---

        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, July 27, 2005, Vol. 6, Issue 147

                            Headlines

A R G E N T I N A

BANCO HIPOTECARIO: BNL Deal Seen Unlikely on Unipol's Offer
CAPEX: S&P Assigns `B-' Rating to Debt
D.K.L. HUECO: Judge Issues Bankruptcy Ruling
DURANCO S.A.: Court Declares Company Bankrupt
EDENOR: Regulators Delay Any Public Offer by Employees

GRASI S.R.L.: Bankruptcy Process Begins by Court Order
JACC IMPRESORES: Individual Reports Due in September
REDES EXCON: Gets Green Signal To Proceed With Reorganization


B E R M U D A

LOM HOLDINGS: Buys Back Own Shares
LORAL SPACE: Court Confirms Chapter 11 Reorganization Plan


B R A Z I L

BANCO BMG: Ratings Unaffected by Political Crisis in Brazil
BANCO BRADESCO: Central Bank OKs Conversion of Stocks
COPEL: Adjusts Electricity Supply Tariffs
COPEL: Date of General Meeting Set to Analyze Tariff Adjustment
TCP: Customer Base Grows 22.3% Over 2Q04

VARIG: TAP to Present New Bid in September


C O L O M B I A

GRANAHORRAR: Fogafin Recovers $385M in Investments


H O N D U R A S

MILLICOM INTERNATIONAL: Reports 21% Boost in Revenues for 2Q05


M E X I C O

BALLY TOTAL: Reiterates Unanimous Support for CEO Paul Toback
CINTRA: Potential Buyers Gain More Time to Express Interest
CORPORACION GEO: Reports 2Q05 Net Profit of MXN227.8M
GRUPO DESC: Net Debt Decreases by 22.2% to $570M in 2Q05
GRUPO DESC: Completes Bond Exchange

GRUPO ELEKTRA: Up EBITDA by 17% to Ps.1.1 Bln in 2Q05
GRUPO MEXICO: Consolidated Sales Reaches $1,303.5M in 2Q05
GRUPO MEXICO: Asarco Mgt. Meets With Workers to Settle Conflict
GRUPO SIMEC: Acquires 100% of Republic Stock With Industrias CH
HYLSAMEX: Reports Net Financial Gain of $0.5M in 2Q05

MAXCOM TELECOMUNICACIONES: Deploys Sylantro-Based Applications
VITRO: Continues to See Upturn in Sales in 2Q05


U R U G U A Y

ANCAP: To Sign MOU With Brazil's Petrobras Next Month

     -  -  -  -  -  -  -  -

=================
A R G E N T I N A
=================

BANCO HIPOTECARIO: BNL Deal Seen Unlikely on Unipol's Offer
-----------------------------------------------------------
The possibility of Argentine bank Banco Hipotecario acquiring
the local assets of Italian Banca Nazionale del Lavoro (BNL) is
getting tougher, according to Business News Americas.

On Friday, Italian insurer Unipol made a US$5.9 billion offer to
buy BNL. But Hipotecario assured that negotiations with BNL were
still alive even after Unipol made its offer.

Hipotecario announced in February that it would be acquiring
100% of BNL Inversiones Argentinas S.A. for US$207 million. In
exchange, BNL will acquire 3.7% of Hipotecario's shares with a
book value of US$25 million.

However, the government, which holds a 53.9% stake in
Hipotecario, has repeatedly delayed the acquisitions because of
business plan and management disagreements.

Local financial group IRSA, which holds a minority post in
Hipotecario, has been pushing hard for the deal's approval but
its conflict with the economy ministry has held back the close
of the deal.

BNL has reportedly begun looking for new buyers such as Banco
Comafi, Swiss Medical Group and the local Macri magnate.

CONTACT: Banco Hipotecario S.A.
         151 Reconquista
         Buenos Aires
         Argentina
         Phone: +54 11 4347 5546
         Web site: http://www.hipotecario.com.ar


CAPEX: S&P Assigns `B-' Rating to Debt
--------------------------------------
Standard & Poor's Ratings Services said Monday that it assigned
its 'B-' rating to Argentine power generator CAPEX S.A.'s (D/--
/--) up to about US$18.1 million listed floating step-up rate
secured notes (Series I), up to US$33.6 million listed fixed
step-up rate secured notes (Series II), and US$27.2 million
floating step-up rate secured notes (Series V).

The debt is being issued as part of the company's debt
restructuring process.

All the notes are due on quarterly basis starting in September
2007 with final maturity in 2014. The corporate credit rating on
CAPEX will remain at 'D' until the debt restructuring is
formally concluded, when it will be raised to 'B-' with a stable
outlook.

"We expect that CAPEX will generate excess cash flow during the
next three years that will be partly applied to reduce its
outstanding debt, resulting in better debt service coverage
ratios," said Standard & Poor's credit analyst Sergio Fuentes.

This scenario assumes a relatively stable foreign exchange rate
and some recovery of electricity prices in the spot market in
U.S. dollar terms.

The ratings on CAPEX reflect the company's weak business and
financial profile, which derive from the high political and
regulatory risk in Argentina and also from the company's
relatively high foreign exchange risk and limited financial
flexibility.

The ratings also incorporate CAPEX's low-cost position for
electricity generation in Argentina and a favorable debt
maturity schedule after the completion of its debt restructuring
process.

Primary Credit Analyst: Sergio Fuentes, Buenos Aires (54) 114-
891-2131; sergio_fuentes@standardandpoors.com

Secondary Credit Analyst: Mariano Ingaramo, Buenos Aires (54)
114-891-2124; mariano_ingaramo@standardandpoors.com


D.K.L. HUECO: Judge Issues Bankruptcy Ruling
--------------------------------------------
D.K.L. Hueco Offset S.A. was declared bankrupt after Court No. 3
of Buenos Aires' civil and commercial tribunal endorsed the
petition of Brillapel S.A. for the Company's liquidation.
Argentine daily La Nacion reports that D.K.L. Hueco Offset S.A.
has claims totaling US$4,756.41 against Brillapel S.A.

The court assigned Ernesto Higueras to supervise the liquidation
process as trustee. Mr. Higueras will validate creditors' proofs
of claim until Sep. 28, 2005.

The city's Clerk No. 6 assists the court in resolving this case.

CONTACT: D.K.L. Hueco Offset S.A.
         Ponsomby 966
         Buenos Aires

         Mr. Ernesto Higueras, Trustee
         Sanchez de Loria 1944


DURANCO S.A.: Court Declares Company Bankrupt
---------------------------------------------
Court No. 4 of Buenos Aires' civil and commercial tribunal
declared local construction company Duranco S.A. "Quiebra",
relates La Nacion. The court approved the bankruptcy petition
filed by Gustavo Alvarez, whom the Company has debts amounting
to $22,301.49.

The Company will undergo the bankruptcy process with Maria Orazi
as trustee. Creditors are required to present proofs of their
claim to Ms. Orazi  for verification before Sep. 19, 2005.
Creditors who fail to submit the required documents by the said
date will not qualify for any post-liquidation distributions.

Clerk No. 8 assists the court on the case.

CONTACT: Duranco S.A.
         Conde 908
         Buenos Aires

         Ms. Maria Orazi, Trustee
         Tucuman 1484
         Buenos Aires


EDENOR: Regulators Delay Any Public Offer by Employees
------------------------------------------------------
The employee ownership program holding a 10% stake in Argentine
power distributor Edenor SA won't be able to offer their shares
to the public until mid-October, Dow Jones Newswires reports,
citing Edenor's new majority shareholder.

Pending approval from the French and Argentine authorities,
local investment fund Grupo Dolphin has agreed to buy French
power company EdF's 65% interest in Edenor in a deal worth some
US$100 million. If the deal goes through, EdF's 90% stake in
Edenor will be reduced to 25%.

Under local securities regulations, Grupo Dolphin, as the new
majority shareholder, is required to extend to the remaining
shareholders the same terms it agreed upon with EdF. This means
Dolphin would offer the employees US$15.4 million for their 10%
stake.

However, employees are also allowed to hold a public offer of
their shares. Securities regulators, at Dolphin's request, have
postponed such an offer for 90 days starting July 14.

Dolphin is reportedly having a hard time convincing the
employees to accept its offer.

Edenor, which distributes electricity to parts of the capital
and the greater Buenos Aires region, posted net losses of
ARS89.9 million (US$30.8mn) in 2004. The Company has been
negatively affected by the devaluation of the peso in early 2002
and subsequent rates freeze. As of December 31, 2004, Edenor had
ARS1.53 billion of net equity.

CONTACT:  EDENOR S.A.
          Azopardo Building
          Azopardo 1025 (1107) Capital Federal
          Phone: (54-11) 4346-5000
          Fax: (54-11) 4346-5300
          E-mail: to ofitel@edenor.com.ar
          Web Site: http://www.edenor.com.ar


GRASI S.R.L.: Bankruptcy Process Begins by Court Order
------------------------------------------------------
Cordoba's civil and commercial Court No. 39 declared Grasi
S.R.L. "Quiebra," reports Infobae. The declaration signals the
Company to proceed with the bankruptcy process, which will close
with the liquidation of its assets.

The court appointed Mr. Marcelo Oscar Masciotta, as receiver who
will authenticate proofs of claim until Aug. 8, 2005.
Afterwards, the receiver will prepare the individual reports
based on the results of the authentication and then submit these
reports to court on Sep. 20, 2005. After these results are
processed in court, the receiver will then submit the general
report on Nov. 2, 2005.

CONTACT: Grasi S.R.L.
         Mendoza 2160
         Ciudad de Cordoba (Cordoba)

         Mr. Marcelo Oscar Masciotta
         9 de Julio 183
         Ciudad de Cordoba (Cordoba)


JACC IMPRESORES: Individual Reports Due in September
----------------------------------------------------
Mr. Ricardo Alberto Perelmiter, who has been appointed as
receiver for the Jacc Impresores S.A. bankruptcy case will
submit individual reports on Sep. 16, 2005, reports Infobae.
These reports will be based on the results of the verification
process, which will end today, July 27, 2005.

The trustee is also required by the court to submit a general
report on Oct. 28, 2005.

San Martin's civil and commercial Court No. 5 declared Jacc
Impresores S.A. "Quiebra" after the Company failed to pay its
debts. The case will close with the liquidation of the Company's
assets to repay creditors.


CONTACT: Jacc Impresores S.A.
         Fernandez D Oliveira 4063
         Caseros (Partido de 3 de Febrero)

         Mr. Ricardo Alberto Perelmiter, Trustee
         Calle 95 (Caseros) 2191
         Partido de General San Martin


REDES EXCON: Gets Green Signal To Proceed With Reorganization
-------------------------------------------------------------
Buenos Aires' civil and commercial Court No. 3 approved the
"Concurso Preventivo" petition filed by Redes Excon S.A.,
reports local news source La Nacion.

The Company, which listed assets of $8,230,353.04 and
liabilities of $8,502,730.13, will undergo a reorganization
process, with Estudio Castro as trustee.

The court-appointed receiver will verify creditors' proofs of
claim until Sep. 29, 2005. Verifications are done to ascertain
the nature and amount of the Company's debts. The receiver will
also prepare the individual and general reports on the case.

The date for the informative assembly is yet to be disclosed.

Clerk No. 6 assists the court on the case.

CONTACT: Redes Excon S.A.
         Montevideo 251
         Buenos Aires

         Estudio Castro, Trustee
         Danovara y Asociados
         Salguero 2533
         Buenos Aires



=============
B E R M U D A
=============

LOM HOLDINGS: Buys Back Own Shares
----------------------------------
LOM (Holdings) Limited (LOM) informed the Bermuda Stock Exchange
(BSX) that the Company repurchased 12,200 of its own shares on
15th July 2005 at a price of $3.00 per share for cancellation.

CONTACT:  LOM Group
          The LOM Building
          27 Reid Street
          Hamilton HM 11
          Bermuda

          Tel: 441 292 5000
          Fax: 441 295 3343
          E-mail: info@lom.com

          LOM Asset Management Limited
          Tel: 441 296 5802
          Fax: 441 296 5597
          E-mail: lomam@lom.com

          LOM Securities (Bahamas) Limited
          Millennium House
          P.O. F42498-350
          Freeport, Grand Bahama
          Bahamas

          Tel: 242 351 5000
          Fax: 242 351 7738
          E-mail: info.bahamas@lom.com


LORAL SPACE: Court Confirms Chapter 11 Reorganization Plan
-----------------------------------------------------------
Loral Space & Communications Ltd. (OTC Bulletin Board: LRLSQ -
News) announced Monday that the U.S. Bankruptcy Court for the
Southern District of New York has confirmed Loral's Plan of
Reorganization, paving the way for the company to conclude its
chapter 11 reorganization.

Loral currently expects that, after it satisfies customary
regulatory and certain other conditions, including obtaining
FCC approval, its Plan of Reorganization will become effective
and the company will emerge from chapter 11 early in the
fourth quarter of 2005.

Bernard L. Schwartz, chairman and chief executive officer,
said: "We are grateful for the support of our employees,
customers, suppliers and business partners during the
reorganization process. Thanks to their loyalty, Loral has
managed over the past two years not only to maintain but to
strengthen its critical skills, trim costs significantly and
win new contracts and customers despite the challenges
inherent in the chapter 11 reorganization process.

He continued, "The approved plan enables us to harness the
positive momentum we've built and capitalize on an improving
industry environment. Coming out of chapter 11, we will have a
strengthened balance sheet, little debt, an experienced
management team and two core businesses that are technology
and service leaders in their respective segments -- all the
ingredients needed to build on Loral's recent successes."

Loral did not require any debtor-in-possession (DIP) financing
during the reorganization period. In addition, the company
continued to fund all of its pension obligations on a regular
basis.

At the confirmation hearing in New York that concluded today,
the Court ruled that Loral had met the statutory requirements
to confirm the plan. The plan provides, among other things,
that:

* Loral will emerge as a public company under its current
management and will seek to be listed on NASDAQ.

* Loral's two businesses, satellite manufacturing (Space
Systems/Loral) and satellite services (Loral Skynet), will
emerge intact as separate subsidiaries of reorganized Loral
Space & Communications.

- Space Systems/Loral, which will emerge debt-free, has
received orders for nine satellites from seven customers
during the reorganization period - a 33 percent share of the
number of contracts awarded worldwide and a 40 percent share
of the estimated total dollar value of those contracts, an
impressive growth of market share for commercial satellites.
The company has delivered and launched nine satellites over
the past 24 months.

- Loral Skynet expanded its FSS capacity in the high growth
Asian and Latin American markets and introduced its SkyReach
IP-based communications service during the reorganization. In
addition, XTAR - a joint venture between Loral and Hisdesat -
commenced service earlier this year. XTAR provides previously
unavailable commercial X-band service to the U.S. and allied
governments.

* The general unsecured creditors, including the trade
creditors, of SS/L and Loral SpaceCom will be paid in full in
cash, plus interest from the petition date.

* Loral Orion unsecured creditors will receive approximately
77 percent of new Loral common stock and their pro rata share
of $200 million of preferred stock to be issued by Loral
Skynet.

- These creditors have also been offered the right to
subscribe to purchase their pro-rata share of $120 million in
new senior secured notes to be issued by Loral Skynet. This
rights offering, which expires July 29, 2005, will be
underwritten by certain Loral Orion creditors who will receive
a fee which is payable in additional Loral Skynet notes.

* Loral bondholders and certain other unsecured creditors
will receive approximately 23 percent of the common stock in
reorganized Loral.

* Loral's existing common and preferred stock will be
cancelled and no distribution will be made to the holders of
such stock.

Copies of Loral's Plan of Reorganization, as confirmed, and
Disclosure Statement are available on the Loral website. The
documents also are available via the court's website, at
http://www.nysb.uscourts.gov.Please note that a PACER
password is required to access documents on the Bankruptcy
Court's website. Loral's bankruptcy case number is 03-41710
(RDD).

Loral Space & Communications is a satellite communications
company. It owns and operates a fleet of telecommunications
satellites used to broadcast video entertainment programming,
distribute broadband data, and provide access to Internet
services and other value-added communications services. Loral
also is a world-class leader in the design and manufacture of
satellites and satellite systems for commercial and government
applications including direct-to-home television, broadband
communications, wireless telephony, weather monitoring and air
traffic management.

CONTACT: Loral Space & Communications Ltd.
         600 Third Avenue
         New York, NY 10016
         USA
         URL: http://www.loral.com
         Phone: 212-697-1105



===========
B R A Z I L
===========

BANCO BMG: Ratings Unaffected by Political Crisis in Brazil
-----------------------------------------------------------
Standard & Poor's Ratings Services said Monday that the
counterparty credit ratings on Banco BMG S.A. (foreign and local
currency, BB-/Stable/B) are not affected by the recent
developments in the political crisis in Brazil.

The Congressional Investigative Commission (CPI) is
investigating alleged improper fundraising by political parties
in Brazil. As a result of the CPI investigations and the
attendant media coverage, some banks and companies in Brazil
have been in the spotlight. Banco BMG is mentioned as the lender
of a BrR2.4 million (approximately US$1 million) loan to the
Workers Party (PT) and approximately BrR39 million in loans
(approximately US$16 million) to private-sector companies that
are under investigation. Until the CPI reaches a final
conclusion, it is possible that the names of these banks and
companies will remain in the press.

From a ratings viewpoint, the potential risk of nonpayment of
these loans is mitigated by the good quality of the majority of
the loans in Banco BMG's loan portfolio and its high
profitability, which allows for further loan loss provisions if
needed. The 'BB-' ratings incorporate the risks faced by a
relatively small bank in a competitive environment and the
challenges of developing and maintaining stable and more
diversified funding sources. The ratings currently have a stable
outlook, reflecting Standard & Poor's expectations that the bank
will benefit from the maintenance of its core competencies, with
further growth in its niche operations in payroll-discount
loans, maintaining asset quality and capitalization at adequate
levels. The ratings may be lowered or the outlook may be revised
to negative if there is a significant worsening in asset
quality, if profitability levels drop drastically, and if
liquidity is significantly impaired.

Banco BMG's March 2005 financial statements show that the bank's
deposits remained fairly stable in the first quarter of 2005
(after a decline of 27% in the last quarter of 2004 following
the Central Bank's intervention in Banco Santos, a situation
that affected all small banks in Brazil). In our opinion, the
bank can withstand some reduction in deposits. We note that even
before
the funding difficulties for small banks at the end of 2004,
anco BMG had taken proactive steps to diversify its funding,
having made use of receivables funds as a new funding mechanism.
In addition, the bank sold part of its loan portfolio to other
banks. Moreover, Banco BMG entered into sizable agreements with
Banco Itau S.A., Caixa Economica Federal, and Cetelem/BNP
Paribas whereby these entities will acquire the loans originated
by Banco BMG. Finally, in June 2005, the bank issued five-year
$200 million of senior unsubordinated notes.

Standard & Poor's, a division of The McGraw-Hill Companies
(NYSE:MHP), is the world's foremost provider of independent
credit ratings, indices, risk evaluation, investment research,
and data and valuations. With approximately 6,000 employees
located in 21 countries, Standard & Poor's is an essential part
of the world's financial infrastructure and has played a leading
role for more than 140 years in providing investors with the
independent benchmarks they need to feel more confident about
their investment and financial decisions.

Primary Credit Analyst: Daniel Araujo, Sao Paulo
(55) 11-5501-8939; daniel_araujo@standardandpoors.com

Secondary Credit Analyst: Beatriz Degani, Sao Paulo
(55) 11-5501-8933; beatriz_degani@standardandpoors.com


BANCO BRADESCO: Central Bank OKs Conversion of Stocks
-----------------------------------------------------
Banco Bradesco disclosed Monday a letter sent to the
Securities and Exchange Commission (SEC) stating that the
Central Bank of Brazil has approved on July 18, 2005 the
conversion of stocks of the minority stockholders of Seguros
into Bradesco stocks.

Banco Bradesco S.A. Executive Vice President and Investor
Relations Director Jose Luiz Acar Pedro wrote:

We hereby communicate the approval, by the Central Bank of
Brazil, on July 18 th, 2005, as published in the Federal
Official Gazette of July 20 th, 2005, of the conversion of
stocks of the minority stockholders of Seguros into Bradesco
stocks, deliberated in the Special Stockholders' Meeting held
on March 10th, 2005.

Consequently, stocks issued by Bradesco, attributed to the
minority stockholders of Seguros, in the proportion of
165,12329750137 stocks, in which 82,95659669277 are common
stocks and 82,16670080860 are preferred ones for each stock of
Seguros, will be subscribed on behalf of the stockholders of
Seguros in Bradesco on July 26 th, 2005.

The amount relative to the payment of fractions of stocks due
to the conversion (R$32,6377574001 per stock, proportionally
to the fraction held) will be avaible for the stockholders of
Seguros from July 29 th, 2005 on.

Dividends: New stocks will be entitled to monthly and
eventually complementary Dividends and/or Interest on Own
Capital which may be declared by the Board of Directors from
the conversion date on, as well as eventual advantages which
may be attributed to the outstanding stocks.

CONTACT: Banco Bradesco S.A.
         Predio Novo - 4 ANDAR
         Cidade de Deus
         S/N, Osasco
         Sao Paulo, 06029-900
         Brazil
         Phone: 55-11-3684-9229
         Web site: http://www.bradesco.com.br


COPEL: Adjusts Electricity Supply Tariffs
-----------------------------------------
Companhia Paranaense de Energia - Copel, in terms of CVM
Instruction no. 358/2002, informed on July 22 that - by
Resolution no. 130, of June 20, 2005, which deals with Copel
Annual Tariff Readjustment and was issued by Aneel (the
Brazilian Agency of Electric Energy) - was authorized to adjust
its electricity supply tariffs by 7.8% in average, as of June
24, 2005.

The Company decided to grant the final customers who pay their
electricity bill when due, from August 1st, 2005 on, an average
discount of 7% over the tariff set forth by Aneel's Resolution
no. 130.

Additionally, Copel included in the amount to be paid by
customers, as of June 24, 2005, the PIS/Pasep and Cofins
expenses effectively incurred by the Concessionary, the same
practice already applied to sale tax (ICMS), which will account
for a 5.3% increase, depending on the monthly result basis.

As from the Resolution herein dealt with, PIS/Pasep and COFINS
expenses will no longer be part of the electricity tariff
composition.

CONTACT: COMPANHIA PARANAENSE DE ENERGIA- COPEL
         Rua Coronel Dulcidio 800
         Curitiba
         Parana, 80420-170
         Brazil

         Investor Relations team:
         E-mail: ri@copel.com
         Phone:(55 41) 3222-2027


COPEL: Date of General Meeting Set to Analyze Tariff Adjustment
---------------------------------------------------------------
The Board of Directors of Companhia Paranaense De Energia
(Copel) ratified in the 72nd Extraordinary Meeting held on July
22 the call of an Extraordinary General Meeting in order to
analyze and deliberate on the application of the tariff
readjustment authorized by ANEEL and the discount granted to
final customers who pay their electricity bill when due. The
meeting will be held on August 4, 2005.

EXTRACT OF THE MINUTES OF THE 72nd EXTRAORDINARY MEETING OF THE
BOARD OF DIRECTORS

1. VENUE: Rua Coronel Dulcˇdio n§ 800, Curitiba - PR. 2. DATE
AND TIME: July 22, 2005 - at 9:30 am 3. PRESIDING BOARD: Joao
Bonifacio Cabral Junior - Chairman; Rubens Ghilardi - Executive
Secretary.

4. DELIBERATIONS:

I. after analyses, the full board deliberated, by unanimous
vote, to submit to the General Meeting the proposal for, in the
light of the average supply tariff readjustment ratio
authorized by ANEEL's Resolution # 130/2005, totaling 7.80%, in
average, Copel to maintain the average 7% discount granted to
the final customers who pay their electricity bill when due,
being also authorized the application of a 4.41% readjustment,
in average as of 08.01.2005 (approximately 4% were residual
from the readjustment granted in 2004);

II. ratified, by unanimous vote, the call of an Extraordinary
General Meeting, to be held on 08.04.2005, in order to analyze
and deliberate on the application of the tariff readjustment
authorized by ANEEL and the discount granted to final customers
who pay their electricity bill when due;

III. authorized, by majority of votes, the application by Copel
of the amount of R$ 2,500,000, in Escoelectric, being the
Executive Board members responsible for the definition of the
best application for such resources and, after, communicating
the decision to the Board of Directors;

IV. deliberated, by majority of votes, to report to the
majority shareholder the behavior of one of the Board of
Directors members.

5. SIGNATURES: JOAO BONIFACIO CABRAL JUNIOR - Chairman; MARIA
APARECIDA RODRIGUES PLACA; ROGERIO DE PAULA QUADROS; SERGIO
BOTTO DE LACERDA; LAURITA COSTA ROSA; RUBENS GHILARDI -
Executive Secretary.

The text of the Minutes of the 72nd Extraordinary Meeting of
Copel's Board of Directors was drawn up in the Company's Book
#5, registered with the Board Trade of the Parana State under #
00/056085-5, on August 8, 2000.

CONTACT: COMPANHIA PARANAENSE DE ENERGIA- COPEL
         Rua Coronel Dulcidio 800
         Curitiba
         Parana, 80420-170
         Brazil

         Investor Relations team:
         E-mail: ri@copel.com
         Phone:(55 41) 3222-2027


TCP: Customer Base Grows 22.3% Over 2Q04
----------------------------------------
Telesp Celular Participacoes S.A. (TCP) (Bovespa: TSPP3 (ON =
Common Shares) / TSPP4 (PN = Preferred Shares); NYSE: TCP),
released its consolidated results the second quarter of 2005
(2Q05), reporting an increase of 22.3% on customer base over
2Q04.

Results:

Strong competition and intense commercial activity during the
2Q05, with the campaigns for the Mother's Day and Valentine's
Day.

TCP's customer base grew 22.3% over 2Q04, recording 19,000
thousand customers.

In relation to 2Q04, the post-paid customers base increased by
7.9%, showing the result of campaigns for obtaining customers in
this market segment.

Monthly churn at 1.5% in 2Q05, showing the results of customer
retention campaigns, despite the strong competition.

ARPU blended of R$ 28.7 rose 1.8% in relation to 1Q05. Post-paid
ARPU grew 5.5% in relation to 1Q05.

Post-paid MOU increased by 6.6%, with addition of 14 minutes
compared to the 1Q05.

Sustained growth of data revenues, which increased by 44.4% over
last year, accounting for 6.4% of the net services revenue in
2Q05.

The qualified base for data services has already reached 89.5%
in 2Q05.

Launching of VIVO Play 3G, service based on a 3rd Generation
technology that offers cellular access to multimedia contents,
consolidating the absolute Leadership in innovative and
diversity of services launched on the market. Successful in the
differentiation strategy as regards its competitors as a result
of the provision of innovating services, using the CDMA 1xEV-DO
technology.

Accumulated EBITDA in 2005 of R$ 1,091.5 million, representing a
margin of 30.1% in the first half of the year.

Net debt reduction in relation to 1Q05 with reduction in
financial expenses of R$ 39.4 million in relation to 2Q04.

Short-term debt reduced in 48.3%.

Telesp Celular Participacoes (controlling shareholder of Tele
Centro Oeste Participacoes S.A.), along with Tele Leste Celular
Participacoes S.A., Tele Sudeste Celular Participacoes S.A. and
Celular CRT Participacoes S.A., make up the assets of the joint
venture undertaken by Telefonica Moviles and Portugal Telecom
that operates under the VIVO brand, Top of Mind on the Brazilian
market. In June 2005, VIVO Group exceeded 28 million customers,
thus keeping its market leadership.

To see consolidated results:
http://bankrupt.com/misc/TELESP_CELULAR.htm

CONTACT: Telesp Celular Participacoes S.A.
         VIVO Investor Relations
         Phone: 011-55-11-5105-1172
         E-mail: ir@vivo.com.br
         URL: http://www.vivo.com.br/ir


VARIG: TAP to Present New Bid in September
------------------------------------------
TAP Air Portugal will present a new bid to buy a 20% stake in
cash-strapped Brazilian airline Varig SA in September after the
latter tables its restructuring plan, said TAP Chairman Fernando
Pinto.

Pinto indicated that the proposal will be more complex than the
initial bid because it will have to be submitted to Varig's
creditors, he said.

"TAP will only invest in Varig after the firm is restructured,"
he said. "The idea is to present it (the bid) in September," he
added.

Earlier this month, Varig confirmed resumption of negotiations
with TAP, after both companies dropped a preliminary agreement
signed in May when Varig was forced to file for protection from
creditors under a new bankruptcy law.

Varig is struggling to handle gross debts of about BRL9.5
billion ($1=BRL2.398).

According to reports, TAP plans to issue debentures to raise
money to buy a stake in Varig.

CONTACT:  VARIG S.A. (Viacao Aerea Rio-Grandense)
          Avenida Almirante Silvio de Noronha, 365
          Rio de Janeiro, RJ 20021-010
          Brazil

          VICENTE CERVO - FOREIGN REPRESENTATIVE OF VARIG
          Attorneys for the Foreign Representative:
               PILLSBURY WINTHROP SHAW PITMAN LLP
               1540 Broadway
               New York, New York 10036-4039
               (212) 858-1000 (Phone)
               (212) 858-1500 (Fax)
               Rick B. Antonoff (RBA-4158)



===============
C O L O M B I A
===============

GRANAHORRAR: Fogafin Recovers $385M in Investments
--------------------------------------------------
Deposit insurance fund Fogafin confirmed it has recovered the
COP891 billion (US$385mn) it spent to save state-run mortgage
lender Granahorrar from bankruptcy in the late 1990s.

Business News Americas recalls that Fogafin injected some COP439
billion worth of capital into Granahorrar between 1998-2002, and
purchased COP452 billion worth of loans from the bank.

Fogafin is scheduled to commence the privatization process of
Granahorrar this week, giving the bank's employees and
cooperatives the first opportunity to purchase shares in the
bank. These groups will have 60 days to participate in the sale
of Granahorrar, after which a new process will be opened to
private companies and investors.

Fogafin director Juan Ortega expects the sale of Granahorrar to
bring in as much as COP438 billion pesos (US$189mn). The entity
has some COP130 billion in equity.



===============
H O N D U R A S
===============

MILLICOM INTERNATIONAL: Reports 21% Boost in Revenues for 2Q05
--------------------------------------------------------------
Millicom International Cellular S.A. (Nasdaq:MICC)
(Stockholmsborsenand Luxembourg Stock Exchange: MIC), the global
telecommunications investor, announced Monday results for the
quarter and six months ended June 30, 2005.

- 21% increase in Revenues for Q2 05 to $261.4m (Q2 04:
$215.2m)(a)
- 14% increase in EBITDA for Q2 05 to $122.2m (Q2 04:
$107.5m)(a)
- Profit for Q2 05 of $4.9m (Q2 04: profit of $14.3m)(iv)
- Basic Earnings per common share for Q2 05 of $0.05
    (Q2 04 Earnings per share: $0.17) (iv)
- 24% increase in Revenues for the first half of 2005 to
    $530.3m
    (2004:  $428.3m)(a)
- 16% increase in EBITDA for the first half of 2005 to $248.7m
    (2004: $214.1m)(a)
- Loss for the first half of 2005 of $6.4m
    (2004: profit of $28.9m)(iv)
- Basic Earnings / (Loss) per common share of ($0.06) for the
    first half of 2005 (2004: $0.38)(iv)

(i) Subscriber figures represent the worldwide total number of
subscribers of cellular systems in which Millicom has an
ownership interest. Subscriber figures exclude divested
operations.

(ii) Proportional subscribers are calculated as the sum of
Millicom's percentage ownership of subscribers in each
operation.

(iii) EBITDA; operating profit before interest, taxation,
depreciation and amortization, is derived by deducting cost of
sales, sales and marketing costs, and general and administrative
expenses from revenues

(iv) Comparative information restated as a result of the
adoption of IFRS 2, "Share-based Payment"

(a) Figures exclude divested operations (and include Vietnam up
to May 18th 2005), for financial results down to and including
EBITDA

Marc Beuls, Millicom's President and Chief Executive Officer
stated:

"Millicom's second quarter saw the end of our ten year BCC in
Vietnam. As Vietnam represented a large part of Millicom's
results, we have produced a pro forma Profit and Loss statement
excluding Vietnam and including our increased ownership in
Honduras, in order to illustrate the ongoing position of the
business.  I am very pleased to say that these pro forma numbers
showed revenue growth for Q2 2005 of 30% year on year and 7%
quarter on quarter.  EBITDA increased by 25% year on year and
11% quarter on quarter.  These numbers show strong growth across
Millicom's operations, especially in Central America, which
produced pro forma revenue growth of 12% from the first quarter
of 2005.  Central America is Millicom's largest region,
accounting for 36% of revenue and 38% of EBITDA for the year to
date.  In Pakistan, Paktel GSM is on schedule to reach the 1
million-subscriber mark at the first anniversary of the launch
of the GSM network and Paktel has established itself as a solid
third operator in Pakistan.  We are pleased with the launch of
the Talya network in Tehran by RIC.  This is the first step
towards eventually obtaining ownership for Millicom in one of
the most promising markets for mobile telephony.  In Vietnam,
the contacts continue with VMS/VNPT regarding a future
cooperation but there is no indication of a potential deal yet."

To see financial summary:
http://bankrupt.com/misc/MILLICOM_INTERNATIONAL.htm

CONTACT: Millicom International Cellular S.A.
         Marc Beuls
         President and Chief Executive Officer
         Phone: 352 27 759 327

         Andrew Best
         Investor Relations
         Phone: 44 20 7321 5022
         URL: www.millicom.com



===========
M E X I C O
===========

BALLY TOTAL: Reiterates Unanimous Support for CEO Paul Toback
-------------------------------------------------------------
Bally Total Fitness (NYSE:BFT) released Monday a copy of its
letter in response to correspondence from Liberation Investment
Group. The Company's independent directors of the board remain
firm in their earlier stand to support CEO Paul Toback, his
management and turnaround plan. The directors also unanimously
decided against adding a representative of Liberation
Investment Group into the Board of Directors. The independent
directors wrote:

We received your latest letter and do not intend to engage in
ongoing correspondence by again addressing specifics. As with
any shareholder, we have carefully considered your views as
expressed in your two recent letters, in our meetings with you
and in your numerous calls to various Directors. We stand
behind our earlier response and wish to reiterate the
Independent Directors' support for CEO Paul Toback, his
management team and turnaround plan. Our vote of support for
Mr. Toback and against adding you to the Board of Directors was
unanimous.

Mr. Toback and his team are executing our turnaround plan and
moving Bally forward to maximize shareholder value.

Bally Total Fitness is the largest and only nationwide
commercial operator of fitness centers, with approximately four
million members and nearly 440 facilities located in 29 states,
Mexico, Canada, China, Korea and the Caribbean under the Bally
Total Fitness(R), Crunch Fitness(SM), Gorilla Sports(SM),
Pinnacle Fitness(R), Bally Sports Clubs(R) and Sports Clubs of
Canada(R) brands. With an estimated 150 million annual visits
to its clubs, Bally offers a unique platform for distribution
of a wide range of products and services targeted to active,
fitness-conscious adult consumers.

CONTACT: Bally Total Fitness
         Matt Messinger
         Phone: 773-864-6850
         URL: www.ballyfitness.com
                  or
         MWW GROUP
         Public Relations
         Carreen Winters
         Phone: 201-507-9500


CINTRA: Potential Buyers Gain More Time to Express Interest
-----------------------------------------------------------
State airline holding company Cintra SA has extended the
deadline for investors to show their interest in acquiring the
country's top airlines, Mexicana and Aeromexico, reports Dow
Jones Newswires.

At the behest of various investors, Cintra postponed from July
26 to Aug. 9 the period for investors to submit letters of
interest. Interested investors will have until July 29 to
acquire the necessary paperwork.

Only those bidders approved by Cintra to participate in the
privatization will receive the sale terms of AeroMexico and
Mexicana.

The flagship carriers will be sold separately, although
investors are allowed to submit bids for both. AeroMexico will
be sold together with regional carrier Aerolitoral, while
Mexicana will be packaged with new low-cost carrier Click.

Cintra said Monday it still hopes to sell at least 51% of each
carrier by the end of the year.

Credit Suisse First Boston (CSR) is managing the sale.

CONTACT: Cintra S.A. de C.V.
         Av Xola 535 piso 16 col. del Valle Mexico
         Phone: (5)448 - 8000
         E-mail: infocintra@cintra.com.mx
         Web site: http://www.cintra.com.mx


CORPORACION GEO: Reports 2Q05 Net Profit of MXN227.8M
-----------------------------------------------------
Corporacion Geo, S.A. de C.V. (OTC Bulletin Board: CVGFY) (BMV:
GEOB; CORPGEO MX, ADR Level One CUSIP: 21986V204), the leading
homebuilder in Mexico and Latin America, reported Monday results
for the second quarter of 2005. Above estimate growth rates
reported in each line of the income statement, margin expansion,
a solid financial structure combined with a reduction in the net
debt level of the Company are the key points to notice.

Luis Orvananos, founding President and Chairman of Corporacion
Geo, commented, "With the results obtained during the first half
of 2005, Geo is well on its way to achieving the expected goals
by year's end. We feel very proud and joyful for having exceeded
the market's expectations of growth, showing with this report
the consistency and solidity that Geo has for continuing down
the path of profitable and sustainable growth by taking full
advantage of the opportunities presented by the housing sector
in Mexico."

For the 16th consecutive quarter, the 2Q2005 operating results
increased in all lines of P&L and a more solid Balance Sheet.
Units sold grew 12.2%, totaling 8,120 homes sold during the
quarter, while Revenue grew 22.5% year-over-year, reaching
$2,249.9 million pesos. In addition, Gross Profit increased by
22.5% with a Gross Margin of 26.92% compared to 26.91% in the
2Q2004. Operating Profit increased 26.8% with an Operating
Margin of 17.1%, versus 16.5% in 2Q2004.

Moreover, EBITDA showed an increase of 33.5% against the 2Q2004
with a margin of 25.2% for this period compared to 23.1% in the
2Q2004. When comparing year-over-year amount, Net Profit grew by
37.6% totaling $227.8 million, versus $165.6 million in the
2Q2004, with a Net Margin of 10.1% in the 2Q2005.

Regarding Financial Structure, due to the high investment levels
that the Middle and Residential housing segment requires, the
Free Cash Flow generation presented a decrease of $404.7 million
pesos over last year, having passed from $-322.8 million in 2004
to $-727.5 million in June of this year. Quarterly Free Cash
Flow generation in 2Q2005 totaled $117.6 million pesos, a
decrease of -78.8% compared to $554.6 million in the same
quarter of last year.

Also, as a result of the Company's product diversification
strategy, Geo is increasing its participation in the Middle and
Residential segment, which requires a higher investment level,
principally in the work in process line, being the main reason
why the level of inventories of the second quarter presented an
increase of $1,146.3 million compared to June 2004.

As a result of the implementation of strategies to improve the
Company's management of Working Capital, the Accounts Receivable
to Sales ratio reached a level of 42.08% versus the 42.11% of
the second quarter of 2004.

In the same manner, total Financial Liabilities presented a
decrease of - 3.5% equivalent to $109.0 million pesos compared
to 2Q04. The level of Cash and Cash Equivalents decreased 4.8%
when compared to the second quarter of 2004, from $1,423.4
million to $1,355.6 million pesos.

Lastly, Net Debt presented a decrease of 2.4% standing at
$1,664.0 million pesos versus $1,705.2 million pesos in the
2Q2004, and quarter-by-quarter presented an important decrease
of 6.0% moving from $1,777.4 million pesos in 1Q05 to $1,664.0
million this quarter, while Net Debt to Capitalization ratio
observed a decrease over 2Q2004 moving from 32.0% to 27.7% in
2Q2005. Finally, the debt risk profile significantly improved
during the quarter, especially considering the fact that U.S.
dollar-debt exposure is less than 1.8% of total financial
liabilities, that the composition of the debt is 81.1% short
term and 18.9% long term, and that Geo was able to reach a
leverage level without deferred taxes of 0.81 versus 0.88 showed
in the 2Q2004.

It is important to mention the notable increase in the Return on
Equity indicator moving from 20.2% to 25.9% in the 2Q2005.

CONTACTS:  Jorge Perez Rivero
           Director of Finance and Capital Markets
           Corporacion Geo
           Ph.: +(52) 55-5480-5071
           Fax: +(52) 55-5554-6064
           E-mail: jperezr@casasgeo.com

           Kenia Vargas / Eduardo Muniz
           Investor Relations
           Corporacion Geo
           Ph.: +(52) 55 5480 5078
           Fax: +(52) 55 5554 6064
           E-mail: geo_ir@casasgeo.com

           URL: http://www.casasgeo.com


GRUPO DESC: Net Debt Decreases by 22.2% to $570M in 2Q05
--------------------------------------------------------
DESC, S.A. de C.V. (BMV: DESC) announced on July 18, 2005 its
results for the second quarter of 2005 (2Q05). Except as noted
below, all figures were prepared according to generally accepted
accounting principles in Mexico (Mexican GAAP). Unless otherwise
noted, the results in this report are being compared to adjusted
2Q04 accumulated figures, which are pro forma since they exclude
DESC's constant velocity joint business to make them more
comparable with the 2Q05 results.

Management believes that investors can better evaluate and
analyze DESC's historical and future business trends on a
comparative basis if they consider results of operations without
these divested businesses. In addition, 2Q04 results are stated
at the peso-dollar exchange rate at June 30, 2005, as well as in
U.S. dollars.

SALES and EXPORTS

2Q05 sales increased 17.9% when compared to 2Q04, reaching US
$557 million. This improvement was due to better volumes and
prices.

Total exports during 2Q05 reached US $265 million, representing
an increase of 18.4% when compared to 2Q04, mainly due to the
price and volume increases in export sales of DESC Automotive
and DESC Chemical.

OPERATING INCOME

Operating income in 2Q05 increased by 62.4% when compared to
2Q04, reaching US $26 million. Strict operating expense controls
continued to be observed, which improved their relation to sales
from 14.6% in 2Q04 to 13.6% in 2Q05. This partially offset the
increases in raw material prices, mainly of steel, natural gas,
butadiene and styrene.

EBITDA1

EBITDA for 2Q05 was US $49 million, which represents an increase
of 15.1% over 2Q04. This reflects the results obtained mainly
from DESC Chemical and DESC Food. Despite the sharp increases in
raw material prices, the results have remained stable since the
start of 2004 to the second quarter of 2005.

In addition, DESC experienced an improvement in working capital,
which had deteriorated during 1Q05. This was mainly due to: the
recovery of receivables mainly in DESC Automotive despite the
increase in sales; the reduction of inventories in DESC Food and
DESC Chemical due to seasonality and in DESC Automotive due to
the program for reducing steel purchases; and lastly, the
increase in financing with vendors upon lengthening the credit
terms, particularly in DESC Chemical.

NET INCOME

Net income for the first half of 2005 was US $25 million, which
was a significant improvement over the loss reported in the
first half of 2004 of US $21 million. This was DESC's fourth
consecutive profitable quarter.

DEBT

During 2Q05, net debt decreased by US $50 million, or 8.1%, when
compared to 1Q05 going from US $620 million to US $570 million.
Notably, in the last 18 months, the net debt has declined by
42.4% or US $420 million, going from US $990 million to US $570
million.

At June 30, 2005, the total debt mix was 55% dollar-denominated,
11% peso-denominated and 34% in UDIS. The debt profile at the
close of 2Q05 was 92% long-term and 8% short-term. The average
cost of debt as of the close of the quarter was 6.09% for the
dollar-denominated debt and 10.39% for the peso-denominated
debt, compared to 5.17% and 8.86%, respectively in 2Q04.

The following is a breakdown of DESC's total debt as well as its
leverage ratio and interest coverage ratio:

The leverage ratio experienced a positive trend, going from
4.09x in 2Q04 to 2.98x in 2Q05, due mainly to the decrease in
debt and the improvement in EBITDA. The interest coverage ratio
also experienced improvements, increasing from 2.67x during 2Q04
to 3.91x in 2Q05.

RECENT EVENTS

DESC INITIATES PUBLIC EXCHANGE OFFERING

On July 1, 2005, DESC initiated the public exchange offering of
its Medium Term Note Program issued in 1999 for local bonds
(Certificados Bursatiles).

The local bonds have the following characteristics: 5-year term,
nominal interest rate equivalent to TIIE of 28 days plus a
margin to be defined, "AA-" rating by Standard & Poor's and
Fitch Mexico, a guarantee by Banco Nacional de Comercio Exterior
(Bancomext) of up to 50% of the nominal value, among others.

DESC ACQUIRES PARTICLE BOARD BUSINESS (PANELES PONDEROSA)

DESC successfully completed the acquisition of the Particle
Board segment (Paneles Poderosa) from Ponderosa Industrial de
Mexico, S.A. de C.V. located in the city of Chihuahua. This
acquisition is part of DESC's strategy of creating a dynamic
portfolio of businesses, not only divesting, but also investing
in and focusing on industries with the greatest potential of
value creation and growth.

DESC RECEIVES AWARDS

1. Some of the businesses of DESC Automotive received awards
from Nissan North America. Cardanes, S.A. de C.V., Pistones
Moresa, S.A. de C.V., T.F. Victor, S.A. de C.V., and
Transmisiones y Equipos Mecanicos, S.A. de C.V. received the
"Supplier Master Award". Additionally, Cardanes, S.A. de C.V.,
received the 'Regional Supplier Quality Award" and the "Zero
Defects Award".

2. Pinturas y Estampados, S.A. de C.V. was the only Mexican
company to receive the world's highest award for quality, cost
and delivery from Ford Motor Company, the "2004 Gold Award
Winner".

3. Punta Mita was ranked #2 by "Conde Nast for "Best Golf
Resorts" among those in North America, Mexico, Ireland and
Scotland.

DESC ANNOUNCES SALE OF VALVE LIFTER BUSINESS

Morestana, S.A. de C.V., the valve lifter business, was sold to
Eaton Corporation. The proceeds of this sale were mainly used to
finance the investment requirements in fixed assets in those
businesses with the greatest potential of generating value and
growth.

RESULTS BY BUSINESS

DESC CHEMICAL

2Q05 sales reached US $238 million, which represents an increase
of 23.5% when compared to 2Q04 due to the increases in demand
that triggered higher volumes and sales prices in all of the
businesses, as well as the recent appreciation of the U.S.
dollar versus the Euro, which produced positive results in the
Solution Rubber business. This helped to offset the rise in raw
material prices (butadiene, styrene, heating oil and natural
gas).

During the quarter, the price of petroleum and its derivatives
reached historical levels, which caused the costs of principal
raw materials to increase between 20% and 50%, approximately,
compared to 2Q04.

Despite the increase in the prices of raw materials, operating
income increased 74.9% in comparison to 2Q04, due to DESC's
ability to largely offset these increases. As a result,
operating margin improved from 3.3% in 2Q04 to 4.7% in 2Q05.

The combination of the aforementioned factors resulted in an
improvement in EBITDA of 35.6% when compared to 2Q04. Notably,
the capacity utilization rate is near 90% in all plants.

During 2Q05, DESC Automotive showed improvement in its results
due to an increase in demand and in the prices of its products,
as well as an improvement in plant operations and strict cost
controls.

As a result, sales increased 20.9% from US $155 million to US
$188 million with respect to 2Q04, despite a decrease in
production in the TLC region. This increase is attributed to
greater sales of original equipment in the Transmission (16%),
Gear (43%), Stamping (16%), Shaft (10%), Axel (22%), and Heavy
Transmission Businesses (20%), as well as a price adjustment in
the Smelting, Gear and Steel Wheel businesses.

Operating income reached US $2 million, which was a substantial
increase over the loss reported in 2Q04, bringing the operating
margin from -1.3% in 2Q04 to 1.0% in 2Q05.

These results helped offset the increase in the price of steel
(approximately 32%) that affected practically all businesses, as
well as a decrease in production from General Motors,
DaimlerChrysler and Ford due to the loss in market share in the
face of strong competition from Asian automakers.

Since 1Q04, the results have deteriorated due in part to the
increase in steel prices, as well as the scarcity of steel.
Nevertheless, starting in 2Q05 DESC has observed a change in
this trend and is experiencing an improvement.

DESC FOOD

During 2Q05, sales, operating income and EBITDA increased 10.1%,
35.2% and 23.3%, respectively, compared to 2Q04.

BRANDED PRODUCTS

During 2Q05, sales increased 6.7% compared to 2Q04, due to
greater volumes in practically all product lines, most notably:
"Del Fuerte" brand tomato paste, reaching a record level of
sales in the year ended May 31, 2005; "Embasa" brand ketchup,
showing a strong performance versus the previous year; "Blason"
brand coffee, introducing its new line, "Cafe Premium", which
has had very good acceptance in the domestic and export markets;
and "Zuko" brand powered drink. The U.S. business (ASF) had a
drop in sales due to a change to a better product mix with
greater margin.

Operating income registered an important increase of 28.2%
compared to 2Q04, mainly due to improved plant production costs,
which translated into a higher productivity index, as well as
strict cost controls.

PORK BUSINESS

2Q05 sales increased 15.4% with respect to 2Q04 due to improved
prices and higher volumes. Operating margin increased 41.7% with
respect to 2Q04 due mainly to the fall in the price of soy of
approximately 26% and grain of 14%, as well as improved
operating yield.

DESC REAL ESTATE

2Q05 sales reached US $26 million, representing a slight
decrease of 9.5% compared to revenues for the same quarter of
the previous year. Sales at the Punta Mita project increased 14%
with respect to 2Q04 due to excellent acceptance by the market;
however, sales did not exceed those posted during the same
period of the previous year in the Centro Comercial de Santa Fe
project.
The sales distribution for 2Q05 was as follows:

- Punta Mita 95%
- Bosques de Santa Fe 4%
- Others 1%

During the quarter, operating income reached US $4 million and
EBITDA reached US $5 million, registering a decrease of 26.0%
and 19.3%, respectively, when compared to 2Q04 due to a decrease
in sales.

CONTACT: Grupo DESC
         In Mexico
         Marisol Vazquez-Mellado
         Jorge Padilla
         Phone: (5255) 5261-8044
         E-mail: ir@DESC.com.mx

         In the U.S.
         Maria Barona
         Melanie Carpenter
         Phone: 212-406-3690
         E-mail: DESC@i-advize.com

         URL: www.DESC.com.mx


GRUPO DESC: Completes Bond Exchange
-----------------------------------
DESC, S.A. de C.V. (BMV:DESC) has completed a public exchange
offering of its UDI-denominated Medium Term Notes, says Dow
Jones Newswires.

The Company placed MXN953 million ($1=MXN10.6670) in new five-
year notes, extending the average maturity of its debt to four
years from two-and-a-half years.

DESC expects to generate annual savings of about US$1.3 million
in interest payments. The Company said holders of 81% of its
UDI-denominated notes exchanged them in the offering.

The recently completed operation will bring DESC's 2006
maturities down to US$47 million from US$137 million. The
Company faces maturities of US$296 million in 2007 and US$186
million in 2008.

DESC S.A DE C.V. is one of the largest industrial groups in
Mexico, with 2004 sales of approximately US$ 2 billon and nearly
14,000 employees, which through its subsidiaries is a leader in
the Automobile Parts, Chemical, Food and Property businesses.

DESC has operations in various states in Mexico, the U.S. and
Spain, and is listed on the Mexican Stock Exchange (Bolsa
Mexicana de Valores, S.A. de C.V.) in its series A and B under
the symbol "DESC".

CONTACT: Grupo DESC
         In Mexico
         Marisol Vazquez-Mellado
         Jorge Padilla
         Phone: (5255) 5261-8044
         E-mail: ir@desc.com.mx

         In the U.S.
         Maria Barona
         Melanie Carpenter
         Phone: 212-406-3690
         E-mail: desc@i-advize.com

         URL: www.desc.com.mx


GRUPO ELEKTRA: Up EBITDA by 17% to Ps.1.1 Bln in 2Q05
-----------------------------------------------------
Grupo Elektra, S.A. de C.V. (BMV: ELEKTRA*; NYSE: EKT; Latibex:
XEKT), Latin America's leading specialty retailer, consumer
finance and banking and financial services company, reported
Monday its financial results for the second quarter of 2005.

Javier Sarro, CEO of Grupo Elektra said, "Our second quarter
financial results were consistent with the outlook we provided
for 2005. We are very enthusiastic that the overall business
expansion translated into solid earnings growth and further
improvements in profitability and bottom line."

Carlos Septien, Banco Azteca's CEO said, "We are delighted with
Banco Azteca's strong financial results, which exceeded our
expectations. Banco Azteca represents an optimal alternative to
grant reliable consumer credit for millions of families who have
been able to increase their purchasing power and improve their
quality of life though access to high quality products and
services. Likewise, we are transforming the Mexican banking
system with our unique products and services, and principally,
the savings culture in a large under attended segment of the
population."

Financial Division

Banco Azteca

For 2Q05, Banco Azteca reported net income of Ps. 122.0 million,
28.4% higher than the net income of Ps. 95.0 million for 2Q04.

As of June 30, 2005, the estimated capitalization index of Banco
Azteca was 11.3%, flat when compared with the index of June
2004. The capitalization index exceeds the 8.0% minimum required
by Mexican regulators.

Gross Credit Portfolio

Banco Azteca's total gross credit portfolio increased 76.9%,
reaching Ps. 13.0 billion from Ps. 7.4 billion at the end of
2Q04. The average term of the credit portfolio at the end of the
2Q05, was 54 weeks. At the end of 2Q05, we had a total of 4.5
million active accounts, representing a 38.7% increase from
2Q04. The collection rate of Banco Azteca continues at the same
excellent historic level that defines Grupo Elektra's standard,
approximately 97% as of June 30, 2005.

Savings Accounts and Term Deposits

Net deposits increased 74.5% to Ps. 22.5 billion in 2Q05 from
Ps. 12.9 billion in 2Q04, and the total number of accounts rose
to 6.8 million.

Afore Azteca

For 2Q05, Afore Azteca reported a net income of Ps. 1.0 million
from a net income of Ps. 5.0 million for 2Q04. As of June 30,
2005, Siefore Azteca reached Ps. 4.2 billion in net assets under
management, and yielded an 8.67% return.

Seguros Azteca

For the fifth consecutive quarter, Seguros Azteca recorded a
positive net income; this time of Ps. 37.0 million, from a net
income of Ps. 7.0 million in 2Q04.

Circulo de Credito

On June 1, Circulo de Credito, S.A. de C.V. received
authorization from the Ministry of Finance to start operations
as the new credit information bureau for individuals in Mexico.
Grupo Elektra partnered with Banco Afirme, S.A., Coppel, S.A. de
C.V., Grupo Chedraui, S.A. de C.V., and two other private
investors to create Circulo de Credito. Each partner of the new
credit bureau has 18% equity stake with the exception of the two
private investors who each has a 14% equity stake. The new
credit bureau primarily intends to obtain, manage and send
information on the credit history of individuals.

Commercial Division

Commercial division revenues decreased 1.0%, due primarily to
lower merchandise revenues that result from the closing of
certain stores that did not reach our profitability standards.
However, Latin American operations continued to show favorable
results.

Total Debt and Net Debt

At the end of 2Q05, the commercial division's total debt with
cost was Ps. 3.6 billion, 8.5% lower compared with Ps. 3.9
billion at the end of 2Q04. Net debt at the commercial division
decreased to a negative amount of Ps. 576.3 million in 2Q05 from
Ps. 1.1 billion in 2Q04.

Consolidated Financial Results

Consolidated Revenues

Consolidated revenues increased 18.4% to Ps. 7.6 billion in 2Q05
from Ps. 6.5 billion in 2Q04.

EBITDA

Consolidated EBITDA reached Ps. 1.1 billion, a 17.1% increase
from Ps. 989.9 million in 2Q04. During the quarter, the growth
in operating expenses was offset by higher consolidated revenues
and a 110 basis points higher consolidated gross margin, from
43.9% in 2Q04 to 45.0% in 2Q05. Consolidated EBITDA margin
reached 15.2%, 10 basis points lower than the 15.3% reported in
2Q04.

Operating Expenses

During the quarter, operating expenses grew 24.8% to Ps. 2.6
billion in 2Q05 from Ps. 2.1 billion in 2Q04. The increase in
operating expenses was mainly the result of hiring and training
of employees; door-to-door sales initiatives; increased
operations from 137 net new stores; and higher advertising
expenses from our new business units.

Comprehensive Cost of Financing

The commercial division comprehensive cost of financing for 2Q05
was Ps. 609.3 million, 59.9% higher when compared with the Ps.
381.1 million in 2Q04. The difference in the cost of financing
is explained by:

* A Ps. 330.5 million loss in equity swaps operations explained
by the impact of the implementation of Mexican accounting
Bulletin C-10 on the Company's position in equity swaps.
Bulletin C-10, "Derivative Financial Instruments and Coverage
Operations" of Mexican GAAP states that realized and unrealized
gains and losses on interest rate swaps and options, on foreign
exchange options and forward contracts, are recognized in the
income statement of the period and are included in the
comprehensive cost of financing; and

* An increase in FX losses of Ps. 147.3 million in the period.

These were partially offset by:

* A Ps. 159.8 million decrease in interest expense resulting
from a lower level of debt with cost this quarter largely due to
the four years in advance redemption of the full amount of the
12% US$275 million Senior Notes due in 2008;

* A Ps. 5.1 million increase in interest income; and

* A Ps. 3.4 million increase in monetary gains.

On a proforma basis, excluding the Ps. 330.5 million loss in
equity swaps operations, the comprehensive cost of financing in
2Q05 was Ps. 278.7 million, 7.0% lower compared with the
proforma Ps. 299.7 million of 2Q04.

Operating Profit

During the quarter, operating income increased 11.7% despite a
30.8% growth in depreciation and amortization. The rise in D&A
results from increased fixed assets in both the commercial and
the financial divisions.

Net Income

Our positive operating performance, coupled with a Ps. 276.3
million gain from our equity participation in Comunicaciones
Avanzadas, partially offset by the increase in the comprehensive
cost of financing, led to a net income of Ps. 351.5 million in
2Q05, 34.0% higher than the Ps. 262.3 million net income of
2Q04.

On a proforma basis, excluding the Ps. 330.5 million loss in
equity swaps operations in the comprehensive cost of financing
in 2Q05, net income for 2Q05 was Ps. 682.1 million, 98.5% higher
when compared with the proforma Ps. 343.7 million of 2Q04.

CAPEX

Capital expenditures in the first half of 2005 were Ps. 593.3
million, principally due to our expansion and the purchases of
communications equipment.

Cash and Cash Equivalents

Total cash and cash equivalents rose 89.0% to Ps. 17.9 billion
in 2Q05 from Ps. 9.5 billion in 2Q04, comprised of a 48.8%
increase to Ps. 4.2 billion from the commercial division and a
106.1% growth to Ps. 13.7 billion from the financial division in
line with the increase in customer deposits.

Consolidated Gross Loan Portfolio

Total consolidated gross loan portfolio increased 75.6% to Ps.
13.6 billion in 2Q05 from Ps. 7.8 billion at the end of 2Q04.
Collection rate for the credit portfolio remained at 97%.

Equity

Consolidated equity grew 10.4% to Ps. 7.9 billion in 2Q05 from
Ps. 7.2 billion in 2Q04.

Grupo Elektra is Latin America's leading specialty retailer,
consumer finance and banking services company. Grupo Elektra
sells retail goods and services through its Elektra, Salinas y
Rocha, Bodega de Remates and Elektricity stores and over the
Internet. The Group operates more than 1,000 stores in Mexico,
Guatemala, Honduras and Peru. Grupo Elektra also sells and
markets its consumer finance, banking and financial products and
services through approximately 1,400 Banco Azteca branches
located within its stores, as a stand-alone, and in other
channels in Mexico and Panama. Banking and financial services
include loans, electronic money transfer services, extended
warranties, demand deposits, pension-fund management, insurance,
and credit information services.

CONTACTS:

     Esteban Galindez, CFA,
     Director of Finance and I.R.
     Grupo Elektra S.A. de C.V.
     Tel. +52 (55) 1720-7819
     Fax. +52 (55) 1720-7822
     egalindez@elektra.com.mx

     Bruno Rangel
     Director of Investor Relations
     Grupo Salinas
     Tel. +52 (55) 1720 9167
     Fax +52 (55) 1720 0831
     jrangelk@tvazteca.com.mx


GRUPO MEXICO: Consolidated Sales Reaches $1,303.5M in 2Q05
----------------------------------------------------------
Grupo Mexico, S.A. de C.V. (BMV: GMEXICOB) reports its financial
results on July 21 for the second quarter and the six months
ended June 30, 2005.

Results of the Second Quarter of 2005

- Consolidated sales increased during 2Q05 reaching $1,303.5
million, 31% higher than total sales in 2Q04 and 5% over the
figures recorded in 1Q05 amounting to $1,246 million due to
better metal prices.

- Southern Peru (SPCC) concluded the acquisition/merger of
Minera Mexico (MM) in a stock-forstock operation, consolidating
results as of April 1, thus creating the second largest mining
company in the world in terms of copper reserves, GMexico holds
75.1% of the company's stock.

- Sales, EBITDA and profits showed a significant performance
compared to former years in Peru (SPCC) and Mexico mining units
as well as those in Ferromex.

- Sustained growth in the metal prices produced by our company;
152% in molybdenum, 24% in zinc, 24% in copper and 15% in silver
compared to prices in 2Q04.

- GMexico reduced bank debt in holdings and sub-holdings to
"zero".

- Standard & Poors upgraded Grupo Mexico, Americas Mining
Corporation, SPCC and Minera Mexico's rating from BB- to BBB-,
thus attaining Investment Grade. But downgraded Asarco's rating
to CCC.

- EBITDA accrued for the first half reached US$1,199.3 million,
41.3% over the one obtained the corresponding period last year
due to higher produced volumes and better metal prices.

- SPCC issue $800 million in 30-year bonds for US$600 million
and in 10-year bonds for US$200 million in the international
markets on July 20, the proceeds of which will be used to pay
off SPCC and MM's syndicated loans amounting to US$200 million
and US$480 million respectively, improve the amortization
program and strengthen the investment plan. Citi/Banamex lead
the transaction.

- In the second quarter, Minera Mexico reduced its 2008-bond
maturity from US$316.25 million to US$221.68 million, resulting
in a healthier and more conservative amortization plan for 2008.

- On May 16, 2005 GMexico reported that its subsidiary
embracing the mining division Americas Mining Corporation (AMC)
made on May 13 a debt pre-payment in the amount of $175.0
million to Banco Inbursa in connection with a loan to be due in
2008. Likewise, $15 million were paid in advance to Banco
Calyon. The outstanding balance of a credit loan granted in
favor of its subsidiary ITM, that comprehends the railway and
transport operations of GMexico, and granted by Banco Ixe in the
amount of $5.0 million was settled as well. The foregoing
allowed GMexico to fulfill its goal of reducing its subsidiaries
indebtedness to zero.

- Southern Peru (SPCC) made a secondary offer of 21 million
shares by means of its minority shareholders: Phelps Dodge and
Cerro Trading. The offer was oversuscribed and allowed a wider
spread of shares within a larger number of international
investors, significantly improving SPCC's liquidity in the
market.

- SPCC makes good progress on its investment program: the
smelter project in Ilo, Peru with capacity of 1.2 million tons
on an annualized basis is on schedule, to be finished by year
end 2006, although benefits thereof will be evident as of the
third quarter this year due to the cost reduction to US$0.02 per
pound of copper imputable to the operation of the moulding
wheel. US$195 million have been invested in the different
projects undergoing in the mining and metallurgic fields.

- GMexico incorporated Mexico Constructora Industrial, S.A. as
subsidiary for infrastructure development so as to make its
technical personnel, construction equipment and credentials
before different governmental entities profitable to take part
in projects conducted in the energy sector, well drilling,
railways, highways, etc. In the past, the construction division
provided services to the Group in a preferable manner, but today
it will make use of its experience and strength for the benefit
of third-party projects as well.

- Ferromex invested US$49.0 million in new projects during this
first semester. Investments conducted in Torreon's freight yard
make it the best in the country, 25 new 4,400 HP locomotive
engines were purchased together with the first 700 wagons out of
the 3,000 new-wagon project.

- Ferromex reached sales record figure for a first quarter:
US$354.3 million. EBITDA amounted to US$ 122.8 million.

- Net ton-km. ratio went up by 8.5% within the first quarter
2005, reaching US$16,842 million compared to US$15,522 within
the corresponding period the previous year.

- Intermodal Mexico, S.A. subsidiary of GMexico continues its
aggressive program for the creation of an intermodal network
aiming at increasing moved load volumes. Operations with the new
Monterrey terminal, capable of handling 100,000 containers a
year began this quarter. Terminals in Hermosillo, Sonora and
Bajio in Guanajuato are currently under construction and will be
added to those already operating in Guadalajara, Jalisco,
Mexicali, Baja California, Torre˘n, Coahuila, and Pantaco in
Mexico City, where Ferromex holds 25%.

- GMexico declared a 25-cent/peso dividend corresponding to the
second quarter results in 2005 payable on August 31. The
foregoing aims at reflecting similar conditions to those in SPCC
while maintaining a conservative profile allowing it to reduce
the inter-companies debt, perform its buyback program and
consolidate its operations within the transport and
infrastructure sectors.

Relevant Events

On May 17, 2005, GMexico paid its shareholders MXP$0.75 per
share before the 3 to 1 Split as dividend relevant to the first
quarter.

Pursuant to the previously approved by the Ordinary Shareholders
Meeting held on April 29, 2005, GMexico reported on May 3, 2005
the creation of a reserve up to $4 billion Mexican Pesos
(US$362.9 million) for future dividend payments which the Board
of Directors may approve by the end of the following quarters
depending on the results obtained by the company. Likewise, it
announced a buy-back program of shares reaching MXP$2,240
million and up to MXP$112 million to be allocated to the Stock
Option Plan for the Company's and Subsidiaries' Officers and
Employees Trust.

On July 12, 2005 Standard & Poors upgraded Grupo M‚xico's credit
risk rating (long term foreign currency) from BB to BBB- with
outlook stable. Likewise, S&P rated BBB- SPCC's $800 million
bonds due in 2015 and 2035. The proceeds derived from this
issuance will be used to refinance SPCC and MM's debt. The
ratings for AMC and SPCC were upgraded from BB- to BBB-. S&P
downgraded Asarco's rating from BB- to CCC, with outlook
negative.

On July 11, 2005 Moody's assigned a Ba1 Corporate Family Rating
to SPCC and a Ba1 rating to the company's $600 million issuance
of Senior Unsecured Notes.

Proceeds from the $600 million note offering will be used to
repay existing debt, which could include debt at Minera M‚xico
and SPCC. At the same time, Moody's placed the ratings of Minera
M‚xico B1 under review for possible upgrade.

On July 11, 2005, Fitch Ratings upgraded SPCC's rating (foreign
currency) from "BB" to BB+. Fitch Ratings has also assigned a
preliminary foreign currency rating of BB+ to SPCC's proposed
US$600 million to $680 million 30-year bond issuance the
proceeds of which will be used to pay off SPCC and Minera
Mexico's outstanding syndicated loans of US$200 million and
US$480 million, respectively.

Moreover, Fitch Ratings has also upgraded Minera Mexico (foreign
currency) rating to BB+ from BB- with rating outlook positive.

As of July 2, 2005 Asarco's labor union went on strike.
Notwithstanding the foregoing, the production level is
maintained by non-union workers, with a lower pace than
expected, though. This may affect the production by 50%, thus
losing between 100,000 and 125,000 tons of copper contained on
an annualized basis.

The company is currently analyzing the possibility of
restructuring looking for its viability in the long term.

Financing

GMexico's total debt at June 30, 2005 amounted to $2,001.1
million; with a cash balance of $641.7 million equal to a net
debt of $1,359.3 million. Cash at the close of December 2004 was
$973.5 million, for a net debt of $1,543.4 million vs. $1,359.3
million at June 2005. This ratio provides a debt reduction of
$184.1 million during 2Q05, accounting for a 9% net debt
decrease vis-a-vis the close of the year 2004.

The financial cost for the second quarter of 2005 was $40.9
million, 27.7% less than the same quarter in 2004, due to a
major reduction in the Group's liabilities and recently improved
rate conditions obtained by MM and SPCC.

With this, Grupo Mexico fulfills its commitment to improve the
financial conditions of its operating subsidiaries by
diminishing to zero its holding subsidiaries level of
indebtedness, improving its amortization profile and eliminating
warranties and restrictions, thus affording efficient growth of
operations and reducing its financial costs as well for the
benefit of its shareholders, employees and workers.

Metal prices maintained their upward trend during the second
quarter in 2005, mainly with significant increases for
molybdenum by 153%, zinc by 24% and copper by 24% compared over
2Q04.

A sound growth trend in copper demand during the first half of
2005 is evident in all the consumer economies and was
particularly high in China. This, together with a higher demand
in the United States, contributed to a continuing deficit in
global metal inventories. At the end of June 2005 the
inventories reached their lowest level in the last
15 years, totaling 72,000 tons of world inventories. A weaker
dollar also contributed to rising copper prices, reaching
historical 15-year highs. Analysts expect the deficit in copper
supplies will continue during the second half of 2005 and part
of 2006.

GMexico, the world's second largest company in copper reserves
conducts its projects pursuant to its policy and in a gradual,
disciplined and responsible manner so as to supply the markets
and assure the adequate returns to its shareholders in the long
term.

Sales of the mining sector (AMC) during 2Q05 had a 33.4%
increase reaching $1,112.8 million, while the sales cost
increased 32.2%, thus attaining net profits of $233.5 million,
32.2% higher than the net profits within the same period of time
the previous year. Sales in 2Q05 were 2% higher than those the
previous quarter.

The copper mining production reached 215,539 TM in 2Q05, 1%
higher than the production in 2Q04 and 6.4% or 13,004 TM over
the mineral production of 1Q05. The production increase derived
from a higher production in the Mexican and US mines that made
up for lower volumes obtained in the Peruvian mines due to a
lower ore grades.

EBITDA grew 44% compared to the accrued in 2Q04 going up to
$1,067.9 million. EBITDA margin as sales percentage represented
48.4% of the sales in the first half.

Americas Mining Corporation is a Delaware-based corporation and
the holding company for the Mexico,
Peru and United States mining operations. It ranks as the
world's second largest company in terms of copper ore reserves,
the third largest mine to refined copper producer, the fourth
largest silver producer, and the seventh largest zinc producer.

On April 1 SPCC finalized the acquisition of Minera Mexico by
means of the Merger and Acquisition Agreement entered on October
21, 2004. As a result of such decision, SPCC acquired 99.15% of
MM's shares of stock and issued approximately 67,2 million new
shares to the order of Americas Mining Corporation, MM's
majority shareholder. Grupo Mexico's shareholding in SPCC by
means of its subsidiaries went from 54.2% to 75.1%.

Additionally, based on the Agreement mentioned above, SPCC paid
a transaction dividend of $100 million during the second quarter
in 2005.

Copper production amounted to 168,692 MT in 2Q05, 7.7% lower
than production levels reached within the same period in 2004.
Such decrease of 14,059 MT includes 5,404 MT from Toquepala mine
and 10,276 TM from Cuajone mine, mainly due to lower mineral ore
grades, as forecasted, that compensated with a higher production
of 883 MT from the Cananea mine and 1,600 MT from La Caridad
mine.

Product sales reached $958.0 million in 2Q05, 32.6% higher
compared to $722.2 million 2Q04 that may be attributed to the
increase in metal prices, despite lower sales of molybdenum.
Accrued EBITDA as of June 30, 2005 increased 48.0%, going from
US$709.4 to US$1,049.8 million. In the meantime, cash in SPCC
had a 9% increase, reaching $471.1 million as of June 30, 2005.
The EBITDA margin as sales percentage was 54.8% during 2Q05.

The company's net profit was 43.3% higher than the accrued by
2Q04 amounting to US$605.5 million whereas net profits at June
30, 2004 amounted to US$422.6 million.

As for SPCC's expansion and modernization program, the Ilo
smelter project is on schedule with detailed engineering work in
progress and procurement of larger equipment in order to
complete the project by year end 2006.

In addition, the ore crushing, leaching and conveyor belt
project at the Toquepala mine is also on schedule. In March 2004
a construction contract was awarded to Cosapi, a Peruvian
contractor. The contract is part of the $70 million project
scheduled for completion in mid-2005. This project will increase
SX/EW copper recovery and will allow for annual savings of $25
million in operating costs at Toquepala. As of June 30, 2005
investments in the amount of $60.6 million have been allocated
to this project.

SPCC is the first company with assets in Latin America listed on
the NYSE obtaining the certification from its external auditors
in connection with regulation 404 in the Sarbanes-Oxley Law
regarding the corporate governance adequate management.

SPCC is the first company with assets in Latin America listed on
the NYSE obtaining the certification from its external auditors
in connection with regulation 404 in the Sarbanes-Oxley Law
regarding the corporate governance adequate management for 2004.

Southern Peru Copper Corporation (SPCC) is the world's largest
copper mining company in terms of ore reserves listed in New
York and Peru. It has mining units in Peru and Mexico. SPCC
shareholders, directly or through subsidiaries, are as follows:
Grupo Mexico (75.1%) and other common shareholders (9.6%)

Copper production reached 46,847 MT in 2Q05, 53% over the
production attained in the 2Q04, mainly due to the progress made
in the mine stripping plan and the maintenance of the equipment
in order to increase the availability levels to satisfy the
industry's standards.

The sale of products amounted to $314.8 million in 2Q05,
compared to $252.7 million in the same period for 2004, a 24.5%
growth that may be attributed to the metal price increase.

Asarco's EBITDA reached $42.5 million in the 2Q05 compared to
$33.2 million within the same period of time last year.

The cost of sales in the 2Q05 was $123.4 million, 14.8% over the
same one in the previous year within the same period, mainly due
to the 49% increase in the tonnage load moved according to the
mine stripping program and equipment maintenance plan designed
to upgrade to industry standards.

Asarco's cash operating breakeven cost for copper production was
113.5 and 95.4 cents per pound during 2Q05 and 2Q04
respectively. The foregoing derived from higher labor costs that
affect competitiveness needed to maintain its viability in the
long term.

As for the company's investment and acquisition projects, at
June 30, 2005 $29.6 million were invested, 3.9 times higher than
in 2004 for the same period. $12.3 million were assigned to the
Hayden Smelter for its 5-year maintenance service, so that work
was interrupted for 50 days last January and February. Such
maintenance will enable the smelter to operate at full capacity
and lower their unit costs in the future.

Asarco reported as of June 30, 2005 net profit of $11.1 million,
compared to 7.1 million for the same period in 2004.

On April 11, Asarco LLC announced its decision to file Chapter
11 proceedings in Bankruptcy Court for its non-operating and
dormant subsidiaries LAQ and CAPCO, in which all asbestos-
related claims will be channeled to a trust for an equitable
resolution and payment.

As of July 2, 2005 Asarco's labor union went on strike.
Notwithstanding the foregoing, the production level is
maintained by non-union workers, with a lower pace than
expected, though. This may affect the production by 50%, thus
losing between 100,000 and 125,000 tons of copper contained on
an annualized basis.

Asarco regrets the decisions made by the relevant Workers Union
about abandoning the undergoing negotiations aiming at
reaffirming the collective job contracts in such units, thus
assuring the generation and helping to preserve a source of
employment. Asarco is one of the mining companies with highest
operating cost both in the US and in the world due to the labor
costs, which affect the competitiveness required so as to assure
its viability in the long term. Cooperation of its workers was
of paramount importance so as to pursue the above mentioned.
Asarco has not totally recovered yet from the low copper price
cycle due to the mine stripping programs, comprehensive
maintenance costs, environmental expenses and legal fees related
thereto as well as to the cost of retirement and pension funds.

Founded in 1899, Asarco is a fully integrated copper mining,
smelting and refining company having important copper reserves
in the United States. The open pit mining units at Mission, Ray
and Silver Bell in Arizona include electro-winning plant
facilities at Ray and Silver Bell. Asarco operates a copper
smelter in Hayden, Arizona, and has a copper refinery and a
copper rod and cake plant in Texas.

Load volumes moved by Ferromex in the second quarter of 2005 as
measured by tons per kilometer (tons/kilometer) increased 8.9%
compared to the load volumes moved within the same period of
time in 2004, mainly due to a commercial flow increase between
Mexico and the United States derived from the market economic
growth and larger domestic volumes.

Total sales increased by 17.5%, reaching $195.0 million in 2Q05,
compared to $165.9 million attained in the same quarter in 2004.
The revenues obtained after discounts reduction resulting from
the increase in diesel prices, amounted to $12.3 million as of
June 30, 2005 something that did not happen in 2004, as Ferromex
implemented a pricing formula in order to allow for the recover
of diesel increments as it is done by US rail companies, for the
purpose to better reflect a ratio between load volumes moved and
sales.

The sale costs in 2Q05 amounting to $115.8 million increased by
18.7% compared to the same period in 2004 and a similar increase
in connection with 1Q05. The foregoing was slightly offset by
higher moved transportation volumes, which afforded higher
revenues from services during this quarter. Nevertheless, cost
of sales was affected by significant diesel cost increase.
Diesel prices grew 34.4%, going from 28.5 to 38.3 US dollar
cents per liter, which added to higher consumption in liters,
accounted for a $15.0 million increase.

Ferromex EBITDA in 2Q05 totaled $122.7 million, 12.1% higher
than the EBITDA attained in the same period of 2004. EBITDA
margin as a sales percentage was 35.8% in 2Q05, compared to
34.7% recorded in the 2Q04.

Operation profit was higher than that reported in the second
quarter of 2004 by 18.8% despite the significant increase in the
diesel costs which is the major consumable of railroad
operations, going up to $52.9 million in the second quarter of
2005.

As of June 30, 2005 total debt diminished 0.3% from $448.7
million at 2Q04 to $447.2 million in 2Q05. Such decrease derived
from amortization payments to Eximbank for $8.0 million and Bank
of America of $6.6 million. In addition, an early amortization
of $31.7 and $13.8 million to Banco Inbursa on its loan maturing
December 2007 was conducted by the Company, using funds from the
normal course of its operations. This item is partially offset
by the loans granted in December 2004 and January 2005 by BNP
Paribas which included an Eximbank guaranty for US$39.5 million
for the acquisition of 25 locomotives engines.

Ferromex is Mexico's largest railway company, providing the
widest coverage. Through an 8,500 km network, its tracks cover
71% of Mexican territory. Ferromex lines connect with five
gateways at the U.S. Border, four ports on the Pacific Ocean and
two ports on the Gulf of Mexico. The company is controlled by
Grupo Mexico (74%) and Union Pacific (26%).

CONTACT:  GRUPO MEXICO S.A. DE C.V.
          Avenida Baja California 200,
          Colonia Roma Sur
          06760 Mexico, D.F., Mexico
          Phone: +52-55-5264-7775
          Fax: +52-55-5264-7769
          Web site: http://www.gmexico.com


GRUPO MEXICO: Asarco Mgt. Meets With Workers to Settle Conflict
---------------------------------------------------------------
The management of Grupo Mexico's strike-bound U.S. unit Asarco
met with union representatives Friday for the first time since
more than 1,500 workers went on strike early this month to
protest the unit's proposed wage freeze and reductions in health
and pension benefits, reports Dow Jones Newswires.

The meeting didn't yield a solution to their conflict right away
but according to Grupo Mexico chief financial officer Eduardo
Gonzalez: "Discussions are under way and we expect that will
have a positive result."

Gonzalez was speaking to analysts to discuss Grupo Mexico's
second-quarter results. When asked whether Grupo Mexico plans to
sell Asarco, he said Asarco management "is studying various
possibilities."

In a press release on July 5, Asarco mentioned asset sales among
considerations, generating some speculation about plans to
unload the Company.

One analyst questioned Grupo Mexico's commitment to ending the
strike quickly, given that equity markets assign very low value
to Asarco.

Gonzalez said Asarco needs a "global settlement" to problems
including environmental liabilities, asbestos claims and pension
liabilities.

"Asarco management believes it can be done, and that Asarco
could be a profitable, albeit small operation," he said, but
Grupo Mexico "doesn't feel compelled to invest in companies that
don't have a future."


GRUPO SIMEC: Acquires 100% of Republic Stock With Industrias CH
---------------------------------------------------------------
Grupo Simec, S.A. de C.V. (Amex: SIM) ("Simec"), a subsidiary of
Industrias CH, S.A. de C.V., and Industrias CH, S.A. de C.V.
("ICH") announced Monday that they have acquired 100% of the
Stock of PAV Republic, Inc. ("Republic").

Republic is the leading producer of special bar quality (SBQ)
steel in the United States and, together with Simec, will become
the largest producer of this kind of steel in North America.

With this acquisition, Simec anticipates an installed annual
capacity of nearly three million metric tons of steel. Simec
expects that in the next 12 months sales in metric tons will
exceed 2.7 million metric tons of finished products.

Simec's recent sales of SBQ represented one third of its total
sales. As a result of the acquisition, this line of products is
expected to account for 65% of the consolidated sales of Simec.
The acquisition strategically positions Simec in a market that
typically has less price volatility and higher margin than
commodity steel products.

Simec revenues in the last 12 months were approximately US$600
million. Simec expects that revenues will approach US$1.8
billion for the next 12 months.

Simec projects EBITDA for the next 12 months of US$270 million,
an increase of almost 50% over its last 12 months EBITDA. This
increase would result not only from Republic's operations but
also from synergies and economics of scale.

Republic has six production plants located in Ohio, Indiana and
New York and one facility in Ontario, Canada. Those seven plants
employ more than 2,500 people and have a joint annual installed
capacity of up to two million metric tons for liquid steel and
approximately 1.7 million metric tons for finished steel
products.

Simec will acquire 50.2% of Republic's stock, and ICH will
purchase the remaining 49.8% of Republic stock. The acquisition
was financed by funds generated internally by Simec and ICH.

CONTACT: Grupo Simec, S.A. de C.V.
         Adolfo Luna Luna
                 Or
         Jose Flores Flores
         Phone: 011-52-33-1057-5740


HYLSAMEX: Reports Net Financial Gain of $0.5M in 2Q05
-----------------------------------------------------
The following report contains unaudited information for 2Q05,
presented in constant pesos (Ps) as of June 30, 2005, and in
metric tons. For convenience, income statement and cash flow
statement figures are translated into dollars (US$) at the
average exchange rate of each month and balance sheet items are
translated into dollars at the end-of-period exchange rate.

HIGHLIGHTS

- Hylsamex registered solid volumes in 2Q05, supported by
growth in domestic and export sales. Shipments were 824,500 tons
in 2Q05, up 5% and 11% compared to the same quarter of 2004 and
the previous quarter, respectively.

- Revenues amounted to US$612 million during 2Q05. Revenue per
ton reached US$742/ton in 2Q05, which represented a 1% and 4%
decline from the amounts registered in the same quarter of 2004
and in the previous quarter, respectively, due to a reduction in
international steel prices.

- COGS reached US$550/ton in 2Q05, 17% higher than the
US$468/ton recorded in the same quarter of 2004 and similar to
the US$548/ton reported in the previous quarter. Compared to the
previous quarter, the Company was able to significantly contain
energy cost increases through its natural gas hedging program
and a better spread of fixed costs due to greater shipments.

- In 2Q05, Hylsamex generated EBITDA of US$150 million, 32% and
7% less than the US$222 million and the US$161 million of the
same quarter of 2004 and the previous quarter, respectively. The
EBITDA margin reached 25% in 2Q05.

- Free cash flow generation in 2Q05 totaled US$87 million.
Hylsamex ended the quarter with debt net of cash of US$471
million, representing a US$75 million reduction year-to-date.

- Hylsamex paid a US$100 million extraordinary dividend in
April. The Net Debt to LTM EBITDA ratio was 0.6x for 2Q05, while
LTM Interest Coverage reached 10.5x.

- Net income for 2Q05 amounted to US$89 million (Ps.977
million), a decrease of 28% compared to the US$124 million
(Ps.1,472 million) of net income registered in the same quarter
of 2004 and a decrease of 6% from the US$95 million (Ps.1,072
million) of net income reported in the previous quarter.

Hylsamex continued producing excellent results in terms of
operating cash flow during the second quarter of 2005, in spite
of softened steel prices. Due to greater sales, an increase in
volume sold and revenue per ton near the highs reached in 2004,
the Company recorded solid EBITDA of US$150 million in 2Q05. In
an environment of rising costs in the global steel industry,
Hylsamex continued to capitalize on its vertical integration and
its modern facilities in order to maintain relative cost
stability.

Hylsamex's free cash flow reached US$87 million in 2Q05, similar
to the US$89 million generated in the same quarter of 2004. The
strong generation of free cash flow resulted from solid EBITDA
generation, coupled with modest capital expenditures and a
source of funds from net working capital. In recent quarters,
Hylsamex's financial burden has been reduced due to the
deleveraging carried out in 2004. In addition, Hylsamex obtained
medium-term bank loans of US$150 million and used internally
generated funds to carry out the prepayments of Hylsa's Notes
due 2007 and Certificado Bursatil due 2008, which will further
reduce Hylsamex's financing cost. The strong free cash flow
generated by Hylsamex in the last quarters allowed the payment
of a US$100 million extraordinary dividend in April, without
increasing total debt. During 2Q05, Hylsamex also paid US$31
million in statutory employee profit sharing related to the 2004
profits.

The Company's EBITDA generation in 2Q05 experienced a small drop
in the quarter-over-quarter comparison. The decrease was mainly
caused by lower international steel prices, which produced a 4%
reduction in revenue per ton compared to the previous quarter.
Nevertheless, Hylsamex continued posting attractive levels of
profitability as a result of solid sales volume and a relatively
stable cost per ton in 2Q05, which allowed the Company to
partially compensate the decrease in revenue per ton.

During 2Q05, the global steel industry saw steel prices come
down from the record levels observed in 2004. While prices in
the U.S. and Europe fell due to excess inventories built late in
2004, prices in Asia remained relatively high; however, end
demand for steel remains strong in Hylsamex's markets, which
bodes well for inventory coming back to normal levels and prices
stabilizing. Another factor that can support prices are the
announcements made in 2Q05 by large steel producers in relation
to production cuts and moving forward of maintenance programs,
as the industry as a whole pays more attention to managing
supply to levels more in tune with demand trends.

Finally, on May 18th, 2005, Alfa -Hylsamex's parent company-
announced it accepted the Techint Group's ("Techint") offer to
buy Hylsamex. At the same time, Techint will make a public
tender offer for all of Hylsamex's outstanding shares in the
Mexican stock market, under the same terms and conditions. This
transaction will strengthen Hylsamex, as it will become part of
a leading regional steel group in Latin America.

Steel demand-supply trends in key economies such as China and
the U.S., as well as energy costs, remain relevant variables
which can affect the Company's future performance.

FREE CASH FLOW

Hylsamex generated excellent free cash flow of US$87 million in
2Q05, similar to the US$89 million recorded in the same quarter
of 2004, but below the US$100 million obtained in the preceding
quarter. Free cash flow generation was enhanced in 2Q05 by net
working capital, which was a source of funds, and lower interest
expense. During 2Q05, Hylsamex obtained medium-term bank loans
of US$150 million and used internally generated funds to carry
out the prepayments of Hylsa's Notes due 2007 and Certificado
Bursatil due 2008, which will further reduce Hylsamex's
financing cost.

As a result of the improving profitability, Hylsamex paid
greater cash taxes in 2Q05. This can largely be attributed to
the US$31 million in statutory employee profit sharing related
to the 2004 profits; Hylsamex also continued making interim
income tax payments. However, with the use of asset tax credits
in the annual 2005 tax return, the Company's net tax burden for
2005 is expected to be reduced through a tax refund early in
2006.

STEEL MARKET

Hylsamex recorded sales volume of 824,500 tons during 2Q05, 5%
or 37,800 tons more than the 786,700 tons shipped during the
same quarter of 2004 and 11% or 79,000 tons greater than the
745,500 tons sold in the previous quarter. The increase versus
the previous quarter is due to greater sales volume across all
product lines. However, gains in flat product shipments appear
even larger in 2Q05, considering the major scheduled maintenance
program carried out during January. Greater volumes of flat
products (includes tubular and coated products) were behind much
of the increase over the same quarter of 2004.

Volume sold in the domestic market totaled 634,700 tons in 2Q05,
4% or 21,500 tons greater than the 613,200 tons registered in
the same quarter of 2004 and 14% or 78,100 tons more than the
556,600 tons of the prior quarter. Of these volumes, greater
sales of flat products, wirerod and billet are largely
responsible for the 14% increase versus the prior quarter. The
4% growth in volume compared to the same quarter of 2004 mainly
resulted from greater shipments of flat products.

Exports in 2Q05 reached 189,800 tons, 9% or 16,300 tons more
than the 173,500 tons exported in the same quarter of 2004 and
similar to the 188,900 tons of the previous quarter. Compared
against the same quarter of 2004, exports increased due to
greater demand for both flat and long products. Export prices
for 2Q05 calculated in nominal dollars increased 1% versus the
same quarter of 2004 but decreased 3% compared to the previous
quarter. These variations were mainly due to the trends observed
in international steel prices. Solid export volumes and pricing
allowed Hylsamex to generate significant export revenues of
US$148 million in 2Q05, 13% greater than the export revenue
obtained in the same quarter of 2004 and identical to the export
revenues of the previous quarter.

Year-to-date, Hylsamex has sold 1,570,000 tons, similar to the
shipments of 1,574,500 tons recorded during the first six months
of 2004. Total domestic sales decreased 4%, to a level of
1,191,300 tons, due to the major maintenance program in the Flat
Product's Division's minimill during January 2005 and recent
market conditions that have led to decreased output at Mill #1.
Conversely, export shipments grew 14% to 378,700 tons in the
first half of 2005. Sound economic activity in key regions of
the world has led to strong export volume.

REVENUE

Hylsamex registered solid revenue generation in 2Q05. The
Company generated sales revenue of US$612 million (Ps.6,743
million) in 2Q05, 4% greater than the US$589 million (Ps.6,982
million) achieved in the same quarter of 2004 and 7% higher than
the US$574 million (Ps.6,463 million) obtained in the previous
quarter. In both comparisons, the increases were primarily due
to greater sales volume, as revenue per ton marginally
decreased.

Hylsamex's revenue per ton in 2Q05 reached US$742/ton,
consisting of an average steel price of US$699/ton and a
US$43/ton contribution from other steel revenue. Hylsamex's
revenue per ton of US$742/ton for 2Q05 represents a slight
decrease of 1% or US$6/ton in relation to the US$748/ton
achieved in the same quarter of 2004 and reflects a drop of 4%
or US$27/ton compared to the US$769/ton obtained in the previous
quarter. The small decline was caused mainly by lower
international and domestic steel prices, as well as a less rich
product mix in 2Q05 due to greater volumes of long products,
such as wirerod and billet.

In the first six months of 2005, the Company has generated
US$1,186 million (Ps.13,207 million) in revenues, an increase of
13% compared to the revenues of US$1,050 million (Ps.12,355
million) reported for the same period of 2004. Accumulated
revenue per ton reached US$755/ton, an increase of 13% compared
to the average revenue per ton of US$667/ton obtained in the
same period of 2004.

Hylsamex continued operating at high utilization levels during
2Q05 to meet the solid steel demand. In 2Q05, Hylsamex's
metallic charge flexibility and vertical integration allowed
relative cost stability, as cost per ton remained nearly
unchanged from the preceding quarter despite rising input costs.
The Company maintained DRI production close to maximum capacity,
sourcing 100% of iron ore requirements from its own mines.

COGS for 2Q05 amounted to US$453 million (Ps.4,998 million), 23%
greater than the US$368 million (Ps.4,369 million) registered in
the same quarter of 2004 and 11% higher than the US$409 million
(Ps.4,609 million) recorded in the preceding quarter. The
increase in COGS versus the previous quarter is mainly the
result of the 11% increase in tonnage sold. The rise against the
same quarter of 2004 was also due primarily to greater volume
sold, but did reflect higher costs for electricity, domestic
scrap and externally-sourced steel used by the coating
operations.

On a per ton basis, COGS in 2Q05 reached US$550/ton, US$82/ton
or 17% above the US$468/ton recorded in the same quarter of 2004
and US$2/ton greater than the US$548/ton attained in the
previous quarter. The US$82/ton increase in cost per ton
compared to the same quarter of 2004 consisted of US$74/ton and
US$8/ton increases in variable and fixed costs per ton, in that
order. The increase in variable costs resulted from higher costs
for electricity, domestic scrap and externally sourced steel
used in the coating operations. The increase in fixed cost was
largely due to greater maintenance expenses. The US$2/ton
increase in cost per ton against the previous quarter was caused
by a US$12/ton increase in variable cost per ton, mostly offset
by a US$10/ton decrease in fixed cost per ton. Slightly higher
costs for natural gas and externally sourced steel used in the
coating operations were behind the rise in variable costs, while
larger sales volumes allowed for an improved spread of fixed
costs. An explanation of the quarterly behavior of the main
components of COGS follows:

Energy Inputs: The effective natural gas price for Hylsamex
during 2Q05 was US$5.52/MMBtu (corresponding to a US$6.30/MMBtu
average reference price in South Texas), 2% lower than the
US$5.66/MMBtu recorded in the same quarter of 2004 but 4% higher
than the US$5.32/MMBtu observed in the previous quarter. The
savings versus market prices are the result of the current
financial hedging program. The Company is constantly monitoring
and studying the natural gas markets to manage this exposure. As
of the date of this report, the natural gas hedges in force
consist of the following positions:

2005

- The South Texas price for July 2005 was set at US$6.70/MMBtu.
As a result of financial hedges in place, Hylsamex's cost of
natural gas for the first 200 contracts used in July will be
approximately US$5.005/MMBtu. July's consumption in excess of
200 contracts will be charged at the market price.

- August to December 2005: 32% of the needs are hedged with a
US$4.28/MMBtu swap capped at US$6.70/MMBtu.

- August 2005: an additional 32% of the month's requirements
are covered through a US$5.86/MMBtu swap. When market prices
hover between US$4.50/MMBtu and US$5.73/MMBtu, the Company will
pay the prevailing market price plus US$0.13/MMBtu. The swap is
capped at US$7.70/MMBtu.

- September to December 2005: an additional 32% of the
requirements are covered through a US$5.73/MMBtu swap. When
market prices fluctuate between US$4.90/MMBtu and US$5.73/MMBtu,
the Company will pay the prevailing market price. The swap is
capped at US$7.70/MMBtu.

The adjacent graph depicts Hylsamex's natural gas cost for
August to December 2005, including the combined effect of the
financial hedges detailed above. The graph also shows the
average and high-low prices for August to December 2005 futures
as of July 24th, 2005.

2007

- The Company sold a swaption at US$4.20/MMBtu for 32% of the
requirements for the year. Note: While the Company's financial
hedges are referenced to NYMEX natural gas prices, all of the
Company's financial hedges described above are shown at their
South Texas equivalent price. In 2004, South Texas prices were
on average US$0.30 lower than the NYMEX price.

The cost of electricity for 2Q05 was US›4.68/Kwh, 13% higher
than the US›4.16/Kwh recorded in the same quarter of 2004 and 1%
lower than the US›4.73/Kwh registered in the previous quarter.
The increase versus the same quarter of 2004 was the result of
higher international prices for fossil fuels.

Metallic Inputs: In 2Q05, the weighted average cost of the
Company's metallic charge was US$18/ton and US$1/ton higher than
the cost during the same quarter of 2004 and the previous
quarter, in that order. In the comparison against the same
quarter of 2004, the metallic charge's cost increase is mainly
attributed to higher costs for domestic scrap and DRI. The
metallic charge's slight increase versus the previous quarter
resulted from a greater DRI cost, mostly offset by a greater use
of imported scrap in the metallic charge mix.

In 2Q05, DRI's cost rose US$14/ton and US$7/ton compared to the
same period of 2004 and the previous quarter, respectively. The
increases are attributable to greater energy costs. However, the
relative stability is due to the fairly steady effective cost of
natural gas for Hylsamex, which has oscillated around
US$5.50/MMBtu since 2004, in part as a result of the Company's
natural gas hedging strategy.

The cost of Hylsamex's overall scrap mix remained relatively
high compared to prior years. The cost of Hylsamex's domestic
scrap mix in 2Q05 rose US$30/ton compared to the same quarter of
2004 but decreased by US$2/ton when measured against the
preceding quarter. During 2Q05, the cost of Hylsamex's imported
scrap mix decreased by US$4/ton in the comparison versus the
same quarter of 2004. The cost of imported scrap increased by
US$4/ton compared to the previous quarter.

The U.S. market for scrap softened during 2Q05, with scrap
prices1 prices averaging US$173/ton, 12% less than the average
price for the previous quarter. So far, early in 3Q05, scrap
prices are at US$136/ton, as of July 15th, 2005. Locally sourced
scrap prices are also trending down lately, since there is some
lag in the pricing trends of domestic and imported scrap.

COGS for the first six months of 2005 amounted to US$862 million
(Ps.9,601 million), increasing 20% from the US$720 million
(Ps.8,468 million) recorded in the same period of 2004. The 20%
rise in COGS reflects the higher variable costs mostly. On a per
ton basis, COGS increased US$92/ton or 20%, from US$457/ton in
the first six months of 2004 to US$549/ton in the same period of
2005. In this comparison, variable costs increased US$78/ton due
to higher costs of scrap, energy and externally sourced steel
used in the coating operations; fixed cost per ton increased to
a lesser degree by US$14/ton, derived from greater maintenance
expenses in the first part of 2005.

OPERATING EXPENSES

Operating expenses for 2Q05 totaled US$41 million (Ps.456
million), 43% higher than the US$29 million (Ps.343 million)
registered in the same quarter of 2004 and 10% greater than the
US$38 million (Ps.425 million) spent in the previous quarter.
Compared to the same quarter of 2004, US$11 million of the
increase came from the resumption of the payment of management
fees to Hylsamex's parent company, Alfa. Likewise, the entire
increase in operating expenses versus the previous quarter was
caused by the management fee paid to Alfa, which totaled US$11
million in 2Q05, up US$3 million from 1Q05. The ratio of
operating expenses to sales reached 6.8% in 2Q05, higher than
the 4.9% observed in the same quarter of 2004 and slightly above
the 6.6% of the previous quarter.

For the first six months of 2005, operating expenses amounted to
US$79 million (Ps.879 million), up 26% from the US$59 million
(Ps.697 million) recorded in the first half of 2004. In the
first six months of 2005, the ratio of operating expenses to
sales increased to 6.7%, from 5.6% registered in the same period
of 2004.

OPERATING INCOME AND EBITDA

During 2Q05, operating income totaled US$117 million (Ps.1,290
million), US$74 million less than the US$191 million (Ps.2,271
million) obtained in the same quarter of 2004 and US$10 million
less than the US$127 million (Ps.1,437 million) gained in the
previous quarter. Hylsamex's operating profit margin for 2Q05
reached 19%, below the 33% and 22% operating profit margin
obtained in the same quarter of 2004 and the preceding quarter,
respectively.

The Company's EBITDA in 2Q05 of US$150 million (Ps.1,654
million) was 32% lower than the US$222 million (Ps.2,632
million) achieved in the same quarter of 2004 and was 7% less
than the US$161 million (Ps.1,813 million) generated in the
previous quarter. Hylsamex's EBITDA margin reached 25% during
2Q05, less than the EBITDA margins of 38% and 28% registered in
the same quarter of 2004 and the prior quarter, respectively. On
a per ton basis, EBITDA reached US$182/ton in 2Q05, US$100/ton
lower than the US$282/ton obtained in the same quarter of 2004
and US$34/ton less than the US$216/ton registered in the
previous quarter.

Despite the softening in international steel prices observed
during 2Q05 that produced decreases in operating profitability,
Hylsamex generated a sound EBITDA during the quarter, thanks to
steel prices which remained at fine levels and the Company's
vertical integration that helped it maintain relatively stable
costs. Against both comparable quarters, operating profitability
for 2Q05 decreased as a result of lower international steel
prices. In addition to lower prices, 2Q05 operating
profitability decreased in the comparison against the same
quarter of 2004 as a result of a higher cost per ton caused by
higher energy costs, greater prices for scrap metal, the higher
cost for externally sourced steel used in the coating operations
and the management fees paid to Alfa.

Operating income for the first six months of 2005 amounted to
US$244 million (Ps.2,727 million), 10% less than the operating
income of US$271 million (Ps.3,190 million) obtained in the same
period of 2004. EBITDA decreased to a lesser extent, as Hylsamex
generated US$311 million (Ps.3,467 million) in the first half of
2005, a 6% decrease compared to the EBITDA of US$332 million
(Ps.3,914 million) accumulated in the same period of 2004.

COMPREHENSIVE FINANCIAL RESULT (CFR)

Hylsamex recorded in 2Q05 a net financial gain of US$0.5 million
(Ps.6 million), as compared to net financial costs of US$45
million (Ps.536 million) and US$13 million (Ps.146 million)
recorded in the same quarter of 2004 and in the previous
quarter, in that order. The CFR variations are largely
attributable to fluctuations in the Peso-dollar exchange rate
and its effect on Hylsamex's basically dollarized debt. In 2Q05,
the Company registered a US$16 million foreign exchange gain due
to the appreciation of the Peso vis-…-vis the dollar during the
quarter. Against the previous quarter, Hylsamex recorded a lower
monetary position gain in 2Q05, as a result of lower inflation.
Compared to 2004, the Company continued experiencing a
relatively lower net interest expense burden, because of the
deleveraging and refinancing efforts carried out during 2004.
Net interest expense for 2Q05 amounted to US$17 million, a
decrease of 22%, or US$5 million, versus the same quarter of
2004, but 8%, or US$1 million, higher compared to the previous
quarter.

For the first six months of 2005, the Company registered a net
financial cost of US$12 million (Ps.140 million), 72% less than
the net financial cost of US$44 million (Ps.516 million)
reported for the comparable period of 2004. The reduction was
mostly a consequence of Hylsamex registering foreign exchange
gains in 2005 instead of the losses of 2004, in addition to a
decline in net interest expense in 2005. These favorable changes
were only partially offset by lower monetary position gains in
2005, which derived from lower domestic inflation and less
monetary liabilities on Hylsamex's balance sheet.


CONSOLIDATED NET INCOME

Consolidated net income for 2Q05 amounted to US$89 million
(Ps.977 million), a decrease of 28% compared to the US$124
million (Ps.1,472 million) of net income registered in the same
quarter of 2004 and a decrease of 7% from the US$95 million
(Ps.1,072 million) of net income reported in the previous
quarter. Net income decreased compared to the same quarter of
2004 mainly due to lower operating income and equity income from
associated companies, which were partially offset by a small
gain at the CFR line in 2Q05, instead of the cost registered at
the CFR line in 2Q04. Compared to the prior quarter, net income
decreased as a result of lower operating income and greater tax
accruals, which were compensated in part by a small gain at the
CFR line in 2Q05, instead of the cost registered at the CFR line
in 2Q04, and higher equity income from associated companies.

Year-to-date, for the six months ended June 30, 2005, Hylsamex
reported consolidated net income of US$184 million (Ps.2,049
million), a slight decrease of 2% versus the US$187 million
(Ps.2,205 million) of net income registered in the same period
of 2004.

NET DEBT VARIATION 2Q05

Debt, Net of Cash: Hylsamex's net debt as of June 30, 2005 was
US$471 million, US$13 million or 3% more than the US$458 million
registered as of March 31, 2005. This increase in net debt
during 2Q05 was caused by a reduction in cash reserves of US$70
million that, coupled with internally generated funds, was used
to pay the US$100 million extraordinary dividend in April.

Cash Taxes Paid: Cash taxes paid during 2Q05 amounted to US$38
million, US$33 million and US$19 million more than the amounts
paid in the same quarter of 2004 and the previous quarter,
respectively. As a result of improved profitability, Hylsamex
paid greater cash taxes in 2Q05 as the Company continued making
the required interim income tax payments. However, with the use
of asset tax credits in the annual 2005 tax return, the
Company's 2005 net tax burden is expected to be reduced through
a tax refund to be made in early 2006. As of June 30, 2005, the
Company holds US$93 million and US$139 million in tax loss carry
forwards and asset tax credits, respectively. Tax loss carry
forwards can be used to reduce future taxable income and
consequently reduce income taxes incurred. Furthermore, if the
remaining future income tax incurred is greater than the asset
tax, asset tax credits can be utilized to reduce income tax
payments to the asset tax level. Since most of the remaining tax
loss carry forwards belong to non-operating companies,
management does not foresee the immediate use of these carry
forwards during 2005.

Profit Sharing: During 2Q05, the Company paid US$31 million in
statutory employee profit sharing related to the 2004 profits,
which compares to US$2 million paid in the same quarter of 2004.
Net Working Capital (NWC): During 2Q05, net working capital
represented a source of funds of US$33 million, which compared
to a use of funds of US$93 million and US$23 million in the same
quarter of 2004 and in the previous quarter, respectively. In
2Q05, the Company obtained funds primarily from accounts
receivable and to a lesser extent from inventories; these
sources of funds were partially offset by a use of funds in
accounts payable.

Capital Expenditures: Capital expenditures amounted to US$22
million during 2Q05, an increase of US$9 million in relation to
both comparable periods. Galvak invested US$6 million while
Hylsa's capital expenditures totaled US$16 million.

NET DEBT VARIATION 6M05

Debt, Net of Cash: Hylsamex's net debt as of June 30, 2005
dropped to US$471 million, US$75 million or 14% less than the
US$546 million outstanding balance as of December 31, 2004.
This reduction in net debt in the first six months of 2005 was
obtained through the prepayment of Hylsa's Certificado Bursatil
due 2008 with internally generated cash and free cash flow that
bumped cash reserves up by US$21 million from year-end 2004, for
a balance of US$146 million as of June 30, 2005.

Cash Taxes Paid: Cash taxes paid during the first six months of
2005 amounted to US$56 million, which are higher than the US$15
million paid in the same period of 2004 because of Hylsamex's
improved profitability, as the Company began making interim
income tax payments in 2005.

Profit Sharing: During the first six months of 2005, the Company
paid US$31 million in statutory employee profit sharing related
to the 2004 profits, which compares to US$2 million paid in the
comparable period of 2004.

Net Working Capital (NWC): For the first six months of 2005, net
working capital represented a source of US$10 million in funds,
as compared to a use of funds of US$108 million in the
comparable period of 2004.

Capital Expenditures: Capital expenditures totaled US$34 million
during the first six months of 2005, US$8 million more than the
investments made in the same period of 2004. Out of the figure
for the first six months of 2005, US$9 million were disbursed at
the Galvak level and US$25 million at Hylsa.

HYLSA PREPAYS NOTES DUE 2007 AND CERTIFICADO BURSATIL DUE 2008

During 2Q05, Hylsa -Hylsamex's main subsidiary- successfully
refinanced its Notes due 2007 and prepaid its Certificado
Bursatil due 2008, with principal amounts of US$139 million and
US$64 million, respectively. Hylsa obtained medium-term bank
loans of US$150 million and used internally generated funds to
carry out the prepayments, which will further reduce Hylsamex's
consolidated cost of debt.

LIQUIDITY AND CASH RESERVES

Strong free cash flow allowed a high level of cash reserves,
which reached US$146 million as of June 30, 2005, US$6 million
more than the US$140 million at the end of the same quarter of
2004 but US$71 million lower than the balance of US$217 million
at the end of the previous quarter. Hylsa's US$60 million
Liquidity Facility, which was obtained to support general
corporate purposes and working capital needs, remains unused.

KEY FINANCIAL RATIOS

The Company recorded Net Debt to LTM EBITDA of 0.6x as of the
end of 2Q05, decreasing from the 2.0x observed in the same
period of 2004 and similar to the 0.6x of the preceding quarter.
The Interest Coverage ratio (LTM EBITDA to LTM Net Interest
Expense) reached 10.5x as of the end of 2Q05, compared to 4.5x
in the same quarter of 2004 and 10.8x in the previous quarter.

EQUITY INCOME FROM ASSOCIATED COMPANIES (SIDOR)

Hylsamex's minority stake in Amazonia generated a gain of US$15
million (Ps.160 million) in 2Q05, as compared to the gains of
US$21 million (Ps.253 million) and US$8 million (Ps.95 million)
recorded in the same quarter of 2004 and in the previous
quarter, respectively. Hylsamex's gain for 2Q05 reflects Sidor's
solid operating performance, as a result of favorable
fundamentals in the global steel market, the company's position
as one of the world's lowest-cost steel producers through
vertical integration, and its privileged geographic location
that allows it to efficiently supply the domestic and export
markets.

To see financial statements:
http://bankrupt.com/misc/Hylsamex_2Q05.pdf

CONTACT:  Othon Diaz Del Guante
          Tel: +(52) 81-8865-1240
          E-mail: odiaz@hylsamex.com.mx

          Ismael De La Garza
          Tel: +(52) 81-8865-1224
          E-mail: idelagarza@hylsamex.com.mx

          Kevin Kirkeby
          Tel: +(646) 284-9416
          E-mail: kkirkeby@hfgcg.com


MAXCOM TELECOMUNICACIONES: Deploys Sylantro-Based Applications
--------------------------------------------------------------
Sylantro Systems Corporation announced Monday that Maxcom
Telecomunicaciones has deployed Sylantro's applications feature
server to power the new Maxcom GENUS Voice System for businesses
throughout the company's service area. The GENUS Voice System
gives business users hosted IP PBX-type capabilities as well as
advanced features that improve employee productivity and
collaboration while reducing capital and operational expenses.

With more than 1000 employees, Maxcom Telecomunicaciones serves
in excess of 200,000 business and residential lines via copper,
fiber-optic and microwave networks. The company was the first
competitive local exchange carrier (CLEC) to deploy commercial
services in Mexico. The GENUS Voice System will be offered
initially to business customers in Mexico's largest metropolitan
areas including Mexico City, Puebla, Queretaro, Toluca,
Guadalajara, Monterrey, Leon, San Luis Potosi and
Aguascalientes.

"The Sylantro applications feature server allows us to offer
businesses a complete suite of high-end features and
capabilities in a network-hosted model that eliminates the need
for a costly on-premise PBX," said Juan Pablo del Real, director
of new technologies and strategic sales of Maxcom
Telecomunicaciones. "Further, the GENUS Voice System
democratizes these advanced IP technologies, allowing businesses
of almost any size to take advantage of state-of-the-art
communications services to achieve greater efficiency and
productivity."

Maxcom commenced commercial operation in 1999 and has been a
consistent leader in providing advanced telecommunications
options for its business and residential customers. The GENUS
Voice System includes fully localized user and administrator
portals, integration with Microsoft(R) Outlook(R) messaging and
collaboration clients, and mobile phone integration via Wireless
Access Protocol (WAP). Maxcom has also deployed advanced
features such as find me/follow me, customizable call
treatments, call logs and many others.

"Maxcom exemplifies the new wave of service providers who are
embracing hosted IP communications services on a worldwide
basis," said Pete Bonee, president and CEO of Sylantro Systems.
"Through Sylantro's applications feature server and business
VoIP applications, Maxcom can now offer new compelling IP
communication services that address the needs of existing
customers and attract new customers as well."

About Maxcom Telecomunicaciones

Maxcom Telecomunicaciones, S.A. de C.V., headquartered in Mexico
City, Mexico, is a facilities-based telecommunications provider
using a "smart-build" approach to deliver last-mile connectivity
to micro, small and medium-sized businesses and residential
customers in the Mexican territory. Maxcom launched commercial
operations in May 1999 and is currently offering Local, Long
Distance and Internet & Data services in greater metropolitan
Mexico City, Puebla, Queretaro, and recently Monterrey and
Guadalajara. The information contained in this press release is
the exclusive responsibility of Maxcom Telecomunicaciones, S.A.
de C.V. and has not been reviewed by the National Banking and
Securities Commission of Mexico (CNBV).

About Sylantro Systems Corp.

Sylantro Systems provides the premier software platform for
advanced IP Centrex and hosted communications services for
business, residential, wireless and other applications. The
company leads the market in deployments, with carriers such as
SBC, PTTs such as Swisscom, and next-generation service
providers such as NuVox and Covad using the Sylantro platform.
With a unique combination of advanced applications, a carrier-
class platform, and proven go-to-market services, Sylantro
allows service providers to rapidly deliver high-value, high-
margin managed telephony services. These award-winning solutions
offer business users sophisticated communications services
without the cost and complexity of today's in-house PBX and key
systems, and give consumers new flexibility in their
communications services. Sylantro is a privately held company
backed by premier investors.


VITRO: Continues to See Upturn in Sales in 2Q05
-----------------------------------------------
Vitro S.A. de C.V. (BMV: VITROA; NYSE: VTO) one of the world's
largest producers and distributors of glass products, announced
Monday 2Q'05 unaudited results. Consolidated sales rose 9.0
percent YoY. Excluding divestitures of Vitro American National
Can (VANCAN) in September 2004 and Plasticos Bosco (BOSCO) in
April 2005, consolidated sales rose by 12.4 percent during the
same period. Consolidated EBITDA fell 4.6 percent, resulting in
a margin decline of 2.1 percentage points to 14.3 percent. On a
comparable basis, consolidated EBITDA declined 2.2 percent.
Comparable EBITDA rose 26.1 percent at Glass Containers and
fell 33.7 percent at Flat Glass and 28.7 percent at Glassware.

Alvaro Rodriguez, Chief Financial Officer, commented: "We are
pleased to see the upturn in sales continuing as we report the
fourth consecutive quarter of YoY comparable sales growth
across all business units. Once again, Glass Containers was the
outstanding performer, with a 25 percent increase in comparable
sales, and a record comparable EBITDA of US$59 million, the
highest since 2Q98. This excellent performance was driven by
strong volume, both in the domestic and export markets; high
capacity utilization; a better product mix in almost every
segment and the positive impact of our ongoing cost reduction
program."

"As anticipated, on a sequential basis, Flat Glass turned in a
slightly better performance, reflecting a stable pricing
environment in the domestic market since the second half of
last year," Mr. Rodriguez continued. "However, high-energy
costs continue to penalize profitability in this segment. The
highlight for Flat Glass has been international, with foreign
subsidiaries reporting a total sales gain of 17.5 percent and
very strong EBITDA growth," he added.

"Higher energy costs continue to affect results. This issue,
which is influencing glass companies worldwide, reinforces the
need for effective cost cutting programs. Our focus in this
environment is on strict cost management across all major
facets of our business, including enhanced production
efficiencies, reduced headcount and expenses at the corporate
offices. In fact, new initiatives introduced in the recent past
resulted in savings of approximately US$3 million in cost of
goods sold and SG&A, the latter decreasing 1 percentage point
as a percentage of sales year-over-year."

"As one of the world's leading glass companies, we serve
diverse industry sectors, which exposes us to a variety of
economic variables and geographic markets. In this respect, the
portfolio effect works to our advantage. For example this
quarter, glass containers and international flat glass
operations provided strong support to both the top and bottom
lines.

All figures provided in this announcement are in accordance
with Generally Accepted Accounting Principles in Mexico, except
otherwise indicated. Dollar figures are in nominal US dollars
and are obtained by dividing nominal pesos for month by the end
of month fix exchange rate published by Banxico. In the case of
the Balance Sheet, US dollar translations are made at the fix
exchange rate as of the end of the period. The exchange rate as
of April 30, 2005 was 11.0832, as of May 31, 2005 was 10.9160
and as of June 30, 2005 was 10.7752 pesos per US dollar.
Certain amounts may not sum due to rounding. All figures and
comparisons are in USD terms, unless otherwise stated.

Vitro, S.A. de C.V. (NYSE: VTO; BMV: VITROA), through its
subsidiary companies, is one of the world's leading glass
producers. Vitro is a major participant in three principal
businesses: flat glass, glass containers and glassware. Its
subsidiaries serve multiple product markets, including
construction and automotive glass; food and beverage, wine,
liquor, cosmetics and pharmaceutical glass containers;
glassware for commercial, industrial and retail uses. Vitro
also produces raw materials and equipment and capital goods for
industrial use. Founded in 1909 in Monterrey, Mexico-based
Vitro has joint ventures with major world-class partners and
industry leaders that provide its subsidiaries with access to
international markets, distribution channels and state-of-the-
art technology. Vitro's subsidiaries have facilities and
distribution centers in eight countries, located in North,
Central and South America, and Europe, and export to more than
70 countries worldwide.

To see financial highlights:
http://bankrupt.com/misc/Vitro.htm

CONTACT: Vitro, S.A. de C.V.
         Investor Relations
         Mr. Adrian Meouchi (ameouchi@vitro.com)
         Ms. Leticia Vargas (lvargasv@vitro.com)
         Vitro S.A. de C.V.
         Phone: (52) 81-8863-1350 / 1219

         Media Relations (achico@vitro.com)
         Mr. Albert Chico
         Vitro, S. A. de C.V.
         Phone: (52) 81-8863-1335
         Web site at: http://www.vitro.com



=============
U R U G U A Y
=============

ANCAP: To Sign MOU With Brazil's Petrobras Next Month
-----------------------------------------------------
State oil company Administracion Nacional de Combustibles
Alcohol y Portland (ANCAP) expects to formalize on August 15 a
memorandum of understanding (MOU) with Brazil's federal energy
company Petrobras for exploration and refining cooperation.

Business News Americas recalls that the two companies signed an
MOU on April 1 committing them to appraising the possibility of
exploring for oil in Uruguayan waters.

The MOU will allow Petrobras to explore the deep waters off
Uruguay's coastline. Meanwhile, Ancap can make use of Petrobras'
consulting services to expand Uruguay's only refinery.

ANCAP is Uruguay's government-owned oil & gas company with
strong roots in the domestic downstream market. The government
incorporated the Company in 1931 to operate the state monopoly
in the fuel and natural gas sectors. ANCAP maintains exclusive
rights over refining activities and crude oil, refined products,
and natural gas imports in the country. The Company also
participates in the cement sector, although it does not have a
monopoly in this activity.



                            ***********


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
Sheryl Joy P. Olano, Editors.

Copyright 2005.  All rights reserved.  ISSN 1529-2746.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.

Information contained herein is obtained from sources believed
to be reliable, but is not guaranteed.

The TCR Latin America subscription rate is $575 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for
members of the same firm for the term of the initial
subscription or balance thereof are $25 each.  For subscription
information, contact Christopher Beard at 240/629-3300.


* * * End of Transmission * * *