TCRLA_Public/050228.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                    L A T I N   A M E R I C A

           Monday, February 28, 2005, Vol. 6, Issue 41

                            Headlines

A R G E N T I N A

ACTUAR MED: Court Approves Reorganization Petition
CASA IAN: Verification Deadline Approaches
CENTRO PEDIATRICO QUILMES: Plans Assets Liquidation
FRIGOFRUIT S.A.: Moving Forward With Reorganization
HARAS SAN PABLO: Awaiting Reorganization Request Approval  

INSTITUTO MODELO SAINT: Court Orders Liquidation
PRIDE INTERNATIONAL: Moves Earnings Submission Date
MICROOMNIBUS ESTE: Court Grants Creditor's Bankruptcy Motion
SCHEIN S.A.: Begins Liquidation Process
SOUTHERN WINDS: Drug Scandal Ruins Chance for Contract Renewal

TELMEX S.A.: Court Grants Creditor's Bankruptcy Petition


B O L I V I A

* REPUBLIC OF BOLIVIA: S&P Affirms 'B-' Rating


B R A Z I L

BANCO FIBRA: Moody's Confirms Ratings
BANCO RURAL: Ratings Confirmed by Moody's
CESP: Bill to Transfer CTEEP's Stake Faces Strong Resistance
EMBRATEL: Resumes Capital Increase Process
EMBRATEL: UBS Raises Stock Rating Following Drop in Share Price

KLABIN: Develops Microwaveable Packaging for Sadia  
MRS LOGISTICA: Reports 4Q04 EBITDA at BRL170.3Mln
TCP: Proposes Reverse Split of Shares   
TELEMAR: Initiates Nationwide Internet Service


C O L O M B I A

INTERCONTINENTAL DE AVIACION: Government Seizes Planes, Assets


M E X I C O

CORPORACION DURANGO: Concludes Financial Restructuring
CYDSA: Net Losses Balloon to $97M in 2004
GRUPO DESC: Removed From Rating Watch Positive by Fitch
GRUPO TFM: Reports $173.5M Net Revenues for 4Q04
GRUPO TMM: Reports Revenues of $67.8M for 4Q04

TV AZTECA: Confident Investigation Will Yield Positive Outcome


P E R U

PAN AMERICAN SILVER: Reports Net Earnings of $15.7M for 4Q04

     -  -  -  -  -  -  -  -

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

ACTUAR MED: Court Approves Reorganization Petition
--------------------------------------------------
Court No. 2 of Buenos Aires' civil and commercial tribunal
approved a petition for reorganization filed by Actuar Med S.A.,
according to a report by Argentine daily La Nacion.

The Company is entrusted to Ms. Susana Marino, who will verify
claims until April 26. The informative assembly will be held on
February 16, 2006. This is one of the last parts of the
reorganization process.

In its filing, the Company reported assets valued at
US$1,282,880.66 and debts totaling US$907,825.57.

The city's Clerk No. 3 assists the court on this case.

CONTACT: Actuar Med S.A.
         Segui 526
         Buenos Aires
  
         Ms. Susana Marino, Trustee
         Uruguay 560
         Buenos Aires


CASA IAN: Verification Deadline Approaches
------------------------------------------
The verification of claims for the Casa Ian S.A. bankruptcy will
end on April 12, says Infobae. Creditors with claims against the
bankrupt Company must present proof of the liabilities to Ms.
Maria Marcela Porolli, the court-appointed trustee, by the said
deadline.

Court No. 4 of Buenos Aires' civil and commercial tribunal
handles the Company's case with assistance from the city's Clerk
No. 7. The bankruptcy will conclude with the liquidation of the
Company's assets to pay its creditors.

CONTACT: Ms. Maria Marcela Porolli, Trustee
         Parana 785
         Buenos Aires


CENTRO PEDIATRICO QUILMES: Plans Assets Liquidation
---------------------------------------------------
Buenos Aires-based Centro Pediatrico Quilmes S.A. will begin
liquidating its assets following the bankruptcy pronouncement
issued by Court No. 14 of the city's civil and commercial
tribunal.

The ruling places the Company under the supervision of court-
appointed trustee Rodolfo Fernando Torella. Mr. Torella will
verify creditors' proofs of claims until April 22. The validated
claims will be presented in court as individual reports on June
7.

The trustee will also submit a general report, containing a
summary of the Company's financial status as well as relevant
events pertaining to the bankruptcy, on July 19.

The bankruptcy process will end with the disposal Company assets
in favor of its creditors.

CONTACT: Mr. Rodolfo Fernando Torella, Trustee
         Bulnes 2057
         Buenos Aires


FRIGOFRUIT S.A.: Moving Forward With Reorganization
---------------------------------------------------
Frigofruit S.A. will begin reorganization following the approval
of its petition by Court No. 7 of Buenos Aires' civil and
commercial tribunal. The opening of the reorganization will
allow the Company to negotiate a settlement with its creditors
in order to avoid a straight liquidation.

Mr. Gustavo D. Micciullo will oversee the reorganization
proceedings as the court-appointed trustee. He will verify
creditors' claims until April 22. The validated claims will be
presented in court as individual reports on June 3.

The trustee is also required by the court to submit a general
report essentially auditing the Company's accounting and
business records as well as summarizing important events
pertaining to the reorganization. This report will be presented
in court on August 1.

The Informative Assembly, the final stage of a reorganization
where the settlement proposal is presented to the Company's
creditors for approval, is scheduled on December 21.

CONTACT: Frigofruit S.A.
         Avda San Martin 5830
         Buenos Aires

         Mr. Gustavo D. Micciullo, Trustee
         Avda Cordoba 1417
         Buenos Aires


HARAS SAN PABLO: Awaiting Reorganization Request Approval  
---------------------------------------------------------
Court No. 26 is currently reviewing the merits of the
reorganization petition filed by Haras San Pablo S.A. Argentine
daily La Nacion reports that the Company filed the request after
defaulting on its debt payments.

The reorganization petition, if granted by the court, will allow
the Company to negotiate a settlement with its creditors in
order to avoid a straight liquidation.

Clerk No. 51 assists the court on this case.

CONTACT: Haras San Pablo S.A.
         Avda Cordoba 1417
         Buenos Aires


INSTITUTO MODELO SAINT: Court Orders Liquidation
------------------------------------------------
Court No. 2 of Lomas de Zamora's civil and commercial tribunal
ordered the liquidation of Instituto Modelo Saint S.A. de
Difusion Cultural after the Company defaulted on its debt
obligations, Infobae reveals.

The pronouncement will effectively place the Company's affairs
as well as its assets under the control of Mr. Pablo Javier
Kainsky, the court-appointed trustee. Mr. Kainsky will verify
creditors' proofs of claims until March 28.

CONTACT: Instituto Modelo Saint S.A. de Difusion Cultural
         Esmeralda 447 Temperley
         Partido de Lomas de Zamora

         Mr. Pablo Javier Kainsky
         Colon 519/21 Temperley
         Partido de Lomas de Zamora


PRIDE INTERNATIONAL: Moves Earnings Submission Date
---------------------------------------------------
Pride International, Inc. (NYSE: PDE) announced Thursday that
its earnings press release and associated conference call
originally scheduled for Friday, February 25, 2005 have been
rescheduled. The Company is now planning to issue the press
release related to its fourth quarter and year-end 2004 earnings
on Wednesday, March 2, 2005, following the market close.

The Company reported that, in spite of its best efforts to meet
its original schedule, the extensive workload associated with
the requirements of Section 404 of the Sarbanes-Oxley Act
combined with the Company's year-end closing processes have
necessitated this slight delay.

About Pride International

Pride International, Inc., headquartered in Houston, Texas, is
one of the world's largest drilling contractors. The Company
provides onshore and offshore drilling and related services in
more than 30 countries and operates a diverse fleet of rigs.

Pride has over 40 years experience in Latin America, with
operations in Argentina, Brazil, Bolivia, Colombia, Ecuador,
Peru and Venezuela. The Company provides onshore and offshore
drilling and E&P services in these countries, with over 250 rigs
and 6,000 employees.

CONTACT: Mr. Steven D. Oldham
         Mr. Louis A. Raspino
         Phone: (713) 789-1400


MICROOMNIBUS ESTE: Court Grants Creditor's Bankruptcy Motion
------------------------------------------------------------
Microomnibus Este S.A. entered bankruptcy after Court No. 8 of
Buenos Aires' civil and commercial tribunal ruled on the
bankruptcy motion filed by Mr. Guillermo S. Mazzei and Horacio
Jose Forns, reports La Nacion. The Company's failure to pay
US$15,824.16 in debt prompted the creditors to file the
petition.

Working with the city's Clerk No. 16, the court assigned Mr.
Osvaldo Luis Weiss as trustee for the bankruptcy process. The
trustee's duties include the authentication of the Company's
debts and the preparation of the individual and general reports.
Creditors are required to present their proofs of claims to the
trustee before May 20.

The transportation company's assets will be liquidated at the
end of the bankruptcy process to repay creditors. Payments will
be based on the results of the verification process.

CONTACT: Microomnibus Este S.A.
         Zelada 7585
         Buenos Aires

         Mr. Osvaldo Luis Weiss, Trustee
         Av. Roque Saenz Pena 651
         Buenos Aires


SCHEIN S.A.: Begins Liquidation Process
---------------------------------------
Schein S.A. will begin liquidating its assets after Court No. 21
of Buenos Aires' civil and commercial tribunal declared the
Company bankrupt. Infobae reveals that the bankruptcy process
will commence under the supervision of court-appointed trustee
Manuel Omar Mansanta.

The trustee will review claims forwarded by the Company's
creditors until March 8. After claims verification, the trustee
will submit the individual reports for court approval on May 2.
The general report will follow on June 22.

Clerk No. 41 assists the court on this case.

CONTACT: Schein S.A.
         Rivadavia 6249
         Buenos Aires

         Mr. Manuel Omar Mansanta, Trustee
         Avda Cordoba 1351
         Buenos Aires


SOUTHERN WINDS: Drug Scandal Ruins Chance for Contract Renewal
--------------------------------------------------------------
The government of Argentina led by President Nestor Kirchner has
decided to sever ties with private carrier Southern Winds by not
renewing an 18-month cooperation agreement between the latter
and state airline LAFSA.

The announcement was made by Cabinet Chief Alberto Fernandez and
Transportation Secretary Ricardo Jaime in a joint press
conference late Wednesday.

Mr. Fernandez said the accord, signed in September 2003, will
expire on March 2, with the public tender for LAFSA immediately
following.

The government created LAFSA in July 2003 so that 800 former
workers at defunct airlines Lapa and Dinar would have jobs. The
airline didn't have any planes of its own, so officials brokered
a deal with Southern Winds. Southern Winds agreed to
infrastructure-sharing rights with LAFSA in exchange for fuel
subsidies.

The government's decision to put an end to the accord would mean
that fuel and maintenance subsidies from the federal government
would also stop.

Southern Winds is embroiled in a drug trafficking scandal, which
broke out two weeks ago. Local media reported that a September
Southern Winds flight from Buenos Aires to Madrid transported
four suitcases containing 60 kilograms of cocaine. The luggage
had been placed on the plane without having been checked in by
any registered passengers, a violation of security regulations.

The scandal prompted President Kirchner to fire top officials at
the National Aeronautical Police and the Air Force, then create
a civilian-led air security agency. He had also distanced his
government from Southern Winds, saying in a speech last week
that "we have nothing to do with" the private carrier.


TELMEX S.A.: Court Grants Creditor's Bankruptcy Petition
--------------------------------------------------------
Mr. Carlos Rojas successfully requested the bankruptcy of Telmex
S.A. as Court No. 4 of Buenos Aires' civil and commercial
tribunal declared the Company "Quiebra," reports La Nacion.

As such, the Company will now start the bankruptcy process with
Ms. Maria Orazi as trustee. Creditors of the Company must submit
proofs of their claim to the trustee before April 20 for
authentication. Failure to do so will mean a disqualification
from the payments that will be made after the Company's assets
are liquidated.

The creditor sought for the Company's bankruptcy after the
latter failed to pay debts amounting to US$3,200. The city's
Clerk No. 8 assists the court on the case that will close with
the liquidation of all of its assets.

CONTACT: Telmex S.A.
         Suipacha 211
         Buenos Aires

         Ms. Maria Orazi, Trustee
         Montevideo 536
         Buenos Aires


=============
B O L I V I A
=============

* REPUBLIC OF BOLIVIA: S&P Affirms 'B-' Rating
----------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' long-term
and 'C' short-term credit ratings on the Republic of Bolivia.

Standard & Poor's also said that the outlook on Bolivia remains
stable.

"The ratings reflect the severe political polarization in
Bolivia," noted Standard & Poor's credit analyst Sebastian
Briozzo. "This polarization continues to constrain Bolivia's
ability to reach a consensus on new initiatives to enhance
governability, restore the country's fiscal sustainability, and
support a medium-term growth strategy." For example, the attempt
to pass a new hydrocarbon law has become increasingly
controversial.

If passed, it would allow Bolivia to take advantage of its
significant reserves of gas (the second largest in Latin
America), attract new foreign direct investment that could boost
the country's medium-term growth prospects, and contribute to
fiscal correction. As shown in the past, large flows of foreign
direct investment are a precondition for achieving high per-
capita growth rates in Bolivia, which would create the
conditions for a successful poverty-reduction strategy.

Bolivia's economic and fiscal performance continues to be
extremely dependent on external factors. Prices of international
commodities--in particular agricultural, hydrocarbons, and
mining--are especially important in supporting the current
economic recovery over the short term. Likewise, Bolivia's
medium-term growth will depend on foreign direct investment
given the country's relatively low level of domestic saving,
estimated at 14% of GDP for 2005. Fiscally, support from the
donor community (grants accounted for an 3% of GDP over the last
three years) and flexibility from the International Monetary
Fund were, and will continue to be, key in supporting President
Mesa's attempt to reduce the large fiscal deficit gradually.
Bolivia's public-sector deficit peaked at almost 9% of GDP in
2002, declining to a still-high deficit estimated in 6.1% in
2004. Despite political fragility, the economic recovery now
underway could allow the government to reduce the deficit even
further in 2005 to about 5.7% of GDP.

The stable outlook is based on Standard & Poor's expectation
that President Mesa's still-high level of popular support--
combined with the current economic recovery--will continue to
assure governability despite intense levels of demonstrations
and political polarization. At the same time, the persistence of
a weak political environment will make progress in the reform
agenda increasingly challenging. A more severe intensification
of the political problems, a declining level of support from the
international community, or a drastic change in the now-
favorable international conditions that could affect the
economic recovery and fiscal performance will lead to
significant pressures on Bolivia's ability to service its market
(domestic) debt and might trigger a downgrade. Alternately,
increasing public support for the government's agenda will
reflect a more conductive political environment over the short
term and enhance growth potential over the medium term, leading
to a potential upgrade.

Primary Credit Analyst: Sebastian Briozzo, New York
(1) 212-438-7342; sebastian_briozzo@standardandpoors.com

Secondary Credit Analyst: Joydeep Mukherji, New York
(1) 212-438-7351; joydeep_mukherji@standardandpoors.com



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

BANCO FIBRA: Moody's Confirms Ratings
-------------------------------------
Moody's Investors Service confirmed the ratings of Banco Fibra
S.A. (Fibra) at B1 for global local currency deposits and
Baa2.br for deposits on the Brazilian National scale. This
rating action concludes the review for possible downgrade of
Banco Fibra's ratings, initiated in December 2004.

Moody's noted that despite pressures on Banco Fibra's funding
base, following the receivership of Banco Santos, the bank has
been able to manage both the temporary deposit outflows and the
resulting higher cost of funding without a substantial impact on
its financial flexibility. To offset withdrawals, Fibra's
management had access to alternative funding sources, and was
thus able to maintain its loan portfolio, while continuing to
lend to its targeted market segments.

Moody's said that Fibra's global local currency rating of B1
incorporates the view that its shareholders would be forthcoming
in assisting the bank's capital and liquidity in a stress
situation.

Banco Fibra is headquartered in Sao Paulo and at December 31,
2004, it had total assets of R$6.5 billion (approximately US$2.4
billion).

The following ratings were confirmed

Global local currency deposit ratings- B1 for long term, Not
Prime for short-term

National Scale Deposit Ratings -- Baa2.br for long-term, Br-3
for short-term.


BANCO RURAL: Ratings Confirmed by Moody's
-----------------------------------------
Moody's Investors Service confirmed Banco Rural's bank financial
strength rating of D minus (D-), the Ba3 global local currency
deposit rating, and the Brazilian National scale deposit rating
of A3.br. Moody's also placed a positive outlook on Banco
Rural's long-term foreign currency deposit rating of B2, and
long-term foreign currency bond rating of B1. These rating
actions conclude the review for possible downgrade of Banco
Rural's ratings, initiated in December 2004.

Moody's noted that Banco Rural's funding had come under stress
as a result of the receivership of Banco Santos, which resulted
in a substantial outflow of deposits in the latter part of 2004.
To offset such movement, the bank reduced its loan portfolio, as
reflected in a 25% decrease in the balance sheet at year-end.
The short-term, secured nature of the bank's loan book allowed
management to collect loans, thus aligning the bank's assets to
its new funding availability.

The rating agency said that despite such a dramatic change in
the balance sheet, it views Banco Rural's franchise as being
resilient and consistent with a D- bank financial strength
rating.

Banco Rural is headquartered in Belo Horizonte and at December
31, 2004, it had total assets of R$5.5 billion (approximately
US$2.1 billion).

The following ratings were confirmed:

Bank Financial Strength Rating of D minus (D-), stable outlook

Global Local Currency Deposit Ratings- Ba3 for long term; Not
Prime for short-term, stable outlook

Brazil National Scale Deposit Ratings - A3.br, for long-term
deposits

The following outlooks were changed to positive:

B1 Long-term foreign currency bond rating - to positive, from
stable

B2 Long-term foreign currency deposit rating --to positive, from
stable


CESP: Bill to Transfer CTEEP's Stake Faces Strong Resistance
------------------------------------------------------------
A bill aimed at giving the Sao Paulo state government freedom to
transfer its controlling stake in transmission Company CTEEP to
generation Company CESP so that the latter can use them as
guarantees to issue debt is facing strong opposition in the
state legislative chamber.

Sao Paulo Governor Geraldo Alckmin recently submitted the bill
to the state's legislature as part of his government's efforts
to rescue CESP, which is a sister Company of CTEEP.

The state's CTEEP stake is worth about BRL700 million (US$267
million) and the state is in talks for national development bank
BNDES to inject an equivalent amount into CESP.

CESP's debt tops BRL10 billion and the capital injection would
allow the Company to issue BRL2 billion in local debt, allowing
it to roll over part of its maturing debt.

CONTACT:    Companhia Energetica De Sao Paulo (CESP)
            Rua da ConsolaO o, 1.875
            CEP 01301 -100 S o Paulo, Brazil
            Phone: +55-11-234-6322
            Fax: +55-11-287-0871
            Home Page: http://www.CESP.com.br/
            Contact:
            Mauro G. Jardim Arce, Chairman
            Ruy M. Altenfelder Silva, Vice Chairman
            Vicente Kazuhiro Okazaki, Finance Director


EMBRATEL: Resumes Capital Increase Process
------------------------------------------
Embratel Participacoes S.A. ("Embrapar"), in compliance with the
provisions of paragraph 4 of article 157 of Law #6.404/76 and to
CVM Instruction #358/02, communicates to its shareholders and to
the public in general that, on February 24, it is resuming its
capital increase process, as authorized by February 18th, 2005
Deliberation #479 of the Brazilian Securities and Exchange
Commission (CVM) , the Board of Directors of the Company
approved a new timetable for the capital increase, rectifying
the decision taken by the Board of Directors on February 03rd,
2005.

Further information and details about the capital increase can
be found on the Minutes of the Board Meeting and available in
the Company's web site at www.embratel.com.br.

In compliance with the legislation, the Company will publish, on
March 02nd, 2005, a Notice to Shareholders with all final terms
and conditions for the capital increase.

CONTACT: Embratel Participacoes S.A.
         Rua Regenta Feijo
         166 sala 1687-B Centro
         Rio de Janeiro, 20060-060
         Brazil
         Phone: 5521-519-6474
         Web site: http://www.embratel.net.br


EMBRATEL: UBS Raises Stock Rating Following Drop in Share Price
---------------------------------------------------------------
A fall in Embratel Participacoes SA's share price prompted UBS
Investment Research to raise its stock rating on the long-
distance phone operator to Neutral from reduce, reports Dow
Jones Newswires.

However, the investment house cut its price target on Embratel
to US$10 per American Depositary Receipt from US$11.19 earlier,
saying Embratel's traffic is "substantially less than previously
thought, while pricing is higher."

Those factors pose a risk to the Company's revenue along with
the entry of Voice Over Internet Telephony, or VoIP, services,
it added.


KLABIN: Develops Microwaveable Packaging for Sadia  
--------------------------------------------------
Klabin has always applied innovation and high technology when
developing its packing cardboard and has just entered into a new
sector of the Brazilian food industry: the market of fast food
for microwave. The Company supplies the cardboard used for
packing the Hot Pocket, a new fast food of Sadia, which goes
straight from the freezer to the microwave and takes only 2
minutes to be ready to consume.

Klabin's cardboard is the only cardboard in Brazil that has all
the characteristics required to both store and cook the product.
The new fast food requires packing that is able to withstand
extreme temperature variations while preserving the original
flavor.

Among the cardboard distinguishing characteristics are the
hardness and tearing strength, as well as low water absorption,
to tolerate the conditions found in the supply chain, such as
packing, storing, distribution and consumption. To these
characteristics is added a surface appropriate for printing the
packing.

The cardboard used for the packing is manufactures of 100%
virgin fibers, bleached by "Total Chlorine Free" (TFC) process,
that is, without using chlorine. The absence of chlorine in the
bleaching process prevents subsequent aggression to the
environment. Also, the fiber used to produce the cardboard comes
from planted forests which are certified by the FSC (Forest
Stewardship Council), the most demanding forest certification
entity in the world.

CONTACT: Klabin S.A.
         RUA Formosa
         367-18 Andar
         Sao Paula SP
         Brazil
         Phone: 55-11-3225-4000

         Website: http://www.klabin.com.br


MRS LOGISTICA: Reports 4Q04 EBITDA at BRL170.3Mln
-------------------------------------------------
MRS Logistica S.A. ("MRS") transported 26.3 million tons in the
4th Quarter of 2004 (4Q04), 2.7% above volumes achieved in 3Q04
and 15.1% higher when compared with the same period of previous
year. The Company established a new monthly transportation
record, with 8.82 million tons shipped in October, attaining a
105 million-tons/year production rate. This increase in volumes
was a consequence of record shipments of iron ore (MBR, CVRD and
Cosipa), bauxite (CBA), cellulose (VCP) and containers. Total
volume shipped in 2004 reached 98.1 million tons, 13.7% higher
when compared to 2003. Heavy haul and general cargo volumes
increased 15% and 8%, respectively, compared to 2003.

Revenues, Costs and EBITDA

Gross revenues in 4Q04 reached R$476.5 million, 10.5% and 31.6%
higher when compared with 3Q04 and 4Q03, respectively. Gross
revenues in 2004 reached R$1,621 million, a 20.3% growth when
compared with last year. Heavy haul and general cargo revenues
in the year increased 17% and 31%, respectively, compared to
2003.

Costs of materials and services in 2004 were 35% and 8% higher,
respectively, when compared to 2003, due to the intensification
of a preventive maintenance plan for locomotives and wagons.
Fuel and lubricant costs in 2004 were 7% greater than in 2003,
as a consequence of higher volumes shipped throughout the
period.

EBITDA reported in 4Q04 amounted to R$170.3 million, 4.3% lesser
than in 3Q04 and 11.5% greater than in 4Q03. The EBITDA decline
in 4Q04 was a consequence of a R$30 million provision regarding
tax credit losses recorded in 4Q04. Total EBITDA in 2004 grew
11.3% compared to previous year, totaling R$614.7 million, with
a 44% margin.

Operating and Net Income

Operating income, before financial effects, totaled R$545.6
million in 2004, up 9% compared to 2003. Net income in the year
reached R$222.3 million, against R$351.9 million registered in
2003. This decrease was caused by higher net exchange and
monetary variations, which amounted to R$92.9 million in 2004,
against R$29.5 million in 2003, together with a R$105.3 million
tax credit recorded in 4Q03. As a result of the sustained
profitability reported by the Company in the last 12 months,
shareholders" equity amounted to R$413.8 million in 4Q04,
against R$280.6 million in 4Q03.

Indebtedness

Net debt at 4Q04 was reduced to R$416.7 million, 36.8% lower
than the R$659.5 million recorded in 4Q03, as a result of the
increasing cash generation throughout the period. The net
debt/EBITDA (last 12 months) ratio in 4Q04 was 0.68x, down from
1.19x in 4Q03, a solid improvement in the Company's capacity to
meet its financial obligations. Below, a chart demonstrates the
improvement of the Net Debt/EBITDA ratio over the last years.

Capital Expenditures

Capital expenditures totaled R$283.3 million in 2004, with the
following breakdown:

Permanent way                          (R$70.4 million)
Rolling stock - locomotives and wagons (R$186.0 million)
Signaling systems                      (R$9.1 million)
IT                                     (R$3.7 million)
Environment                            (R$1.4 million)
Others                                 (R$12.7 million).

The major projects were:

- Overhauling of locomotives and wagons in order to improve the
fleet's reliability and increase capacity;

- Recovering of 185 HTS and 75 HAS wagons;

- Acquisition of 630 new GDT wagons for iron ore shipments;

- Acquisition of 38 locomotives in the U.S. secondary market;

- Acquisition of ATC systems for traffic through CPTM's lines;

- Improvement of the permanent way at Baixada Santista (SP) and
Sao Paulo Line in order to handle the increasing demand for
transportation of iron ore, soybeans, containers, sulfur,
bauxite and steel products;

- Acquisition of safety equipments such as derailment detectors,
hot wheel and hot box detectors; and

- Sealing of several segments of the railway lines in order to
prevent accidents and to assure cargo integrity.

The above capital expenditures allowed a 31.4% reduction in the
accident index (Concession Target) from 2003 to 2004. The chart
presented below confirms the Company's efforts applied in
accident reduction in the last 7 years.

Commercial/Operational Highlights

Throughout the year, several new projects/businesses should be
highlighted:

- Companhia Vale do Rio Doce (CVRD) - transport of 2.7 million
tons of iron ore from CVRD's mines in Belo Horizonte (MG) to its
Patrag terminal in Ouro Branco (MG) for export through the Port
of Tubarao (ES).

- Companhia de Fomento Mineral (CFM) and Mineracao Rio Verde -
additional shipments of 1.2 million tons of iron ore for export
through the Port of Sepetiba (RJ).

- Joint venture among MRS, Brasil Ferrovias and Coinbra Trading
- a subsidiary of Louis Dreyfuss - in order to transport
soybeans and corn from Sao Simao (GO), initially through the
Tiete-Parana waterway to Pederneiras (SP), and from there
through MRS trains until the Port of Santos for export.

- Vallourec & Mannesmann do Brasil: transportation of tubes from
V&M's plant in Belo Horizonte to Macae (RJ), to supply
Petrobras. MRS ships the cargo until its Arara terminal at the
Port of Rio de Janeiro. From there the tubes follow by trucks to
Macae.

- Cosipa: transportation of steel products from Cosipa's plant
in Sao Paulo to two shipyards located in the State of Rio de
Janeiro. In the 1st project, MRS ships the products to its Arara
terminal (RJ) and from there the cargo is moved through trucks
until EISA's yard in Rio. In the 2nd project, the products are
shipped until Barra Mansa (RJ) and from there through trucks
until BrasFells" yard in Angra dos Reis (RJ).

- Votorantim Metais: shipping of zinc concentrate, from the
Sepetiba Port to Votorantim's plant in Juiz de Fora. In order to
accomplish this transportation, MRS and Votorantim invested
R$10.5 million in the project. MRS reactivated 6.5 Km of the
Juiz de Fora-Paraibuna railway segment and reformed 30 HFS
hopper wagons, while Votorantim refurbished the unloading
terminal at the plant and constructed a loading unit at TECAR
(coal loading terminal at the Sepetiba Port), using a convey-
belt system.

- Companhia Siderurgica de Tubarao (CST): logistic project
combining 3 railroads and trucks to ship steel products from
CST's plant, in Vitoria (ES), to CSN Parana, in Araucaria (PR).
The cargo is dispatched from Vitoria (ES), through CVRD's
railway to Lafaiete Bandeira (Ouro Preto - MG), where it is
transferred to MRS" trains, continuing the route up to Agua
Branca terminal (SP). Trucks then move the cargo to Tatui
terminal (SP), where is finally carried through AL rail cars
until CSN's plant in Araucaria. Formerly, the products were
shipped by cabotage.

- Containers: MRS shipped 91.9 thousand TEUs (20-feet
containers), an 18.7% increase compared to 2003. The containers
are primarily moved through 5 express routes:

Santos (SP) - Vale do Paraiba (SP),
Santos - Sao Paulo - Jundiai (SP),
Santos - Campinas (SP),
Rio de Janeiro/Sepetiba - Belo Horizonte (MG) and Rio de
Janeiro/Sepetiba - Vale do Paraiba for clients such as Fiat,
Volkswagen, General Motors, Daimler-Crysler, Ford, Toyota,
Hamburg Sud/Alianca and P&O Nedlloyd/ Mercosul Line.

- Pig Iron: Agreement with several pig iron producers from the
region of Sete Lagoas (Belo Horizonte - MG) to transport their
production for export through the Port of Rio de Janeiro. Trucks
initially move the products from the pig iron plants to MRS"
terminal in Joaquim Murtinho (MG) where the cargo is then
shipped to the Port of Rio.

- Volkswagen and General Motors: beginning of transport of auto
parts in containers for export from Tecon Vales Intermodal
terminal in Cacapava (SP) to the Ports of Rio de Janeiro and
Sepetiba.

To view financial statements:
http://bankrupt.com/misc/MRS.pdf

CONTACT: MRS Logistica
         Praia de Botafogo 228, 1201-E
         22250-906 - Rio de Janeiro
         Phone: 55-21-2559-4600
         Fax: 55-21-2552-2635
         E-mail: daf@mrs.com.br


TCP: Proposes Reverse Split of Shares   
-------------------------------------
Telesp Celular Participacoes S.A. ("TCP"), ("BOVESPA": TSPP3
(Ord.), TSPP4 (Pref.), NYSE: TCP), hereby announces to the
market and to its shareholders that its Board of Directors, in a
meeting held on February 16, 2005, decided to submit to the
Extraordinary General Shareholders' Meeting of TCP, for which a
notice of convocation will be published up to February 23, 2005,
the proposal for a reverse split of the 1,582,563,526,803
registered book-entry shares of capital stock of TCP, with no
par value, of which 552,896,931,154 are common shares and
1,029,666,595,649 are preferred shares with such reverse split
to occur at the ratio of two thousand and five hundred (2,500)
shares to one (1) share of the respective class, after which
there will be 633,025,410 registered book-entry shares, with no
par value, of which 221,158,772 will be common shares and
411,866,638 will be preferred shares, pursuant to Article 12 of
Law 6,404/76, as amended.

In compliance with Instruction No. 358 of the CVM, dated January
3, 2002, as amended, below are the main characteristics of this
reverse split of shares:

I.  Purpose:

- To adjust the unit quotation value of the shares to a more
adequate level from a stock market perspective, since the
quotation of the shares in Reais per share gives greater
visibility as compared with the quotation per lot of one
thousand (1,000) shares;

- To unify the basis for quoting the shares in the national and
international markets, since the shares are currently quoted in
lots of 1,000 (one thousand) shares in the national market - Sao
Paulo Stock Exchange ("BOVESPA"), and in lots of two thousand
and five hundred (2,500) shares for each American Depositary
Receipt ("ADR") in the international market - New York Stock
Exchange ("NYSE");

- To reduce operational expenses and to increase the efficiency
of the system for registering information regarding the
shareholders of TCP; and

- To reduce the possibilities of informational errors, improving
services to the shareholders of TCP.

II. Ratio of the Reverse Split of Shares:

Upon approval by the duly convened Extraordinary General
Shareholders' Meeting of TCP, the shares will be grouped at the
ratio of two thousand and five hundred (2,500) shares into one
(1) share and, after the period mentioned in item III below,
will be traded in units of a single share.

III. Period for the Adjustment of Shareholder Positions

If the transaction is approved by the Extraordinary General
Shareholders' Meeting of TCP, the Company will publish a Notice
to the Shareholders establishing a minimum period of 30 (thirty)
days, so that each shareholders, in its discretion, may adjust
its equity position, by class, into lots of two thousand and
five hundred (2,500) shares through trading on BOVESPA.

Shareholders will be able to adjust their positions through the
Brokerage Companies of their choice.

Further Proceedings

Once the period established for the adjustment by shareholders
has expired, the remaining fractional shares will be separated,
grouped in whole numbers and sold in an auction to be carried
out on the Sao Paulo Stock Exchange.

The proceeds of the sale of the fractional shares will be
available to the shareholders who own those fractional shares at
the Depositary Institution holding the Book-Entry Shares of TCP,
ABN Amro Real S.A. ("ABN"). The payment of such amounts will be
made through any of its branches, upon request to ABN by the
shareholder. The value corresponding to the fractional shares
owned by shareholders whose shares are in the custody of CBLC
Companhia Brasileira de Liquidacao e Custodia (the Brazilian
Settlement and Custody Company) will be credited directly to
CBLC, which will forward the applicable amounts to the
shareholders through their custodial agents.

Holders of ADRs Traded in the United States of America

There will be no reverse split of ADRs in the United States of
America . Only the ratio of shares to each ADR will be changed
from the current ratio of two thousand and five hundred (2,500)
shares per ADR to one (1) share per ADR. Thus, there be no
fractional ADRs resulting from the reverse split, contrary to
the effect of the transaction on Brazilian shares.

Documents Available to the Shareholders

The Minutes of the Meeting of the Board of Directors of TCP that
approved the transaction and this Notice of Material Fact are
available to interested parties at the Investor Relations
Department of the Company at Av. Dr. Chucri Zaidan, 860,
Morumbi, Sao Paulo , SP. The documents are also available
electronically on the web-site of Investors Relations
Department, www.vivo.com.br/ri, and on the BOVESPA web-site,
www.bovespa.com.br.

Further clarifications regarding the reverse split stock of
shares are available on the web-site and through the network of
branches of ABN.

The authorized capital of TCP will also reflect the reverse
split changing, from 1.8 trillion shares to 720 million shares,
and the Bylaws of the Company will consequently be updated.

CONTACT: VIVO - Investors Relation
         Phone.: + 55 11 5105.1172
         E-mail: ri@vivo.com.br
         Available Information: http://www.vivo.com.br/ri
  

TELEMAR: Initiates Nationwide Internet Service
----------------------------------------------
Telemar Internet, a subsidiary of Telemar Norte Leste S.A.,
launched, Thursday, a new nationwide internet service covering
246 cities through its recently formed Internet service
provider/portal, "Oi Internet". The new service initially offers
free dial-up access, providing its customers with local Internet
access. Broadband access will also be available in the near
future.

Several "Oi Internet" features ensure its competitiveness
including:

- sending short messages (SMS) via dialer;
- the largest (300 megabytes) e-mailbox among Brazilian free
internet providers, unlimited e-mail accounts;
- free personalized page and unified e-mail, (enabling
management of different e-mail accounts in the same place).

Additional services offered by the Oi Internet portal include
news, e-commerce, horoscopes, chat rooms, games, blogs, among
others.

The new ISP has an inaugural promotion: the first 500 thousand
customers in Region 1, which is comprised of the 16 states in
the North, Northeast and Southeast regions where the Telemar
Group has its core operations, will receive a 31% discount on
the amount of excess pulses in calls placed to the ISP any time
of the day. The promotion will run through May 24, 2005. Telemar
expects to reach one million ISP customers by year-end 2005,
further reinforcing the Oi brand throughout Brazil.

Initial investments in Oi Internet are estimated at R$ 10
million, after which investments are expected to increase
proportionally as the customer base expands.

CONTACT: TNE - Investor Relations
         Mr. Roberto Terziani
         E-mail: invest@telemar.com.br
         Phone: 55 21 3131 1208
        
         Mr. Carlos Lacerda
         E-mail: carlosl@telemar.com.br
         Phone: 55 21 3131 1314
         Fax: 55 21 3131 1155

         The Global Consulting Group
         Mr. Kevin Kirkeby
         E-mail: kkirkeby@hfgcg.com
         Phone: 1-646-284-9416
         Fax: 1-646-284-9494



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

INTERCONTINENTAL DE AVIACION: Government Seizes Planes, Assets
--------------------------------------------------------------
The Colombian government confiscated eight planes and other
assets from the Intercontinental de Aviacion on Thursday,
reports Xinhuanet.

Most of the assets belong to Gabriel Puerto, a principal
shareholder in Internacional de Aviacion who was arrested in
Colombia on Oct. 7, 2004 on allegations of drug trafficking. The
US government, which accused him of importing, owning and
distributing cocaine, is seeking to extradite him.

Colonel Oscar Naranjo of the Judicial and Investigative Police
Direction said 10 prosecutors and 150 police agents took part in
the confiscation activities.

Another principal shareholder of Intercontinental de Aviacion is
also allegedly implicated in the drug-related crime. The
shareholder is a lawyer known by the alias El Doctor, considered
as the second leader in the Norte del Valle cartel, headed by
Diego Montoya, alias Don Diego.

On Oct. 15, 2004, the Intercontinental de Aviacion was listed by
the US State Department as a drug-trafficker.
     


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

CORPORACION DURANGO: Concludes Financial Restructuring
------------------------------------------------------
Corporacion Durango, S.A. de C.V. (BMV:CODUSA), announced that
all agreements regarding its financial restructuring have been
signed and executed on Wednesday, Feb. 23, 2005.

This substantially strengthens the Company's financial structure
and fortify its leadership as the largest papermaker in Mexico.

Miguel Rincon, Chairman and C.E.O. of Corporacion Durango,
commented: "We are gratified that our lenders showed confidence
in our financial strategy and business plan; They have worked
with the Company in effecting an efficient financial
reengineering, which it can be summarized as follows".

- Successful consensual restructuring

- Competitive and sustainable new capital structure achieved

- Substantial debt reduction of approximately 40%

- Debt reduction of US$402 million

- The Company covered 100% of its obligation through debt notes,
equity and cash

- A portion of the debt has been exchanged by 17% of equity

- Interest rate reduction to 6.9% annual

- Financial cost reduction of 61%

- Savings of approximately $560 million in financial cost / next
8 years

- Extended new 8 years debt maturity profile through 2012

- Broader financial flexibility

- Rincon Family controls approximately 80% ownership of the
Company

- Establishes a new mark in efficient corporate restructurings

- Significantly strengthens Durango's financial reputation

"The year 2004 will be remembered as the time in which
Corporacion Durango built new, and more solid, fundamentals and
became a more competitive Company in its operations, in its
financial structure, and in its strategic vision, which, coupled
with the industry's recovery underway, will allow us to continue
creating value to our customer people and shareholders",
concluded Miguel Rincon.

CONTACTS:  CORPORACION DURANGO, S.A. DE C.V.
           Mayela R. Velasco
           Tel: +52 (618) 829 1008
           E-mail: mrinconv@corpdgo.com.mx

           Miguel Antonio R.
           Tel: +52 (618) 829 1070
           E-mail: rinconma@corpdgo.com.mx

           THE GLOBAL CONSULTING GROUP
           Kevin Kirkeby
           Tel: (646) 284-9416
           E-mail: kkirkeby@hfgcg.com


CYDSA: Net Losses Balloon to $97M in 2004
-----------------------------------------
Mexican industrial group Cydsa (Grupo Celulosa y Derivados) saw
its net losses soar to MXN1.08 billion (US$97.3 million) in 2004
from losses of MXN807 million (US$72.7 million) in 2003, reports
Comtex Global News.

The Company posted sales of MXN7.12. billion (US$642 million) in
2004, 16.5% higher than the MXN4.93 billion (US$444 million)
posted in 2003.

Its chemical products and plastics business made sales last year
of MXN4.63 billion (US$417 million), growth of 18.3% year-on-
year, while its textile and fiber subsidiary raked in 16.7% more
than in 2003, after grossing US$2.14 billion.

Nevertheless, income made by its flexible packaging business
slipped 4.3%, after totaling just MXN356 million (US$32.1
billion) in the period.

Cydsa's gross profits rose from MXN1.24 billion (US$112 million)
in 2003 to MXN1.38 billion (US$124 million) in 2004.

At the end of December, the industrial group's debt reached
MXN4.78 billion (US$431 million), which compared favorably to
liabilities of MXN7.52 billion (US$677 million) at the end of
2003.

Cydsa is a major Mexican industrial Company with leading market
share in some of its lines of business and with long-standing
relationships with major Mexican and international companies.

CONTACT:  Jose de Jesus Montemayor Castillo
          Chief Financial Officer
          +011-52-81-8152-4585
          URL: http://cydsa.com/Ingles/index.htm


GRUPO DESC: Removed From Rating Watch Positive by Fitch
-------------------------------------------------------
Fitch Ratings has removed the senior secured foreign currency
and local currency ratings of Desc, S.A. de C.V. (Desc), as well
as the national scale rating, from Rating Watch Positive. The
'B+' senior secured foreign currency and local currency ratings,
the 'B' senior unsecured foreign currency and local currency
ratings and the 'BBB-(mex)' unsecured national scale rating have
been affirmed. The Rating Outlook is Stable. Fitch has also
assigned a senior secured foreign national scale rating of
'BBB+(mex)' to Desc.

On Feb. 20, 2004, Fitch placed the ratings of Desc on Rating
Watch Positive following the announcement of a capital increase
by $248 million, the proceeds of which were used to reduce debt.
The improvement in the Company's leverage was partially offset
during 2004 by strong cost pressures due to a significant raise
in the price of raw materials. This impaired the recovery of
profitability despite the recovery of revenues during the year.

During 2004, revenues began to recover following continued
declines over the prior several years resulting from challenging
business conditions across most of the Company's businesses.
Revenue growth was driven by higher demand in the automotive
parts, chemical and food sectors, as well as price increases.
Adjusted for the divestiture of the aluminum wheel, adhesive and
sealant businesses during 2003, revenues grew by 14% in 2004.
Profitability, however, was pressured by important increases in
raw material costs. The profitability of the automotive parts
sector was affected by high international steel prices and
pricing pressures from costumers (original equipment
manufacturers - OEMs). The chemical sector recovered volume and
prices but higher raw material costs, particularly of styrene
and butadiene pressured margins. Revenues and margins of the
food sector grew driven by higher demand for branded products
and higher pork prices.

In 2005, challenging operating conditions in the automotive
parts sector will persist with steel prices forecasted to remain
high and pricing pressures from OEMs to continue. In the
chemical sector, the stabilization of profitability is expected
to sustain as a favorable pricing trend is supported by higher
demand. The food sector is also expected to continue to grow
both volume and prices.

During 2004, Desc continued to focus on the divestiture of non
core assets. On Jan. 31, 2005, the Company closed the sale of
its 51% equity stake in Velcon, its constant velocity joint
business, to its former joint venture partner GKN Industries.
Net proceeds of US$65 million will be applied to reduce debt.

At Dec. 31, 2004, total debt reached US$717 million, a decline
from US$1.05 billion at Dec. 31, 2003, as the Company repaid
debt with proceeds from the US$248 million capital increase
completed in April 2004. Correspondingly, the ratio of total
debt-to-EBITDA improved to 3.43 times (x) at the end of 2004
from 4.95x in 2003 and the ratio of EBITDA-to-interest expense
reached 3.42x compared to 2.91x in 2003.

At Dec. 31, 2004, total debt was composed of US$319 million
equivalent of dollar-denominated secured amortizing bank loans
due 2005-2008, US$76 million of peso-denominated secured
amortizing bank loans due 2005-2008, US$216 million equivalent
of peso-denominated notes due 2006 and 2007, US$77 million of
International Finance Corporation secured notes due 2007-2009
and US$29 million of other debt. In 2005, Desc does not have
large debt maturities, with only 5% or US$38 million of total
debt due in the short term. Debt maturities are concentrated in
2006 and 2007 on the peso-denominated inflation-adjusted notes.
The Company is planning to refinance these notes during 2005.

At Dec. 31, 2004, Desc had US$39 million in cash and marketable
securities. Budgeted capital expenditures for 2005 are US$75
million which the Company is expected to fund from free cash
flow. Proceeds from the sale of the constant velocity joint
business and possibly other non core business are expected to
contribute to debt reduction during the year, which should
translate into a recovery of credit metrics should revenues
continue their current favorable trend and the cost base remain
stable.

The ratings are supported by a diversified revenue stream, hard
currency generation from direct exports primarily to North
America and joint ventures and strategic alliances with
international industry leaders. The Company is exposed to
significant volatility in demand and input commodity prices in
its petrochemical and automotive parts operations.

Desc is one of Mexico's largest industrial conglomerates, with
operations in the automotive parts, chemical, food and real
state businesses. In 2004, Desc had total sales of US$2 billion,
EBITDA of US$198 million and exports of US$955 million.


GRUPO TFM: Reports $173.5M Net Revenues for 4Q04
------------------------------------------------
Grupo Transportacion Ferroviaria Mexicana, SA. de C.V. and its
subsidiaries ("TFM") report financial results for the fourth-
quarter and full-year periods of 2004.

FOURTH-QUARTER 2004 OPERATIONAL RESULTS

Consolidated net revenues for the three months ended December
31, 2004, were $173.5 million compared to revenues of $175.2
million for the same period in 2003. The sale and subsequent
deconsolidation of Mexrail reduced revenues by $15.2 million.
The comparison of the quarter ended December 31, 2004, of TFM
without Mexrail shows an increase in consolidated revenues of
$13.5 million, or 8.4 percent, over the same period of 2003,
from $160.0 million to $173.5 million. This improvement in
revenues is mainly due to an increase of 9.9 percent in general
freight segments due to conversion and higher activity in
chemicals, industrials, and metals and minerals, and 7.7 percent
in auto & intermodal segments. Revenues were also slightly
affected by the devaluation of the peso, which translated into a
$1.1 million deterioration of revenues.

Consolidated operating profit for the fourth quarter of 2004 was
$34.1 million, representing an increase of $2.0 million from the
fourth quarter of 2003. The operating ratio (operating expenses
as a percentage of revenues) for the fourth quarter of 2004 was
80.4 percent. Operating expenses without Mexrail were impacted
$9.7 million due to an increase in fuel prices of 52 percent
compared with the average price during the same quarter of 2003.
Costs other than fuel grew only 2.9 percent, which represented
an improvement in productivity when compared to the growth of
revenues in the fourth quarter of 2004 as compared to the same
quarter of 2003.

FULL-YEAR 2004 OPERATIONAL RESULTS

Consolidated net revenues for the 12 months ended December 31,
2004, were $700.4 million, which represented an increase of $1.9
million from the year ended December 31, 2003. These results
include the consolidation of Mexrail for seven months as a
consequence of the sale of Mexrail to KCS. Revenues for the year
ended December 31 2004, without Mexrail, grew 3.7 percent, or
$24.0 million over 2003. Total carload volume grew 7.4 percent
in all segments with the exception of automotive. The
depreciation of the peso over revenues denominated in pesos
impacted revenues by $16.0 million, or 2.5 percent.

Operating profit for the year ended December 30, 2004, was
$130.0 million, resulting in an operating ratio of 81.4 percent.
The consolidated operating ratio without Mexrail was 79.9
percent. Results were impacted by greater revenues and fuel
price variability, which reflected sustained increases
throughout 2004 of 26 percent and negatively impacted results by
$20.5 million. Costs other than fuel grew only 1.9 percent when
compared with 2003 expenses.

FINANCIAL EXPENSES

Net financial expenses incurred in the year ended December 31,
2004, were $111.5 million. A foreign exchange gain of $0.4
million resulted from the appreciation of the Mexican peso
relative to the U.S. dollar.

LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 2004, accounts receivable decreased to $182.4
million from $188.4 million at December 31, 2003.

TFM made capital expenditures of $7.5 million and $41.1 million
during the fourth quarter and 12 months, respectively, of 2004,
investing in the improvement of TFM and Mexrail lines.

As of December 31, 2004, TFM had an outstanding debt balance of
$883.0 million, including $65.1 million of short-term and $817.9
million of long-term debt. This balance represents a decrease of
$56.8 million when compared to December 31, 2003.

VAT LAWSUIT

On November 24, 2004, the Federal Court of the First Circuit
stated that it had found merit to the claim made by TFM
regarding the form in which the Federal Treasury had issued the
Special VAT Certificate. On January 26, 2005, the Mexican Fiscal
Court issued a favorable bench decision upholding TFM's claim
for inflation and interest.

On February 18, 2005, TFM was served with the favorable written
decision of the Fiscal Court carrying out the mandate of the
Federal Court of the First Circuit dated November 24, 2004,
which recognized TFM's legal right to receive the original VAT
refund adjusted for inflation and interest since 1997. The
Fiscal Court ordered the federal tax authorities to make the VAT
refund to TFM through a single certificate issued in TFM's name,
and to refund through that certificate the original amount of
the VAT refund due, increased for inflation and interest since
the date the tax authorities should have made the refund in
1997, until the date the refund is actually delivered to TFM.
The Fiscal Court also vacated its prior decisions in this
matter. Under the terms of the law, the government has 120 days
to deliver the certificate, or settle the matter through
negotiation.

GRUPO TFM PUT

As previously stated, Grupo TFM also asked for and received from
a federal judge an injunction, which prevented the government
from exercising its Put option. The ability of the Mexican
government to exercise its Put option has been suspended
indefinitely until the Put lawsuit is resolved.

To see financial statements:
http://bankrupt.com/misc/Grupo_TFM.htm


GRUPO TMM: Reports Revenues of $67.8M for 4Q04
----------------------------------------------
Grupo TMM, S.A. (NYSE:TMM) (BMV:TMM A; "TMM"), a Mexican multi-
modal transportation and logistics Company, reported revenues
from operations of $67.8 million for the fourth quarter of 2004
compared to $59.0 million for the same period of 2003. Improved
revenues were reported at Specialized Maritime, Ports and
Logistics operations. Fourth-quarter 2004 operating income
increased from $0.3 million in 2003 to $0.7 million in 2004. Net
loss in the fourth quarter after discontinuing operations was
$13.1 million in 2004, or $0.23 cents per share, compared to a
net loss in 2003 of $66.3 million, or $1.16 per share. Fourth-
quarter 2004 selling, general and administrative (SG&A) costs,
including restructuring charges, decreased $0.3 million, or 3.6
percent, compared to the same period of last year and reflected
cost savings associated with the completion of the Company's
debt restructuring.

For the 12 months of 2004, revenues from operations were $251.0
million compared to $226.9 million for the same period of 2003.
Improved revenues were reported at all Grupo TMM divisions.
Operating income in the period improved $6.4 million, from an
operating loss of $2.3 million in 2003 to operating income of
$4.1 million in 2004. Net results after discontinuing operations
for the 2004 full year improved $63.3 million from the year-
earlier period. SG&A costs, including restructuring charges, for
the full year of 2004 decreased $7.6 million, or 23.2 percent,
over the prior-year period mainly due to employee overhead
reductions.

TFM FOURTH-QUARTER AND YEAR-END RESULTS

Fourth-quarter revenues increased $13.5 million, or 8.4 percent,
from $160.0 million in 2003 to $173.5 million in 2004, primarily
impacted by revenue expansions in all business categories with
the exception of intermodal. Auto revenues in the fourth quarter
improved primarily due to the expansion of intra-Mexican
movement caused by truck-to-rail conversion. For the full year,
revenues improved 3.7 percent, or $24.0 million. Operating
profit during the 2004 fourth quarter increased $2.0 million as
compared to last year, impacted primarily by $9.7 million in
additional fuel costs (a 52.0 percent increase).

The following chart reflects the rail division's segment
results, comparing the fourth quarter and the full year of 2004
with the same periods of 2003:


                    Fourth-Quarter Percent Full-Year Percent
                        Revenues Change     Revenues Change
  ---------------------------------------------------------
Chemical                         13.1%               12.0%
  ---------------------------------------------------------
Industrial                       14.7%                6.7%
  ---------------------------------------------------------
Cement, Metals and Minerals      13.8%               10.2%
  ---------------------------------------------------------
Agroindustrial                    1.8%                0.3%
  ---------------------------------------------------------
Intermodal                       (8.1%)              (3.7%)
  ---------------------------------------------------------
Automobile                       14.0%               (3.8%)
  ---------------------------------------------------------

GRUPO TMM NON-RAILROAD ASSET PERFORMANCE

Specialized Maritime provides international and coastal maritime
transportation services for liquid cargoes, harbor towing, and
logistical support to the oil production and exploration
sectors. During the fourth quarter, revenue in the division
increased 1.5 percent, and operating profit increased 13.8
percent compared to the previous period of last year. On an
annualized basis, revenues increased 10.1 percent, and operating
profit increased 80.6 percent. These divisional results were
influenced by supply ships, which serve ever-expanding Mexican
oil exploration, and experienced revenue growth in the quarter
of 10.2 percent and full-year revenue growth of 23.6 percent.
Gross profit for this division increased 19.7 percent in the
fourth quarter as contracts continued to grow. Additionally,
parcel tankers revenue improved 23 percent year over year, and
gross profit improved 46 percent quarter over quarter and 25.5
percent year over year, due to better chemical cargo mix and
higher tariffs. Product tankers, which represent tanker
opportunities to haul clean petroleum products, experienced
improved revenue of 20.6 percent quarter over quarter and 12.9
percent year over year. All contracts for 2004 were renewed at
higher rates, and gross profits continued to increase in spite
of some off-hire time between the renewals of these contracts.
In the tugboat segment, gross profit increased 10.6 percent in
2004 compared to last year.

In the Ports and Terminals division revenues improved 42.1
percent quarter over quarter and 24.0 percent year over year.
For the full year, Acapulco booked 109 cruise ship calls, 55 of
which occurred in the fourth quarter. The port has 155 cruise
ship calls already scheduled for 2005. Revenues in the cruise
ship segment increased 79.4 percent quarter over quarter and
23.9 percent year over year. Additionally, in 2004, the division
handled approximately 68 percent more automobile exports for
Volkswagen, Chrysler and Nissan to South America and Asia than
in 2003, increasing revenues by 45.5 percent. In the fourth
quarter of 2004, car-handling revenues increased 80.4 percent
compared to the same quarter of last year.

In the Logistics division, revenues increased substantially
during the fourth quarter, improving 27.7 percent due primarily
to start-up services related to the movement of Ford vehicles
within Mexico. Significant start-up costs were incurred in the
quarter, but should come in line with expectations during the
first and second quarters of 2005. The Ford contract represents
the first of many anticipated "total supply chain outsourced
conversions" for TMM Logistics.

MANAGEMENT ASSESSMENT OF TFM SALE

Javier Segovia, president of Grupo TMM, described elements of
the Company's Strategic Program for Enhancing and Accelerating
Value for 2005. Focusing on the first step of that plan, the
sale of Grupo TFM to Kansas City Southern, Mr. Segovia stated,
"We accomplished several important steps in the fourth quarter
of 2004 and the first month of 2005, and I believe we have much
to be proud of. As of today, the sale of TFM to KCS is worth
approximately $707 million, which includes $200 million in cash,
$47 million in a five percent promissory note that will be paid
to TMM in June 2007, 18 million shares of KCS common stock now
valued at over $350 million, and an additional $110 million in
cash and stock upon completion of a settlement involving the VAT
and Put lawsuits. Through this sale, TMM will be the largest
individual shareholder of KCS. KCS shareholders are expected to
approve the purchase in late March. Although we do not
anticipate nor desire at this time to sell any portion of our
KCS stock, stock sales could occur through registrations, which
would be enacted by KCS upon the request of TMM.

"By monetizing our ownership interest in TFM through the sale to
KCS," Segovia continued, "TMM's balance sheet will improve
dramatically, we will have much greater flexibility than we have
had in the last several years to focus on opportunities to
enhance TMM's operations, and we will free the Company from
litigation, allowing management to focus all of its efforts on
value enhancement for stakeholders. With debt at a predictable
level because of our recent bond refinancing, the proceeds of
the asset sale will provide the Company with not only real debt
reduction, but with access to working and growth capital, as
well as alternative methods for acquiring additional capital to
purchase operating entities, enhance cash flow, or to grow
existing TMM businesses.

"As you can see from the news released earlier this week, we are
awaiting the Mexican Federal government's compliance with the
decisions of the court system, and we expect that a VAT-Put
settlement will take place in the near term. Once a settlement
is completed and announced, TMM will receive a payment from KCS
of $35 million in cash, an additional payment of $35 million in
stock, and the remaining $40 million held as a tax contingency
note payable within five years. We do not anticipate any tax
liability issues, nor do we expect any transitional issues
during due diligence."

IMPROVED BALANCE SHEET

As a result of the sale of TFM to KCS, the Company's equity
value will improve by $263 million, and its financial
obligations will be reduced by $160 million. Interest costs
under the terms of its remaining debt will be managed with cash
flow from existing operations and from new cash flows
anticipated in 2005 from expanded operations. The Company
intends to grow its existing operations with capital raised
through the use of long-term bankable contracts at Special
Maritime and at Ports, which will allow for the refinancing of
existing assets, and which can, in turn, immediately improve
operating results. Segovia commented, "Our current objective is
to defend the potential accretive value of the KCS shares and to
grow existing businesses in order to exceed interest coverage
demands and operating profit expectations."

EXISTING AND ACCRETIVE OPPORTUNITIES FOR GROWTH

TMM announced that, following the sale of TFM to KCS, it will
continue to use railroad services through a contract with KCS.
These services, combined with existing Ports, Logistics and
Specialized Maritime operations, supply chain logistics
solutions, and the Company's information platforms, provide
exceptional value to customers within and to and from Mexico.
Without expansion of existing operations, 2005 EBITDA is
expected to reach $22 million. During the first and second
quarters of 2005, the Company will provide additional details on
plans to improve performance and enhance interest coverage.

Describing opportunities to expand operations, Mr. Segovia
commented, "During the past several months, we have researched
extensively the impact of long-term bankable contracts as
alternative methods for financing expansions of our operations.
For example, Specialized Maritime has developed a consistent and
reliable reputation, holding a 70 percent share of contractual
revenues with chemical commodities moved via parcel tankers
between Mexico and the United States. The division also holds
several options to purchase currently leased vessels at
competitive prices. Using future revenue streams from its
significant petrochemical customers, in 2005 the Company will
seek to finance the exercising of these options, thereby
shifting charter expenses to lower depreciation costs and
boosting EBITDA performance. By purchasing instead of leasing
these vessels, EBITDA in this division could increase by
approximately $24 million.

"At Ports, the use of similar long-term bankable contracts will
provide for expanded operations at Tuxpan, which is
exceptionally well-positioned land for liquid transport,
container ship handling, and general cargo. The opportunity to
compete with other Gulf of Mexico ports by creating similar
infrastructures as the Company built in 1995 at Manzanillo is a
very real possibility. This expansion project could increase
EBITDA by $26 million. Additional details on all of these
potential opportunities will be provided during the first half
of 2005."

OVERALL VISION

Jose F. Serrano, chairman and CEO of TMM, concluded, "The goals
we stated in early 2004 were to restructure our debt, finalize
the sale of TFM to Kansas City Southern and settle the VAT-Put
issue. We are proud that we have accomplished the first two of
these goals and are close to completing the third one. For 2005,
a new Company is taking shape, one with a portfolio holding the
largest individual percentage of outstanding KCS shares, which
continue to appreciate, and a new balance sheet, with increased
equity, lower debt, and most importantly, with greater financial
flexibility. We see a Company capable of managing its interest
costs, growing its operations in niches that are unique and
profitable, and improving its operating profits in excess of its
financial obligations. As all of these programs come together,
our Company's value will continue to increase for both our
stockholders and bondholders."

STATUS OF VALUE ADDED TAX (VAT) LAWSUIT AND MEXICAN GOVERNMENT
PUT VAT LAWSUIT

On November 24, 2004, the Federal Court of the First Circuit
stated that it had found merit to the claim made by the
Company's subsidiary, Grupo Transportacion Ferroviaria Mexicana,
S.A. de C.V. (TFM), regarding the form in which the Federal
Treasury had issued the Special VAT Certificate. On January 26,
2005, the Mexican Fiscal Court issued a favorable bench decision
upholding TFM's claim for inflation and interest.

On February 18, 2005, TFM was served with the favorable written
decision of the Fiscal Court carrying out the mandate of the
Federal Court of the First Circuit dated November 24, 2004,
which recognized TFM's legal right to receive the original VAT
refund adjusted for inflation and interests since 1997. The
Fiscal Court ordered the federal tax authorities to make the VAT
refund to TFM through a single certificate issued in TFM's name,
and to refund through that certificate the original amount of
the VAT refund due, increased for inflation and interest since
the date the tax authorities should have made the refund in
1997, until the date the refund is actually delivered to TFM.
The Fiscal Court also vacated its prior decisions in this
matter. Under the terms of the law, the government has 120 days
to deliver the certificate, or could settle the matter through
negotiation.

GRUPO TFM PUT

As previously stated Grupo TFM also asked for and received from
a federal judge an injunction, which prevented the government
from exercising its Put option. The ability of the Mexican
government to exercise its Put option has been suspended
indefinitely until the lawsuit is resolved.

SALE OF TFM

On December 15, 2004, TMM and Kansas City Southern, (KCS)
entered into an amended acquisition agreement for the sale of
TMM's 51 percent voting interest in Grupo Transportacion
Ferroviaria Mexicana, S.A. de C.V. ("Grupo TFM") to KCS for $200
million in cash, 18 million shares of KCS common stock, $47
million in a two-year promissory note, and up to $110 million
payable in a combination of cash and KCS common stock upon
successful resolution of the current proceedings related to the
VAT Claim and the Put with the Mexican Government. The $47
million promissory note and a portion of the $110 million
contingent payment will be subject to certain escrow
arrangements to cover potential indemnification claims. The
boards of directors of both companies had approved the
transaction.

Consummation of the transaction was subject to the satisfaction
of certain conditions, including KCS shareholder approval, TMM
shareholder approval, Hart Scott Rodino waiting period, approval
by the Mexican Foreign Investment Commission and the Mexican
Federal Competition Commission.

TMM shareholder approval was granted on January 11, 2005. Both
the Mexican Foreign Investment Commission and the Mexican
Federal Competition Commission have approved the acquisition. On
January 25, 2005, the companies announced that the 30-day
waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act had expired without a formal request from the
U.S. Department of Justice.

TMM's management will discuss earnings and provide a corporate
update on Friday, February 25, 2005, at 11:00 a.m. Eastern Time.
To participate in the call, please dial 800-257-2101 (domestic)
or 303-205-0044 (international) at least five minutes prior to
the start of the call. A simultaneous Webcast of the meeting
will be available at http://www.actioncast.acttel.com,Event ID:  
25304. The Company suggests that Internet participants access
the site at least five minutes prior to the start of the
conference call to download and install any software required to
run the presentation. A replay of the conference call will be
available through November 5 at 11:59 p.m. EDT, by dialing 800-
405-2236 or 303-590-3000, and entering conference ID 11011935.
On the Internet a replay will be available for 30 days at
http://www.actioncast.acttel.com,Event ID: 25304.  

About Grupo TMM

Headquartered in Mexico City, TMM is a Latin American multimodal
transportation Company. Through its branch offices and network
of subsidiary companies, TMM provides a dynamic combination of
ocean and land transportation services. TMM also has a
significant interest in Transportacion Ferroviaria Mexicana
(TFM), which operates Mexico's Northeast railway and carries
over 40 percent of the country's rail cargo.

To view financial statements:
http://bankrupt.com/misc/TMM.htm

CONTACT: Grupo TMM S.A.
         Av. de la Cuspide # 4755
         Colonia Parquer del Pedregal
         Tlalpan, 14010
         Mexico
         Phone: 525-629-8866

         Web site: http://www.grupotmm.com


TV AZTECA: Confident Investigation Will Yield Positive Outcome
--------------------------------------------------------------
Ricardo Salinas, chairman of TV Azteca currently under
investigation for alleged fraud, said Thursday that Mexican
authorities will find he did no wrong in a 2003 debt deal and
will end up thanking him for saving the Company involved.

Last month, the U.S. Securities and Exchange Commission (SEC)
accused broadcaster TV Azteca, Salinas and two other Company
executives of taking part in a scheme to conceal Salinas' role
in a deal that made him $109 million in profit.

The National Banking and Securities Commission (CNBV), which has
been criticized for lagging in its own investigation, pledged a
thorough investigation into the scandal.

"They are carrying out their own investigations and you will
see, that in the end, the truth is that we saved Unefon and they
will have to thank us for that," Salinas said, adding he
answered all the CNBV's requests for information.

Salinas and a business partner own 50% each of investment
Company Codisco, which bought the debt of cellular phone
operator Unefon in 2003 at a steep discount and sold it back to
the Company at full value. Between them, they made US$218
million in the Unefon deal.

CONTACT: Mr. Bruno Rangel
         Phone: 5255 1720 9167
         E-mail: jrangelk@tvazteca.com.mx

         Mr. Omar Avila
         Phone: 5255 1720 0041
         E-mail: oavila@tvazteca.com.mx

         Media Relations:
         Mr. Tristan Canales
         Phone: 5255 1720 5786
         E-mail: tcanales@tvazteca.com.mx

         Mr. Daniel McCosh
         Phone: 5255 1720 0059
         E-mail: dmccosh@tvazteca.com.mx



=======
P E R U
=======

PAN AMERICAN SILVER: Reports Net Earnings of $15.7M for 4Q04
------------------------------------------------------------
Pan American Silver Corp. (NASDAQ: PAAS; TSX: PAA) reported net
earnings of $15.7 million or $0.23 per share for the fourth
quarter of 2004 versus a fourth quarter loss of $2.8 million in
2003. Earnings included a one-time gain on the sale of the
Company's 20 per cent interest in the Dukat mine in Russia for
$20.1 million, partially offset by the write-down of obsolete
equipment of $1.8 million, after tax. Excluding these items,
there was a loss of $2.7 million in the quarter, due primarily
to the first-time payment of Peruvian income taxes totaling $2.8
million as well as mandatory employee profit sharing of $1.0
million. In addition, $0.6 million was accrued for royalties
payable in Peru as a result of recently introduced legislation.
Consolidated revenue for the quarter was $29.4 million versus
$12.9 million in 2003 due to higher production levels and higher
metal prices.

Consolidated silver production for the fourth quarter totaled
3.1 million ounces, a 48% increase over the fourth quarter of
2003. The increase was due primarily to the addition of silver
production from the Morococha mine acquired in the third quarter
and increased production from La Colorada. By-product production
of zinc and copper was higher while lead production was lower
than in the fourth quarter of 2003 due to the addition of zinc
and copper contributions at Morococha and lower lead grades at
Huaron and Quiruvilca.

Cash costs in the fourth quarter rose 17% over 2003 levels to
$4.70/oz and total costs rose 27%. A number of one-time charges
were incurred in the fourth quarter, including profit-sharing
and bonus payments in Peru and the reclassification of certain
deferred charges in Mexico. In addition, production at Morococha
was adversely affected by temporary production disruptions,
including a crusher breakdown and a significant workforce
reduction. Production levels at Morococha have since returned to
normal.

For the full year ended December 31, 2004 Pan American recorded
consolidated net earnings of $19.9 million, or $2.3 million
excluding the gain from the sale of Dukat and the write-down of
assets. The loss in 2003 was $6.8 million, due primarily to
lower production and metal prices. Consolidated revenue in 2004
was $92.9 million versus $45.1 million in 2003.

Silver production in 2004 totaled 11.2 million ounces, a 30%
increase over 2003. Zinc production of 34,086 tonnes was 7%
higher than in 2003, lead production was 12% lower and copper
production was 9% higher. Cash costs for 2004 rose slightly to
$4.25/oz while total production costs rose 15% to $5.33/oz due
to the inclusion in 2004 of depreciation charges from La
Colorada and Morococha. Consolidated cash costs in 2005 are
expected to decline.

Capital spending in 2004 decreased to $17.0 million from $18.3
million in 2003 reflecting the completion of construction of the
La Colorada mine in 2003. Capital expenditures related primarily
to re-engineering expenses at Huaron, tailings dam construction
at La Colorada and project development expenditures at Alamo
Dorado. Working capital at December 31, 2004 improved to $114.7
million from $81.9 million at December 31, 2003 due to an
increase in cash and cash equivalents, an increase in accounts
receivable and inventories, and a decrease in current
liabilities.

Ross Beaty, Chairman of Pan American, commented that "Pan
American Silver marked its tenth anniversary with its best
financial and operating performance ever. We have one of the
largest silver reserve and resource bases of any mining Company,
the strongest balance sheet in the silver industry, and the most
robust pipeline of future growth projects to complement our
long-life assets. Our focus in 2005 will be on reducing
production costs, capitalizing on the potential of the Morococha
mine and successfully commencing construction of the Alamo
Dorado silver mine in Mexico, and of course, we will continue to
grow. In 2005 we expect to increase annual silver production
another 21% to 13.6 million ounces, and to reduce cash costs
significantly."

    OPERATIONS AND DEVELOPMENT HIGHLIGHTS

MEXICO

In the fourth quarter, the La Colorada mine more than doubled
its production from the year-earlier period to 683,526 ounces of
silver. December marked the mine's sixth consecutive month of
oxide production growth, culminating in record monthly
production of 241,440 ounces. The oxide portion of the mine is
expected to reach full production capacity early in the second
quarter of 2005. However, the mine's sulphide plant remains shut
down due to excess water underground. Hydrogeological studies
are underway to evaluate the viability of resuming sulphide
production. La Colorada's silver production for 2004 totaled
2,036,075 ounces. Cash production costs for the quarter were
$5.98/oz and total costs were $7.45/oz due to high development
costs as the operation converted to more selective mining to
address poor ground conditions. In 2005 the mine is forecast to
produce 2.9 million ounces of silver at a cash cost of $5.53/oz.

Pan American Silver will commence construction of the Alamo
Dorado silver project in Mexico in the second quarter of this
year. Capital costs for the project are estimated at $76.6
million and Pan American will fund construction from its cash on
hand. Starting in 2007, Alamo Dorado is expected to produce
approximately 5 million ounces of silver and 14,000 ounces of
gold annually at an average cash cost of less than $3.25/oz of
silver, net of gold by-product revenues.

PERU

The Quiruvilca mine was Pan American's most profitable operation
in 2004, generating $9.5 million in operating profit. Quiruvilca
produced 638,486 ounces of silver in the fourth quarter, up 3%
over 2003 levels. Cash costs totaled $4.47/oz in the fourth
quarter, up 11% over 2003 due to workers' profit participation
and year-end bonus payments. For the year, however, the mine's
cash cost fell 28% from $5.01/oz to $3.63/oz. Total costs fell
from $5.18/oz to $3.88/oz on full-year production of 2.5 million
ounces of silver, 11,709 tonnes of zinc, 3,803 tonnes of lead
and 1,081 tonnes of copper. Successful exploration drilling more
than replaced the tonnes mined in 2004. The operation is
expected to produce 2.3 million ounces of silver in 2005 at a
cash cost of $4.03/oz.

The acquisition of 86% of the Morococha silver mine in Peru was
completed mid-year. In the fourth quarter the mine produced
573,514 ounces of silver, 2,812 tonnes of zinc, 1,025 tonnes of
lead and 254 tonnes of copper, bringing six-month totals to
1,259,451 ounces of silver, 5,902 tonnes of zinc, 2,186 tonnes
of lead and 538 tonnes of copper. Cash costs of $5.42/oz and
total costs of $7.01/oz in the fourth quarter were negatively
affected by mandatory employee profit sharing, a year-end bonus
payment to workers, and temporary production disruptions. For
the year, cash costs were $4.41/oz and total costs were
$5.94/oz. Costs are expected to decline significantly in 2005
when Morococha is expected to produce 2.6 million ounces of
silver at cash costs of $3.42/oz of silver. The Company also
expects to invest approximately $9.6 million in mill
refurbishment and development as part of a gradual expansion to
3.9 million ounces of silver production annually.

Production at the Huaron mine in the fourth quarter of 2004
remained unchanged at 954,000 ounces of silver while cash costs
of $3.66/oz declined 15% from $4.33/oz in the same period of
2003. Total costs declined from $5.08/oz in the fourth quarter
of 2003 to $4.87/oz in 2004. For the year, production totaled
4,080,737 ounces, down 6.5% from 2003 though cash costs in 2004
remained steady at $3.90/oz while total costs rose from $4.62/oz
in 2003 to $5.06/oz in 2004 due to higher depreciation charges.
Drilling at Huaron was also successful in 2004, replacing the
tonnage mined. In 2005 Huaron is expected to produce 4.2 million
ounces of silver at a cash cost of $4.10/oz.

The Silver Stockpile Operation continued to generate excellent
cash flow, producing 182,417 ounces of silver in the fourth
quarter at a cash cost of $3.50/oz, up from $2.28/oz in the year
earlier period due to the higher silver price, upon which the
stockpile's operating cost is based. Beginning in the fourth
quarter, the stockpiles became subject to a 33% cash flow
royalty to Volcan, the Peruvian Company from which Pan American
purchased the operation. In 2004 the mine produced a total of
961,869 ounces of silver at cash and total costs of $2.95/oz and
$3.58/oz respectively and those production rates are expected to
continue in 2005.

ARGENTINA

Feasibility work continues to progress on the 50% owned
Manantial Espejo silver-gold joint venture where permitting and
environmental baseline studies are well advanced. Work completed
to date indicates a combined underground and open pit operation
producing a total of 3.6 million ounces of silver and 60,000
ounces of gold (100%) annually over a nine-year mine life. A
15,000 m drilling program is underway to follow up on several
resource expansion targets identified in 2004. The feasibility
study is to be completed later in 2005.

BOLIVIA

In 2004, Bolivian mining Company EMUSA earned a 50% interest in
the San Vicente project and conducted small-scale mining which
contributed 313,029 ounces of silver to Pan American's
production, paid as a royalty. In 2005, San Vicente will be
expanded to produce 700,000 ounces of silver as Pan American's
share, at a forecast cash cost of $2.23/oz.

RESERVES AND RESOURCES

Pan American drilled nearly 65,000 meters and replaced all of
the tonnage mined at its operations in 2004, at a cost of $3.8
million. The Company's silver reserve and resource base remained
one of the largest in the industry in 2004, despite the sale of
its interest in the Dukat mine in the fourth quarter and a
recalculation of Alamo Dorado's reserves based on the current
mine plan. Proven and probable reserves as of December 31, 2004
totaled 147.5 million ounces. Measured and Indicated resources
totaled 233.6 million ounces. Inferred resources totaled 266.2
million ounces. These levels are comparable to 2003, excluding
Dukat.

SILVER MARKETS

Silver prices were volatile in 2004, ranging from a low of $5.63
to a high of $8.29 and ending the year at $6.77, a rise of 13.6%
over 2003. Industrial and investment demand for silver rose
strongly in the year, while jewelry demand fell by 8% due to the
higher silver price and photographic demand declined modestly,
resulting in a silver deficit of approximately 60 million ounces
(2003 - 83 million ounces). This deficit was filled by sales of
government stockpiles, mainly from China and Russia. World mine
production of silver rose only 1% and production growth is
expected to remain modest as depleted mines offset new
production. Silver prices continue to benefit from the ongoing
deficit and renewed investor interest and we are optimistic that
silver prices will continue to be strong in 2005.

To see financial statements:
http://bankrupt.com/misc/Pan_American_Silver.htm

CONTACT: Brenda Radies, Vice-President Corporate Relations
         (604) 806-3158
         www.panamericansilver.com




                            ***********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter - Latin America is a daily newsletter
co-published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA. John D. Resnick, Edem Psamathe P. Alfeche and
Lucilo Junior M. Pinili, Editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
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Information contained herein is obtained from sources believed
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