individual reports are processed, the receiver will combine the results into a single general report, which is due for submission on March 9 next year. The reorganization will proceed with an informative assembly on September 2 next year. CONTACT: Martha Magdalena Comba French 474 Campana DIRECTV LATIN AMERICA: Files Motion To Release Confidential Info ---------------------------------------------------------------- Judge Walsh rules: (1) DIRECTV LATIN AMERICA is directed to disclose to Pachulski and Huron information and other data contained in the Contracts between the Debtor and certain programmers and the other third parties that the Committee has requested which in the Debtor's sole determination is reasonably necessary to the Committee Advisor's evaluation of the Debtor's proposed restructuring, provided that the Contracts, and all the requested information or other data they contain, provided by the Debtor will be designated as, and deemed to be, "Restricted Disclosure Only," pursuant to the Non- Agreement entered into as of July 31, 2003 by the Debtor and the Committee Advisor, and the Debtor's disclosure complies with the terms of the Order; (2) Notwithstanding the Non-Disclosure Agreement, the Debtor will not remove the designation of "Restricted Disclosure Only" or otherwise consent to the disclosure by the Committee Advisors of the Contracts, and the information and data it contains, without the prior written consent of the affected third parties or, in the absence of the consent, entry of a Court order of competent jurisdiction granting relief after appropriate notice to all affected parties and hearing; (3) The disclosure is to be made in strict compliance with the Non-Disclosure Agreement and the Order, and any breach of the Non-Disclosure Agreement may be enforced by the parties concerned and by the affected third parties, including without limitation by enforcing and pursuing the rights and remedies provided in the agreement, as if the affected third party were an express party to, and a third party beneficiary of, the Non-Disclosure Agreement; (4) The Non-Disclosure Agreement will not be amended without the consent of any affected third party; (5) The limited disclosure to Pachulski and Huron in accordance with the terms of the Non-Disclosure Agreement is necessary to comply with a valid order of the Court and therefore is not in violation of confidentiality provisions in the Contracts between the Debtor and the affected third parties; and (6) The Order will be deemed a waiver by any party of any right to seek further protection under Section 107(b) of the Bankruptcy Code. (DirecTV Latin America Bankruptcy News, Issue No. 14; Bankruptcy Creditors' Service, Inc., 609/392-0900) EASA: Receiver Closes Credit Verifications in Bankruptcy Process ---------------------------------------------------------------- Mr. Daniel del Castillo, receiver for Buenos Aires-based Emprendimientos Americanos S.A., closes the verification process for the Company's bankruptcy today. The receiver will now prepare the individual reports on the results of the verifications. The Troubled Company Reporter - Latin America earlier reported that the individual reports must be presented to the court on December 10. The receiver will prepare a general report, which is due on February 20, 2004, after these reports are processed in the court. The Company's assets will be liquidated at the end of the bankruptcy process. Payments will be based on the results of the credit verifications. CONTACT: Daniel del Castillo Peron 1558 Buenos Aires HARINARG: Credit Verification Deadline Expires Today ---------------------------------------------------- Creditors of Harinarg S.A. must present their claims to the Buenos Aires-based company's receiver for verification. The Troubled Company Reporter - Latin America earlier revealed that the deadline for verification process expires today. The process determines the nature and amount of the Company's debts. The receiver, Mr. Jorge Wilke, will start preparations for the individual reports on the result of the verifications. After these reports are processed at court, the receiver will consolidate the results into a general report. Local sources, however, did not mention, whether Court No. 20, which is under insolvency judge Raillade, has set the deadlines for the submission of these reports. The TCR-LA revealed earlier that the Company entered bankruptcy after the court approved a petition for bankruptcy filed by one of its creditors to whom the Company failed to meet its financial obligations. CONTACT: Harinarg S.A. Lavalle 3161 Buenos Aires Jorge Wilcke 8th Floor, Tower I Teodoro Roosevelt 1877 Buenos Aires MARMAK: Receiver Verifies Claims in Bankruptcy Proceedings ---------------------------------------------------------- Creditors of Buenos Aires-based company Marmak S.A. must present their proofs of claim to the Company's receiver, Mr. Ricardo Adrogue, for validation. A report by Argentine news source Infobae indicates that the deadline for verifications is December 16 this year. The Company entered bankruptcy on orders from the city's Court No. 23. Clerk No. 45 assists the court on the case. Infobae, however, did not mention whether the court has set the deadlines for submission of the individual and general reports. CONTACT: Marmak S.A. Donato Alvarez 3149 Buenos Aires Ricardo Adrogue Bouchard 468 Buenos Aires MATPLASS: Enters Bankruptcy On Court Orders ------------------------------------------- Buenos Aires plastic maker Matplass S.A. enters bankruptcy on orders from the city's Court No. 6. The decision came after the Uni¢n de Obreros y Empleados Pl sticos sought for its bankruptcy for nonpayment of debt. Working with Clerk No. 11, Dr. Piatti, the court assigned local accountant Norberto Bonesi as the Company's receiver. Credit verifications will run until December 30 this year. The receiver is also required to prepare the individual and general reports. CONTACT: Matplass S.A. 5th Floor, Room E San Nicolas 410 Buenos Aires Norberto Bonesi 1st Floor Ave Juan B. Justo 5096 Buenos Aires OSHIMA: Individual Reports Filing Due Today ------------------------------------------- Mr. Abraham Elias Gutt, the receiver for Buenos Aires company Oshima S.A., is required to file the individual reports for the Company's bankruptcy process today. The reports were prepared after the credit verification process was completed earlier this year. An earlier report by the Troubled Company Reporter - Latin America indicated that the Company entered bankruptcy on orders from the city's Court No. 21, which also selected the receiver and set the schedule for the bankruptcy proceedings. The court also ordered the receiver to prepare a general report and file it on December 11 this year. The Company's assets will be liquidated at the end of the process to reimburse its creditors. CONTACT: Abraham Elias Gutt Tucuman 1484 Buenos Aires REJEANS: Court To Decide on Reorganization Petition --------------------------------------------------- Insolvency Judge Fernandez of Buenos Aires Court No. 19 handles the petition for reorganization filed by local company Rejeans S.R.L., relates local newspaper La Nacion. Clerk No. 38, Dr. Johnson, works with the court on the case. The Company, which markets cotton products, submitted a motion for "Concurso Preventivo" to the court. Documents indicated that the Company stopped making debt payments in March 1998. The court is yet to decide on the case. CONTACT: Rejeans S.R.L. Cabrera 4967 Buenos Aires RIO LINDO: Files "Concurso Preventivo" Motion --------------------------------------------- Rio Lindo S.R.L., which is based in Buenos Aires, is seeking to undergo reorganization. Argentine newspaper La Nacion reports that the Company has filed a "Concurso Preventivo" motion at the city's Court No. 17. Insolvency judge Bavastro handles the Company's case with assistance from Clerk No. 34, Dr. Vanoli. CONTACT: Rio Lindo S.R.L. Cuzco 467 Buenos Aires SATNET: Credit Check in Bankruptcy Process Closes Today ------------------------------------------------------- The period for the verification of creditors' claims in connection with the bankruptcy of Buenos Aires company Satnet Internet S.A. ends today, according to an earlier report by the Troubled Company Reporter - Latin America. The Company's receiver, Mr. Roberto Lapollnik validates proofs of claims in order to determine the nature and amount of the Company's debts. As ordered by the city's Court No. 7, the receiver will prepare the individual reports on the results of the verifications. The receiver is also required to prepare the general report, whose deadline, like the individual reports', were not revealed by the local source. Clerk No. 13 assists the court on this particular case. CONTACT: Satnet Internet S.A. Florida 878 Buenos Aires Roberto Lapollnik Parana 851 Buenos Aires TRANSENER: Argentine S&P Rates $525M of Bonds `raD' --------------------------------------------------- Some US$525 million of bonds issued by Transener S.A. were rated `raD' by Standard & Poor's International Ratings, Ltd. Sucursal Argentina. Argentine securities regulator, the Comision Nacional de Valores, said that the bonds matured on March 26 this year. The bonds, classified under "Program", were described as "Programa Global de Obligaciones Negociables simples no convertibles en acciones, aprobado por Asamblea Gral. de Accionistas de fecha Julio de 2001.". The rating was based on the Company's finances as of the end of June this year. S&P said that the rating is given to obligations that are currently in default or whose obligor has filed for bankruptcy. =========== B R A Z I L =========== BANCO RURAL: Moody's Assigns LTFC Debt B2 Rating ------------------------------------------------ Moody's Investors Service assigned a B2 rating to Rio de Janeiro- based bank Banco Rural S.A.'s long-term foreign-currency debt. The rating, which has a stable outlook, affects US$50 million notes, maturing November 2004. The notes are issued under the US$500 million Euro- medium term note program recently established by Banco Rural. The B2 rating, according to Moody's, incorporates Banco Rural's fundamental credit quality, which is reflected by its Ba3 global local currency rating and which includes all relevant country risks. Furthermore, the B2 rating reflects the probability of a sovereign default implied by the Brazilian government's sub- investment grade B2 foreign currency bond rating, and the likelihood that the Brazilian government could impose a debt moratorium in the event of default on its own foreign currency obligations. Banco Rural listed assets totaling US$1.8 billion as of June 2003. BOMBRIL: Close To An Accord With Creditors ------------------------------------------ Bombril SA, a Brazilian maker of cleaning products, is about to strike a BRL57-million (US$20 million) debt-restructuring accord with creditors, Valor Economico, reports, citing an unidentified creditor. The said creditor suggested that almost all the large creditors have accepted the plan, which calls for debt payments to be delayed until January. Several small creditors, however, remain dissident to the plan. Sao Paulo-based Bombril more than tripled its net income in 2002 but reported losses for the fourth quarter of 2002 and the first quarter of 2003, the latest periods available, according to Bloomberg data. EMBRATEL PARTICIPACOES: Reports 3Q03 Results -------------------------------------------- Embratel Participacoes S.A. (Embratel Participacoes or the "Company"), the Company that holds 98.8 percent of Empresa Brasileira de Telecomunicacoes S.A. ("Embratel"), announced third quarter Results. (All financial figures are in Reais and based on consolidated financial in "Brazilian Corporate Law") HIGHLIGHTS -- Net revenues were R$1.8 billion in the third quarter of 2003 increasing 7.8 percent when compared to the previous 2003 quarter. Year-to-date revenues reached R$5.2 billion. -- EBITDA in the quarter was R$553 million representing an increase of 46 percent when compared to the second quarter of 2003. The improvement in EBITDA resulted from stronger revenues, improved operating efficiency, reversal of taxes and accounting reclassification. Better operating performance alone contributed to a 2.8 percentage point EBITDA margin growth. -- Allowance for doubtful accounts dropped for the seventh consecutive quarter to R$81 million or 3.4 percent of gross revenues (4.5 percent of net revenues) compared to 3.9 percent of gross revenues in the second quarter of 2003 and 6.4 percent in the 2002 quarter of comparison. -- Net income in the third quarter of 2003 was R$15 million and was impacted by the effect of the devaluation of the Real vis-a- vis foreign currencies. Year-to-date net income for 2003 was R$155 million compared to a loss of R$738 million in the same 2002 period. -- Cash position increased slightly from the previous 2003 quarter to R$685 million and net debt fell to R$3.3 billion. -- Approximately R$187 million, net of new financing, were amortized during the quarter. In the first nine months of 2003 Embratel reduced total outstanding debt by R$601 million (US$206 million). -- Total capital expenditures in the quarter were R$141 million. DATA COMMUNICATION SERVICES Major contracts renewed this quarter Embratel's data communications revenues (Data & Internet and wholesale) were R$437 million in third quarter of 2003, remaining flat relative to the previous 2003 quarter. Compared to the same 2002 quarter, net data revenues declined 4.0 percent due to loss of contracts from merged entities (banking and cellular industries) and a generally weak performance of the Internet industry. The decline in Data & Internet revenues was partially offset by the growth in data wholesale revenues resulting from more capacity being made available to SMP providers. Despite overall market weakness, Embratel has maintained or grown share in most segments of the market. During the quarter the company gained and renewed contracts with major credit card, financial institutions, retailers and car manufacturers. Year-to-date, Embratel's data revenue were R$1.3 billion representing a decline of 2.3 percent compared to the first nine months of 2002. The main causes for the quarter-over-quarter and year-over-year reduction was the termination of the Service Agreement with the Internet provider UOL (see Press release 9/7/03) and general downturn in the ISP market. Embratel's satellite subsidiary continues to do well in both of its main businesses. In the transponder space rental, Star One recently renewed its contract with a large traditional client. In its innovative Internet broadband offering via satellite, it is having excellent acceptance among medium and small business and with government entities. Star One's new satellite will be a hybrid with 28 C band transponders and 14 Ku band transponders with South American and transcontinental coverage. These capabilities will allow this business to expand once the satellite in launched in late 2005. Embratel's launch of ISP gains momentum. Embratel's own free Internet service provider - Click 21T, launched last quarter, has gained over 200,000 subscribers in the first month and a half of nationwide launch. This rapid subscriber growth indicates the provider's superior quality (storage capacity, fast access, anti-spam and anti-virus features) is being recognized by customers. Just last week, Embratel launched Click21 TopT, a paid Internet provider service. Click21 Top is a unique offering for small and medium companies of up to 500 employees located in more than 100 Brazilian cities. Embratel will enable these companies to obtain in a single provider a complete Internet solution including - own-domain, automatic email anti-virus, tools to develop their own home-page and send faxes as well as exclusive content. Clients of Click21 Top will benefit from Embratel service quality. VOICE SERVICES Domestic Long Distance Tariff increases and SMP revenues led to overall revenue growth Domestic long distance revenues rose 14 percent quarter-over- quarter to R$ 1.1 billion primarily due to entrance into a new market for long distance SMP services and tariff adjustments. Starting July 6, 2003 customers began to choose long distance carrier for each call originating from a cellular phone. The introduction of this calling mode is being done in phases and will be completed in the fourth quarter of 2003. It also represents a new revenue source for Embratel which more than offsets the loss of wholesale voice revenues from cellular operators. "We were pleased to enter this segment of the long distance market and leverage the strength of our brand to grow revenues", said Jorge Rodriguez, President of Embratel. Basic voice traffic declined partly due to substitution for advanced voice services, which continued to grow in the quarter, and partly due to competition. Year-over-year domestic long distance revenues declined by 2.3 percent mainly due to lower traffic because of line blocking (despite net unblocking, the number of lines currently blocked still exceed those that were blocked at the end of the third quarter 2002) and competition. Accumulated in the first nine months of the year, domestic long distance revenue was R$3.0 billion compared to R$3.3 billion in the first nine months of 2002. The decline in revenues is explained by the company's efforts to focus on recurring- profitable clients who are enabling it to grow revenues profitably. This involved preventing delinquent and fraudulent lines from using its services through line blocking. This factor and competition were the main impact on the year-over-year revenue decline. International Long Distance International long distance revenue was R$204 million in the third quarter of 2003 representing a 5.0 percent decline from the previous 2003 quarter. Inbound traffic continued to rise but settlement tariffs fell causing overall inbound revenues to decline. Outbound revenues, benefiting also from the use of international SMP, rose due to the tariff increase offsetting the decline in traffic. Year-to-date, international revenue was R$645 million compared to R$698 million in the first nine months of 2002. This 7.6 percent decline resulted from lower traffic due to line blocking, to competition and to price declines. Local Services Embratel ended the third quarter of 2003 with 1,370 Vipline local service clients compared to approximately 900 in June 2003. One of the highlights among client additions was one of the country's main financial institutions. Services to Vipline clients are provided in more than 2000 sites and capacity made available to them also rose slightly more than 50 percent in the quarter. EBITDA EBITDA growth and margin improvement continues EBITDA rose to R$553 million in the third quarter of 2003 compared to R$379 million in the previous 2003 quarter. EBITDA in the third quarter of 2002 was R$442 million. Following market practice, Embratel reclassified certain expenses related to financial transactions such as taxes (PIS/Cofins on financial income and CPMF) and expenses such as bank expenses and letters of credit costs below the operating line under the financial expense account. Previously, these expenses were classified either as third party or as taxes both under G&A expenses. The above mentioned reclassification totaled R$51 million for the first nine months of 2003 and were fully charged to the third quarter 2003 financial expense account. A corresponding R$80 million charge relative to the first nine months of 2002 was also reclassified in the third quarter 2002 income statement for comparison purposes. EBITDA margin rose to 30.8 percent in the third quarter of 2003 from 22.7 percent in the previous 2003 and 24 percent in the third quarter of 2002. The improvement in EBITDA resulted from stronger revenues, continued decreases in allowance for doubtful accounts, reduction in personnel expenses and lower third party expenses, which more than offset the increase in interconnection costs. Better operating performance alone contributed to a 2.8 percentage point EBITDA margin growth. "Our operating improvement has been consistent over three consecutive quarters", said Jorge Rodriguez, Embratel's President. Another factor that led to a further increase in the EBITDA of the third quarter 2003 was a non-recurring reversal of ICMS provision and Cofins taxes credited to the other operating income account. Lastly, the reclassification mentioned above also impacted EBITDA. Had neither the tax reversal nor the reclassification been made, EBITDA would have been R$458 million, representing an EBITDA margin of 25.5 percent. Allowance for doubtful accounts dropped for the seventh consecutive quarter to R$81 million, or 3.4 percent of gross revenues (4.5 percent of net revenues). Compared to the third quarter of 2002, this provision fell by 47.2 percent. Since SMP is collected entirely through co-billing, delinquency patterns are subject to the cellular company's objectives, quality standards and efficiency in managing bad debt and fraud on post- paid services. This is a new market for Embratel and the company may make adjustments as the SMP long distance carrier selection process (which has only been in place since July 6, 2003) matures. Personnel expenses, which in the second quarter of 2003 had been increased by severance payments related to the outsourcing of our IT services to IBM, fell by R$18.4 million quarter-over-quarter and by R$7 million year-over-year. Expenses with third party services fell to R$216 million from R$230 million in the second quarter of 2003. In the third quarter of 2002 third-party expenses were R$ 248 million. Interconnection costs increased to R$826 million in the third quarter of 2003. This increase results from higher SMP traffic (which has a higher telco cost) and interconnection tariff increases. As a result, telco margin rose to 46 percent in the third quarter of 2003 when compared to 45 percent of net revenues in the previous 2003 quarter. Compared to the same 2002 quarter, telco ratio declined by more than a percentage point. In the nine months ending September 30, 2003, EBITDA reached 1.3 billion representing a growth of 15.9 percent when compared to the same 2002 period. EBITDA margin rose to 25.2 percent compared to 20.1 percent in the first nine months of 2002. The margin improvement results from improved telco ratio and lower allowance for doubtful receivables. EBIT In the third quarter of 2003, EBIT was R$267 million compared to R$92 million in the previous 2003 quarter and R$154 million in the third quarter of 2002. Year-to-date EBIT was R$436 million representing an operating margin of 8.4 percent and an 55.3 percent increase when compared to the first nine months of 2002. NET INCOME Net income was R$15 million in the third quarter of 2003 compared to a net income of R$128 million in the second quarter of 2003 and a loss of R$550 million in the third quarter of 2002. The quarter-over quarter decline in earnings results from the impact of the depreciation of the Real vis-a-vis the foreign currencies on the company's unhedged foreign currency debt. The Real depreciated against the US dollar and the Yen between June 30, and September 30, 2003. Compared to the third quarter of 2002, the improvement in net income results from the appreciation of the Real. Between September 30, 2002 and September 30, 2003, the Brazilian currency appreciated relative to the US dollar, 25 percent. Note that financial expense in the quarter were R$164 million. Of this amount, R$51 million represent expenses related financial transactions such as taxes and expenses reclassified under financial expenses as explained above, and R$113 million were the actual interest expenses comparable to the R$108 million financial expenses of the previous 2003 quarter. In the third quarter 2002, financial expenses would have been R$172 million of which R$80 million are reclassified financial expense related taxes and expenses and the remaining R$92 million are interest expenses per se. Net income in the first nine months of the year was R$155 million compared to a loss of R$738 million in the same period of the prior year. FINANCIAL POSITION Cash position on September 30, 2003 was R$685 million. Embratel ended the quarter with a total outstanding debt of R$4.0 billion. Net debt fell to R$3.3 billion from R$3.4 billion in the previous 2003 quarter. Short term debt (accrued interest, short term debt and current maturity long term debt in the next 12 months) is R$1.4 billion of which R$478 million is part of the financing agreement and therefore will be rolled over for a period of 2 years at each original maturity. During the quarter Embratel repaid R$187 million of debt, net of new additions, reducing the company's overall outstanding debt. "Our improved cash generation has permitted us to reduce outstanding debt for the third consecutive quarter", said Norbert Glatt, CFO of Embratel. Approximately 86 percent of the debt that matured and was rolled over in the third quarter of 2003 was converted into Reais. The financing for the Star One new satellite - approximately US$200 million (10 year tenor at an all-in-cost of US$ + 5.8 percent) has already been secured and will gradually be disbursed as the construction phases of the satellite are completed. RECEIVABLES The company's net receivable position on September 30, 2003 was R$1.5 billion. The increase in receivables is associated with the growth in voice revenues. The voice aging profile has continued to improve: 80.9 percent of net voice receivables were current at the end of the third quarter of 2003 compared to 75.7 percent at the end of the second quarter 2003. Despite the increase in receivables, days-sales-outstanding, based on net receivables, remained at the same level as in the previous quarter: 60 days compared to 59 days in the second quarter of 2003. CAPEX Total capital expenditures in the quarter were R$141 million. The breakout of this expenditure is the following: local infrastructure and access - 16.3 percent (including PPIs); data and Internet services - 23.0 percent; network infrastructure - 2.1 percent, others - 23.0 percent and Star One - 35.6 percent. Accumulated capex in the first nine months of 2003 was R$283 million. We expect that total capex for 2003 to remain below R$600 million. REGULATORY Tariffs On June 27, 2003 Anatel approved average tariff increase using the IGP-DI index as established in the concession agreements. This rate increase was challenged by public authorities in the Brazilian Courts. The rate increase currently in place is based on an injunction dated September 11, 2003 rendered by a Federal Court which altered the IGP-DI index to the IPCA index in the concession contract formula. As such, consumer tariffs as well as interconnection rates were allowed to increase by the IPCA minus the productivity factor. This issue is still subject to an ongoing judicial process and a final decision. M&A ACTIVITY Early fourth quarter of 2003, Embratel concluded the sale of its Clearinghouse subsidiary. The sale of this asset combined with the sale of its participation in Intelsat in the previous quarter raised US$57 million of cash. Embratel no longer expects to acquire AT&T Latin America's five subsidiaries in South America. The company actively participated in this Chapter 11, 363 sale process, up to the point where it thought the acquisition price was consistent and accretive to its business. The Vesper acquisition has made progress and documentation has been filed to obtain approval for the transaction with the regulatory agencies. Embratel is the premier communications provider in Brazil offering a wide array of advanced communications services over its own state of the art network. It is the leading provider of data and Internet services in the country and is well positioned to be the country's only true national, local service provider for corporates. Service offerings: include telephony, advanced voice, high-speed data communication services, Internet, satellite data communications, corporate networks and local voice services for corporate clients. Embratel is uniquely positioned to be the all-distance telecommunications network of South America. The Company's network is has countrywide coverage with 28,868 km of fiber cables comprising 1,068,657 km of optic fibers. To see financial statements: http://bankrupt.com/misc/EMBRATEL.htm TELEMAR: Oi Reaches 3 Million Subscribers ----------------------------------------- After only 16 months of operations, Oi, the wireless arm of Telemar beats another challenge by achieving ahead of time the target of 3 million subscribers it had scheduled for the end of 2003. ========= C H I L E ========= ENDESA CHILE: Places Bonds for Over $200M on the Local Market ------------------------------------------------------------- - A strong demand for these papers developed on the market, exceeding UF 14,200,000g - The first series of these bonds was issued at a rate of 5.65% and the second at a rate of 6.74% - The resources raised from this operation, which forms part of the Financial Strengthening Plan, will go towards refinancing company debt The bonds issued for a total value of over US$200,000 by Endesa Chile, a subsidiary of Enersis, were successfully placed on the local market late Friday. The placement was made in two series, each for a value of UF 4 million. The first of these was met with a demand of UF 7,276,000 and was placed at a rate of 5.65% with a 7-year term. The second was placed at a 25-year term at a rate of 6.74% and attracted an investment of UF 6,943,000. The resources obtained from this operation, which forms part of the Financial Strengthening Plan, will be utilized to refinance the company's debts. TELEFONICA CTC: S&P Unlikely To Up Ratings Despite Improvements --------------------------------------------------------------- Compania de Telecomunicaciones de Chile S.A. (CTC, BBB/Positive/- -), the largest Chilean telecommunication operator, reported significant improvement in bottom-line profitability as of September 2003 compared to losses in the first nine months of 2002, mainly due to severances from headcount reduction and losses from Terra Network's lower market value registered in 2002. In 2003, profitability was favored by the revaluation of the Chilean peso against the dollar, which added to the 17% debt reduction since the end of September 2002, resulting in lower interest costs. Despite the 7.6% drop in revenues year on year mainly due to divestments, EBITDA margins remained fairly stable. Headcount, cost reductions, and mobile segment growth have helped to offset an increase in fixed-line uncollectables and lower subscriber base (mostly due to the migration of low income clients to mobile prepaid telephony), the negative trend in the long-distance segment, and higher GSM and ADSL costs. Coverage ratios have benefited also from lower debt and lower rates translating into higher EBITDA interest coverage of 5.8x in the first nine months of 2003, from 4.9x for the same period of 2002. In spite of these improvements, regulations remain the main challenge. As a result, Standard & Poor's Ratings Services is not likely to raise its ratings on CTC until the next regulatory setting process is finalized in 2004 in a way that is favorable to the company's performance and business position. ANALYSTS: Ivana Recalde, Buenos Aires (54) 114-891-2127 Marta Castelli, Buenos Aires (54) 114-891-2128 =============== C O L O M B I A =============== * S&P Affirms Republic of Colombia's Long-Term Ratings ------------------------------------------------------ Standard & Poor's Ratings Services said Monday that it affirmed its 'BB' long-term foreign currency and 'BBB' long-term local currency sovereign credit ratings on the Republic of Colombia in light of the likely failure of the government to pass most of the measures contained in the national referendum held on Saturday, Oct. 25, 2003. These measures include a freeze in wages, pensions, and salaries, which was important to broadly meet the government's fiscal targets with the International Monetary Fund, especially in 2004. Standard & Poor's also said that the outlook is stable. "Although the failure of the referendum was a clear setback for the Uribe administration, the government will present a back-up plan, which includes a combination of additional tax measures and cuts in spending," said Standard & Poor's sovereign credit analyst Richard Francis. President Uribe maintains a high popularity rating (more than 70%), so passage of additional measures by the Congress is likely. "However, if the government fails to pass and implement needed fiscal measures by year-end, the ratings could come under downward pressure," Mr. Francis added. ANALYST: Richard Francis, New York (1)-212-438-7348 * Fitch Affirms Republic of Colombia's Long-Term Ratings -------------------------------------------------------- Standard & Poor's Ratings Services said on Monday that it affirmed its 'BB' long-term foreign currency and 'BBB' long-term local currency sovereign credit ratings on the Republic of Colombia in light of the likely failure of the government to pass most of the measures contained in the national referendum held on Saturday, Oct. 25, 2003. These measures include a freeze in wages, pensions, and salaries, which was important to broadly meet the government's fiscal targets with the International Monetary Fund, especially in 2004. Standard & Poor's also said that the outlook is stable. "Although the failure of the referendum was a clear setback for the Uribe administration, the government will present a back-up plan, which includes a combination of additional tax measures and cuts in spending," said Standard & Poor's sovereign credit analyst Richard Francis. President Uribe maintains a high popularity rating (more than 70%), so passage of additional measures by the Congress is likely. "However, if the government fails to pass and implement needed fiscal measures by year-end, the ratings could come under downward pressure," Mr. Francis added. ANALYST: Richard Francis New York Phone: (1)-212-438-7348 ============= E C U A D O R ============= ECUADORIAN BANKS: AGD Kicks Off Liquidation Process --------------------------------------------------- The liquidation process of eight intervened Ecuadorian financial institutions will commence November 15, Business News Americas reports. The institutions scheduled to undergo the process are: Finiber, Amerca, Valorfinsa and Necmancorp as well as four banks: Financorp, Azuay, Tungurahua and Occidente. Ecuador's deposit insurance agency AGD, which controls these institutions, scheduled the liquidation process in a bid to clean up the local financial system in return for greater flexibility on the part of the International Monetary Fund in its future policy towards Ecuador. Meanwhile, Finance Minister Mauricio Pozo will present to IMF representatives the definitive list of financial entities targeted for liquidation as a clear signal of the government's determination to balance the financial system's books. ============= J A M A I C A ============= AIR JAMAICA: Expands Codeshare Offerings With Delta Air Lines ------------------------------------------------------------- Delta Air Lines and Air Jamaica announced Monday the expansion of their codeshare service between several cities in the United States and Jamaica. The new codeshare flights are from Baltimore, Chicago, Ft. Lauderdale, Houston, Orlando and Philadelphia to Montego Bay, Jamaica, and from Ft. Lauderdale to Kingston, Jamaica. These new flights are effective immediately. At the present time, Delta operates one daily non-stop flight between Atlanta and Montego Bay, while Air Jamaica operates service to the island from Atlanta, Baltimore, Boston, Chicago, Ft. Lauderdale, Houston, Los Angeles, Miami, New York (JFK and Newark), Orlando and Philadelphia to Montego Bay, as well as from Ft. Lauderdale, Miami and New York to Kingston. Delta already has its code on Air Jamaica flights from Atlanta, Boston, Los Angeles, Miami and New York (JFK and Newark) to Montego Bay, as well as beyond Montego Bay to Antigua, Barbados, Bonaire, Curacao, Grenada and St. Lucia. Delta also places its code on Air Jamaica flights from Miami and New York (JFK) to Kingston. Air Jamaica has placed its code on Delta flights between Montego Bay and Atlanta, and beyond Atlanta to Cincinnati, Los Angeles, Memphis, Nashville and Phoenix. Delta Air Lines, the world's second largest airline in terms of passengers carried and the leading U.S. carrier across the Atlantic, offers 6,130 flights each day to 453 destinations in 82 countries on Delta, Song, Delta Shuttle, Delta Connection and Delta's worldwide partners. Delta is a founding member of SkyTeam, a global airline alliance that provides customers with extensive worldwide destinations, flights and services. For more information, please go to delta.com . CONTACT: Delta Air Lines, Inc. Phone: +1-404-715-2554 Home Page: http://www.delta.com Air Jamaica 4 St. Lucia Avenue Kingston 5, Jamaica Phone: 876/922-3460 Fax: 929-5643 E-mail: webinfo@airjamaica.com =========== M E X I C O =========== GRUPO TMM: TFM Wants Judge to Interpret Purchase-Sale Accord ------------------------------------------------------------ Grupo TMM, S.A. announced that Grupo TFM has requested a federal judge in Mexico to provide an appropriate interpretation of the Purchase-Sale Agreement of TFM's common stock, as outlined in the Agreements, dated January 31. 1997, and June 9 1997, respectively. Grupo TFM is requesting adherence to the process, which must be complied with in order for the government to exercise its Put option for its 20 percent equity interest in TFM. When the Mexican government opened the Mexican railroad system to private investment, it retained a 20 percent equity interest in TFM. The intention was to sell these shares in the equity market through a public offering, when considered appropriate and with approval of the Mexican Securities Registry ("Registro Nacional de Valores") and the National Banking and Securities Commission ("Comision Nacional Bancaria y de Valores" or "CNBV"), with the objective of strengthening the market for public investments in Mexico and encouraging additional investors to participate in the capital stock of TFM. Additionally, TFM's bid contained the following condition: "The franchise purchasers will be obligated to acquire the equity portion that cannot be placed in the Mexican Securities Market ("Bolsa Mexicana de Valores" or "BMV"), at the initial offering price plus respective interest." The Mexican government is obligated to comply with the following process in order to sell the equity interest the government retains in TFM: 1) carry on the necessary formalities to register the shares with the BMV; 2) receive approval of the CNBV; 3) the Mexican government is to request that TFM provide all information necessary to place its equity stake in the market; and 4) the Mexican government will place the number of shares it is able to place in the equity market once all necessary approvals are granted. When the above steps are completed, the Mexican government is to notify Grupo TFM of the number of remaining shares that could not be placed in the equity market and is to request Grupo TFM to acquire those shares at a minimum stipulated price. Since none of the above steps of the process have been completed, and the real value of the shares of TFM owned by the government cannot be determined because TFM has not received reimbursement of a Value Added Tax, ordered by the Mexican Fiscal Court on August 13, there can be no condition that applies in order for the Mexican government to request that Grupo TFM acquire the equity stake held at TFM by the government. Grupo TFM acknowledges its commitment to acquire the equity interest that the Mexican government holds in TFM and has informed the government of its desire to comply with the pending steps from the original Agreement as listed above once the aforementioned formalities and conditions have been fulfilled. For all of the above reasons, Grupo TFM has requested that a federal judge rules in favor on an appropriate interpretation of the Purchase-Sales Agreement and amended Agreement. Headquartered in Mexico City, Grupo TMM is a Latin American 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, 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. CONTACT: GRUPO TMM Investor Relations: Brad Skinner Phone: 011-525-55-629-8725 203-247-2420 Email: brad.skinner@tmm.com.mx Proa/StructurA Media Relations: Marco Provencio Phone: 011-525-55-629-8708 011-525-55-442-4948 Phone: mp@proa.structura.com.mx DRESNER CORPORATE SERVICES: General Investors, Analysts and Media: Kristine Walczak Phone: 312-726-3600 Email: kwalczak@dresnerco.com TFM: S&P Lowers Ratings on KCS ------------------------------ Standard & Poor's Ratings Services said Monday that it lowered its long-term corporate credit ratings on Kansas City Southern and Kansas City Southern Railway Co. to 'BB-' from 'BB'. In addition, Standard & Poor's lowered Kansas City Southern Railway Co.'s senior unsecured debt rating to 'B+' from 'BB-' and affirmed its 'BB+' senior secured debt rating. Kansas City Southern's preferred stock rating was lowered to 'B-' from 'B'. All ratings were removed from CreditWatch, where they were placed April 1, 2003. The outlook is negative. "The downgrades reflect Standard & Poor's belief that the expected improvement in financial measures will not occur as quickly as anticipated and that uncertainties and potential funding requirements related to the company's investment in TFM S.A. de C.V. (TFM, B+/Watch Developing/--) will likely put pressure on the financial profile over the near to intermediate term," said Standard & Poor's credit analyst Lisa Jenkins. The affirmation of the senior secured debt rating reflects Standard & Poor's belief of a very strong likelihood of recovery of principal for bank lenders in the event of a default or bankruptcy, given the significant amount of collateral the company has and the relatively small proportion of secured debt in the capital structure. The Kansas City, Mo.-based Class 1 railroad has about $860 million of debt (adjusted for operating leases). Although Kansas City Southern is a Class 1 (major) railroad, it is significantly smaller and less diversified than its peers. Operating results have been depressed by the weak economy and increased cost pressures (especially fuel) over the past year. Results in 2002 were also adversely affected by complications arising from the implementation of a new transportation computer system in the second half of the year. Although this system is now helping the company manage its rail operations more efficiently (as is reflected in improving service metrics), the company's operating ratio (operating expenses, including depreciation, as a percentage of revenues) remains significantly weaker (higher) than average among Class 1 railroads. Since the late 1990s, Kansas City Southern has maintained an ownership interest in the main privatized Mexican railroad (TFM). In April 2003, Kansas City Southern announced a series of agreements with TMM under which Kansas City Southern would gain control of TFM and the Texas Mexican Railway Co. However, TMM's shareholders voted against the transaction in August 2003, despite the fact that the controlling shareholder is also the chairman and chief executive of TMM. The two companies are now in a dispute over whether TMM shareholder approval is required for the transaction to go forward and whether the merger agreement remains in effect. Adding to financial risk and uncertainty in the near-to- intermediate term is the Mexican government's right to exercise a put of its ownership interest in TFM to Grupo TFM (TFM's holding company) this fall. If Grupo TFM does not purchase the government's interest, TMM and Kansas City Southern would be obligated to purchase the government's interest. If TMM could not purchase its pro rata share, Kansas City Southern would be obligated to pay the total purchase price that, measured as of June 30, 2003, was about $491 million. Ratings incorporate room for the company to pay its portion of the put option or for the company to complete the TFM transaction as originally proposed. However, if Kansas City Southern is forced to pay the full amount of the put, or if financial performance at Kansas City Southern or TFM weakens from expected levels, or if the TFM deal goes forward under more onerous terms, ratings could be reviewed for a further downgrade. ANALYST: Lisa Jenkins, New York (1) 212-438-7697 ======= P E R U ======= ESSALUD: Settles Wage Dispute With Workers ------------------------------------------ Peru's public health agency EsSalud and its workers have reached a wage settlement agreement, paving the way for an end to a strike lodged by the workers, relates Business News Americas. Under the agreement reached between the workers' union representatives and EsSalud's executive president, Jose Luis Chirinos, an improved monthly wage structure will be created. Furthermore, a technical committee will be set up to determine the feasibility of the proposed 150-hour monthly working schedule. Chirinos told local paper Expreso earlier that EsSalud is preparing to trim its management structure as part of the agency's latest cost-cutting plans. The executive suggested that the proposed reforms to the agency's administrative system will result in a saving of PEN85 million (US$24.4 million) through the elimination of 450 managerial posts by end-October. Already, 166 employees have left their posts at the agency's headquarters as part of the first phase of the staff cuts. ================= V E N E Z U E L A ================= IVSS: Commences Medical Debt Repayment Program ---------------------------------------------- Jesus Viloria Juarezas, the president of Venezuela's social security agency, the IVSS, revealed the agency has entered the first phase of a medical debt repayment program, relates local daily El Universal. The first stage, according to the report, calls for IVSS to pay between 25-40% of the total debt held with specialized pharmaceutical suppliers. Meanwhile, Viloria announced that a recent agreement with suppliers' representatives also ensures the fresh supply of medicine starting this week. The debt repayment program was launched amid provisional measures taken by the agency to guarantee the nationwide supply of medicine up to February next year. PDVSA: Files 2002 Annual Report With the U.S. SEC ------------------------------------------------- Venezuela's state-owned oil company Petroleos de Venezuela SA filed its 2002 annual report with U.S. regulators on Friday, the AP Online reports. The recently filed results showed that PDVSA's net profit in 2002 plunged 37%, to US$2.5 billion, from 2001. The Company attributed the plunge to the Dec.2-Feb.1 nationwide strike, which cut into sales and exports. Meanwhile, Energy and Mines Minister Rafael Ramirez said that PDVSA will "soon hold its general shareholders assembly, where the 2004 investment plan will be announced." Investments last year totaled US$2.96 billion, a decline from US$3.8 billion in 2001. The Company paid US$9.3 billion to the government in royalties, dividends and taxes last year, down from US$11.8 billion in 2001. PDVSA was originally scheduled to file the report with the U.S. Securities and Exchange Commission on June 30. However, the Company missed the deadline following a disruption in its accounting system due to the strike. Extensions from the SEC aren't uncommon. PDVSA is required to file with the U.S. SEC because several wholly owned units operate in the United States. *********** 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 America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick, Maryland USA. 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. 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