/raid1/www/Hosts/bankrupt/TCRLA_Public/040506.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 6, 2004, Vol. 5, Issue 89
Headlines
A R G E N T I N A
BUENOS AIRES SYSTEM: Court Sets Cutoff for Submission of Reports
CHACRAS DE PILAR: Submits "Concurso Preventivo" Motion
E.I.M.E.: Court Authorizes Liquidation
EDESUR: Ups Ratings on $450M Worth of Bonds
EDITORIAL COLUMBA: Starts Bankruptcy Proceedings
IMPSAT: Telefonica Resumes Purchase Talks
ITALTEXTIL: Begins Bankruptcy Process
ITALVINIL: Judge OKs Reorganization
LUCCA SPINELLO: Reorganization Advances to Bankruptcy
MULTICANAL: Judge Junks Claims Against Debt Deal Approval
NII HOLDINGS: Launches International Direct Connect
SALPE: Requests Court's Approval to Undergo Reorganization
SCP: $400M of Bonds Retain Junk Rating from Local Fitch
SERVICIOS DE ALIMENTACION: Court Deems Bankruptcy Necessary
SUCESION DE BARREIRO: Files Bankruptcy Petition
TURBINE POWER: Bonds Remain at Junk Level
YACYRETA: Accord For Projects Completion Signed
*ARGENTINA: Creditors to Junk a 'Unilateral' Debt Offer
B E R M U D A
GLOBAL CROSSING: Anatoly Weiser Files Class Action Suit
GLOBAL CROSSING: Cauley Bowman Files Class Action Lawsuit
GLOBAL CROSSING: Another Class Action Lawsuit Filed
LORAL SPACE: DIRECTV 7S Satellite Successfully Launched
TYCO INTERNATIONAL: Continues to Report Strong Cash Flow
B R A Z I L
BRASKEM: Minutes Of the Board Of Directors Mtg. Held April 19
CEMIG/USIMINAS: Inks Five-Year Power Deal
EMBRATEL: Debt Load Shrinks to BRL4.1B in 1Q04
TUPY: Seeks Capacity Expansion Capital
USIMINAS: Expected To Post Solid 1Q04 Profit, Sales
C H I L E
TELEFONICA CTC: Shares Jump on New Tariff Bets
E C U A D O R
PETROECUADOR: New Leader Reveals Plans
H O N D U R A S
*HONDURAS: WB Approves $15M Credit For Community Projects
M E X I C O
CORPORACION DURANGO: Reports Lower EBITDA in 1Q04
CYDSA: Plant Shuts Down
GRUPO MEXICO: Unit Prepays 2007 Debt
P A N A M A
BLADEX: Net Income Increases; Debt Exposure Improves
V E N E Z U E L A
EDC: Posts 1Q04 Loss
PDVSA: Sidor Strike Creates Turmoil
SIDOR: Strikers Dispersed; Deliveries Resume
- - - - - - - - - -
=================
A R G E N T I N A
=================
BUENOS AIRES SYSTEM: Court Sets Cutoff for Submission of Reports
----------------------------------------------------------------
Buenos Aires Court No. 26 has ordered Mr. Ernesto Garcia, the
receiver tasked to oversee the bankruptcy proceedings of Buenos
Aires System S.R.L., an information technology services and
consultancy firm, to submit the individual reports to court on
August 10, 2004, reports Infobae.
Individual reports contain the results of the claims
verification process expected completed by June 14, 2004. After
submitting these reports to court, the receiver will consolidate
all of them into a general report and submit it to the court on
September 22, 2004.
The case will conclude with the liquidation of all of its assets
to repay creditors. Repayment will be made based on the results
of the verification process.
CONTACT: Buenos Aires System S.R.L.
Av Triunvirato 5570
Buenos Aires
Ernesto Garcia, Receiver
Montevideo 536
Buenos Aires
CHACRAS DE PILAR: Submits "Concurso Preventivo" Motion
------------------------------------------------------
Chacras de Pilar Chico S.A., which does its business in the
maintenance, conservation and administration of small farms at
the Club de Campo Chacras del Pilar, filed a petition to undergo
a reorganization process. In the filing, the Company revealed
that it ceased paying its debts since October last year. Judge
Di Noto of Buenos Aires No. 15, with assistance from Dra. Tevez,
is now analyzing whether to grant approval to the petition.
CONTACT: Chacras de Pilar Chico S.A.
Montevideo 1163
Buenos Aires
E.I.M.E.: Court Authorizes Liquidation
--------------------------------------
E.I.M.E. S.R.L. entered bankruptcy on orders from Buenos Aires
Court No. 3, reveals Infobae.
Working with Clerk No. 6, the court assigned Mr. Marcelo Carlos
Rodriguez as receiver. He is to verify creditors' claims until
June 08, 2004
Creditors who fail to have their claims validated before the
deadline will be disqualified from receiving any payments to be
made after the company's assets are liquidated.
The individual reports, which are due on August 10, 2004, are to
be prepared upon completion of the verification process. The
court also requires the receiver to prepare a general report and
file it on September 22, 2004. This report contains a summary of
the results in the individual reports.
CONTACT: Mr. Marcelo Carlos Rodriguez, Receiver
Cerrito 146
Buenos Aires
EDESUR: Ups Ratings on $450M Worth of Bonds
-------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. upgraded the ratings
of US$450 million worth of corporate bonds issued by Edesur S.A.
under "Program" from `B(arg)+' to `BBB(arg)'. Argentina's
securities regulator, the Comision Nacional de Valores (CNV),
described the bonds, which have an undisclosed maturity date, as
"Programa de Obligaciones Negociables." The action, which was
taken based on the Company's financial status as of December 31,
2003, means that the issue carries an adequate credit risk
relative to other issues in the country.
CONTACT: EDESUR S.A.
Gte. Gral.: Ing. Rafael Fernandez Morande
San Jos, 140, 3o P
Capital Federal 1076
Argentina
Phone: 4370-3700/4370-3370
Fax: 4381-0708
Home Page: www.edesur.com.ar
EDITORIAL COLUMBA: Starts Bankruptcy Proceedings
------------------------------------------------
Buenos Aires Court No. 3 declared Editorial Columba S.A.
"Quiebra," reports Infobae. Clerk No. 5 assists the court on the
case, which will close with the liquidation of the Company's
assets to repay creditors.
Mr. Alberto Daniel Chebi, who has been appointed as receiver,
will verify creditors' claims until June 30, 2004 and then
prepare the individual reports based on the results of the
verification process.
The individual reports will then be submitted to court on
August 27, 2004, followed by the general report on October 8,
2004.
CONTACT: Alberto Daniel Chebi, Receiver
Viamonte 2381
Buenos Aires
IMPSAT: Telefonica Resumes Purchase Talks
-----------------------------------------
The negotiations for the acquisition of Argentine corporate
services provider Impsat Fiber Networks by Spanish
telecommunications group Telefonica have been restarted, reports
local daily El Cronista.
Market sources reveal that Telefonica's bid for Impsat is not
for regional network expansion purposes, but to stop rival
Mexican company Telmex from gaining a foothold in the region.
Impsat, a provider of broadband internet, data transmission and
telephony services, is owned by US investment bank Morgan
Stanley and investment fund WR Huff. It has a 8,800 km fiber
optics network linking Valparaiso, in Chile; to Buenos Aires, in
Argentina; and Curitiba, Sao Paulo and Rio de Janeiro, in
Brazil; as well as local networks in 15 metropolitan regions
across Latin America.
ITALTEXTIL: Begins Bankruptcy Process
-------------------------------------
Buenos Aires Court No. 3 declared Italtextil S.A. "Quiebra,"
reports Infobae. The declaration signals the Company to proceed
with the bankruptcy process, which will end with the liquidation
of its assets.
The court, assisted by Clerk No. 5, appointed Mr. Marcelo Carlos
Rodriguez, as receiver. Mr. Rodriguez will authenticate proofs
of claim until June 17, 2004. Afterwards, he will prepare the
individual reports based on the results of the authentication
and then submit these reports to court on August 13, 2004. After
these results are processed in court, the receiver will then
submit the general report on September 27, 2004.
CONTACT: Marcelo Carlos Rodriguez, Receiver
Cerrito 146
Buenos Aires
ITALVINIL: Judge OKs Reorganization
-----------------------------------
San Luis Civil Court No. 1 has approved the Reorganization of
Italvinil San Luis S.A.C.I., but it has yet to appoint a
receiver to oversee the reorganization proceedings.
Reorganization, or "Concursos Preventivo", is a measure
available for companies under Argentine law to prevent a
straight liquidation.
Infobae reports that important dates, such as the deadline for
the submission of the necessary reports, as well as the schedule
for the informative assembly will be announced shortly.
LUCCA SPINELLO: Reorganization Advances to Bankruptcy
-----------------------------------------------------
Lucca Spinello S.R.L., an Argentina-based company that was
undergoing reorganization, was declared bankrupt. Argentine news
source Infobae relates that Salta Civil and Commercial Court No.
2 ruled that the Company is "Quiebra".
The report adds that the court assigned Mr. Romualdo A. Caniza
as receiver, who will verify creditors' proofs of claim until
May 31, 2004. The court also ordered Mr. Caniza to prepare
individual reports after the verification process is completed,
and have them ready by July 30, 2004. The court also expects a
general report on the bankruptcy process to be filed on
September 13, 2004.
CONTACT: Lucca Spinello S.R.L.
F de Gurruchaga 88
Salta
MULTICANAL: Judge Junks Claims Against Debt Deal Approval
---------------------------------------------------------
In a filing with the Buenos Aires stock exchange Tuesday,
Argentine cable television operator Multicanal SA announced that
the remaining challenges to its court-approved extra-judicial
proposal to restructure US$500 million in debt have been finally
dismissed by an Argentine judge, Dow Jones relates.
Under the bankruptcy laws of Argentina, a company pursuing this
kind of debt-restructuring - known as an APE in Spanish - needs
two-thirds agreement from creditors before submitting the
proposal for legal approval, which then imposes the terms on all
creditors.
Multicanal's restructuring proposal, which included a cash
offer, a combination of equity plus new seven-year bonds at 44%
of the original value, or new 10-year notes with a step-up
interest rate up to 4.5%, was approved by 67.9% of its creditors
in December. In February, however, seven creditor groups filed
formal objections to the APE. The claims were junked last month,
paving the way for the granting of the APE.
Opponents of the Multicanal APE said the company would have
never gotten the required two-thirds approval had it counted
votes from creditors representing the total debt burden. In
addition, some bondholder groups have an involuntary bankruptcy
petition pending against Multicanal in the U.S. The primary
creditor involved is the Argentinian Recovery Company LLC, or
ARC, which represents 31% of Multicanal's outstanding debt.
NII HOLDINGS: Launches International Direct Connect
---------------------------------------------------
NII Holdings, Inc. (Nasdaq: NIHD - News) launched International
Direct Connect(SM) in partnership with Nextel Communications,
Nextel Partners, Telus Mobility in Canada and Motorola. The
service, which is an extension of its Direct Connect(SM) walkie-
talkie capability, allows Nextel subscribers in Latin America to
reach other Nextel subscribers, in under a second, and to
communicate instantly across national borders within the region,
with Nextel subscribers in the United States and among Nextel
users while traveling in Argentina, Brazil and Peru.
The service is operational for subscribers of Nextel Argentina,
Nextel Brazil and Nextel Peru. Nextel Mexico, which currently
offers a cross-border dispatch service covering northern Baja
California, Mexico is in its final phase of IDC implementation
and will make the service available nationwide later this
quarter.
A first of its kind, International Direct Connect(TM) renews NII
Holdings' commitment to business customers by meeting a growing
need for a wireless solution that provides instant and cost-
effective communications across North and South American
geographies. IDC enables subscribers to communicate instantly
within workgroups, and among customers, suppliers and key
contacts, whether conducting business in their country or while
traveling in Latin markets where the service is available. IDC
overcomes barriers associated with making international calls
and provides a cost-effective alternative to international and
local long distance dialing.
"International Direct Connect(TM) (IDC), the latest breakthrough
in dispatch communications, is as much a milestone in
communication technology and methods as it is a natural
extension of the dispatch feature which has distinguished
iDEN(TM) operators among business users in both North and South
America," said Steve Shindler, NII's Chairman and CEO. "IDC
provides Latin American companies with a tool to enhance
productivity and with business opportunities beyond their
borders, demonstrating a commitment to continuously offering
communications solutions that enable customers in the region to
do business more efficiently."
IDC provides unmatched "Push to Talk" speed and clarity, saves
users on long distance, roaming and cellular charges, and
provides immediate access to iDEN(TM) wireless networks in North
and South America. Other key benefits include overcoming
challenges associated with international long distance,
preventing delays in decision-making, and gaps in information
flows among groups and individuals. For example, a Nextel Brazil
subscriber, while traveling in the U.S., can place a Direct
Connect call to another Nextel Brazil subscriber who is also
traveling in the U.S. At the same time, either of those Nextel
Brazil subscribers can communicate instantly with Direct Connect
to a subscriber in his/her home country or to Nextel Argentina
and Peru.
IDC is made possible by Motorola's iDEN technology developed
since 1987.
SALPE: Requests Court's Approval to Undergo Reorganization
----------------------------------------------------------
Buenos Aires-based Salpe S.R.L. filed a petition to undergo a
court-supervised reorganization, reports Infobae. The petition
is now pending before Buenos Aires Court No. 24, which is being
assisted by Clerk No. 48.
CONTACT: SALPE S.R.L.
Pasaje Rivarola 170
Buenos Aires
SCP: $400M of Bonds Retain Junk Rating from Local Fitch
-------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. maintains a `D(arg)'
rating on US$400 million worth of corporate bonds issued by
Sociedad Comercial del Plata S.A. (SCP) under "Program".
The CNV relates that the `D(arg)' rating, which is assigned to
bonds that are currently in default, was given based on the
Company's finances as of December 31, 2003. The bonds, which
have an undisclosed maturity date, are described as
"Obligaciones Negociables."
SCP is controlled by Argentine businessman Santiago Soldati.
SERVICIOS DE ALIMENTACION: Court Deems Bankruptcy Necessary
-----------------------------------------------------------
Servicios de Alimentacion Alihue S.A., which was undergoing
reorganization, entered bankruptcy on orders from Buenos Aires
Court No. 14. Infobae relates that the court, which is assisted
by Clerk No. 28, appointed Mr. Anibal Diego Carrillo to be the
receiver on the case. The court ordered the receiver to conduct
the credit verification process "por via incidental" and submit
the general report on October 5, 2004.
CONTACT: Anibal Diego Carrillo, Receiver
Juncal 615
Buenos Aires
SUCESION DE BARREIRO: Files Bankruptcy Petition
-----------------------------------------------
Buenos Aires-based Sucesion de Barreiro Horacio Antonio is
seeking to undergo bankruptcy, according to a La Nacion report.
In its bankruptcy petition, the Company declared assets of
US$120,000 assets and liabilities of US$131,580.40. The petition
is pending before Judge Rey of the city's Court No. 25. Clerk
No. 50, Dr. Cosentino, assists the court in this particular
case.
CONTACT: Sucesion de Horacio Antonio Barreiro
Estados Unidos 1788
Buenos Aires
TURBINE POWER: Bonds Remain at Junk Level
-----------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. maintains a `D(arg)'
rating on US$20 million worth of corporate bonds issued by
Turbine Power Co. S.A. under "Simple Issue".
The bonds were described as "obligaciones negociables
garantizadas" the CNV says, adding that the issue matured on
November 30, 2002.
The action was taken based on the Company's financial standing
as of December 31, 2003. Such rating is given to issues that are
currently in default or whose obligor has filed for bankruptcy.
YACYRETA: Accord For Projects Completion Signed
-----------------------------------------------
An agreement for the completion of infrastructure projects at
the binational Yacyreta hydroelectric power plant was signed
Tuesday by representatives of Argentina and Paraguay, Dow Jones
reveals. The accord commits the two countries to get on with old
plans to add 200 megawatts to the plant's production capacity
for their benefit.
Work on the plant, according to a spokesman for Argentine
Planning Minister Julio de Vido, is set to begin in 30 to 40
days. The spokesman, however, did not specify a timetable for
the works.
A copy of the agreement states that Argentina has also agreed to
pay in seven monthly increments its US$25 million debt with
Paraguay as "compensation for energy cuts, flooded land, damages
and profits." Furthermore, the two sides also vowed to make an
effort in resolving Yacyreta's murky financial standing. The
company's US$10 billion debt to Argentina's Treasury had been a
source of tension between the two countries. The neighbors also
promised to turn Yacyreta into a profitable company, and "for
that it's necessary to establish the financial-economic
conditions to make it possible," the accord said.
Plans to boost Yacyreta's capacity have long been in place, as
are plans to increase regional integration by stringing up
electricity lines linking Yacyreta on the Argentine-Paraguayan
border and Itaipu on the Brazil-Paraguay border, the two massive
hydropower dams in the region.
A recent report in a business briefing said Yacyreta has opened
bids on contracts to build an 11-kilometer water channel, which
would lift the dam's water levels from 76 meters to 83 meters.
The report said the projects would take three years.
*ARGENTINA: Creditors to Junk a 'Unilateral' Debt Offer
-------------------------------------------------------
In an e-mailed statement Tuesday, the largest representative
group of holders of defaulted Argentine debt stressed it will
not accept any 'unilateral' offer by the Argentine government to
reschedule defaulted bonds totaling US$99.4 billion, says
Bloomberg.
The Global Committee of Argentina Bondholders (GCAB), which
holds about one-third of the country's defaulted bonds, also
scored the Argentine government in its statement for not setting
up a second round of talks after an initial meeting in April 16
in Buenos Aires, where it was agreed that technical meetings
focusing on Argentina's debt repayment capacity will be held in
another 15 days.
The group's warning stemmed from the government's announcement
last week that it will present its final debt restructuring
offer in mid-June. Since the planned technical meetings have not
yet taken place, GCAB warned that "an offering announcement
without prior negotiations would not follow the letter of intent
recently signed with the International Monetary Fund," which
calls for "good faith" negotiations with creditors.
"An Argentine unilateral proposal will not be accepted by
international private investors," the GCAB statement said.
The government's initial proposal in September to pay investors
US$250 per US$1,000 face value of defaulted debt have been
rejected by the GCAB, which claims to represent more than US$37
billion in defaulted bonds, and most other bondholder groups.
=============
B E R M U D A
=============
GLOBAL CROSSING: Anatoly Weiser Files Class Action Suit
-------------------------------------------------------
Law Offices Of Anatoly Weiser announced Tuesday that a
securities lawsuit has been commenced on behalf of shareholders
who purchased the common stock of Global Crossing Ltd. ("Global
Crossing" or the "Company") (Nasdaq:GLBCE) between December 9,
2003 and April 26, 2004, inclusive. The lawsuit was filed in the
United States District Court for the Southern District of New
York.
The complaint alleges that Global Crossing and certain officers
violated sections 10(b) and 20(a) of the Exchange Act, and Rule
10b-5 promulgated thereunder, by issuing a series of material
misrepresentations to the market during the Class Period. More
specifically, the complaint alleges that: (1) the Company had
materially understated its accrued cost-of-access liability by
$50- $80 million; (2) the Company had insufficient internal
controls; and (3) as a result, the Company's financial results
were materially inflated at all relevant times. On April 27,
2004, Global Crossing announced that it had initiated a review
of its previously reported financial statements for the years
ended December 31, 2003 and 2002, including respective interim
periods, and that "the company will amend periodic reports
previously filed with the SEC to reflect the expected
restatement and to revise disclosures related to the internal
control issues presented and the company's methodologies for
estimating cost of access expenses and reconciling these
expenses to vendor invoices." In reaction to the news shares of
Global Crossing stock dropped $5.00 per share, or 27.7 percent
on April 27, 2004 on heavy trading volume.
CONTACT: Law Offices of Anatoly Weiser
Toll-free: (877) 736-5411
Fax: (858) 225-0838
E-mail: info@classlawsuit.com
GLOBAL CROSSING: Cauley Bowman Files Class Action Lawsuit
---------------------------------------------------------
The Law Firm of Cauley Bowman Carney & Williams, PLLC announced
Tuesday that a class action lawsuit has been filed in the United
States District Court for the Southern District of New York on
behalf of purchasers of Global Crossing, Ltd. (Nasdaq: GLBCE)
("Global Crossing" or the "Company") publicly traded securities
during the period between December 9, 2003 and April 26, 2004,
inclusive (the "Class Period").
The complaint charges that Global Crossing, John Legere (Chief
Executive Officer) and Daniel P. O'Brien (Chief Financial
Officer and Executive Vice President) violated sections 10(b)
and 20(a) of the Exchange Act, and Rule 10b-5 promulgated
thereunder, by issuing a series of material misrepresentations
to the market during the Class Period. More specifically, the
complaint alleges that defendants' statements during the Class
Period failed to disclose and misrepresented the following
material adverse facts which were then known to defendants or
recklessly disregarded by them: (1) that the Company had
materially understated its accrued cost-of-access liability by
$50-$80 million; (2) that the Company had insufficient internal
controls; and (3) that as a result, the Company's financial
results were materially inflated at all relevant times.
On April 27, 2004, Global Crossing announced that it had begun a
review of its previously reported financial statements for the
years ended December 31, 2003 and 2002, including respective
interim periods, and that "the company will amend periodic
reports previously filed with the Securities and Exchange
Commission to reflect the expected restatement and to revise
disclosures related to the internal control issues presented and
the company's methodologies for estimating cost of access
expenses and reconciling these expenses to vendor invoices."
News of this shocked the market. Shares of Global Crossing stock
dropped $5.00 per share, or 27.7 percent on April 27, 2004 on
unusually large trading volumes to close at $13.20 per share.
CONTACT:
CAULEY BOWMAN CARNEY & WILLIAMS, PLLC
J. Allen Carney, Esq. or Marcus N. Bozeman, Esq.
Client Relations Department:
Jackie Addison
P.O. Box 25438
Little Rock, AR 72221-5438
Toll Free: 1-888-551-9944
Fax: 1-501-312-8505
E-mail: info@cauleybowman.com
Web site: http://www.cauleybowman.com
GLOBAL CROSSING: Another Class Action Lawsuit Filed
---------------------------------------------------
Law Offices Of Charles J. Piven, P.A. announced Tuesday that a
securities class action was commenced on behalf of shareholders
who purchased, converted, exchanged or otherwise acquired the
common stock of Global Crossing Ltd. (Nasdaq:GLBCE) between
December 9, 2003 and April 26, 2004, inclusive (the "Class
Period").
The case is pending in the United States District Court for the
Southern District of New York against defendant Global Crossing
and one or more of its officers.
The action charges that defendants violated federal securities
laws by issuing a series of materially false and misleading
statements to the market throughout the Class Period which
statements had the effect of artificially inflating the market
price of the Company's securities.
No class has yet been certified in the above action. Until a
class is certified, you are not represented by counsel unless
you retain one. If you are a member of the Class, you may move
the court no later than June 29, 2004 to serve as a lead
plaintiff for the Class. In order to serve as a lead plaintiff,
you must meet certain legal requirements. To be a member of the
class you need not take any action at this time, and you may
retain counsel of your choice.
CONTACT: Law Offices Of Charles J. Piven, P.A.
The World Trade Center-Baltimore
401 East Pratt Street, Suite 2525
Baltimore, Maryland 2120
E-mail: hoffman@pivenlaw.com
Tel: 410/986-0036
LORAL SPACE: DIRECTV 7S Satellite Successfully Launched
-------------------------------------------------------
The DIRECTV 7S high power spot beam direct broadcast satellite,
built by Space Systems/Loral (SS/L) for DIRECTV Inc., El
Segundo, Calif., was successfully launched at 8:42 am EDT
Tuesday. The satellite was sent into space on a Sea Launch
Zenit-3SL rocket from the Odyssey Launch Platform, positioned on
the equator in the Pacific Ocean.
DIRECTV 7S will use highly focused spot beam technology to
provide DIRECTV with the capacity to deliver local channels to
41 additional markets, expanding its local channel coverage to a
total of 106 markets.
"The high power DIRECTV 7S satellite is the most advanced
direct-broadcast satellite ever built," said C. Patrick DeWitt,
president, Space Systems/Loral. "The new satellite will allow
DIRECTV to more than double the markets in which its customers
can watch local television programming, while providing a backup
in its other markets. SS/L is extremely proud to deliver DIRECTV
7S and we look forward to continuing our important relationship
with DIRECTV as it continues to expand its fleet and services."
The DIRECTV 7S satellite is the third Loral-built satellite in
the DIRECTV fleet. SS/L also is building two additional
satellites, DIRECTV 8 and DIRECTV 9S, at its facility in Palo
Alto, Calif.
DIRECTV 7S will generate more than 13kW of total satellite power
at the beginning of its life and is designed to operate from
orbital locations at 101 degrees West longitude, the primary
orbital slot for DIRECTV, or 119 degrees West longitude.
The spacecraft is a version of SS/L's space-proven 1300
satellite platform, which has an excellent record of reliable
operation. The geostationary 1300 has a designed service life of
15 years and maintains station-keeping and orbital stability by
using bipropellant propulsion and momentum-bias systems. In all,
SS/L satellites have amassed more than 1,000 years of on-orbit
service.
DIRECTV is the United States' leading digital multichannel
television service provider with more than 12.2 million
customers. DIRECTV and the Cyclone Design logo are registered
trademarks of DIRECTV, Inc., a unit of The DIRECTV Group, Inc.
(NYSE: DTV). The DIRECTV Group, Inc. is a world-leading provider
of digital multichannel television entertainment, broadband
satellite networks and services, and global video and data
broadcasting. The DIRECTV Group, Inc. is 34-percent owned by Fox
Entertainment Group, which is approximately 82-percent owned by
News Corporation. For more information, visit www.DIRECTV.com.
Space Systems/Loral, a subsidiary of Loral Space &
Communications (OTCBB: LRLSQ), is a premier designer,
manufacturer, and integrator of powerful satellites and
satellite systems. SS/L also provides a range of related
services that include mission control operations and procurement
of launch services. Based in Palo Alto, Calif., the company has
an international base of commercial and governmental customers
whose applications include broadband digital communications,
direct-to-home broadcast, defense communications, environmental
monitoring, and air traffic control. SS/L satellites have
amassed more than 1000 years of reliable on-orbit service. SS/L
is ISO 9001:2000 certified. For more information, visit
www.ssloral.com.
Loral Space & Communications is a satellite communications
company. In addition to Space Systems/Loral, through its Skynet
subsidiary, Loral owns and operates a fleet of
telecommunications satellites used to broadcast video
entertainment programming, and for broadband data transmission,
Internet services and other value-added communications services.
For more information, visit Loral's web site at www.loral.com.
This document contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934,
as amended. In addition, Loral Space & Communications Ltd. or
its representatives have made or may make forward-looking
statements, orally or in writing, which may be included in, but
are not limited to, various filings made by Loral with the
Securities and Exchange Commission, press releases or oral
statements made with the approval of an authorized executive
officer of Loral.
Actual results could differ materially from those projected or
suggested in any forward-looking statements as a result of a
wide variety of factors and conditions. These factors include
those related to the filing, on July 15, 2003 by Loral and
certain of its subsidiaries, of voluntary petitions for
reorganization under Chapter 11 of Title 11 of the United States
Code in the United States District Court for the Southern
District of New York and parallel insolvency proceedings in the
Supreme Court of Bermuda in which certain partners of KPMG were
appointed as joint provisional liquidators. Additional factors
and conditions are also described in the section of Loral's
annual report on Form 10-K for the fiscal year ended December
31, 2003, entitled "Certain Factors That May Affect Future
Results," and Loral's other filings with the Securities and
Exchange Commission. The reader is specifically referred to
these documents.
CONTACT: Loral Space & Communications
John McCarthy
212/338-5345
TYCO INTERNATIONAL: Continues to Report Strong Cash Flow
--------------------------------------------------------
* Cash Flow From Operating Activities of $1.8 Billion; Free Cash
Flow of $1.4 Billion
* Results Include Net Charge of $119 Million Pretax, or $0.04
Per Share, From Restructuring and Divestiture Program
* Company Raises its Full-Year Earnings and Cash Flow Guidance
Tyco International Ltd. (NYSE: TYC; BSX: TYC) reported Tuesday
diluted GAAP earnings per share (EPS) of $0.37 for the second
quarter ended March 31, 2004, compared with EPS of $0.06 in the
second quarter of 2003. The company had revenue of $10.0
billion, compared with $9.0 billion last year, and organic
revenue growth of 3.4 percent in the quarter. Net income for the
quarter increased to $782 million from $124 million a year ago.
Cash flow from operating activities totaled $1.8 billion,
compared with $1.4 billion a year ago. The company had free cash
flow of $1.4 billion, up from $816 million in last year's second
quarter.
Organic revenue growth and free cash flow are non-GAAP financial
measures and are described below. For a reconciliation of these
non-GAAP measures, see the attached tables.
"We're quite pleased with our results for the quarter. They
reflect continued progress in our efforts to build Tyco into a
world-class operating company," said Tyco Chairman and Chief
Executive Officer Ed Breen. "We're continuing our focus on the
fundamentals-satisfying our customers, generating cash to reduce
debt, running our operations more efficiently, and increasing
margins to produce earnings growth across the company."
HIGHLIGHTS
* The company further reduced debt by $1.2 billion to $17.7
billion and had cash on hand of $3.1 billion. The debt-to-
capitalization ratio was 38.1 percent at the end of the second
quarter, compared with 40.4 percent last quarter.
* Organic revenue growth was 3.4 percent driven by strong
performance at Electronics, Healthcare, and Engineered Products
& Services.
* Backlog in the Electronic Components business increased 8
percent organically in the quarter and the quarterly book-to-
bill ratio was 1.06.
* Healthcare continued to invest in its global sales and
marketing organization, adding more than 500 positions over the
last 12 months, and continued to increase its spending on
research and development.
* Engineered Products & Services experienced solid organic
revenue and profit growth due to better market conditions and
improved operating efficiencies.
* Fire & Security had improved results in Worldwide Security,
including further improvement in its Continental European
security business. In addition, Tyco Safety Products had
double-digit organic revenue growth in the quarter.
RESTRUCTURING AND DIVESTITURE PROGRAM
During the quarter the company continued to make progress on the
restructuring and divestiture program announced in November
2003. Through March 2004, the company has announced the closure
of 110 facilities and a staffing reduction of approximately
4,100 positions related to the restructuring program. The
company also made progress on its plan to divest more than 50
non-core businesses and has exited 10 businesses since the
program was initiated.
Included in the second quarter results were $119 million of net
pretax charges related to the divestiture and restructuring
program consisting of $85 million of divestiture charges and $58
million of restructuring charges offset by $24 million of
related restructuring savings.
SEGMENT RESULTS
The financial results presented in the tables below are in
accordance with GAAP. All dollar amounts are pretax and stated
in millions. All comparisons are to the quarter ended March 31,
2003, unless otherwise indicated.
To assist in comparisons to the prior period, please note that
the results for the quarter ended March 31, 2003 included $473
million of net pretax charges primarily related to the
intensified internal audit process and other items. These
charges last year consisted of the following: $352 million in
Fire & Security, $8 million in Healthcare, $33 million in
Engineered Products & Services, $5 million in Plastics &
Adhesives, and $105 million in Corporate. Electronics had $30
million of net restructuring credits related to this process a
year ago.
Fire & Security
March 31, March 31, $ Change % Change
2004 2003
Revenue $2,987.8 $2,769.6 $218.2 8%
Operating Income $219.7 ($178.4) $398.1 NA
Operating Margin 7.4% (6.4%)
Revenue increased $218 million, or 8 percent, with foreign
currency contributing 7 percent and organic growth of 1 percent.
Growth at Worldwide Security and Tyco Safety Products was offset
by continued weakness in the Worldwide Fire Services business.
Tyco Safety Products had double-digit revenue growth led by
increased demand for breathing systems, video surveillance, and
access control equipment. Worldwide Security continued to
benefit from the strong retailer market environment.
Operating income included $47 million of net charges related to
the divestiture and restructuring program announced in November
2003, while last year's quarter was impacted by the $352 million
of charges noted above. Operationally, the segment benefited
from increased efficiencies and higher revenue.
Electronics
March 31, March 31, $ Change % Change
2004 2003
Revenue $2,846.1 $2,538.1 $308.0 12%
Operating Income $380.3 $395.0 ($14.7) (4%)
Operating Margin 13.4% 15.6%
Revenue increased $308 million, or 12 percent, with foreign
currency contributing 7 percent and organic revenue growth of 5
percent. For connectors and cable assemblies, organic revenue
growth was 10 percent driven by strength in the automotive,
industrial, communications, and computer markets. Revenue growth
in connectors and cable assemblies was partially offset by
weakness in battery packs, services, and power systems.
Due to a $44 million divestiture-related charge in the current
quarter and a $30 million net restructuring credit as noted
above in last year's second quarter, operating income declined
$15 million. Operationally, operating income improved due to
higher volume and continued operating efficiencies partially
offset by pricing pressure as well as higher copper and gold
costs.
Healthcare
March 31, March 31, $ Change % Change
2004 2003
Revenue $2,283.8 $2,098.8 $185.0 9%
Operating Income $580.6 $513.6 $67.0 13%
Operating Margin 25.4% 24.5%
Revenue increased $185 million, or 9 percent, with foreign
currency contributing 5 percent and organic revenue growth of 4
percent. All of the segment's business units had year-over-year
organic revenue growth led by Pharmaceutical, with higher sales
from new products in dosage narcotics, and Medical, with strong
sales across the product line especially in pre-filled syringes,
safety needles, and wound care.
Operating income increased 13 percent and the operating margin
expanded 90 basis points, due to increased volumes and continued
cost improvements, partially offset by a $17 million increase in
research and development spending.
Engineered Products & Services
March 31, March 31, $ Change % Change
2004 2003
Revenue $1,446.6 $1,091.1 $355.5 33%
Operating Income $123.0 $72.1 $50.9 71%
Operating Margin 8.5% 6.6%
Revenue increased $356 million, or 33 percent, with foreign
currency contributing 8 percent and organic revenue growth of 8
percent with good growth in all units except Flow Control. The
majority of the remaining 17 percent increase in revenue
reflects the impact of certain subcontract costs previously
treated as pass through to customers at Infrastructure Services
that totaled $169 million. This reclassification had no impact
on operating income.
Operating income included $5 million of charges related to the
restructuring and divestiture program announced in November
2003, while the prior period included $33 million of charges
noted above. The improvement in operating income was driven by
improved markets at Electrical & Metal Products, Fire & Building
Products, and Infrastructure Services partially offset by
continued weakness in Flow Control.
Plastics & Adhesives
March 31, March 31, $ Change % Change
2004 2003
Revenue $470.1 $488.5 ($18.4) (4%)
Operating Income $9.9 $41.9 ($32.0) (76%)
Operating Margin 2.1% 8.6%
Revenue declined $18 million, or 4 percent, with foreign
currency adding 2 percent, offset by a 6 percent organic revenue
decline. Revenue was lower in three of the four business units
within this segment.
Operating income declined $32 million, principally due to a $24
million net charge in the quarter associated with restructuring
activities. Prior period operating income included $5 million of
charges noted above. The decline in operating income was due to
lower volume and tighter resin spreads that more than offset
continued cost improvements.
OTHER ITEMS
* The effective tax rate was 24.7 percent and included a $23
million favorable non-U.S. tax adjustment. The company
continues to anticipate a full year tax rate of approximately 27
percent.
* Net interest expense was $212 million, down 24 percent from
$278 million in the same period a year ago.
OUTLOOK
The company expects to achieve EPS of $0.39 to $0.42 in the
third quarter of 2004 and is raising its EPS outlook for fiscal
year 2004 to a range of $1.52 to $1.58. This EPS outlook
excludes the impact from the restructuring and divestiture
program announced in November 2003. The company is also raising
its full-year cash flow guidance and now expects to achieve cash
flow from operating activities of $5.7 billion and free cash
flow of $4.0 billion before any voluntary pension contributions.
EPS excluding charges and cash flow excluding voluntary pension
contributions are non-GAAP measures and are described below.
Ed Breen concluded, "Since the beginning of our fiscal year, we
have seen an improvement in our end markets and we feel better
about the global economy. As a result of these improved business
conditions and our operational progress, we are raising our
outlook."
ABOUT TYCO INTERNATIONAL
Tyco International Ltd. is a global, diversified company that
provides vital products and services to customers in five
business segments: Fire & Security, Electronics, Healthcare,
Engineered Products & Services, and Plastics & Adhesives. With
2003 revenue of $37 billion, Tyco employs 260,000 people
worldwide.
To see financial statements:
http://bankrupt.com/misc/Tyco_International.txt
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B R A Z I L
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BRASKEM: Minutes Of the Board Of Directors Mtg. Held April 19
-------------------------------------------------------------
On April 19 (nineteen), 2004 (two thousand and four), at 5.00
p.m, at the Company's offices located at Avenida das Nacoes
Unidas, No. 4.777, Zip Code 05477-000, Sao Paulo, SP, the 486th
(four hundred and eighty-sixth) Meeting of the Board of
Directors of BRASKEM S.A. was held, attended by the undersigned
Board Members. Also attending the meeting were the President,
Jose Carlos Grubisich Filho, the Executive Officers Mauricio
Roberto de Carvalho Ferro, and Paul Elie Altit, the Secretary of
the Board of Directors, Mr. Nelson Raso, and Dr. Ana Patricia
Soares Nogueira. The President of the Board of Directors, Pedro
Augusto Ribeiro Novis, acted as Chairman of the meeting, and Dr.
Ana Patricia Soares Nogueira acted as Secretary of the meeting.
AGENDA:
I) Matters for deliberation:
1) PROPOSALS FOR DELIBERATION: after the analysis of the
respective matter, the following Deliberation Proposal
("DP"), previously sent by the Board of Executive
Officers to the members of the Board of Directors as
set forth in the Internal Rules of the Board of
Directors, copies of which were duly filed at the
Company's headquarters, was approved:
a) PD.CA/BAK-04/2004 - Export Securitization Transaction
between Braskem and Overseas III Export Ltd.
("Overseas") - in view of the negotiation of new
terms for the Export Securitization Transaction
approved by the Board of Directors in a meeting held
on February 11, as described in the DP, the Board of
Executive Officers was authorized to negotiate and
enter into:
(i) the export prepayment transaction, for a maximum
amount of US$200,000,000.00 (two hundred million
U.S. dollars) between the Company, as debtor and
guarantor, and Overseas, as borrower
("Transaction");
(ii) a guarantee agreement in respect of the
Transaction;
(iii) any and all documents directly or indirectly
related to the Transaction, as described in the
respective DP. All actions performed by the Board
of Executive Officers, since the approval of the
Transaction in the Board of Directors Meeting
described above, were confirmed;
II) Matters of interest to the Company:
Nothing to be mentioned.
CLOSING OF THE MINUTES - With no other matters to discuss, these
minutes were drafted and, after being read, discussed and found
in accordance with the subjects discussed, were signed by all
present Board Members, the Chairman and the Secretary of the
Meeting. Sao Paulo/SP, April 19, 2004. (Signed) Pedro Augusto
Ribeiro Novis - Chairman; Ana Patricia Soares Nogueira -
Secretary; Alvaro Fernandes da Cunha Filho - Vice-President;
Alvaro Pereira Novis; Andre Tapajos Cunha; Carlos Alberto de
Meira Fontes; Fernando de Castro Sa; Francisco Teixeira de Sa;
Jose de Freitas Mascarenhas; Luiz Fernando Cirne Lima; Margareth
Feijo Brunnet; Newton Sergio de Souza).
Conforms to the original and recorded in the specific book.
CEMIG/USIMINAS: Inks Five-Year Power Deal
-----------------------------------------
In a statement, Brazil's Minas Gerais state integrated power
company Cemig said it will be providing local flat steel maker
Usiminas 14,293GWh under a five-year, BRL1 billion (US$337mn)
power supply contract, BNamericas reports.
The largest of its kind in the Brazilian free energy market, the
contract stipulates that the Usiminas group will be purchasing
the 14,293GWh between 2005 and 2009, according to the statement.
Usiminas President Rinaldo Campos Soares said in a separate
statement that, "With the five-year contract, the Usiminas
system guarantees the stability of electric power acquisition
and the tranquility to plan for the long term, and reaffirms its
commitment to the development of Minas Gerais and its confidence
in Cemig, our partner for four decades."
EMBRATEL: Debt Load Shrinks to BRL4.1B in 1Q04
----------------------------------------------
Embratel Participacoes S.A. (Embratel Participacoes or the
"Company" or "Embrapar") (NYSE:EMT; BOVESPA:EBTP3, EBTP4), the
Company holds 98.8 percent of Empresa Brasileira de
Telecomunicacoes S.A. ("Embratel"), announced Tuesday First
Quarter 2004 Results. All financial figures are in Reais and
based on consolidated financial in "Brazilian Corporate Law".
Highlights:
- Net revenue was R$1.9 billion in the first quarter of 2004,
increasing 10.8 percent compared to the first quarter of 2003.
This increase was due to tariff increases, SMP long distance and
local service revenues. Compared to the fourth quarter of 2003,
revenues rose 1.0 percent.
- Local revenues reached 7.2 percent of total net revenues due
to the growth in Embratel's local revenues and the consolidation
of Vesper.
- EBITDA in the first quarter of 2004 was R$448 million,
representing a 14.8 percent year-over-year growth. First quarter
2004 EBITDA margin was 23.7 percent representing a reduction
from the fourth quarter 2003 EBITDA margin. This reduction is
entirely due to dilution caused by the consolidation of Vesper.
- Interconnection costs fell to 44.5 percent of net revenues
compared to 46.4 percent in the fourth quarter of 2003 and 46.2
percent in the first quarter of 2003.
- Net income in the first quarter of 2004 was R$4.6 million.
- Total debt declined to R$4.1 billion due to additional debt
repayment. Embratel also paid R$102 million of dividends and
acquired CT Torres for R$131 million in the quarter.
- Total capital expenditures in the first quarter of 2004 were
R$104 million.
- On April 27, 2004 the US Bankruptcy Courts approved the sale
of MCI's participation to Telmex. The transaction is subject to
approval by Brazilian regulatory authorities. The purchase price
is US$400 million.
Note: Throughout this document, first quarter 2003 income
statement was restated to reflect the reclassification of
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. This reclassification
occurred in the third quarter of 2003. Previously, these
expenses were classified either as third party or as taxes both
under G&A expenses.
VOICE SERVICES
Domestic Long Distance
14% domestic long distance revenue growth over a 12 months
period
Domestic long distance revenue was R$1.1 billion representing a
13.6 percent increase when compared to the first quarter of
2003. The year-over-year DLD revenue growth results from the
company's ability to participate and to attract customers in the
SMP long distance market and to the substitution for advanced
voice. Compared to the fourth quarter of 2003, domestic long
distance revenues declined 0.9 percent. This decline is
explained by seasonal factors and the entrance of a new
competitor, offsetting the growth in SMP revenues. As of January
2004 all long distance calls originating from cellular phones
were required to choose a carrier and further expansion in this
market should come from growing demand and economic growth.
Embratel is clearly the preferred choice.
International Long Distance
International long distance revenue was R$203 million in the
first quarter of 2004, representing a 4.2 percent decline from
the previous 2003 quarter, resulting from seasonal factors and
competition. Year-over-year, revenue decline results from
competition from both illegal and legal providers.
Embratel offers VOIP transport solutions enabling cost effective
and better services to its clients.
DATA COMMUNICATION SERVICES
2 Mbit equivalent annual volume growth of 32 percent
Embratel's data communications revenues were R$415 million in
first quarter of 2004, representing a decline relative to the
previous 2003 quarter. The decline in data revenues is related
to price reductions despite continued strong volume growth.
Compared to the first quarter of 2003, net data revenues
declined 8.8 percent resulting from the disconnection of
internet provider UOL and the overall reduction of the ISP
market.
Our Click21(TM) free internet provider continues to grow
subscribers and usage and was chosen by On-line research by
Acesso-Gratis.com, an Interlink demonstration site, as the best
free Internet provider for the second consecutive quarter.
LOCAL REVENUE
Local Services represented 7.2 percent of total revenues
Embratel ended the first quarter of 2004 with local revenues of
R$136 million (including Vesper). This revenue represented 7.2
percent of total revenues and were responsible for the overall
growth in the company's revenues quarter-over-quarter. Local
revenues were R$83 million in the fourth quarter of 2003 and
R$10 million in the first quarter of 2003.
Livre, Vesper's first service launch with Embratel is having
wide acceptance. The service is being offered in smaller cities
as Vesper's networks become ready for the launch. Also, in the
local service arena, Embratel began selling ADSL services over
its own networks in Porto Alegre this quarter. Broadband, voice
and Internet services will be offered in Rio and Sao Paulo to
residential, small and medium businesses, over Embratel's own
access network using NGN technology towards the end of the
second quarter of 2004.
EBITDA
Annual EBITDA growth and margin improvement continues
In the first quarter of 2004, EBITDA was R$448 million compared
to R$390 million in the first quarter of 2003, representing a
growth of 14.8 percent. EBITDA margin in each of the comparison
periods were 23.7 and 22.9 percent, respectively. The main
reasons for such improvement were the reduction in allowance for
doubtful accounts and a decrease in interconnection costs as a
percentage of revenues.
Compared to the fourth quarter of 2003, first quarter 2004
EBITDA declined 7.0 percent and EBITDA margin dropped by 2.0
percentage points. EBITDA was diluted due to the first full
quarter consolidation of Vesper, which offset the significant
reduction in interconnection costs as a percentage of total
revenues.
SG&A
Vesper expenses were classified primarily under "other" and
"third party" expenses in the first quarter of 2004, resulting
in the increase in these categories.
Another factor that contributed to the lower EBITDA was an
increase in allowance for doubtful accounts which reached R$94
million, or 3.8 percent of gross revenues (5.0 percent of net
revenues). This increase is attributable to higher bad debt
levels in the SMP market and general economic conditions.
Interconnection
Interconnection costs, as a percentage of net revenues, dropped
to 44.5 percent in the first quarter of 2004 compared to 46.2 in
the first quarter of 2003 and 46.4 in the fourth quarter of
2003. Quarter-over-quarter interconnection costs fell, in part,
due to the fact that all local operators began to uniformly
invoice interconnection costs based on rates adjusted by the
IPCA index using the correct adjustment formula as established
in the interconnection contracts.
In addition, Embratel installed over 250 points-of-presence for
interconnection (PPI) using leased lines in the first quarter of
2004. These PPIs enabled the company to eliminate long distance
interconnection charges in many routes (reduction in TU-RIU
payments).
This large increase in the number of PPIs occurred because the
price of leased lines fell dramatically due to contract
renegotiations with major local operators. These gains were the
result of Embratel's successful actions on the regulatory and
anti-trust fronts. Both Anatel and Cade found strong indication
of anti-competitive pricing of leased lines by major local
operators and imposed preventive measures which made the
negotiations possible.
EBIT
In the first quarter of 2004, EBIT was R$155 million compared to
R$195 million in the previous 2003 quarter. The decline is
attributed to SG&A related to Vesper. Compared to the first
quarter of 2003, EBIT increased 56.9 percent.
NET INCOME
Five consecutive quarters of profits
Net income was R$5 million in the first quarter of 2004 compared
to a net income of R$69 million in the fourth quarter of 2003.
Fourth quarter net income was impacted by non-recurring items
(sale of the Clearinghouse subsidiary and Inmarsat shares).
FINANCIAL POSITION
Cash position on March 31, 2004 was R$1.1 billion. During the
quarter, Embratel distributed dividends of R$102 million to
Embratel Participacoes, Embratel and Star One shareholders and
acquired CT Torres (a tower company) from Qualcomm for R$131
million (US$45 million) (see CT Torres below). Embratel also
prepaid approximately R$420 million of debt in the quarter,
replacing expensive short-term debt with the funds obtained from
the bond issued in December 2003. This prepayment contributed to
a drop in the average cost of hedged and Real debt to 95.5
percent of the CDI in the first quarter of 2004 from 100.6
percent of the CDI in the previous 2003 quarter.
Embratel ended the quarter with a total outstanding debt of
R$4.1 billion. Net debt was R$3.1 billion increasing due to the
uses of cash mentioned above. Short-term debt (accrued interest,
short-term debt and current maturity long-term debt in the next
12 months) was R$1.2 billion. Note that 98.4 percent of short-
term debt is either hedged or in Reais. A total of 58.6 percent
of Embratel's total debt is either denominated in Reais or
hedged against currency fluctuations (Exhibit 19).
RECEIVABLES
The company's net receivable position on March 31, 2004 was
R$1.7 billion. The increase in receivables in the first quarter
continues to be associated with the growth in SMP revenues. The
voice aging profile of basic voice receivables billed by
Embratel, has continued to improve: 85.3 percent of net voice
receivables were current at the end of the first quarter of 2004
compared to 84.0 percent at the end of the fourth quarter 2003.
CAPEX
Total capital expenditures in the quarter were R$104 million.
The breakout of this expenditure is as follows: local
infrastructure, access and services- 22.0 percent (including
PPIs and Vesper); data and Internet services - 32.6 percent;
network infrastructure - 4.1 percent, others - 28.9 percent and
Star One - 12.4 percent.
OTHER INFORMATION
Investments in subsidiaries' operations
Vesper - Embratel is also upgrading Vesper's network to 1x RTT
technology in major cities in the regions it operates not only
to expand the residential and SOHO subscriber base but also to
introduce services with new features. Vesper will also be
launching integrated Vesper/Embratel solutions for business
clients. In addition, Embratel is in the process of expanding
Vesper's IT infrastructure in order to enable rapid expansion
and synergies are being deployed as planned.
Star One - Embratel's satellite subsidiary is Latin America's
largest satellite solutions company. It operates in two market
segments: broadband Internet services (Easyband) and space
segment rental which is used by clients to transmit TV and radio
signals, data, voice and multimedia services. Star One has four
satellites and is in the process of building a fifth - C1 -
which is intended to replace satellite B1. C1 is a hybrid
satellite which will have 42 transponders in the C, Ku and X
bands and a footprint covering all of South America. To
complement satellite capacity, Star One has contracted to
acquire additional C band transponders with transcontinental
capabilities.
Star One is the first and the only company in Brazil that offers
broadband Internet access via satellite. This offering adds to
other broadband services offered by Embratel mentioned elsewhere
in this text such as conventional ADSL, 1x EV-DO and very soon a
new offering through NGN. Broadband services represent a growing
portion of the company's revenues.
Star One Regulatory Issues Clarified - Embratel's satellites B1
and B2 carry a transponder of special frequency for military
communications. This is referred to as the X band. As a
concessionaire Embratel already has the legal and contractual
obligation to provide technical resources, including the
installation of terrestrial control centers for the Brazilian
Armed Forces satellite communications. The concession contract,
signed at the privatization in 1998, contains clauses that
guarantee, among other things, confidentiality and the security
of the military communications (which are encrypted) and which
are controlled by the Armed Forces in their terrestrial
stations.
CT Torres Acquisition
In March, Embratel concluded the acquisition, from a QUALCOMM
affiliate, of 622 communications towers previously owned by
Vesper Sao Paulo S.A. and Vesper S.A. (Vesper) for US$45 million
(R$131 million).
The purpose of this acquisition was to enable Embratel to earn a
higher return on capital than it would if Vesper were to lease
these towers from a third party (see Embratel Advances Local
Business Strategy Through The Acquisition of Vesper press
release December 2, 2003 at www.embratel.com.br/ir-
pressreleases). In addition, Embratel will have greater
flexibility with the use of the towers as well as enjoying full
existing and future revenues earned by renting tower-space to
other interested parties, such as cellular operators.
Sarbanes-Oxley Act
Embratel has initiated (October 2003) the certification process
for the Sarbanes-Oxley 404 rule. The scope of the process has
required the review of 13 internal main processes and more than
130 sub-processes. Notwithstanding this fact, the adaptation to
this rule required few changes, since the company has good
accounting policy and practices. Therefore Embratel expects that
it will obtain the Sarbanes-Oxley 404 certification(s).
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 exhibits and financial statements:
http://bankrupt.com/misc/Embratel.txt
CONTACT: Embratel Participacoes S.A.
Silvia M.R. Pereira, (55 21) 2121-9662
Fax: (55 21) 2121-6388
E-mail: silvia.pereira@embratel.com.br
or
invest@embratel.com.br
TUPY: Seeks Capacity Expansion Capital
--------------------------------------
The marketing head of Brazilian foundry Tupy said the company is
negotiating with possible partners interested in bringing
capital and machinery for its production capacity expansion
plans, reveals BNamericas.
According to Tupy marketing head Fernando Cestari de Rizzo, the
conditions imposed by a debt restructuring deal has limited the
growth of its output despite the foundry's operation at full
capacity. As part of its efforts to restructure some BRL710
million in debt, Tupy has issued in April BRL560 million
(US$189mn) in convertible debentures with an eight-year
maturity.
Based in Joinville, Santa Catarina state, Tupy is Brazil's
largest foundry and has local pension fund managers Previ (35%)
and Telos (22.6%) as major shareholders.
USIMINAS: Expected To Post Solid 1Q04 Profit, Sales
---------------------------------------------------
Analysts surveyed by Dow Jones Newswires said that with steady
sales volumes and a double-digit domestic price increase in
January, they expect Brazilian flat-steel maker Usinas
Siderurgicas de Minas Gerais SA (Usiminas) to report today solid
results for the first-quarter of 2004.
Usiminas is seen to report consolidated net revenue of BRL2.52
billion ($1=BRL2.9). Earnings before interest, taxes,
depreciation and amortization, or EBITDA, should rise to BRL891
million, while net profit is expected to come in between about
BRL320 million and BRL390 million.
The analsysts said that due in part to an average 12% increase
in domestic prices for Usiminas steel products in January, its
net revenue should come in above last quarter's BRL2.44 billion
total, with the help of spiked international steel prices and
increased exports.
Net profit, meanwhile, is seen coming in slightly better than
profits of BRL359 million in the fourth quarter and BRL356
million in the first quarter last year.
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C H I L E
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TELEFONICA CTC: Shares Jump on New Tariff Bets
----------------------------------------------
With investors betting that the government will soften a
regulatory blow to Telefonica CTC Chile SA (CTC) with the
announcement of new telephone tariffs today, the shares of the
country's largest telecommunications company soared Tuesday,
according to Dow Jones.
CTC, a unit of Spain's Telefonica SA (TEF), saw its `A' shares
rise 3.7% to CLP1900.00 ($1=CLP622.70), making it the top-
performing blue chip on Santiago's stock exchange Tuesday. Its
American Depositary Receipts in New York, meanwhile, jumped 3.1%
to US$12.01 on Tuesday - the first time they ended above US$12
since April 19, but still down 20% from the end of December.
Government regulator Subtel sets fees for the country's 16
active carriers every five years. CTC had wanted to raise end-
customer fees 60% and to more than triple interconnection fees
in its grid, and much of the market thought the government would
agree. But in a preliminary report it issued two months ago,
Subtel sought a 23% cut in fixed-line tariffs, hitting 46% of
CTC's sales and 50% of earnings before interest, taxes,
depreciation, and amortization.
The decision, which sparked a 15% sell-off in CTC's `A' shares,
resulted in the temporary suspension of CTC shares from trading,
and the downgrading of its stock by several analysts. However,
traders said the market was confident Tuesday that Subtel will
make modifications to its preliminary report to move it closer
to an arbitration committee's recently-issued recommendations.
=============
E C U A D O R
=============
PETROECUADOR: New Leader Reveals Plans
--------------------------------------
The new man at the helm of Ecuador's state oil company
Petroecuador has laid out his plans for increasing the company's
oil output, says BNamericas, citing local press reports.
According to the reports, one of the first official actions by
Luis Eduardo Camacho Barrios, the 15th executive president in
Petroecuador's 14-year history, was to meet with the presidents
of Petroecuador subsidiaries Petroproduccion, Petroindustrial
and Petrocomercial to discuss his plans.
Among Mr. Camacho's immediate plans, the reports say, to up the
company's production are the drilling of 14 new wells and the
reconditioning of 100 more. These actions are aimed at raising
average production from 199,000 barrels a day (b/d) as of April
30 to 205,000 b/d by the end of the year. The reports also said
that Petroecuador's upstream unit, Petroproduccion, could also
have its US$140mn budget increased.
Camacho, who has a masters degree in oil engineering from the
University of Austin, said that he would take his work
experience at Brazil's federal energy company Petrobras into
consideration in turning state companies like Petroecuador into
efficient businesses. This could mean that the oil company would
be opened up to wider private participation, speculated the
Ecuadorian press.
Aside from Petrobras, Mr. Camacho has also worked in varying
capacities for Texaco, Maxus, Petroproducci¢n and Perez Companc.
A 27-year oil industry veteran, he replaced Pedro Espin as
Petroecuador head.
===============
H O N D U R A S
===============
*HONDURAS: WB Approves $15M Credit For Community Projects
---------------------------------------------------------
The World Bank approved Tuesday a $15 million credit to the
government of Honduras to support community development projects
to benefit indigenous and African-descendents.
The Nuestras Raices, or "our roots", program serves the
country's nine ethnic groups, whose total population of
approximately 440,000 includes Honduras' poorest citizens. The
Bank has supported Nuestras Raices since 1997, two years after
the government initiated the program, under implementation by
the Honduran Social Investment Fund (FHIS).
"Nuestras Raices offers the most vulnerable Hondurans the tools
needed to build better lives," said Jane Armitage, the World
Bank's Country Director for Central America.
Of the funds made available by the credit, some $13.3 million
will finance goods, materials and labor for 600-700 community-
executed projects over a period of three years. Recent community
projects have included health projects, housing rehabilitation,
and construction of water systems.
The key to Nuestras Raices is the community planning process. In
its new phase, the program will assign facilitators to help the
2,000 indigenous and afro-Honduran communities assess their
needs and to design strategic community development plans,
including prioritized small-scale projects. Elements of these
plans will become part of national and municipal development
strategies.
"The program has been characterized by a highly participatory
approach," said Andrea Vermehren, Sr. Social Protection
Specialist for the World Bank and Project Manager for Nuestros
Raices, "with decisions on all aspects made jointly among
representatives of the nine ethnic groups, the Honduran
government, and the Bank."
The US$15 million, multi-currency International Development
Association (IDA) credit has 40 years to maturity, including a
10-year grace period. The total cost of the project is US$16.7
million.
CONTACTS: In Washington
Lee Morrison (202) 458-8741
E-mail: Lmorrison1@worldbank.org
In Tegucigalpa
Maria Amalia San Martin (504) 239-4551
E-mail: Msanmartin@worldbank.org
===========
M E X I C O
===========
CORPORACION DURANGO: Reports Lower EBITDA in 1Q04
-------------------------------------------------
Corporacion Durango, S.A. de C.V., (NYSE: CDG, BMV: CODUSA)
("Durango" or the "Company"), the largest integrated paper
producer in Mexico, announced its unaudited consolidated results
for the 1Q 2004. All figures were prepared in accordance with
Mexican generally accepted accounting principles and are stated
in constant Mexican pesos as of the end of each period and
converted into U.S. dollars using the exchange rate at the end
of each period. All comparative figures for the first quarter
2004 and 2003 were prepared on a pro-forma basis after excluding
the results of the Pronal and Molded Pulp operations as well as
discontinued operations.
H I G H L I G H T S
- Financial Restructuring Agreement In Principle Reached
- Terms of Financial Restructuring Announced Today
- Strong shipments growth of 9% vs 1Q 2003
- Pricing still 4% below 1Q 2003
- Net sales growth of 5% for the first time in three years
- Substantial cost increases of raw material and energy offset
through improved and rationalized manufacturing operations
- Unit cost 1% below 1Q 2003, one of the lowest in the industry
- EBITDA only US$ 0.6 million below the same quarter of last
year
- EBITDA margin of 10%, today one of the best in our industry
INDUSTRY OUTLOOK
After several years of restructuring, the paper industry today
shows sound fundamentals. For the long term, on the supply side,
the capacity outlook remains the best in 30 years and new supply
growth is likely to be well below historical average levels for
the coming years. Most analysts agree that the worst is over,
total paper demand will continue to grow and the industry will
enter into a long lasting and profitable cycle.
With customer and mill inventories at low levels, destocking
completed, relatively little new global capacity on stream
(mostly in China), and a 5% reduction in global capacity, any
pickup in demand should lead to a rapid restocking and pricing
recovery. On the cost side, growing fiber and energy costs
remain a key concern for the industry.
Tighter markets and the weak dollar should fuel a strong
recovery in U.S. industry profitability. However, due to the
strength of their currencies against U.S. dollar, the recovery
for the paper industry in Europe, Canada and Mexico is expected
to be quite modest in 2004.
PERFORMANCE
Although the North American paper industry is showing signs of
cyclical recovery, most major companies continued to report
losses in their primary paper operations for the first quarter
of 2004 and overall earnings were lackluster.
The Company's results for the first quarter 2004 have been
affected by the delay of the implementation of price increases
and the continued higher raw material and energy costs, coupled
with a slower economic growth and weaker demand in Mexico than
in the US.
Item 1Q04 1Q03 VAR EBITDA
EFFECT*
Total Shipments('000 Short Tons) 316.9 291.9 9% +2.9
Pricing (US$/Short Ton) 485 503 -4% -6.1
Net Sales (US$Million) 153.8 146.9 5% +1.5
Unit Cost (US$/Short Ton) 436 440 -1% +1.1
EBITDA (US$Million) 14.7 15.3 -4% -0.6
EBITDA Margin 10% 10% - -
*US$Million
"It is important to note the 9% shipments growth achieved this
quarter in spite of a still weak and very competitive market
environment, as well as the substantial achievement of
improvement in the company's manufacturing operations during
this quarter, which allowed it to offset more than US$5.0
million of increased cost in energy and raw material to deliver
a unit cost slightly below that of the same quarter of the last
year. The average unit cost of US$436 per short ton for our mix
of products: containerboard-packaging, newsprint and uncoated
free sheet grades confirms Durango's position among the lowest
cost producers in the industry", said Miguel Rincon, Durango
CEO.
Commenting on the outlook for the second quarter, Rincon said:
"We are seeing a modest recovery of demand for our products and
average price realizations in the second quarter. This upturn,
combined with our continued focus on cost control, should
position us to deliver a stronger second quarter. We believe
that most of the benefits from higher prices and increased
volumes will be realized through the second half of this year".
FINANCIAL RESTRUCTURING
Miguel Rincon, Chairman of Corporacion Durango, commented:
'After the Company announced that it had reached an agreement in
principle with its bank lenders and members of the Ad Hoc
Bondholders Committee, who collectively hold a substantial
portion of its outstanding unsecured indebtedness, Durango is
pleased to announce at this time the principal terms of our
agreement in principle. As we stated earlier, this consensual
agreement with our creditors represents an important milestone
in our proposed financial restructuring. We expect that the
proposed recapitalization plan will result in a more adequate
and competitive capital structure for Durango and substantially
enhance the financial flexibility of the company and its
operating subsidiaries. If the restructuring is completed as
planed, Durango will have one of the lowest costs of capital of
the industry with an average cash interest rate of 4.5%
annually, which, combined with lower debt, will result in
lowering our financial cost by approximately 2/3. The company
will have the opportunity to continue reducing debt through the
prepayment of portions of its debt at a 50% discount over the
next 7 years. Additionally, if the restructuring is completed as
planned, the Company's debt maturity profile will be extended
thru the year 2013. As a result of this restructuring, the
Company will have not only a competitive cost production
structure but also a competitive cost of capital, which, coupled
with its market leadership, will position the Company to benefit
all of our stakeholders. We wish to thank our creditors for
their unwavering support and look forward to a swift conclusion
to this transaction".
HIGHLIGHTS FOR THE FIRST QUARTER 2004
Shipments(000 Short tons) 1Q04 1Q03
Paper 151.1 134.7
Packaging 162.8 154.0
Other 3.0 3.2
Total 316.9 291.9
Net Sales (US$ Million) 1Q04 1Q03
Paper 65.1 58.8
Packaging 86.6 85.9
Other 2.1 2.2
Total 153.8 146.9
Prices (US$/Short Ton) 1Q04 1Q03
Paper 431 437
Packaging 532 558
Other 703 691
Total 485 503
Unit Cost (US$/ Short Ton) 1Q04 1Q03
Total 436 440
EBITDA(US$ Million) 1Q04 Margin 1Q03 Margin
Paper 2.44 %3.66%
Packaging 12.0 14% 11.6 13%
Other 0.31 5% 0.2 7%
Total 14.7 10% 15.3 10%
To see financial statements:
http://bankrupt.com/misc/CORPORACION_DURANGO.htm
CONTACTS: CORPORACION DURANGO, S.A. DE C.V.
Mayela R. Velasco
Tel: +52 (618) 829 1008
E-mail: mrinconv@corpdgo.com.mx
Miguel Antonio R.
Tel: +52 (618) 829 1070
E-mail: rinconma@corpdgo.com.mx
THE GLOBAL CONSULTING GROUP
Isabel Vieira
Tel: (646) 284-9400
E-mail: ivieira@hfgcg.com
CYDSA: Plant Shuts Down
-----------------------
Due to its decision to pull out of non-strategic businesses in
order to improve its financial standing, Grupo Celulosa y
Derivados (Cydsa) of Mexico said in a statement Monday it is
shutting down its San Marcos plant in the city of
Aguascalientes, local newspaper Notimex reports.
Cydsa, maker of yarn and air-conditioner refrigerants, also
cited in its statement the plant's absence of a positive cash
flow and lack of competitiveness despite investments in new
technology and products as reasons for the closure.
Despite its problems, Cydsa managed to improve its net losses
for 1Q04. For the period, the company reported a net losses
MXN16 million (US$1.4 million) compared to the 146 million pesos
(US$12.8 million) it lost for the same period last year. Its
total sales of MXN1.67 billion (US$146 million) was also an
improvement from last year.
CYDSA is still negotiating with holders of US$159 million of
Euro-Medium-Term-Notes (EMTN's). The firm and its subsidiaries
have signed in March an agreement with creditor banks extending
principal payments on US$192.6 million of the Company's debt.
The agreement establishes escalating principal amortizations
beginning on March 31, 2004, and ending in 2011.
GRUPO MEXICO: Unit Prepays 2007 Debt
------------------------------------
In a filing with the Mexican Stock Exchange Tuesday, Mexican
copper producer Grupo Mexico SA (GMEXICO.MX) said its unit
Minera Mexico has shelled out US$106 million dollars as
prepayment for a debt due in 2007, Dow Jones relates. The
payment, according to Grupo Mexico, has lowered the unit's
restructured debt due 2007 by 11% to US$773 million.
"The prepayment is the result of the good operating performance
of Minera Mexico, the continuing reduction in its costs and
better copper prices," Grupo Mexico said.
Grupo Mexico, the world's third largest copper producer with
operations in Mexico, Peru and the U.S., has raised by 20% its
copper production for the first quarter of 2004. Prices for
copper also rose to 123 cents a pound, compared to 76 cents a
pound for the same period last year.
===========
P A N A M A
===========
BLADEX: Net Income Increases; Debt Exposure Improves
----------------------------------------------------
1Q04 Financial Highlights
* Net Income was US$29.8 million in the 1Q04, compared to
US$16.2 million for the 4Q03, and US$10.4 million for the 1Q03
*Exposure in Argentina (net of allowance for credit losses and
impairment loss) is US$222 million, down 45% from a year ago,
and down 7% from last quarter
Banco Latinoamericano de Exportaciones, S.A. (NYSE: BLX)
("BLADEX" or "the Bank") announced Tuesday its results for the
first quarter ended March 31, 2004. (The Bank's financial
statements are prepared in accordance with U.S. GAAP, and all
figures are stated in U.S. dollars.)
The Bank reported net income of US$29.8 million for the first
quarter of 2004, or US$0.76 per share, compared to net income of
US$16.2 million, or US$0.41 per share, in the previous quarter,
and net income of US$10.4 million, or US$0.58 per share, in the
first quarter of 2003.
Net income for the first quarter of 2004 reflected the effect of
US$36 million in partial payments and prepayments of Argentine
restructured loans, which contributed to the reversals of the
allowance for credit losses in the amount of US$19 million out
of a total of US$21.4 million.
Key Figures 1Q03 4Q03 1Q04
Net Income (In US$ million) $10.4 $16.2 $29.8
EPS* $0.58 $0.41 $0.76
Return on Average Equity 12.1% 11.2% 20.2%
Tier 1 Capital Ratio 18.2% 35.4% 37.9%
Net interest margin 1.73% 2.07% 1.69%
*Earnings per share calculations are based on the average number
of shares outstanding during each period. During the first
quarter of 2004 the average number of common shares was 39.4
million, compared to 39.3 million in the fourth quarter of 2003,
and 17.3 million during the first quarter of 2003.
Comments from the Chief Executive Officer
Jaime Rivera, Chief Executive Officer of BLADEX, stated, "With
the turnaround of the Bank now complete, the overall framework
of our operations is being defined by significantly improved
prospects for economic growth in the Region, continued progress
on our plan to strengthen and broaden the scope of our business
model and, generally, a stable or improved risk profile in our
portfolio. Within this context, the first quarter's financial
results were driven by three factors: first, strong principal
repayments in Argentina; second, a market temporarily flushed
with liquidity, resulting in declining interest rates and
pressure on lending margins, and third, continued progress on
improving our efficiency levels.
"The strong performance of our portfolio in Argentina was
related to generally increasing levels of liquidity in the local
market, and to record high commodity (export) prices. I'm
pleased to report that we collected US$36 million in principal
repayments during the period, bringing our total net exposure to
US$222 million, 7% lower than at year-end 2003.
"Regarding the pressure on margins that we saw during the
quarter, we have taken the position that, given the improved
economic growth prospects in the Region, this trend is likely to
reverse itself as credit demand strengthens. As a result, we
elected to slow down our lending in order to preserve lending
capacity within our credit limits and have it available once
pricing terms improve in our favor.
"The approximate 5 basis point decrease in short-term LIBOR
interest rates over the quarter hurt us because, with our assets
re-pricing faster than our liabilities, our balance sheet is
positioned to take advantage of interest rate increases. We
maintain our view that interest rates are heading for an
increase, however, and currently expect to keep our maturity
profile unchanged. All other things being equal, we estimate
that a 25 basis points increase in the general level of interest
rates would result in a US$2.1 million additional net interest
income through year-end.
"The most exciting developments during the quarter took place
outside the scope of the financial statements, however. With the
arrival of Mr. Rubens Amaral to head our commercial operations
out of our New York Agency, we put in place the last of the
missing pieces needed to put the transformation of the Bank into
high gear. We are taking steps to optimize our client coverage
model, changing the segmentation of our client base to allow for
more effective cross selling tactics identifying and pursuing
new product opportunities, optimizing the structure of our sales
force, and incorporating the feedback developed during our brand
and perception study into our plans. Most importantly, we have
been very successful in attracting top caliber people to our
team.
"I'm pleased to report that at our Annual Shareholders' Meeting,
we received approval by practically 100% of the votes cast on
all items submitted to shareholders. Furthermore, we are seeing
greater interest from the market in our company, evidenced by a
greater flow of our information, broader analyst coverage, and
an overall higher level of Investor Relations activity.
"Lastly, we continue studying the capital management question
closely, aiming to arrive at a solution that will make the most
sense in view of risk levels, growth opportunities, and our
shareholders' best interests. Assuming a stable scenario, it is
the Bank's intention to take additional action on the capital
management front during 2004."
ABOUT BLADEX
BLADEX is a multinational Bank originally established by the
Central Banks of Latin American and Caribbean countries to
promote trade finance in the Region. Based in Panama, its
shareholders include central and commercial banks in 23
countries of the Region, as well as international banks and
private investors. Through March 31, 2004, over its 25 years of
operations, BLADEX had disbursed accumulated credits of over
US$125 billion in the Region.
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-
Investor relations firm
i-advize Corporate Communications, Inc.
Melanie Carpenter / Peter Majeski
Tel: (212) 406-3690, e-mail: bladex@i-advize.com
=================
V E N E Z U E L A
=================
EDC: Posts 1Q04 Loss
--------------------
Blaming higher fuel prices and the devaluation of the local
Bolivar currency, Venezuelan private energy generator
Electricidad de Caracas (EDC) said Tuesday it posted a first-
quarter loss of VEB79.3 billion, more than 50% higher than the
VEB31.1 billion loss it registered for the same period last
year.
"The losses recorded in the quarter are a consequence of the 20%
devaluation of the bolivar and an increase in fuel prices of
39.7%," EDC president Andres Gluski said.
The first quarter loss reported by EDC, an affiliate of U.S.
power firm AES Corp, surpassed the company's VEB77.8 billion
full-year net income for 2003. The company's first-quarter
earnings before interest, taxes, depreciation and amortization
(EBITDA) fell from VEB160.3 billion last year to VEB135.8
billion in 1Q04, while its quarterly operating revenue also
registered a dip to VEB263.2 billion from VEB265.5 billion a
year earlier.
Despite the loss, EDC managed to trim down its debt in the first
quarter to US$651 million, a 12.4 percent reduction from the
same period in 2003.
PDVSA: Sidor Strike Creates Turmoil
-----------------------------------
Venezeulas state-run oil company Petroleos de Venezuela is
beginning to feel the impact of the strike currently paralyzing
operations at the country's steel producer Siderurgica del
Orinoco (Sidor), says BNamericas.
PDVSA, which relies on Sidor for rolled steel used in tubing for
drilling and gas and oil transport, is affected by Sidor's
failure to deliver one-third of its shipments scheduled for
April. Deliveries were suspended at Sidor last week after
striking workers blocked entrances to the company's plant and
prevented non-striking workers from getting back to their jobs.
Sidor president Javier Pe¤a said Sidor's monthly sales to PDVSA
fluctuate between 40,000t and 50,000t.
SIDOR: Strikers Dispersed; Deliveries Resume
--------------------------------------------
Striking workers of Venezuelan steel producer Siderurgica del
Orinoco (Sidor) who have prevented non-striking employees from
entering the plant have been dispersed by National Guard troops,
paving the way for the partial resumption of operations,
according to the Associated Press.
A Sidor representative said the presence of roughly 100 troops
around its installations have allowed some workers to return to
their jobs. Production remains suspended, but the representative
said the company has resumed its deliveries.
However, leaders of the strike launched on April 22 remain
unfazed by the dispersal, saying they would go on with their
action unless their demands for back pay and 20% ownership of
company stock are met.
The strike, which has cost Sidor about US$3 million a day, will
certainly put a dent in the company's annual exports of
approximately 2.1 million metric tons of steel to dozens of
countries, including the United States, Mexico, China and
neighboring Colombia.
***********
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
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Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
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Copyright 2004. All rights reserved. ISSN 1529-2746.
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