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 Monday, November 12, 2007, Vol. 8, Issue 224 Headlines A R G E N T I N A ALLIANCE ONE: Earns US$18.1 Million in Quarter Ended Sept. 30 BALLY TECHNOLOGIES: Buying Compudigm's Gaming Power & seePOWER BANCO MACRO: Reports ARS88-Mln Net Income in Qtr. Ended Sept. 30 FERRO CORP: Reports US$5.6-Mln Net Income in Qtr. Ended Sept. 30 EMPRESA DISTRIBUIDORA: Reports ARS69.9MM Net Income for 9 Mos. B A H A M A S HARRAH'S ENTERTAINMENT: Earns US$244.4 Million in Third Quarter HARRAH'S ENTERTAINMENT: Indiana Gaming Agency OKs Apollo Merger B E R M U D A JETBLUE AIRWAYS: Ed Barnes Replaces John Harvey as Interim CFO B R A Z I L BANCO NACIONAL: Funding 80% of Santo Antonio Plant Through Loans COMPANHIA ENERGETICA: Bidding in Santo Antonio Plant Auction COMPANHIA ENERGETICA: Earns BRL1.47 Billion in First Nine Months COMPANHIA PARANAENSE: Will Focus on Generation Projects FORD MOTOR: Posts US$380-Million Loss for Third Quarter 2007 FORD MOTOR CREDIT: Earns US$334 Million in Third Quarter GENERAL MOTORS: Credit Suisse Maintains Neutral Rating on Firm GENERAL MOTORS: Posts US$39 Billion Net Loss in Third Quarter GEOKINETICS INC: Closes US$25MM Capital Lease Facility with CIT IWT TESORO: Court Approves Donlin Recano as Claims Agent IWT TESORO: Brings In Rader & Coleman as Special Counsel IWT TESORO: Hires Rattet Pasternak as Bankruptcy Counsel MYERS INDUSTRIES: Earns US$1.5 Million in Third Quarter of 2007 TAM SA: Gets Third Airbus A321, Increases Fleet to 111 Aircraft TOWER AUTO: Names New President for International Operations UNIAO DE BANCOS: Net Income Up 123.3% to BRL2,621 Million in 3Q XERIUM TECH: Earns US$7.1 Million in Third Qtr. Ended Sept. 30 XERIUM TECH: Paying US$0.1125 Per Share Dividend on Dec. 17 C A Y M A N I S L A N D S BLUE REEF: Proofs of Claim Filing Deadline Is Nov. 20 BMIT CORP: Sets Final Shareholders Meeting for Nov. 26 CLEAN COLT: Proofs of Claim Verification Deadline Is Dec. 27 DISTRIBUIDORA BANFIELD: Claims Verification Ends Dec. 20 EBS INVESTMENT: Proofs of Claim Filing Deadline Is Nov. 26 FIRST CLUB: Trustee Verifies Proofs of Claim Until Dec. 17 GAMMA GLOBAL: Sets Final Shareholders Meeting for Nov. 20 GAMMA RELATIVITY: Sets Final Shareholders Meeting for Nov. 20 GAMMA RELATIVITY (II): Final Shareholders Meeting Is on Nov. 20 GAMMA RELATIVITY LOW: Sets Last Shareholders Meeting for Nov. 20 GAMMA RELATIVITY (FUND): Last Shareholders Meeting Is on Nov. 20 GAMMA RELATIVITY INT'L: Final Shareholders Meeting on Nov. 20 LOS MIRASOLES: Proofs of Claim Verification Deadline Is Feb. 21 POLIPRODUCTOS ARGENTINOS: Claims Verification Deadline Is Feb. 4 SATELY SA: Trustee Verifies Proofs of Claim Until Dec. 10 C H I L E NOVA CHEMICALS: Paying CDN0.10 Per Share Quarterly Dividend C O L O M B I A BRIGHTPOINT INC: Third Qtr. Net Income Up to US$12.9 Million CASCADES INC: To Pay US$0.04 Per Share Qtrly Dividend on Dec. 17 GRAN TIERRA: Drilling Works Dominate 2008 Capital Expenditures C O S T A R I C A SPECTRUM BRANDS: Incurs US$333-Million Net Loss in Third Quarter D O M I N I C A N R E P U B L I C HANESBRANDS INC: Hires William Nictakis as Chief Comm'l Officer H A I T I BASIC ENERGY: Reports US$24.4 Million Net Income in Third Qtr. DYNCORP INT'L: Peter Schoomaker Joins Board of Directors J A M A I C A AIR JAMAICA: Launching Partnership Talks with Stanford Financial M E X I C O CLEAR CHANNEL: Third Quarter Net Income Rises to US$279.7 Mil. DESARROLLADORA HOMEX: Shareholders Acquire 6.7MM Common Shares DURA AUTOMOTIVE: Seeks to Pay Arrangers for US$425MM Exit Loan DURA AUTOMOTIVE: Wants Plan Confirmation Hearing Moved to Dec. 6 GRUPO MEXICO: Investing US$300MM To Fund Asarco's Chap. 11 Exit MOVIE GALLERY: Committee Taps Miles & Stockbridge as Co-Counsel MOVIE GALLERY: Committee Selects Pachulski Stang as Lead Counsel MOVIE GALLERY: Wants to Employ Ernst & Young as Tax Advisors REMY: Obtains US$225MM Secured DIP Funding From Barclays Capital SCO GROUP: Wants to Sell Certain Assets to JGD for US$36,000,000 SCO GROUP: IBM and Novell Balk at Proposed Asset Sale Procedure SR TELECOM: Posts US$22.2 Million Net Loss in 2007 Third Quarter P A N A M A AES CORP: Bear Stearns Upgrades Firm's Shares to Outperform P E R U QUEBECOR WORLD: Inks US$341 Million Sell/Merge Deal with RSDB NV P U E R T O R I C O DIRECTV GROUP: Earns US$319 Mil. in Third Quarter Ended Sept. 30 V E N E Z U E L A CITGO PETROLEUM: Selling Two Asphalt Plant & Terminal To NuStar PETROLEOS DE VENEZUELA: Investing Over US$10B To Boost Output * BOND PRICING: For the Week Nov. 5 to Nov. 9 - - - - - ================= A R G E N T I N A ================= ALLIANCE ONE: Earns US$18.1 Million in Quarter Ended Sept. 30 ------------------------------------------------------------- Alliance One International, Inc. has announced results for the quarter and six months ended Sept. 30, 2007. Second Quarter Results For the second quarter ended Sept. 30, 2007, the company reported net income of US$18.1 million, or US$0.21 per basic share, compared to net income of US$8.3 million, or US$0.10 per basic share, in the year ago quarter. For the six months ended Sept. 30, 2007, the company had net income of US$24.1 million, or US$0.27 per basic share, compared to net income of US$12.9 million or US$0.15 per basic share for the year ago period. Robert E. Harrison, Chief Executive Officer, said "Operating income for the quarter and six months was comparable to the prior year's same periods. However, the current business environment remains challenging due to the short African burley crops and the continued weakening of the US dollar against many of the foreign currencies where we have a local currency denominated cost structure. These factors negatively impacted our underlying results. The impact of short crops in periods of high demand translated into higher average green prices, higher through put costs and less volume to sell. In areas not supply constrained, including Brazil, the continued weakening of the US dollar has created a challenging pricing environment. Despite these challenges, we did make further significant progress in our strategies to reduce long-term debt, manage our cost structure and execute on the innovation focus of our core business. "Since year end at March 31, 2007, long term debt has been permanently reduced by US$152.1 million, lowering our cash interest expense as we move forward. Additionally, we continue to focus on our core business as demonstrated by the post quarter end sale of the CdF operations in early October -- realizing an additional US$16.2 million dollars of cash available for further debt reductions. "Finally, consistent with our mission to provide our customers with innovative solutions, I am pleased to announce that we have recently filed for intellectual property protection on four new reduced alkaloid burley varieties developed at our R&D facility in Brazil. Applications were filed with the US Department of Agriculture seeking Plant Variety Protection, and patents are now pending with the US Patent and Trademark Office. The new burley varieties, which are the product of a research program spanning more than eight years, were developed using conventional plant breeding methods and exhibit lower alkaloid levels when compared with other standard burley varieties. In addition, the new varieties retain the desirable leaf quality, grower yields and smoking characteristics typical of existing Brazilian burley tobaccos. "Tobacco varieties with lower alkaloid levels mean lower overall nicotine levels and intrinsically may produce leaf containing reduced tobacco specific nitrosamines. We believe this is a positive development and may compliment the industry's ongoing research to develop reduced harm products. Limited commercial production is expected to commence in early 2009. Mr. Harrison concluded, "In summary, it was a challenging quarter in which we kept our focus squarely on our strategic priorities. Our long term debt continues to decline and we're focused on providing innovative products for the future." Performance Summary for the Quarter Sales and other operating revenues The decrease of 1.2% from US$593.6 million in 2006 to US$586.6 million in 2007 is primarily the result of a 3.2% or 5.6 million kilo decrease in quantities sold partially offset by a 2.1% or US$0.07 per kilo increase in average sales prices. -- Tobacco sales from the South America operating segment decreased US$3.3 million or 0.9% resulting from a decrease of US$0.15 per kilo in average sales prices as a result of product mix, partially offset by an increase in volumes of 3.4 million kilos. -- Tobacco sales from the Other Regions operating segment decreased US$3.3 million or 1.4% primarily as a result of a decrease in volumes of 9.0 million kilos partially offset by an increase of US$0.33 per kilo in average sales prices. This dynamic is primarily a result of opportunistic sales and accelerated shipments in the prior year in the United States, the exit from the European markets in Greece and Spain and a shortage of shipping vessels in Tanzania in the current year. Gross profit as a percentage of sales Gross profit decreased US$20.0 million or 19.3% from US$103.8 million in 2006 to US$83.8 million in 2007 and gross profit as a percentage of sales decreased from 17.5% in 2006 to 14.3% in 2007. -- Gross profit in the South America operating segment decreased US$14.5 million primarily as a result of decreased sales prices coupled with higher costs related to higher processing costs as a result of a smaller 2007 crop, as well as the impact of the strengthening Brazilian Real, which substantially increased both the 2006 and 2007 crop green and tobacco processing costs. -- In the Other Regions operating segment, the decrease in gross profit of US$5.5 million is primarily attributable to the Africa origins of Malawi and Tanzania. The 2007 Malawi crop size was reduced as a result of weather conditions and, when coupled with decreased share due to increased competition within the Malawi market, both have dramatically increased the purchase price of the 2007 burley crop. As a result of these factors, the average auction prices for the 2007 crop tobacco in Malawi have almost doubled in comparison with the prior year while the per kilo processing and overhead costs allocated to the 2007 crop increased. Negotiated sales price increases are insufficient to cover these cost escalations. These factors will have a material negative impact on Other Region gross profit as the 2007 Malawi burley crop is sold in future quarters. Selling, administrative and general expenses decreased US$4.5 million or 11.0% from US$41.0 million in 2006 to US$36.5 million in 2007. The decrease is primarily due to decreased incentive compensation costs and professional fees partially offset by increased travel expenses. Other income of US$2.2 million in 2007 and US$2.9 million in 2006 relates primarily to fixed asset sales. Restructuring and asset impairment charges were US$2.4 million in 2007 and US$20.9 million in 2006 as a result of both employee severance and asset impairment changes. Debt retirement expense of US$1.3 million in 2007 relates to accelerated amortization of debt issuance costs as a result of debt prepayment during the quarter. Interest expense decreased US$4.4 million from US$29.6 million in 2006 to US$25.2 million in 2007 primarily due to lower average borrowings during the quarter. Interest income decreased from US$2.8 million in 2006 to US$2.1 million in 2007 primarily due to a lower weighted average return on cash. Effective tax rates were an expense of 23.6% in 2007 and 51.4% in 2006. We forecast the tax rate for the year ended Mar. 31, 2008 will be 29.9% after absorption of discrete items. Income (loss) from discontinued operations. Discontinued operations resulted in income of US$0.4 million in 2007 compared to a loss of US$0.8 million in 2006 as a result of our exit from the discontinued operations in Italy, Mozambique and wool operations. Liquidity and Capital Resources As of Sept. 30, 2007, available credit lines and cash were US$686.2 million including US$10.0 million exclusively available to letters of credit, US$129.2 million of cash, the US$250.0 million unfunded revolver and US$297.0 million in foreign lines. Total debt net of US$129.2 million in cash decreased to US$797.6 million from US$988.2 million for the prior year quarter end and US$903.1 million for the quarter ended June 30, 2007 driven by the pay off of the remaining US$60.0 million under the US$145.0 million term loan B as a result of cash flow from operations and other available cash. Additionally, from time to time in the future, the company may elect to redeem, repay, make open market purchases, retire or cancel indebtedness prior to stated maturity under its various global bank facilities or outstanding public notes, as they may permit. About Alliance One Based in Morrisville, North Carolina, Alliance One International Inc. (NYSE: AOI) -- http://www.aointl.com/-- is a leaf tobacco merchant. The company has worldwide operations in Argentina, Bangladesh, Brazil, Bulgaria, Canada, China, France, Philippines, Malaysia, and Singapore. * * * Alliance One International Inc. continues to carry Moody's Investors Service's B2 long-term corporate family rating, B1 bank loan debt rating, B2 senior unsecured debt rating, Caa1 subordinated debt rating, and B2 probability-of-default rating. Moody's said the ratings outlook is stable. The company also carries Standard & Poor's B+ long-term foreign and local issuer credit ratings. S&P said the ratings outlook is negative. BALLY TECHNOLOGIES: Buying Compudigm's Gaming Power & seePOWER -------------------------------------------------------------- Bally Technologies Inc. has signed a contract to acquire the Gaming Power and seePOWER applications for the gaming industry from Compudigm International, adding exclusive and powerful data visualization and business analysis technology to the new Bally Business Intelligence product line. Compudigm's integrated solutions will immediately serve as a key component in Bally's server-gaming strategy and the company's plans for delivering "The Networked Floor Of The Future." The acquired Compudigm technology currently monitors, manages and optimizes data from more than 60,000 gaming positions around the world that generate $6 billion in annual revenues. Current customers using this product for marketing and business analysis include Harrah's Entertainment, Penn National Gaming, Trump Entertainment Resorts and the Seminole Tribe of Florida, well as major casinos in New Zealand and Australia. Bally also launched a comprehensive Business Intelligence solution that will consist of two distinct and integrated modules -- its internally developed Data Analysis Dashboard and Compudigm's Gaming Power and seePower Data Visualization modules -- both working off one combined Gaming Data Warehouse. This combination of two best-of-breed solutions will offer the most powerful and state-of-the-art business intelligence suite for the gaming industry. The Data Analysis Dashboard offers more than 650 predefined key performance indicators, graphical data analysis charts and graphs, more than 150 predefined reports and ad-hoc reporting that will bring all essential information required to manage a casino just a few computer clicks away. "The Compudigm technology acquisition is consistent with our commitment to deliver leading, yet useable technology with a strong return on investment to our Systems footprint of more than 368,000 devices worldwide," Richard Haddrill, CEO of Bally Technologies, said. "Our leading business intelligence suite of products will be a key component in delivering ROI on the evolving 'networked gaming floor of the future." The new Bally Business Intelligence product line will feature multiple pricing and scalable options for the different data warehousing, business analysis and data visualization solutions. "When combined with the acquired Compudigm technology, this will allow for dynamic decision-making that doesn't currently exist in the industry today and will be the most comprehensive business intelligence package in the gaming space," Bruce Rowe, senior vice president of Strategy and Business Development for Bally," said. "And it's the perfect foundational technology for both today's networked floor and for the potential created by server applications." The Compudigm Gaming Power technology specializes in connecting customer data with individual game data, providing game and marketing managers with deep insights into how casino patrons interact with the gaming floor. seePOWER transforms massive volumes of transaction and customer data, from any system, into critical, real-time visual insights from a physical perspective designed to prompt smarter, faster and more profitable decision- making. The Compudigm products Bally is acquiring transform the deluge of data generated by casino slots, tables and customer loyalty systems into actionable, visual insights that help casino managers make the smartest, fastest marketing and game floor management decisions possible. "The Bally solution will utilize seePOWER's smart marketing and predictive engine to unlock real value and to realize the full potential of a casino's business," Wout van Loon, CEO of Compudigm International, said. "The seePOWER platform has provided many gaming customers with an unparalleled competitive advantage." The Bally agreement represents Compudigm's business model to provide solution providers with the seePOWER platform and application development suite to deliver visualization, customer profiling, customer segmentation and content-intelligence to the entertainment, loyalty, financial services, retail, telecommunications, utilities and health sciences industries. About Compudigm International Headquartered in Las Vegas, Nevada, Compudigm International -- http://www.compudigm.com/-- delivers business intelligence solutions based upon its seePOWER data visualization technology, which enables enterprises to transform disparate data into actionable, visual intelligence for significant competitive advantage. Founded in 1997, the company enables enterprises to see their business clearly by animating, illustrating and infusing maps and floor-plans well as product, engineering and scientific diagrams with comprehensive business intelligence. Compudigm also delivers visualization, customer profiling, and content-intelligence as well as advice and guidance solutions to the gaming, retail, entertainment, telecommunications, utilities, health sciences and financial service industries. About Bally Technologies Inc. Headquartered in Las Vegas, Nevada, Bally Technologies, Inc. (NYSE: BYI) -- http://www.BallyTech.com/-- designs, manufactures, operates, and distributes advanced gaming devices, systems, and technology solutions worldwide. Bally's product line includes reel-spinning slot machines, video slots, wide- area progressives and Class II lottery and central determination games and platforms. Bally Technologies also offers an array of casino management, slot accounting, bonus, cashless, and table management solutions. The company also owns and operates Rainbow Casino in Vicksburg, Miss. The company's South American operations are located in Argentina. The company also has operations in Macau, China, and India. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 7, 2007, Standard & Poor's Ratings Services raised its corporate credit and senior secured debt ratings on Las Vegas- based Bally Technologies Inc. to 'B+' from 'B-'. Concurrently, S&P revised the CreditWatch implications to positive from developing. BANCO MACRO: Reports ARS88-Mln Net Income in Qtr. Ended Sept. 30 ---------------------------------------------------------------- Banco Macro S.A. has announced its results for the three months ended Sept. 30, 2007. All figures are in Argentine pesos and have been prepared in accordance with Argentine GAAP. Highlights -- The Bank's net income totaled ARS88 million. This result was 17% or ARS17.7 million lower than 3Q06's ARS105.7 million. The annualized ROAE and ROAA reached 18.4% and 2.6%, respectively. The Bank's equity also increased by ARS88 million in the quarter. -- Banco Macro decided not to take the option to value its portfolio as "investment" or "available for sale" pursuant to Communications "A" 4698 and 4702 issued by the Central Bank. The Bank continues to value its securities at market value. -- The Bank's net interest income was ARS233 million, decreasing 0.3% Quarter-over-Quarter. The Bond portfolio income declined 2.5% due to lower bond prices. -- Banco Macro's financing to the private sector increased 24% or ARS1.8 billion and 59% or ARS3.4 billion Year-over-Year. Personal loans, which represent a strategic product for the Bank, once again led private loan portfolio growth. This product grew 27% and 150% Year-over-Year. -- Total deposits grew 12% or ARS1.5 billion, totalling ARS13.5 billion and represented 78% of the Bank's liabilities. Time deposits rose 15%. -- Banco Macro continued to have a strong solvency ratio, with excess capital of ARS1.9 billion. In addition, the Bank's liquid assets remained at a high level, reaching 59.7% of total deposits. -- The Bank's asset quality improved to more attractive levels. In Sept. 30, 2007, Banco Macro's PDLs-to-total loans ratio reached 1.34%, improving from 2Q07's 1.55%. The coverage ratio reached 157.1%. About Banco Macro Headquartered in Buenos Aires, Argentina, Banco Macro -- http://www.macro.com.ar/-- had consolidated assets of 11.6 billion (US$3.7 billion) and consolidated deposits of 6.0 billion (US$2 million) as of June 2007. * * * As reported in the Troubled Company Reporter-Latin America on Oct. 22, 2007, Moody's Investors Service has assigned a B2 long- term foreign currency debt rating to the expected issuance of Banco Macro S.A.'s US$200 million senior notes that are due in 2014. This debt is issued under the bank's medium-term note program, which amount has been recently increased to US$700 million, from the initial US$400 million. Moody's said the outlook on the rating is positive. These rating were assigned to Banco Macro S.A.: -- Foreign Currency Senior debt of US$200 million: -- Long-term foreign currency debt rating: B2, positive outlook FERRO CORP: Reports US$5.6-Mln Net Income in Qtr. Ended Sept. 30 ---------------------------------------------------------------- Ferro Corporation has earned US$5.6 million on net sales of US$551 million for the three months ended Sept. 30, 2007, compared to net income of US$5.5 million on net sales of US$501 million for the same period in 2006. Income from continuing operations for the 2007 third quarter was US$5.6 million, up 2.2 percent compared with US$5.5 million in the third quarter of 2006. During the quarter, lower selling, general and administrative expenses and lower interest expense were largely offset by restructuring charges related to the consolidation of certain manufacturing operations in Europe and higher income tax expense. The 2007 third quarter income from continuing operations included net pre-tax expenses of US$6.5 million primarily related to restructuring costs. The third quarter 2006 income from continuing operations included net pre- tax expenses of US$1.3 million primarily related to manufacturing rationalization activities. "We delivered strong third-quarter sales that were driven by the breadth of our international operations," said Chairman, President and Chief Executive Officer James F. Kirsch. "Our segment income increased 7 percent, compared with the third quarter of 2006, despite weakness in a number of U.S. markets and continued raw material cost increases. While we delivered improved segment income from the third quarter of 2006, we remain focused on the opportunities we have identified to improve overall profitability and deliver enhanced shareholder value." Net sales increased in the third quarter primarily as a result of product price increases and favorable changes in foreign currency exchange rates. Compared with the third quarter of 2006, sales increased in the Performance Coatings, Color and Glass Performance Materials, Electronic Materials and Polymer Additives segments. Sales declined from the prior-year period in the Specialty Plastics segment. International net sales grew 18 percent compared with the third quarter of 2006, while sales in the United States were flat. Gross margins were 18.2 percent of sales for the third quarter, compared with 19.7 percent of sales in the third quarter of 2006. The Company's 2007 third quarter gross profit was reduced by US$0.5 million in costs primarily related to accelerated depreciation and other costs associated with manufacturing rationalization activities. Gross profit was negatively impacted by lower volumes, particularly in porcelain enamel and plastics products, and higher raw material costs. In addition, gross margin as a percent of sales continued to be negatively impacted by rising precious metal costs. Precious metal costs are passed through to customers with minimal contribution to margins. Selling, general and administrative (SG&A) expense was US$71.1 million in the third quarter of 2007, or 12.9 percent of sales. SG&A expense in the third quarter of 2006 was US$74.1 million, or 14.8 percent of sales, including charges of US$0.4 million primarily related to organizational initiatives and an accounting restatement. SG&A expense declined primarily as a result of expense reduction activities, particularly in the Specialty Plastics and Electronic Materials segments, lower incentive compensation accruals and lower audit fees. Restructuring charges were US$5.8 million for the 2007 third quarter, primarily as a result of activities related to the consolidation of Ferro's porcelain enamel manufacturing operations in Europe. There were no restructuring charges recorded in the third quarter of 2006. Interest expense for the 2007 third quarter was US$14.5 million, compared with US$16.8 million in the year-ago period. Interest expense declined from the prior-year period largely as a result of lower borrowing levels resulting from the elimination of cash deposits on precious metal consignments and lower interest rates. The elimination of these deposits also resulted in a decline in interest income during the third quarter compared with the third quarter of 2006. The company's tax rate for the third quarter increased to 38.3 percent from 33.0 percent in the 2006 third quarter. The higher rate was largely the result of the tax effects from the restructuring charges recorded in the quarter, the mix of income by country and an increase in the tax cost of foreign current- year earnings to be repatriated. Total debt on Sept. 30, 2007 was US$536.4 million, compared with US$592.4 million at the end of 2006. The company had net proceeds of US$65.5 million from its U.S. accounts receivable securitization program as of Sept. 30, 2007, compared with US$60.6 million at the end of 2006. The company also had US$51.2 million in net proceeds from similar programs outside the U.S. at the end of the quarter, compared with US$33.7 million at the end of 2006. About Ferro Corp. Headquartered in Cleveland, Ohio, Ferro Corporation (NYSE: FOE) -- http://www.ferro.com/-- is a global producer of an array of specialty chemicals including coatings, enamels, pigments, plastic compounds, and specialty chemicals for use in industries ranging from construction, pharmaceuticals and telecommunications. Ferro operates through the following five primary business segments: Performance Coatings, Electronic Materials, Color and Performance Glass Materials, Polymer Additives, and Specialty Plastics. Revenues were USUS$2 billion for the FYE ended Dec. 31, 2006. Ferro Corp. has global locations in Argentina, Australia, Belgium, Brazil, China, among others. * * * As reported in the Troubled Company Reporter-Latin America on May 16, 2007, Moody's Investors Service assigned a B1 corporate family rating to Ferro Corporation. Moody's also assigned a B1 rating to the company's USUS$200 million senior secured notes (issued as unsecured notes in 2001) due in January 2009 and an SGL-3 speculative grade liquidity rating. EMPRESA DISTRIBUIDORA: Reports ARS69.9MM Net Income for 9 Mos. -------------------------------------------------------------- Empresa Distribuidora y Comercializadora Norte S.A. has announced its results for the nine months ended Sept. 30, 2007. All figures are stated in Argentine Pesos and have been prepared in accordance with Argentine GAAP. Solely for the convenience of the reader, Peso amounts as of and for the nine- month period ended Sept. 30, 2007, have been translated into U.S. Dollars at the buying rate for U.S. Dollars quoted by Banco de la Nacion Argentina on Sept. 30, 2007, of ARS3.15. Highlights Net Sales increased 47.0% to ARS1,503.2 million in the nine- month period ended Sept. 30, 2007, compared to Ps.1,022.9 million in the same period of 2006, mainly due to the application to our non residential customers of the increase in our distribution marginfrom Feb. 1, 2007, and the recording of the retroactive portion of the VAD increase for the period from Nov. 1, 2005 through Jan. 31, 2007, which totals ARS218.6 million. As of Sept. 30, 2007 we had already invoiced ARS33.5 million of that amount while ARS185.1 million remains unbilled. Excluding the unbilled amount of retroactive portion of the VAD increase, net sales in the nine-month period ended Sept. 30, 2007 would have been ARS1,318.1 million, representing a 28.9% increase compared to the same period of 2006. This increase is also driven by an increase in the volume of energy sold compared to the nine months ended Sept. 30, 2006. Volume of Energy Sold, increased 9.4% to 13,574.1 GWh in the first nine months of 2007, compared to 12,408.3 GWh in the same period of 2006. This increase was due mainly to a 7.6% increase in average GWh consumption per customer and to a 1.7% increase in the number of customers. Gross Margin increased 91.6% to ARS830.6 million in the first nine months of 2007, compared to ARS433.5 million in the same period of 2006. This increase is also largely due to the application of the increase in our distribution margin from Feb. 1, 2007, the recording of the retroactive portion of this increase and the increase in volume of energy sold, as described above. Excluding the unbilled amount of retroactive portion of the VAD increase, our gross margin would have been ARS645.5 million in the nine-month period ended Sept. 30, 2007, representing a 48.9% increase when compared with the same period of 2006. Net Operating Income increased significantly to ARS350.8 million for the nine months ended Sept. 30, 2007, compared to ARS30.4 million in the same period of 2006. This increase is also largely due to the application of the increase in our distribution margin from Feb. 1, 2007, the recording of the retroactive portion of this increase and the increase in volume of energy sold, as described above. Excluding the unbilled amount of retroactive portion of the VAD increase, net operating income for the first nine months of 2007 would have amounted to ARS165.7 million. Net Income reached ARS69.9 million in the first nine months of 2007, compared to ARS260.0 million in the same period of 2006. In the nine-month period ended Sept. 30, 2007, net income was positively affected by the application of the VAD increase, the increase in volume of energy sold and the recording of the retroactive portion of the VAD increase, which were partially offset by the net exchange losses (ARS32.1 million) related to our financial debt (which is denominated in US dollars), the adjustment to present value of our financial debt (ARS46.3 million), the adjustment to present value of the retroactive portion of the VAD increase and certain trade receivables (ARS32.4 million), and the recording of a tax charge (ARS106.8 million) generated by the reversal of the deferred tax asset related to the tax loss carryforward due to a significant increase in our taxable income, which was partially offset by the tax deduction of ENRE penalties in 2007 fiscal year. In the same period of 2006, net income was positively affected by the gain resulting from our debt restructuring, including the adjustment to present value of the restructured debt (ARS254.7 million) and the recognition of the partial reversal of the valuation allowance of our net deferred tax assets (ARS72.3 million). About Edenor Based in Buenos Aires, Argentina, Edenor is the largest electricity distribution company in Argentina in terms of number of customers and volume of energy sold. Edenor commenced operations in 1992, as a result of the privatization of the previously state-owned SEGBA. At that time, it was granted a 95-year concession to distribute electricity on an exclusive basis in its concession area, the greater Buenos Aires metropolitan area and northern portion of the City of Buenos Aires. EASA, which is controlled by Dolphin Energia S.A., is Edenor's holding company. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 1, 2007, Standard and Poor's Argentina Assigns its 'B' Rating on US$220 Million Bond issued by Empresa Distribuidora y Comercializadora Norte S.A with annual fixed interest rate of 10.5% Notes due 2017. S&P said the outlook is positive. ============= B A H A M A S ============= HARRAH'S ENTERTAINMENT: Earns US$244.4 Million in Third Quarter --------------------------------------------------------------- Harrah's Entertainment Inc. financial reported results for its third quarter ended Sept. 30, 2007. Net income was US$244.4 million, up 37.9% from US$177.2 million in the 2006 third quarter. On a GAAP basis, third-quarter income from operations was US$577.2 million, compared with US$441.9 million in the year-ago quarter. Total revenues increased 13% to US$2.84 billion from total revenues of US$2.51 billion in the 2006 third quarter. Property EBITDA rose 15.4% to US$790.4 million from US$684.7 million in 2006. Property EBITDA excludes certain non-recurring items, including insurance proceeds arising from the 2005 hurricane claims. Interest expense rose to US$216.1 million from US$165.7 million in 2006 due to higher debt levels associated with acquisitions, higher interest rates and a decline of US$25.2 million in the aggregate fair value of the company's interest-rate swaps. The effective tax rate, which includes federal and state income taxes, for the third quarter was 38.4%, compared with 35.1% in the year-ago period. Income from discontinued operations, net of tax, of US$23.8 million for the 2007 third quarter compared to a loss from discontinued operations of US$1.1 million in 2006. Income from discontinued operations in the 2007 third quarter reflect insurance proceeds of US$22.5 million, after taxes, that are in excess of the net book value of the impacted assets and accumulated costs and expenses expected to be reimbursed under the company's insurance claims for Harrah's Lake Charles and Grand Casino Gulfport, both of which were sold in 2006. Third-quarter highlights Harrah's Entertainment announced a US$1 billion expansion and renovation of Caesars Palace in Las Vegas that will include construction of a 665-room hotel tower and a 263,000-square-foot meeting and convention center, as well as enhancements to the resort's 512-room Forum Tower. The project will increase the room and suite offering at Caesars Palace to 4,013 from 3,348 when completed in 2009. Harrah's and AEG, developer of entertainment venues such as STAPLES Center in Los Angeles, unveiled plans for a privately financed, 20,000-seat, state-of-the-art sports and entertainment arena on acreage currently owned by Harrah's near the center of the Las Vegas Strip. The arena is expected to open in 2010. Harrah's has acquired Macau Orient Golf, an 18-hole golf course on 175 acres on Cotai directly adjacent to the Lotus Bridge, one of two border crossings into Macau from China. Harrah's plans improvements that will make Macau Orient Golf one of the most authentic links-style courses in the Pearl River Delta. Balance Sheet At Sept. 30, 2007, the company's consolidated balance sheet showed US$23.19 billion in total assets, US$16.48 billion in total liabilities, US$57.4 million in minority interests, and US$6.65 million in total shareholders' equity. Full-text copies of the company's consolidated financial statements for the quarter ended Sept. 30, 2007, are available for free at http://researcharchives.com/t/s?2512 About Harrah's Entertainment Headquartered in Las Vegas, Nevada, Harrah's Entertainment Inc. (NYSE: HET) -- http://www.harrahs.com/-- has grown through development of new properties, expansions and acquisitions, and now owns or manages casino resorts on four continents and hosts over 100 million visitors per year. The company's properties operate under the Harrah's, Caesars and Horseshoe brand names; Harrah's also owns the London Clubs International family of casinos and the World Series of Poker. Harrah's also owns the London Clubs International family of casinos. In January, it signed a joint venture agreement with Baha Mar Resorts Ltd. to operate a resort in Bahamas. * * * Standard & Poor's placed Harrah's Entertainment Inc.'s long term foreign and local issuer credit ratings at "BB" in December 2006, which still hold to date. HARRAH'S ENTERTAINMENT: Indiana Gaming Agency OKs Apollo Merger --------------------------------------------------------------- Harrah's Entertainment, Inc., has received approval from the Indiana Gaming Commission for its proposed acquisition by affiliates of Apollo Management, L.P., and TPG Capital. The transaction remains subject to approval by other jurisdictions in which Harrah's subsidiaries operate and other conditions to closing set forth in the agreement and plan of merger entered Dec. 19, 2006. About Harrah's Entertainment Headquartered in Las Vegas, Nevada, Harrah's Entertainment Inc. (NYSE: HET) -- http://www.harrahs.com/-- has grown through development of new properties, expansions and acquisitions, and now owns or manages casino resorts on four continents and hosts over 100 million visitors per year. The company's properties operate under the Harrah's, Caesars and Horseshoe brand names; Harrah's also owns the London Clubs International family of casinos and the World Series of Poker. Harrah's also owns the London Clubs International family of casinos. In January, it signed a joint venture agreement with Baha Mar Resorts Ltd. to operate a resort in Bahamas. * * * Standard & Poor's placed Harrah's Entertainment Inc.'s long term foreign and local issuer credit ratings at "BB" in December 2006, which still hold this date. ============= B E R M U D A ============= JETBLUE AIRWAYS: Ed Barnes Replaces John Harvey as Interim CFO -------------------------------------------------------------- JetBlue Airways has appointed Senior Vice President for Finance and Principal Accounting Officer Ed Barnes to the position of interim Chief Financial Officer, effective Nov. 8. John Harvey, JetBlue's former Executive Vice President-Corporate Services and CFO, has resigned from the company to pursue other professional interests. "We thank John for his many years of service with JetBlue, and wish him well in his future endeavors," said Dave Barger, JetBlue's Chief Executive Officer. "We also thank Ed for stepping in to lead our financial team and strategy while we implement an executive search for a permanent CFO." Mr. Barnes has been with JetBlue since 2006 as Vice President- Finance, and assumed the responsibilities of Principal Accounting Officer earlier this year, and was promoted to Senior Vice President-Finance Oct. 1, 2007. Mr. Barnes joined JetBlue after serving in senior financial leadership roles in a number of different industries, including Southwest Airlines Co. and America West Airlines, Inc., with his final position at America West as Vice President-Controller of The Leisure Company, their vacation packaging subsidiary. He is a certified public accountant and a member of the American Institute of Certified Public Accountants. About JetBlue Airways Corp. Headquartered in Forest Hills, New York, JetBlue Airways Corp. (Nasdaq: JBLU) -- http://www.jetblue.com/-- provides passenger air transportation services in the United States. As of Feb. 14, 2007, it operated approximately 502 daily flights serving 50 destinations in 21 states, Bahamas, Bermuda, Dominican Republic, Puerto Rico, Mexico, and the Caribbean; and a fleet of 98 Airbus A320 aircraft and 23 EMBRAER 190 aircraft. The company also provides in-flight entertainment systems for commercial aircraft, including live in-seat satellite television, digital satellite radio, wireless aircraft data link service, and cabin surveillance systems and Internet services, through its wholly owned subsidiary, LiveTV LLC. * * * As reported in the Troubled Company Reporter-Latin America on Aug. 15, 2007, Fitch Ratings affirmed the debt ratings of JetBlue Airways Corp. as: -- Issuer Default Rating at 'B' -- Senior unsecured convertible notes at 'CCC' with a recovery rating of 'RR6' The senior unsecured rating applies to US$425 million of outstanding convertible notes. =========== B R A Z I L =========== BANCO NACIONAL: Funding 80% of Santo Antonio Plant Through Loans ---------------------------------------------------------------- Banco Nacional de Desenvolvimento Economico e Social SA said in a statement that it will finance up to 80% of the total investment to construct the 3.15-gigawatt Santo Antonio hydro plant through 25-year loans. Banco Nacional told Business News Americas that direct loans from the bank will be up to 75% of the total project. BNamericas relates that Banco Nacional's private equity division BNDESpar could negotiate an up to 20% stake in the consortium that will win the Santo Antonio plant project. According to BNamericas, Banco Nacional loans for Santo Antonio will have a funding cost equal to Brazil's long-term rate TJLP -- 6.25% per annum -- plus 0.5% a year. "In the indirect loan category, the conditions will be the same." However, Banco Nacional will charge 0.8% extra. On Dec. 10, 2007, the Brazilian government will auction the right to construct and run the plant, BNamericas notes. Santo Antonio will begin operating in December 2012. It will have 44 turbines and require BRL9.5 billion in investments, BNamericas states, citing federal energy planning company EPE. Banco Nacional de Desenvolvimento Economico e Social is Brazil's national development bank. It provides financing for projects within Brazil and plays a major role in the privatization programs undertaken by the federal government. * * * Banco Nacional currently carries a Ba2 foreign long-term bank deposit rating from Moody's, and a BB+ long-term foreign issuer credit rating from Standards and Poor's. The ratings were assigned in August and May 2007, respectively. COMPANHIA ENERGETICA: Bidding in Santo Antonio Plant Auction ------------------------------------------------------------ Companhia Energetica de Minas Gerais will join federal power firm Furnas and engineering company Odebrecht in presenting bids for the 3.15-gigawatt Santo Antonio hydroelectric plant, Business News Americas reports. Companhia Energetica head Marcio Araujo de Lacerda said in a Web cast, "We are trying to confirm our participation in the auction through Furnas and we see a good chance of that happening. Santo Ant�nio is a good project." BNamericas relates that Companhia Energetica would have a 10% share in the Santo Antonio consortium. The firm's stake could eventually increase to 12%. Mr. de Lacerda commented to BNamericas, "There's consensus between the partners that this 10-12% interest would be adequate for Cemig [Companhia Energetica." BNamericas notes that Companhia Energetica could bid for the 3.3-gigawatt Jirau hydro plant next year. The Jirau plant is part of the Madeira project in the Amazon. Companhia Energetica will also compete to acquire the 49.99% stake in power holding firm Brasiliana. Federal development bank BNDES will sell the 49.99% stake in Brasiliana by year-end. Companhia Energetica head Djalma Morais told BNamericas, "Bidding for Brasiliana is part of Cemig's growth strategy." "Brasiliana is probably the most important asset in the power sector for sale today in Brazil. We are joining a consortium with [engineering firm] Andrade Gutierrez and perhaps a third partner, always in compliance with the company's policy on returns," Ms. Morais commented to BNamericas. Meanwhile, Companhia Energetica Chief Financial Officer Luiz Fernando Rolla told BNamericas that the firm could have a hard time in bidding for the potential sale of a stake in Sao Paulo state-run generator Cesp. Mr. Rolla explained to BNamericas that Cesp is a little more complicated due to a legislation in Sao Paulo that blocks state- owned firms from other states from bidding for its assets. Companhia Energetica is seeking for a change in the law. BNamericas says that the Sao Paulo state government hired Citibank to analyze and help develop a strategy to sell its 33.37% stake in Cesp. Companhia Energetica will set aside part of the BRL1.4-billion allocated for the funding of expansion plans this year, BNamericas states, citing Mr. Rolla. Companhia Energetica de Minas Gerais -- http://www.cemig.com.br/ -- is one of the largest and most important electric energy utilities in Brazil due to its strategic location, its technical expertise and its market. Cemig's concession area extends throughout nearly 96.7% of the State of Minas Gerais, Brazil. Cemig owns and operates 52 power plants, of which six are in partnership with private enterprises, relying on a predominantly hydroelectric energy matrix. Electric energy is produced to supply more than 17 million people living in the state's 774 municipalities. In addition to those 52 plants, another three are currently under construction. Cemig is also active in several other states, through ventures for the generation or the commercialization of energy in these Brazilian states: in Santa Catarina (generation), Rio de Janeiro (commercialization and generation), Espirito Santo (generation) and Rio Grande do Sul (commercialization). * * * As reported on March 8, 2007, Moody's Investors Service assigned corporate family ratings of Ba2 on its global scale and Aa3.br on its Brazilian national scale to Companhia Energetica de Minas Gerais aka CEMIG. The rating action triggered the upgrade of CEMIG's outstanding debentures due in 2009 and 2011, and of the BRL250 million 2014 senior unsecured guaranteed debentures of its wholly owned subsidiary, Cemig Distribuicao S.A. to Ba2 from B1 on the global scale and to Aa3.br from Baa2.br on the Brazilian national scale, concluding the review process initiated on Aug. 8, 2006. COMPANHIA ENERGETICA: Earns BRL1.47 Billion in First Nine Months ---------------------------------------------------------------- Companhia Energetica de Minas Gerais told Business News Americas that its net profits increased 32% to BRL1.47 billion in the first nine months of this year, compared to BRL1.11 billion in the same period last year. BNamericas relates that Companhia Energetica's net profits rose to BRL547 million in the third quarter 2007, from BRL448 million in the same period in 2006. Companhia Energetica told BNamericas that its gross revenues increased 21% to BRL11.7 billion in the nine first months of this year, compared to the same period last year. Ebitda grew 43% to BRL3.00 billion. Companhia Energetica's board president Marcio Araujo de Lacerda said in a Web cast that the firm's increased profitability indicates higher income from the RME consortium and reduced losses at Light, among other factors. BNamericas notes that in the distribution business, Companhia Energetica's power sales increased 10% to 32.9 terra watt-hours in the first nine months of 2007, compared to 29.9 terra watt- hours in the same period last year. Companhia Energetica's power sales to residential customers grew 23% to 6.5 terra watt-hours in the first nine months of 2007, from the first nine months of 2006. Sales to industrial clients rose 0.7% to 18.1 terra watt-hours and to commercial clients 33% to 4.1 terra watt-hours, BNamericas states. Companhia Energetica de Minas Gerais -- http://www.cemig.com.br/ -- is one of the largest and most important electric energy utilities in Brazil due to its strategic location, its technical expertise and its market. Cemig's concession area extends throughout nearly 96.7% of the State of Minas Gerais, Brazil. Cemig owns and operates 52 power plants, of which six are in partnership with private enterprises, relying on a predominantly hydroelectric energy matrix. Electric energy is produced to supply more than 17 million people living in the state's 774 municipalities. In addition to those 52 plants, another three are currently under construction. Cemig is also active in several other states, through ventures for the generation or the commercialization of energy in these Brazilian states: in Santa Catarina (generation), Rio de Janeiro (commercialization and generation), Espirito Santo (generation) and Rio Grande do Sul (commercialization). * * * As reported on March 8, 2007, Moody's Investors Service assigned corporate family ratings of Ba2 on its global scale and Aa3.br on its Brazilian national scale to Companhia Energetica de Minas Gerais aka CEMIG. The rating action triggered the upgrade of CEMIG's outstanding debentures due in 2009 and 2011, and of the BRL250 million 2014 senior unsecured guaranteed debentures of its wholly owned subsidiary, Cemig Distribuicao S.A. to Ba2 from B1 on the global scale and to Aa3.br from Baa2.br on the Brazilian national scale, concluding the review process initiated on Aug. 8, 2006. COMPANHIA PARANAENSE: Will Focus on Generation Projects ------------------------------------------------------- Companhia Paranaense de Energia's director Jaime Kuhn told the press that the firm will concentrate on generation projects, investing BRL7 billion in 2007-16. About 66% of the BRL7-billion investment will be allocated to generation, Business News Americas relates, citing Mr. Kuhn. Mr. Kuhn told BNamericas that the investment excludes Companhia Paranaense's potential participation in a consortium to bid for the 3.15-gigawatt Santo Antonio hydro plant and the planned acquisition of smaller distribution firms in Parana and Rio Grande do Sul. Companhia Paranaense won the auction for a 230-kilovolt transmission line in Parana, published reports say, citing Mr. Kuhn. According to BNamericas, Companhia Paranaense has two substations close to where it will construct the 230-kilovolt line. Mr. Kuhn commented to BNamericas, "Copel [Companhia Paranaense] has infrastructure in Parana state and other companies could not match our offer." The transmission line must begin operating in 15 months, BNamericas says, citing Brazilian power regulator and auction host Aneel. Mr. Kuhn admitted to BNamericas, "This schedule is tight for us, but we can do it." Companhia Paranaense corpoarate T&D director Raul Munhoz Neto told Bnamericas that the company will use its own cash to fund the line. Mr. Neto said the firm has other options, but it will still use its own cash. It has good knowledge of the location where the line will be constructed. Headquartered in Parana, Brazil, COPEL aka Companhia Paranaense de Energia SA -- http://www.copel.com/-- transmits and distributes electricity to more than 3 million customers in the state of Parana and has a generating capacity of nearly 4,600 MW, primarily from hydroelectric plants. COPEL also offers telecommunications, natural gas, engineering, and water and sanitation services. The company restructured its utility operations in 2001 into separate generation, transmission, and distribution subsidiaries to prepare for full privatization, which has been indefinitely postponed. In response, COPEL is re-evaluating its corporate structure. The government of Parana controls about 59% of COPEL. * * * As reported in the Troubled Company Reporter-Latin America on Dec. 13, 2006, Moody's America Latina upgraded the corporate family rating of Companhia Paranaense de Energia aka Copel to Ba2 from Ba3 on its global scale and to Aa2.br from A3.br on its Brazilian national scale. Moody's said the rating outlook is stable. This rating action concludes the review process initiated on July 26, 2006. Moody's upgraded these ratings: -- Corporate Family Rating: to Ba2 from Ba3 (Global Local Currency) and to Aa2.br from A3.br (Brazilian National Scale); -- BRL500 million Senior Unsecured Guaranteed Debentures due 2007: to Ba2 from Ba3 (Global Local Currency) and to Aa2.br from A3.br (Brazilian National Scale); and -- BRL400 million Senior Secured Guaranteed Debentures due 2009: to Ba1 from Ba2 (Global Local Currency) and to Aa1.br from A1.br (Brazilian National Scale). FORD MOTOR: Posts US$380-Million Loss for Third Quarter 2007 ------------------------------------------------------------ Ford Motor Company has reported a net loss of 19 cents per share, or US$380 million, for the third quarter of 2007. This compares with a net loss of US$2.79 per share, or US$5.2 billion, in the third quarter of 2006. Ford's third-quarter revenue was US$41.1 billion, up from US$37.1 billion a year ago. The increase primarily reflected higher net pricing, changes in currency exchange rates, and improved product mix. Ford's third-quarter loss from continuing operations, excluding special items, was 1 cent per share, or US$24 million, compared with a loss of 45 cents per share, or US$850 million, in the same period a year ago. Special items reduced pre-tax results by US$350 million in the third quarter. These were more than explained by costs associated with our previously announced Trust Preferred Securities exchange offer, and charges associated with Ford Europe and Premier Automotive Group personnel reductions and other restructuring actions. Favorable cost adjustments associated with Ford North America personnel reduction programs were a partial offset. Automotive gross cash, which includes cash and cash equivalents, net marketable securities, loaned securities and short-term VEBA assets, was US$35.6 billion at Sept. 30, 2007, an increase of US$1.7 billion from year-end 2006. The company continues to explore in greater detail the potential sale of Jaguar and Land Rover with interested parties and anticipates these discussions will culminate in an agreement no later than early next year. In addition, the company has been conducting a strategic review of Volvo, and has developed a plan. The first priority of the plan is to improve financial performance at Volvo. The plan also includes: enhancing Volvo's position as a global producer of premium vehicles; establishing appropriate business arrangements between Volvo and Ford-brand operations to allow Volvo to operate on a more stand-alone basis in the absence of the Premier Automotive Group structure; and, continuing to achieve synergies between Ford-brand operations and Volvo in areas such as product development and purchasing. The company plans to disclose Volvo's financial performance beginning with 2008 results. "Our third quarter performance is very encouraging," said Ford President and Chief Executive Officer Alan Mulally. "We can see our plan taking hold with significant improvement continuing in our core Automotive operations. We remain committed to executing the four priorities of our plan - restructuring the business to operate profitably, accelerating the development of new products that our customers want and value, funding our plan and improving our balance sheet, and working even more effectively together as one Ford team, leveraging our global assets." Highlights for 2007 -- Tentative agreement reached with the United Auto Workers (UAW) on a new four-year national labor contract, subject to ratification by UAW members, which significantly improves its competitiveness going forward. -- Strong performance in the 2007 Third Quarter U.S. Global Quality Research System study. -- Ford Taurus, Taurus X and Mercury Sable earned Top Safety Pick ratings from the Insurance Institute for Highway Safety for achieving the highest possible ratings in frontal, side and rear crash test performance. -- The Ford Mustang convertible became the first sports car and first convertible in history to earn the highest possible safety ratings from the National Highway Traffic and Safety Administration. The Mustang convertible earned five star ratings in all crash test and rollover categories. -- Ford SYNC - the company's fully integrated, voice-activated in-car communications and entertainment system developed in association with Microsoft - won one of 10 Popular Mechanics' "Breakthrough Awards," which recognize products that set new benchmarks in design, creativity and engineering. -- Ford South America unit sales up 19 percent year to date. -- Ford Europe records sixth consecutive quarter of year-over- year profit improvement, and Ford Europe unit sales rose more than 5 percent in first nine months of 2007. -- Ford Mondeo joins three other models -- Ford Focus, Galaxy and S-MAX -- with a five star performance on the Euro NCAP top 10 list, reinforcing Ford Europe's position as the manufacturer with the highest number of vehicles in the top 10 for adult occupant protection. -- Best-ever quarter for Land Rover unit sales. -- Ford China unit sales up 27 percent in the first nine months of 2007. -- Launched operations at new assembly plant in Nanjing, China. The new plant will produce the latest small-car models from both Ford and Mazda. -- Achieved US$1.8 billion in cost savings in first nine months of 2007, including US$600 million in the third quarter. -- Continued to align capacity to match demand and improve our productivity in North America, reducing personnel by 6,800 in the third quarter. Automotive Sector On a pre-tax basis, worldwide Automotive sector losses in the third quarter were US$362 million. This compares with a pre-tax loss of US$1.9 billion during the same period a year ago. The improvements were more than explained by higher net pricing, lower costs, and improved volume and mix, partially offset by higher interest expense, and unfavorable changes in currency exchange rates. Vehicle wholesales in the third quarter were 1,487,000, up from 1,467,000 a year ago. Worldwide Automotive revenue for the third quarter was US$36.3 billion, up from US$32.5 billion in the same period last year. The increase primarily reflected higher net pricing, changes in currency exchange rates, and improved product mix. Ford North America In the third quarter, Ford North America reported a pre-tax loss of US$1.0 billion, compared with a pre-tax loss of US$2.1 billion a year ago. The improvement primarily reflected higher net pricing and improved product mix, partially offset by unfavorable changes in currency exchange rates. Revenue was US$16.5 billion, up from US$15.4 billion for the same period a year ago. Ford South America Ford South America reported a third-quarter pre-tax profit of US$386 million, compared with a pre-tax profit of US$201 million a year ago. The improvement was primarily explained by higher net pricing and higher volume. Third quarter revenue improved to US$2.1 billion from US$1.5 billion in 2006. Ford Europe Ford Europe's third-quarter pre-tax profit was US$293 million, compared with a pre-tax loss of US$13 million during the same period in 2006. The improvement was more than explained by lower costs and higher net pricing, partially offset by lower volume and less favorable mix. During the third quarter of 2007, Ford Europe's revenue was US$8.3 billion, compared with US$7.3 billion during the third quarter of 2006. Premier Automotive Group This group reported a pre-tax loss of US$97 million for the third quarter, compared with a pre-tax loss of US$508 million for the same period in 2006. The third-quarter 2007 result reflected a loss at Volvo, partially offset by a small profit at the combined Jaguar and Land Rover operation. The year-over- year improvement was primarily explained by cost reductions across all brands, including the non-recurrence of adverse 2006 adjustments to warranty reserves. Higher volumes and higher net pricing were partially offset by the effect of the continued weakening of the U.S. dollar against key European currencies. Third-quarter 2007 revenue was US$7.4 billion, compared with US$6.5 billion a year ago. Ford Asia Pacific and Africa For the third quarter, Ford Asia Pacific and Africa reported a pre-tax profit of US$30 million, compared with a pre-tax loss of US$56 million a year ago. The improvement primarily reflected cost reductions and higher net pricing, partially offset by adverse product mix, mainly in Australia. Revenue was US$1.8 billion for the third quarter of 2007, compared with US$1.6 billion in 2006. Mazda For the third quarter, Ford earned US$18 million from its investment in Mazda and associated operations, compared with US$40 million during the same period a year ago. Other Automotive: Third-quarter results included a pre-tax profit of US$29 million, compared with a profit of US$553 million a year ago. The year-over- year deterioration primarily reflected the non-recurrence of last year's tax- related interest. Financial Services Sector For the third quarter, the Financial Services sector earned a pre-tax profit of US$556 million, compared with a pre-tax profit of US$750 million a year ago. Ford Motor Credit Company: On a pre-tax basis from continuing operations, Ford Motor Credit Company earned US$546 million in the third quarter compared with US$730 million in the previous year. The decrease in earnings was more than explained by the non-recurrence of prior-year credit loss reserve reductions, higher depreciation expense for leased vehicles and higher borrowing costs. Outlook The company is ahead of its 2007 plan both on a pre-tax and net income basis, and anticipates substantial year-over-year improvement in fourth quarter results. Fourth quarter Automotive and company pre-tax results are expected to be a loss, more than explained by North America. Full-year pre-tax results excluding special items are expected to be in the range of a small loss to breakeven, which would be a significant improvement from a year ago. Excluding gains or losses from future divestitures, special items for full-year 2007 are expected to be a charge in the range of US$1 billion to US$2 billion, including a one-time, non-cash charge estimated to be approximately US$1.4 billion relating to a proposed change in business practice for offering and announcing retail variable marketing incentives to our dealers. Ford Motor Credit expects to earn US$1.3 billion to US$1.4 billion this year on a pre-tax basis, excluding the impact of gains and losses related to market valuation adjustments from derivatives, consistent with the previous estimate. Looking ahead, the company's progress in 2007 reflects it is on track to meet its goal of being profitable in North America and Total Automotive in 2009. The company also is on track to meet its North American cost reduction target of US$5 billion by 2008 as compared with 2005. Progress is being made on achieving U.S. market share goals, and the company is ahead of its US$17 billion cash outflow target for the 2007 to 2009 period. "Our third-quarter and year-to-date performance indicate that our plan is working," said Mr. Mulally. "Our full-year pre-tax outlook excluding special items is to be substantially better than 2006. We remain committed to improving our business and delivering our plan." About Ford Headquartered in Dearborn, Michigan, Ford Motor Co. (NYSE: F) -- http://www.ford.com/-- manufactures or distributes automobiles in 200 markets across six continents. With about 260,000 employees and about 100 plants worldwide, the company's core and affiliated automotive brands include Ford, Jaguar, Land Rover, Lincoln, Mercury, Volvo, Aston Martin, and Mazda. The company provides financial services through Ford Motor Credit Company. The company has operations in Japan in the Asia Pacific region. In Europe, the company maintains a presence in Sweden, and the United Kingdom. The company also distributes its brands in various Latin American regions, including Argentina and Brazil. * * * As reported in the Troubled Company Reporter-Latin America on Nov. 7, 2007, Standard & Poor's Ratings Services said its 'B' long-term corporate credit rating on Ford Motor Co. and Ford Motor Credit Co. remains on CreditWatch with positive implications, following the agreement between Ford and the United Auto Workers of a new labor contract. FORD MOTOR CREDIT: Earns US$334 Million in Third Quarter -------------------------------------------------------- Ford Motor Credit Company has reported net income of US$334 million in the third quarter of 2007, down US$118 million from earnings of US$452 million a year earlier. On a pre-tax basis from continuing operations, Ford Motor Credit earned US$546 million in the third quarter compared with US$730 million in the previous year. The decrease in earnings primarily reflected the non-recurrence of credit loss reserve reductions, higher depreciation expense for leased vehicles and higher borrowing costs. In the third quarters of 2007 and 2006, pre-tax earnings were US$341 million and US$521 million, excluding the net gains related to market valuation adjustments from derivatives, which were US$205 million and US$209 million, respectively. Ford Motor Credit expects to earn on a pre-tax basis US$1.3 billion to US$1.4 billion this year, excluding the impact of gains and losses related to market valuation adjustments from derivatives, consistent with the previous estimate. "Our sound risk management practices, high-quality portfolio, strong liquidity and ongoing restructuring continue to produce solid operating results," said Mike Bannister, chairman and Chief Executive Offcier. "As we effectively execute the fundamentals of the business, we remain on track to meet our earnings outlook." On Sept. 30, 2007, Ford Motor Credit's on-balance sheet net receivables totaled US$141 billion, compared with US$135 billion at year-end 2006. Managed receivables were US$148 billion, largely unchanged compared with Dec. 31, 2006. On Sept. 30, 2007, managed leverage was 10.1 to 1. About Ford Motor Credit Ford Motor Credit Co. -- http://www.fordcredit.com/-- is an automotive finance company, which has supported the sale of Ford products since 1959. With about 14,000 employees, Ford Motor Credit operates in 36 countries including Brazil and Mexico in Latin America. Ford Motor Credit is an indirect wholly owned subsidiary of Ford Motor Company. It provides automotive financing for Ford, Lincoln, Mercury, Aston Martin, Jaguar, Land Rover, Mazda and Volvo dealers and customers. * * * As reported in the Troubled Company Reporter on Aug. 22, 2006, Dominion Bond Rating Service placed lowered Ford Motor Credit Co.'s long-term debt rating to BB(low) from BB, and confirmed Ford Credit's short-term debt rating at R-3(high). Fitch Ratings also downgraded the Issuer Default Rating of Ford Motor Credit to 'B' from 'B+'. Fitch also lowered Ford Credit's senior unsecured rating to 'BB-/RR2' from 'BB/RR2'. Fitch said the rating outlook remains negative. Standard & Poor's Ratings Services also placed its 'B+' long- term and 'B-2' short-term ratings on Ford Motor Credit, and related entities on CreditWatch with negative implications. As reported in the Troubled Company Reporter on July 24, 2006, Moody's Investors Service lowered the senior unsecured rating of Ford Motor Credit to Ba3 from Ba2. Moody's said the outlook for the ratings is negative. GENERAL MOTORS: Credit Suisse Maintains Neutral Rating on Firm -------------------------------------------------------------- Credit Suisse analyst C. Ceraso has kept his "neutral" rating on General Motors Corp.'s shares, Newratings.com reports. Newratings.com relates that the target price for General Motors' shares was decreased to US$36 from US$43. Mr. Ceraso said in a research note that General Motors posted net losses of US$69 per share in the third quarter 2007. General Motors' "underlying automotive operating results" in the third quarter 2007 were better compared to the "headline net losses," Newratings.com notes, citing Mr. Ceraso. General Motors told Newratings.com that next year would be a difficult year for the firm due to: -- increased pension expense, -- unstable income stream from unit GMAC, -- a weaker mix, -- flat or reduced volumes, and -- no tax shield in the US. Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 280,000 people around the world and manufactures cars and trucks in 33 countries, including the United Kingdom, Germany, France, Russia, Brazil and India. In 2006, nearly 9.1 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on Oct. 23, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and other ratings on General Motors Corp. and removed them from CreditWatch with positive implications, where they were placed Sept. 26, 2007, following agreement on the new labor contract. S&P said the outlook is stable. GENERAL MOTORS: Posts US$39 Billion Net Loss in Third Quarter ------------------------------------------------------------- General Motors Corp. disclosed Wednesday its financial results for the third quarter of 2007. GM reported a net loss of US$39 billion, including Allison Transmission, which is classified as a discontinued operation, for the third quarter of 2007, compared with a reported net loss of US$147 million in the year-ago quarter. Special items included a net non-cash charge of US$38.6 billion due to a valuation allowance against deferred tax assets related to operations in the U.S., Canada and Germany as required under SFAS No. 109, Accounting for Income Taxes. Also included was a favorable US$3.5 billion after-tax gain on the sale of the Allison Transmission business in August 2007, for which GM received US$5.4 billion in proceeds. GM also had special charges of US$1.6 billion in pension service costs related to prior labor agreements, US$400 million associated with restructuring actions and US$400 million related to an adjustment to the Delphi reserve. Excluding special items, GM had a 2007 third-quarter adjusted net loss of US$1.6 billion, compared to net income of US$497 million in the year-ago quarter. The variance was driven primarily by a significant decline in net income at GMAC, as well as increased corporate expense related to legacy cost, foreign exchange and various 2006 tax benefits, partially offset by improved performance in automotive operations. "We continue to implement the key elements of our North America turnaround strategy, and these initiatives are driving steady improvement in our financial results, despite challenging North America market conditions. In addition, we are very encouraged by our performance in emerging markets. Our record third quarter global sales are strong evidence that our commitment to great cars and trucks is being embraced by consumers around the globe." said Rick Wagoner, GM chairman and chief executive officer. The company's improved performance in its automotive operations was more than offset by special charges of US$37.4 billion related largely to a previously announced valuation allowance against its deferred tax assets, as well as lower reported GMAC Financial Services income, down US$630 million versus the year- ago quarter as a result of continued pressures in the mortgage industry. GM Automotive Operations GM's global automotive operations posted net income of US$122 million from continuing operations on an adjusted basis in the third quarter of 2007 (reported net loss of US$40.6 billion), an improvement of US$577 million compared to an adjusted net loss from continuing operations of US$455 million (reported net loss of US$401 million) in the same quarter 2006. Results for GM's automotive operations, specifically GMNA, exclude Allison Transmission, which was classified as a discontinued operation as a result of the sale of that business which was concluded in August 2007. GM generated record third quarter automotive revenue of US$43.1 billion. The company also achieved record global third quarter sales of 2.39 million cars and trucks, up 4% compared to the third quarter 2006, driven by exceptionally strong demand in emerging markets and improved performance in developed markets. GM also set a number of third quarter sales records around the globe, including a 22% increase in GMLAAM, 16% increase in the GMAP region, and 15% gain in GME. "We continue to see solid progress in the fundamentals of our automotive business. We're very pleased with our strong sales performance in key markets outside of North America, and growing retail momentum in the U.S. driven by products like the all-new Cadillac CTS. We're also very encouraged by the early reactions to our all-new Chevrolet Malibu and 2008 Chevrolet Tahoe and GMC Yukon two-mode hybrids -- the world's only full-size hybrid SUVs," said Wagoner. GMNA had an adjusted net loss from continuing operations of US$247 million in the third quarter 2007 (reported net loss from continuing operations of US$38.2 billion, which includes charges of approximately US$36.5 billion for a valuation allowance against its deferred tax assets and US$1.3 billion for pension service costs related to prior labor agreements), compared to an adjusted net loss of US$660 million from continuing operations in the third quarter 2006 (reported net loss from continuing operations of US$667 million). GMNA's improved adjusted earnings reflect favorable mix, pricing and better warranty performance, which were partially offset by lower volume and increased material cost. GME posted an adjusted net loss of US$90 million in the third quarter (reported net loss of US$2.9 billion, which includes charges of US$2.5 billion for a valuation allowance against deferred tax assets in Germany and restructuring charges of US$262 million), compared to US$39 million loss in the third quarter of 2006 (reported net loss of US$126 million). The variance in adjusted net income reflects the softness of the German market and unfavorable currency exchange, which was partially offset by improved pricing and higher volume. GME achieved record third quarter sales of about 524,000 units, aided by continued momentum of GME's multi-brand strategy during the period. Chevrolet is amongst the fastest growing global vehicle brands in Europe, posting record third quarter sales of 113,000 vehicles. GM gained further ground in the growing Russian market, with sales up by 75% over the same quarter 2006, to a record 65,700 vehicles. GMAP recorded adjusted net income of US$138 million in the third quarter (reported net income also US$138 million), compared with US$57 million in the year ago period (reported net income of US$205 million, which included US$148 million in favorable tax- related items). This favorable earnings performance was driven largely by strong export growth from GM Daewoo, continued strong sales and profitability in China, and improved earnings in India and Australia. GM achieved 16% sales growth in the Asia Pacific region, resulting in record third quarter sales of 327,500 units. GM China sold 230,000 vehicles, a 21% increase compared with the year ago period. GM sales in the region were also aided by the strong performance of GM Daewoo products, including the Chevrolet Captiva. GMLAAM achieved all-time record earnings and quarterly sales in the third quarter, posting adjusted earnings of US$340 million (reported net income also US$340 million), up 86% compared with strong earnings in the year ago period of US$183 million (reported net income also US$183 million). The earnings improvement was driven primarily by volume growth, favorable pricing and vehicle mix. GMLAAM set a third quarter sales record of over 329,000 vehicles, up almost 22% year-over-year. All-time sales records were achieved in Brazil, Colombia, Venezuela, Argentina and Egypt. The successful launch of the Chevrolet Captiva in South Africa, Venezuela, Colombia and the Middle East helped drive strong sales in the region. GMAC As a standalone company, GMAC Financial Services reported a net loss of US$1.6 billion for the third quarter 2007, compared to a net loss of US$173 million in the third quarter 2006. The reported results for the third quarter of 2007 included a US$455 million goodwill impairment charge at Residential Capital LLC, while a goodwill impairment charge of US$695 million related to GMAC Commercial Finance was reflected in results for the third quarter of 2006. Results were dominated by the effects of the dislocation in the mortgage and credit markets on the real estate finance business, which more than offset the continued strong performance at GMAC's automotive finance, insurance and other operations. GM recognized US$757 million of the net loss attributable to GMAC as a result of its 49% equity interest and accrued preferred dividends (reported net loss of US$803 million). Cash and Liquidity GM continues to have a strong liquidity position. Cash, marketable securities, and readily-available assets of the Voluntary Employees' Beneficiary Association trust grew to US$30 billion as of Sept. 30, 2007, up from US$27.2 billion on June 30, 2007. The balance includes US$5.4 billion of net cash proceeds from the completion of the Allison Transmission transaction in August 2007. GM had negative adjusted automotive operating cash flow of US$2.5 billion in the third quarter of 2007, improved from a negative US$3.9 billion in the third quarter 2006. About General Motors Headquartered in Detroit, Michigan, General Motors Corp. (NYSE: GM) -- http://www.gm.com/-- was founded in 1908. GM employs about 280,000 people around the world and manufactures cars and trucks in 33 countries, including the United Kingdom, Germany, France, Russia, Brazil and India. In 2006, nearly 9.1 million GM cars and trucks were sold globally under the following brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, HUMMER, Opel, Pontiac, Saab, Saturn and Vauxhall. GM's OnStar subsidiary is the industry leader in vehicle safety, security and information services. * * * As reported in the Troubled Company Reporter on Oct. 23, 2007, Standard & Poor's Ratings Services affirmed its 'B' corporate credit rating and other ratings on General Motors Corp. and removed them from CreditWatch with positive implications, where they were placed Sept. 26, 2007, following agreement on the new labor contract. S&P said the outlook is stable. GEOKINETICS INC: Closes US$25MM Capital Lease Facility with CIT --------------------------------------------------------------- Geokinetics Inc. has closed a new US$25 million capital lease facility with CIT Group/Equipment Financing, Inc. This facility adds US$25 million of additional capacity to the company's existing capital lease with CIT that closed on July 25, 2006 for an original amount of US$6 million. Richard Miles, President and Chief Executive Officer of Geokinetics, said: "I am happy to report the expansion of our relationship with CIT. This facility will serve as a major cornerstone for the future growth of Geokinetics. We have recently experienced record levels of backlog and that, along with ever-increasing demand from our customers to deliver world- class data in some of the world's toughest environments, has fueled our significant capital investment program for this year. This facility will help us to finance our equipment on a long- term basis and support our growth plans going forward." About Geokinetics Inc. Headquartered in Houston, Texas, Geokinetics Inc. -- http://www.geokineticsinc.com/-- is a global leader of seismic acquisition and high-end seismic data processing and interpretation services to the oil and gas industry. Geokinetics provides seismic data acquisition services in North America, Indonesia, Norway and Brazil. Geokinetics operates in some of the most challenging locations in the world from the Arctic to mountainous jungles to the transition zone environments. * * * As reported in the Troubled Company Reporter-Latin America on Aug. 23, 2007, Moody's Investors Service has withdrawn all the ratings for Geokinetics Inc. following the company's redemption of all of its rated bonds with the proceeds of an equity offering. Moody's does not rate any other debt for Geokinetics. The ratings withdrawn are the B3 corporate family rating and probability of default rating, the SGL-3 speculative liquidity rating and the B3, LGD4 (53%) rating on the US$110 million second priority senior secured floating rate notes due 2012. IWT TESORO: Court Approves Donlin Recano as Claims Agent -------------------------------------------------------- The United States Bankruptcy Court for the Southern District of New York authorized I.W.T Tesoro Corporation and its debtor- affiliates to employ Donlin, Recano & Company Inc. as their claims, notice, and balloting agent. In their application, the Debtors told the Court that they have over a thousand creditors and other potential parties-in- interest. The Debtors believe that the bankruptcy clerk's office is not equipped to distribute notices, process all of the proofs of claim filed, and assist in the balloting process for the Debtors' large case, thus the need to hire Donlin Recano. Specifically, Donlin Recano is expected to: a. notify all potential creditors of the filing of the Debtors' bankruptcy petitions and of the setting of the first meeting of creditors, pursuant to Bankruptcy Code Section 341(a); b. maintain an official copy of the Debtors' schedules of assets and liabilities and statement of financial affairs listing the Debtors' known creditors and the amounts the Debtors owe; c. notify all potential creditors of the existence and amount of their respective claims, as evidenced by the Debtors' books and records and as set forth in their schedules; d. furnish a notice of the last day for the filing of proofs of claim and a form for the filing of a proof of claim, after the notice and the form are approved by the Court; e. file with the Clerk an affidavit or certificate of service which includes a copy of the notice, a list of persons to whom it was mailed (in alphabetical order), and the date the notice was mailed, within 10 days of service; f. docket all claims received, maintain the official cliams registers for each of the Debtors on behalf of the Clerk, and provide the Clerk with certified duplicate unofficial claims registers on a monthly basis, unless otherwise directed; g. specify, in the applicable claims register, these information for each claim docketed: i. the claim number assigned; ii. the date received; iii. the name and address of the claimant and agent, if applicable, who filed the claim; iv. the filed amount of the claim, if liquidated; and v. the classification of the claim according to the proof of claim; h. relocate, by messenger, all of the actual proofs of claim filed to Donlin Recano, not less than weekly; i. record all transfers of claims and provide any notices of the transfers required by Bankruptcy Rule 3001; j. make changes in the claims register pursuant to Court Order; k. upon completion of the docketing process for all claims received to date by the Clerk's Office, turn over to the Clerk copies of the claims registers for the Clerk's review; l. maintain the claims register for public examination without charge during regular business hours; m. maintain the official mailing list for each Debtor of all entities that have filed a proof of claim, which list will be available upon request by a party-in-interest or the Clerk; n. assist with, among other things, solicitation, calculation, and tabulation of votes and distribution, as required in furtherance of confirmation of the plan; o. provide and maintain a Web site where parties can view claims filed, status of claims, and pleadings or other documents filed with the Court by the Debtors; p. in 30 days prior to the close of the cases, an order dismissing Donlin Recano would be submitted terminating its services upon completion of its duties and responsibilities and upon the closing of the case; and q. at the close of the case, box and transport all original documents in proper format, as provided by the Clerk's office, to the Federal Records Center. In addition, the Debtors may utilize other services of Donlin Recano like disbursing and related administrative services upon request. Donlin Recano's schedule of services and their specific fees are: Type of Service Hourly Rate --------------- ----------- Date Input Clerical US$35 Admin. Proj. Specialist US$65 Consulting Bankruptcy Consultant US$130 - US$195 IT Programming Consultant US$115 - US$135 Attorneys/Sr. Consultant US$200 - US$250 The Debtors paid Donlin Recano a US$5,000 retainer. The Debtors assured the Court that Donlin Recano neither holds nor represents any interest adverse to the Debtors' respective estates. The firm can be reached at: Donlin Recano & Company, Inc. 419 Park Avenue South New York, NY 10016 Tel: (212) 481-1411 Fax: (212) 481-1416 http://www.donlinrecano.com/ I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, -- http://www.iwttesoro.com/-- is headquartered in New York City. The company and its subsidiaries distribute building materials, specifically hard floor and wall coverings. They are wholesalers and do not sell directly to any end user. Their products consist of ceramic, porcelain and natural stone floor, wall and decorative tile. They import a majority of these products from suppliers and manufacturers in Europe, South America (Brazil), and the Near and Far East. Their markets include the United States and Canada. They also offer private label programs for branded retail sales customers, buying groups, large homebuilders and home center store chains. The Debtor and its debtor-affiliates, International Wholesale Tile, Inc. and American Gres, Inc., filed for Chapter 11 bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case No. 07-12841). Dawn K. Arnold, Esq. and Jonathan S. Pasternak, Esq. at Rattet, Pasternak & Gordon-Oliver, L.L.P. represent the Debtors in their restructuring efforts. Donlin, Recano & Co., Inc. serves as the Debtors' claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed by the U.S. Trustee for Region 2 on this case. As of June 30, 2007, the Debtors had total assets of US$39,798,579 and total debts of US$47,940,983. IWT TESORO: Brings In Rader & Coleman as Special Counsel -------------------------------------------------------- I.W.T. Tesoro Corporation and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Southern District of New York to employ Rader & Coleman, P.L. as their special counsel. Rader & Coleman is expected to perform legal services including: a. the supervision and assistance with the preparation of all SEC filings; b. communication with the SEC on behalf of the Debtors; c. working with the Debtors' auditors and financial management to prepare all necessary books and records as well as certain required filings; d. aiding the Debtors' counsel, to the extent necessary, with any negotiations involving the secured lenders and consult with the Debtors and their counsel with respect to any corporate governance or structure issues which may arise. In the event that the Debtors go forward with a particular reorganization transaction, Rader & Coleman will assist in strategy, structure and documentation required for such a transaction. The Debtors propose to pay Rader & Coleman its customary hourly rates that ranges from US$275 to US$350 per hour for attorneys and US$120 per hour for paraprofessionals. Gayle Coleman, Esq., will continue to be primarily responsible for the legal needs of the Debtors, and will charge the Debtors US$275 per hour. The Debtors disclosed that Rader & Coleman has represented the Debtors since June 2002 and was counsel to Debtor, IWT Tesoro Corporation when it acquired International Wholesale Tile Inc. The Debtors believe that the retention of Rader & Coleman is essential to the efficient and successful administration of their Chapter 11 cases and that it is in the best interests of the creditors that Rader & Coleman continue to represent the Debtors. The firm can be reached at: Gayle Coleman, Esq. Rader & Coleman, P.L. 2101 Northwest Boca Raton Boulevard, Suite 1 Boca Raton, Florida 33431 Tel: (561) 368-0545 Fax: (561) 367-1725 http://www.raderandcoleman.com/ I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, -- http://www.iwttesoro.com/-- is headquartered in New York City. The company and its subsidiaries distribute building materials, specifically hard floor and wall coverings. They are wholesalers and do not sell directly to any end user. Their products consist of ceramic, porcelain and natural stone floor, wall and decorative tile. They import a majority of these products from suppliers and manufacturers in Europe, South America (Brazil), and the Near and Far East. Their markets include the United States and Canada. They also offer private label programs for branded retail sales customers, buying groups, large homebuilders and home center store chains. The Debtor and its debtor-affiliates, International Wholesale Tile, Inc. and American Gres, Inc., filed for Chapter 11 bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case No. 07-12841). Dawn K. Arnold, Esq. and Jonathan S. Pasternak, Esq. at Rattet, Pasternak & Gordon-Oliver, L.L.P. represent the Debtors in their restructuring efforts. Donlin, Recano & Co., Inc. serves as the Debtors' claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed by the U.S. Trustee for Region 2 on this case. As of June 30, 2007, the Debtors had total assets of US$39,798,579 and total debts of US$47,940,983. IWT TESORO: Hires Rattet Pasternak as Bankruptcy Counsel -------------------------------------------------------- I.W.T. Tesoro Corporation and its debtor-affiliates obtained authority from the U.S. Bankruptcy Court for the Southern District of New York to hire Rattet, Pasternak & Gordon-Oliver, L.L.P. as their bankruptcy counsel. Rattet Pasternak is expected to: a. advice the Debtors with respect to their powers and duties as debtors-in-possession and the continued management of their property and affairs; b. negotiate with creditors of the Debtors and work out a plan of reorganization and take the necessary legal steps in order to effectuate a plan including negotiations with the creditors and other parties in interest; c. prepare the necessary answers, orders, reports and other legal papers required of a Debtor who seeks protection under Chapter 11; d. appear before the Court to protect the interest of the Debtors and to represent the Debtors in all matters pending before the Court; e. attend meetings and negotiate with representatives of creditors and other parties in interest; f. advise the Debtors in connection with any potential refinancing of secured debt and any potential sale of the business; g. represent the Debtors in connection with obtaining post- petition financing; h. take any necessary action to obtain approval of a disclosure statement and confirmation of a plan of reorganization; i. perform all other legal services for the Debtors which may be necessary for the preservation of the Debtors' estate and to promote the best interests of the Debtors, their creditors and its estate. The Debtors will pay Rattet Pasternak on an hourly basis according to these rates: Designation Hourly Rate ----------- ----------- Partners US$415 - US$550 Counsel US$140 Associates US$250 - US$385 Paraprofessionals US$120 To the best of the Debtors' knowledge, the firm is a disinterested person and does not hold or represent any interest adverse to the Debtors' estates. The firm can be reached at: Rattet, Pasternak & Gordon-Oliver, L.L.P. 550 Mamaroneck Avenue Harrison, NY 10528 Tel: (914) 381-7400 Fax: (914) 381-7406 I.W.T. Tesoro Corporation, fka Ponca Acquisition Company, -- http://www.iwttesoro.com/-- is headquartered in New York City. The company and its subsidiaries distribute building materials, specifically hard floor and wall coverings. They are wholesalers and do not sell directly to any end user. Their products consist of ceramic, porcelain and natural stone floor, wall and decorative tile. They import a majority of these products from suppliers and manufacturers in Europe, South America (Brazil), and the Near and Far East. Their markets include the United States and Canada. They also offer private label programs for branded retail sales customers, buying groups, large homebuilders and home center store chains. The Debtor and its debtor-affiliates, International Wholesale Tile, Inc. and American Gres, Inc., filed for Chapter 11 bankruptcy protection on Sept. 6, 2007 (Bankr. S.D. NY Lead Case No. 07-12841). Dawn K. Arnold, Esq. and Jonathan S. Pasternak, Esq. at Rattet, Pasternak & Gordon-Oliver, L.L.P. represent the Debtors in their restructuring efforts. Donlin, Recano & Co., Inc. serves as the Debtors' claims and noticing agent. An Official Committee of Unsecured Creditors has been appointed by the U.S. Trustee for Region 2 on this case. As of June 30, 2007, the Debtors had total assets of US$39,798,579 and total debts of US$47,940,983. MYERS INDUSTRIES: Earns US$1.5 Million in Third Quarter of 2007 --------------------------------------------------------------- Myers Industries Inc. reported net income of US$1.5 million for the third quarter ended Sept. 30, 2007, compared to net income of US$6 million for the same period in 2006. Net sales from continuing operations for the three months ended Sept. 30, 2007, increased 15 percent to US$213.9 million, as compared to net sales from continuing operations of US$185.8 million reported for the third quarter ended Sept.r 30, 2006. Net sales in the third quarter of 2007 include net sales of approximately US$29.5 million from the acquisition of ITML Horticultural Products, which was completed in January 2007, and net sales of approximately US$8.0 million from the purchase of material handling product lines and assets from Schoeller Arca Systems, Inc. North America, which was completed in March 2007. Net sales from continuing operations, excluding the acquisitions, decreased by approximately US$9.4 million in the third quarter of 2007 as compared to the third quarter of 2006. Net sales in the third quarter 2007 benefited from the ongoing, strategic integration of the acquisitions, which helped to offset the softness in industrial, manufacturing, automotive, heavy truck and tire service markets. Income before taxes from continuing operations for the third quarter of 2007 was US$2.5 million compared to US$6.9 million in the third quarter of 2006. The US$4.4 million decrease in income before taxes from continuing operations in the third quarter of 2007 was primarily the result of: 1) restructuring expenses and the impact of purchase accounting adjustments aggregating approximately US$2.3 million; 2) foreign currency transaction losses of approximately US$1.3 million related to the increased strength of Canadian currency compared with U.S. currency; and 3) expenses of approximately US$1.1 million related to the company's merger transaction. These special items, combined with decreased volume in the quarter due to soft market conditions, offset the company's rigorous application of strategic selling and pricing initiatives to recover raw material inflation, as well as gains from cost control, productivity and further streamlining initiatives directed at long-term growth. Income from continuing operations for the third quarter of 2007 was US$1.5 million as compared to US$4.2 million in the third quarter of 2006. "Third quarter sales and earnings were well within our expectations given the Company's transformation this year, despite the challenging conditions in some of the markets we serve," said President and Chief Executive Officer John C. Orr. "The most critical factor in our performance is that we continue to execute our strategic business plan to drive sustainable, profitable growth. So far this year we have made two key acquisitions, divested a non-strategic business segment, and are working through several major plant consolidation and integration activities. All of these actions, combined with the Company's strong business fundamentals, put us on track to optimize our growth." Summary & Outlook Results in the Company's 2007 third quarter were mixed but expected, as seasonality, softness across several markets and increasing resin prices combined to constrain benefits from improvements made through product mix, pricing, strategic selling, acquisition integration and synergy programs throughout the business segments. The company is cautiously optimistic in its outlook for the remainder of 2007 and moving into 2008, given the market conditions. However, within its key business segments the Company remains focused on its strategic business plan and growth activities to further insulate against shifts in the markets and macro-economic conditions. These activities include new product development, expansion into value-driven niche markets, customer satisfaction and improved cost structures through streamlining and productivity enhancements. Management believes that attention to these actions and other initiatives will continue to position Myers Industries for sustainable, profitable growth. Merger Transaction The company's acquisition by GS Capital Partners is expected to close in the fourth quarter of 2007, but no later than Dec. 15, 2007, as provided for in the Agreement and Plan of Merger. Both parties continue to work together in preparation for closing of the transaction. About Myers Industries Myers Industries, Inc. -- http://www.myersind.com-- is an international manufacturer of polymer products for industrial, agricultural, automotive, commercial, and consumer markets. The Company is also the largest wholesale distributor of tools, equipment, and supplies for the tire, wheel, and undervehicle service industry in the US. The company reported record net sales from continuing operations of USUS$780.0 million in 2006. It has operations in Brazil. * * * As reported in the Troubled Company Reporter-Latin America on Sept. 19, 2007, Standard & Poor's Ratings Services withdrew all ratings on Myers Industries Inc. The withdrawal follows the announcement that private equity sponsor Goldman Sachs Capital Partners would postpone the closing of its acquisition of Myers until the fourth quarter. TAM SA: Gets Third Airbus A321, Increases Fleet to 111 Aircraft --------------------------------------------------------------- TAM SA has received a new Airbus A321 last week directly from the Airbus factory in Hamburg (Germany). This is the third A321 incorporated by the company into its operating fleet. The A321 has capacity to transport up to 220 passengers and will be used by TAM on domestic and South American routes. With this new aircraft, TAM will have 95 Airbus models (15 A319, 66 A320, 3 A321, 10 A330 and 1 A340), consolidating its position as the largest Latin American customer of the European aircraft manufacturer. The A321 is the largest in the A320 family (A318, A319, A320 and A321) and adequate for high-demand markets for mid-size airplanes. TAM is the first company in South America to operate flights using the A321. TAM already has received 22 aircraft this year - 18 from the A320 family (including the three A321s), 1 A340 and three MD- 11s. With the new A321, the Company's operating fleet increased to 111 aircraft -- 95 Airbus models, 13 F-100s and 3 MD-11s. The company plans to end 2007 with 111 airplanes and has plans to expand the fleet to 136 airplanes by the end of 2011. The incorporation of the new Airbus A321 reinforces <