TCRLA_Public/050422.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

            Friday, April 22, 2005, Vol. 6, Issue 79

                            Headlines

A R G E N T I N A

ALIMENTOS FARGO: Fitch Retains 'D(arg)' Rating on $120M of Bonds
CARLOS CEVALLOS: Court Favors Creditor's Bankruptcy Motion
CENTRO MEDICO: Halts Debt Payments, Moves to Reorganize
EDELAP: Senate OKs Contract; Awaits Confirmation From Congress
GREGORIO GALANTE: Reorganization Concluded

IMAGEN SATELITAL: Fitch Retains Bonds' Default Ratings
JOSE RIZZO: General Report Submission Set
MARMOLERIA SIERRA CHICA: Court Reschedules Informative Assembly
METALURGICA ELCH: Verification Deadline Approaches
TELEFONICA DE ARGENTINA: Proposes Pistrelli for 2005 Audit

VIGNA HERMANOS: Court Grants Reorganization Plea
YPF S.A.: $700M Bond Program Gets Green Light From Shareholders
YPF S.A.: Ratings Not Affected By Dividend Payment Announcement


B E R M U D A

SEA CONTAINERS: Pays Dividends on Common Shares


B O L I V I A

GOLDEN EAGLE: Not on the Verge of Bankruptcy, Says CEO


B R A Z I L

BANCO BRADESCO: Proposes Payment of Interest on Own Capital
BANCO BRADESCO: Accquires Morada Servicos for BRL80 Mln
EMBRATEL: Results of First Reoffering for Unsubscribed Shares
MRS LOGISTICA: S&P Revises Outlook to Positive


D O M I N I C A N   R E P U B L I C

* DOMINICAN REPUBLIC: Opens $1.1B Bond Swap
* DOMINICAN REPUBLIC: S&P Cuts Ratings on Global Bonds to `D'


J A M A I C A

AIR JAMAICA: 40 Pilots Likely to Lose Jobs in Two Month's Time


M E X I C O

CINTRA: Airlines to Hike Commission of Ticket Sales
EMPRESAS ICA: Secures $36M Construction Contract
GRUPO SIMEC: Boosts Sales 75% Year-on-Year in 1Q05
HYLSAMEX: Net Income Declines 59% From Previous Quarter
TV AZTECA: Registers 1Q05 EBITDA of Ps.630 Million

UNEFON: Denies Reports About Impending Sale


P U E R T O   R I C O

DORAL FINANCIAL: Lowered & Placed on Rating Watch Negative
DORAL FINANCIAL: SEC Conducts Probe on Results Restatements
DORAL FINANCIAL: Declares $0.18 per Share Quarterly Dividend


U R U G U A Y

ANCAP: CEO to Meet With PDVSA, Petrobras Executives Next Week
UTE: Shelves Tender for Contract to Build 400MW Thermo Project


V E N E Z U E L A

PDVSA: Likely to Win Cammesa Fuel Oil Contract

     -  -  -  -  -  -  -  -

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A R G E N T I N A
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ALIMENTOS FARGO: Fitch Retains 'D(arg)' Rating on $120M of Bonds
----------------------------------------------------------------
Fitch Argentina Calificadora de Reisgo S.A. maintains a 'D(arg)'
rating on some US$120 million of corporate bonds issued by local
Company Compania de Alimentos Fargo S.A., the CNV reports.

The rating, assigned to financial commitments that are
currently in default, was given based on the Company's finances
as of December 31, 2004. The bonds, described as "Obligaciones
Negociables Simples," will mature on July 24, 2008.


CARLOS CEVALLOS: Court Favors Creditor's Bankruptcy Motion
----------------------------------------------------------
Court No. 1 of Buenos Aires' civil and commercial tribunal
declared Carlos Cevallos S.R.L. bankrupt, says La Nacion. The
ruling comes in approval of the petition filed by the Company's
creditor, Delanta S.A., for nonpayment of US$23,611.48 in debt.

Trustee Mauricio Brawer will examine and authenticate creditors'
claims until June 8. This is done to determine the nature and
amount of the Company's debts. Creditors must have their claims
authenticated by the trustee by the said date in order to
qualify for the payments that will be made after the Company's
assets are liquidated.

The city's Clerk No. 2 assists the court on the case that will
conclude with the sale of the Company's assets.

CONTACT: Carlos Cevallos S.R.L.
         Avenida Corrientes 1515
         Buenos Aires

         Mr. Mauricio Brawer, Trustee
         Sarmiento 2593
         Buenos Aires


CENTRO MEDICO: Halts Debt Payments, Moves to Reorganize
-------------------------------------------------------
Court No. 4 of Buenos Aires' civil and commercial tribunal is
currently studying the request for reorganization submitted by
local Company Centro Medico de Diagnostico S.A., says La Nacion.

The report adds that that the Company filed a "Concurso
Preventivo" petition following cessation of debt payments on
March 15.

The city's Clerk No. 8 assists the court on this case.

CONTACT: Centro Medico de Diagnostico S.A.
         Virrey Ceballos 592
         Buenos Aires


EDELAP: Senate OKs Contract; Awaits Confirmation From Congress
--------------------------------------------------------------
Power distributor Edelap gained Wednesday the backing of the
Argentine Senate for its renegotiated contract offer, reports
Dow Jones Newswires.

A legislative spokesman revealed that the Senate approved the
contract with the Edelap, a unit of AES Corp. (AES), with 37
senators in favor, and 12 against.

The vote came a day after a bicameral commission ruled in favor
of the measure. The deal now awaits confirmation from the lower
house.

Edelap's contract, when approved, will be the government's first
new contract with an energy sector utility company since
contracts were derailed in January 2002, when the government
converted utility rates into devalued pesos and froze them.

Renegotiations on new contracts have been slowed by
disagreements over initial rate hikes and the mechanism for
negotiating future rate increases.

Edelap, which serves 285,000 customers in a 5,700 sq. km.
concession area in Buenos Aires province, posted net losses of
ARS17.6 million (US$6mn) in 2004.


GREGORIO GALANTE: Reorganization Concluded
------------------------------------------
The settlement plan proposed by Gregorio Galante S.A. for its
creditors acquired the number of votes necessary for
confirmation. As such, the plan has been endorsed by Court No. 2
of Buenos Aires' civil and commercial tribunal and will now be
implemented by the Company.

CONTACT: Gregorio Galante S.A.
         Crisologo Larralde 2501
         Sarandi
         Buenos Aires
         Phone: 54-11 4265-2500
         E-mail: http://www.galantemaderas.com.ar


IMAGEN SATELITAL: Fitch Retains Bonds' Default Ratings
------------------------------------------------------
Fitch Argentina Calificadora de Riesgo S.A. maintains a default
rating on US$80 million worth of Imagen Satelital S.A.'s
corporate bonds called "obligaciones negociables".

Local securities regulator, the CNV, reports that Fitch retained
a junk rating on the bonds based on the Company's financial
status as of December 31, 2004.

CONTACT: Imagen Satelital S.A.
         Av. del Libertador 602
         Buenos Aires
         Phone: (011) 4814-1190/1196


JOSE RIZZO: General Report Submission Set
-----------------------------------------
Mr. Alfredo Mario Solodki, the trustee supervising the
reorganization of Jose Rizzo S.R.L., will submit a general
report of the case on May 27, says Infobae. The general report
essentially provides the court with an audit of the Company's
accounting and business records.

Court No. 1 of Mendoza's civil and commercial tribunal has
jurisdiction over this case.

CONTACT: Mr. Alfredo Mario Solodki, Trustee
         San Juan 826
         Mendoza


MARMOLERIA SIERRA CHICA: Court Reschedules Informative Assembly
---------------------------------------------------------------
Court No. 17 of Buenos Aires' civil and commercial tribunal
moved the informative assembly related to Marmoleria Sierra
Chica S.A.'s reorganization to May 6, reports Infobae. Creditors
of the Company will vote to ratify the completed settlement plan
during the said assembly.

The city's Clerk No. 33 assists the court with the proceedings.

CONTACT: Marmoleria Sierra Chica S.A.
         Sanchez de Bustamante 1758
         Buenos Aires


METALURGICA ELCH: Verification Deadline Approaches
--------------------------------------------------
The verification of claims for the Metalurgica Elch S.A.
bankruptcy will end on May 13 according to Infobae. Creditors
with claims against the bankrupt Company must present proof of
the liabilities to Mr. Carlos Manuel Carrescia, the court-
appointed trustee, before the deadline.

Court No. 7 of Buenos Aires' civil and commercial tribunal
handles the Company's case with the assistance of Clerk No. 14.
The bankruptcy will conclude with the liquidation of the
Company's assets. Proceeds from the assets sale will be used to
pay the Company's creditors.

CONTACT: Mr. Carlos Manuel Carrescia, Trustee
         Tucuman 1621
         Buenos Aires


TELEFONICA DE ARGENTINA: Proposes Pistrelli for 2005 Audit
----------------------------------------------------------
Mr. Guillermo Harteneck, a member of Telefonica De Argentina's
Audit Committee, informs shareholders of the External Auditor
appointment proposed by the Company's board, through this letter
dated April 13, 2005:

In our capacity as members of the Audit Committee of Telefonica
de Argentina S.A., and under section 15, subsection a) of Decree
No. 677/01 and the Comision Nacional de Valores (the Argentine
Securities Commission) Regulations, Book 1, Chapter III, section
22, we issue this report regarding the proposal by the Company's
Board to appoint Pistrelli, Henry Martin & Asociados S.R.L.
audit firm as the external auditors for the 2005 fiscal year.

In order to express our opinion we have considered the following
aspects:

I. Background Evaluation

Pistrelli, Henry Martin & Asociados S.R.L. is one of the most
renowned external audit firms nationwide. It was organized upon
the merger of two long-standing, professionally well-known
companies in our country. It is a member of Ernst & Young
Global, one of the top four audit firms worldwide.

Pistrelli, Henry Martin & Asociados S.R.L. has submitted to the
Audit Committee a letter stating its independence and filed with
the Comision Nacional de Valores (the Argentine Securities
Commission) the relevant affidavit under section 12 of Decree
No. 677/2001.

II. Reasons Supporting Auditors' Replacement

Pursuant to the relevant Minutes, the Company's Board has
proposed the replacement of the external auditor since
Telefonica S.A., the Spanish indirect controlling Company of the
Company, has completed the global external auditor appointment
process corresponding to Grupo Telefonica, appointing Ernst &
Young Global as the external auditors for the whole corporate
group.

III. Eventual Discrepancies with the Outgoing Auditor

In compliance with the above mentioned provisions, we hereby
report that we are not aware of the existence of any discrepancy
with the former external auditor or of any objection to its
discharge of duty.

IV. Previous Explanation

Such proposal shall be submitted to the Company's Shareholders'
Meeting to be held on April 28, 2005, and therefore it is hereby
explained that the appointment shall include auditing the
financial statements for the fiscal year ending at December 31,
2005 and revising the quarterly periods ending at June 30, 2005,
and September 30, 2005, respectively. Consequently, the current
audit firm, Deloitte & Co. S.R.L, shall be only in charge of
revising the financial statements corresponding to the quarterly
period ended at March 31, 2005.

V. Opinion

Therefore, we consider that the proposal by the Board of
Telefonica de Argentina S.A. to appoint Pistrelli, Henry Martin
& Asociados S.R.L., a member of Ernst & Young Global as the
Company's external auditors for the 2005 fiscal year, which
shall be brought for consideration at the Shareholders' Meeting,
is appropriate.

VI. Restrictions on the Use of this Report

This report is issued for the sole purpose of evaluating the
above-mentioned proposal by the Company's Board within the
framework of the above mentioned provisions. Any use other than
that herein set forth may be inappropriate.

CONTACT: Telefonica de Argentina S.A.
         Avenida Ingeniero Huergo 723
         Buenos Aires, C1107AOH
         Argentina
         Phone: 5411 4332-2066
         Web site: http://www.telefonica.com.ar


VIGNA HERMANOS: Court Grants Reorganization Plea
------------------------------------------------
Vigna Hermanos S.H., a Company operating in La Plata, begins
reorganization proceedings after the city's civil and commercial
Court No. 8 granted its petition for "concurso preventivo".

During the reorganization, the Company will be able to negotiate
a settlement proposal for its creditors so as to avoid a
straight liquidation.

According to Argentine news source Infobae, the reorganization
will be conducted under the direction of Mr. Eduardo Miguel
Rojas, the court-appointed trustee.

Creditors with claims against the Company must present proofs of
the Company's indebtedness to Mr. Rojas by May 4. These claims
will constitute the individual reports to be submitted in court
on June 21.

The court also requires the trustee to present an audit of the
Company's accounting and business records through a general
report due on August 18.

In addition, an informative assembly for the Company's creditors
will be held on February 7 next year.

CONTACT: Vigna Hermanos S.H.
         Avda 44 Nro. 2878
         La Plata

         Mr. Eduardo Miguel Rojas, Trustee
         Calle 45 Nro. 1047
         La Plata


YPF S.A.: $700M Bond Program Gets Green Light From Shareholders
---------------------------------------------------------------
Oil Company YPF S.A. informed the Buenos Aires stock market that
it has secured shareholders' approval on a new US$700 million
bond program, relates Business News Americas. The Company said
its board is yet to decide the terms and conditions of the
program. YPF has earmarked the proceeds from the bond sale to
finance investments, increase cash flow and/or refinance debt.


YPF S.A.: Ratings Not Affected By Dividend Payment Announcement
---------------------------------------------------------------
Standard & Poor's Ratings Services said Wednesday that YPF
S.A.'s (YPF, local currency: BB+/Positive/--; foreign currency:
BB/Stable/--) dividend announcement will not affect the
Company's ratings. YPF announced the payment of dividends for
Argentine peso (ArP) eight per share that would total
approximately ArP3.15 billion (about $1.1 billion). YPF has an
aggressive dividend policy, evidenced by large dividend payments
in the past four years resulting in an average payout ratio of
close to 100%. However, given its conservative capital structure
and strong cash flow generation resulting in a sound financial
profile, this cash outflow has not affected YPF's credit
quality, although these dividend payments might become
politically sensitive in the future. YPF's ratings continue to
reflect its strategic importance to its parent, Repsol-YPF S.A.
(BBB+/Stable/A-2), and Repsol's economic incentive to strongly
support its Argentine operation. Given its importance within the
Repsol Group, Standard & Poor's expects YPF's dividend policy to
reflect the Repsol Group's cash management policy but not to
increase the Company's cash needs or jeopardize YPF's capital
expenditure requirements.

CONTACT:  Primary Credit Analyst:
          Pablo Lutereau, Buenos Aires
          Tel: (54) 114-891-2125
          E-mail: pablo_lutereau@standardandpoors.com

          Secondary Credit Analyst:
          Luciano Gremone, Buenos Aires
          Tel: (54) 11-4891-2143;
          E-mail: luciano_gremone@standardandpoors.com



=============
B E R M U D A
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SEA CONTAINERS: Pays Dividends on Common Shares
-----------------------------------------------
The Board of Directors of Sea Containers Ltd. declared Wednesday
quarterly cash dividends on the Company's Class A and Class B
common shares. The dividend will be $0.025 per share on the
Class A common shares and $0.0225 per share on the Class B
common shares.

Class B common shares are convertible at any time into Class A
common shares. The dividends will be payable May 20, 2005 to
shareholders of record May 5, 2005.

The Class A and B common shares of Sea Containers Ltd. are
listed on the New York Stock Exchange under the symbols SCRA and
SCRB, respectively.

CONTACT: Head Office
         Sea Containers Ltd.
         Canon's Court
         21 Victoria Street
         Hamilton HM12
         Bermuda
         Phone: +1 (441) 295 2244
         Fax: +1 (441) 292 8666



=============
B O L I V I A
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GOLDEN EAGLE: Not on the Verge of Bankruptcy, Says CEO
------------------------------------------------------
A top executive of Golden Eagle International (OTCBB: MYNG)
downplayed the Company's problems, saying the salt Lake City-
based outfit is not in danger of declaring bankruptcy, reports
Business News Americas.

"Golden Eagle has never discussed bankruptcy, we're not
discussing bankruptcy now and we don't have creditors pressing
us to the point where we would ever have to seek bankruptcy
protection," Golden Eagle CEO said.

The Company is yet to restart operations at its Cangalli gold
mine in western Bolivia despite meetings with the Bolivian
government and President Carlos Mesa.

Operations at the gold mine have been suspended since June due
to a legal dispute surrounding the non-payment of contributions
by the property's previous owners.

Turner doesn't see an immediate hope of reopening Cangalli, but
according to him, there is an 80% chance of operations
restarting within the next five years.

At the same time, Golden Eagle is struggling to bring into
production its Buen Futuro gold-copper project in eastern
Bolivia.

Plans to commence production hit a snag after Brazilian
investment group Polion do Brasil failed to fulfill a commitment
to provide US$3.5 million in funding for the project.

Buen Futuro has current estimated proven and probable reserves
of 84,000oz of gold and 82Mlb of copper.

Turner is confident it will be able to turn its problems around,
saying the Company has a plan which will allow it to not just
"stay alive" but to get Buen Futuro funded.

Turner said that he had bought US$50,000 worth of Golden Eagle
restricted stock on Wednesday as a mark of his confidence in the
Company and a director had recently loaned the firm US$118,000.

CONTACT:  Golden Eagle International, Inc.
          12401 South 450 East
          Suite A
          Building D2
          Draper, UT 84020
          United States
          Phone: 801-619-9320



===========
B R A Z I L
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BANCO BRADESCO: Proposes Payment of Interest on Own Capital
-----------------------------------------------------------
The Board of Executive Officers of Banco Bradesco S.A., in a
meeting held Wednesday, decided to propose to the Board of
Directors, in a meeting to be held on May 2, 2005, the payment
to the Company's stockholders, pursuant to the Corporate By-Laws
and legal provisions, of interest on own capital related to the
month of May 2005, in the amount of R$0.057000 per common stock
and R$0.062700 per preferred stock, benefiting the stockholders
registered in the Company's records on that date (May 2, 2005).

Upon approval of the proposal, the payment will be made on June
1, 2005, at the net amount of R$0.048450 per common stock and
R$0.053295 per preferred stock, after deduction of Withholding
Income Tax of fifteen percent (15%), except for the legal entity
stockholders that are exempt from such taxation, which will
receive for the declared amount.

The respective Interests will be computed, net of Withholding
Income Tax, in the calculation of the mandatory dividends for
the year as provided in the Corporate By-Laws.

The Interests relating to the stocks under custody at CBLC -
Brazilian Company and Depository Corporation will be paid to
CBLC which will be transferred to the stockholders through the
depository Brokers.

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


BANCO BRADESCO: Accquires Morada Servicos for BRL80 Mln
-------------------------------------------------------
Mr. Jose Luiz Acar Pedro, Banco Bradesco S.A. Executive Vice
President and Investor Relations Director, informs the U.S.
Securities and Exchange Commission of the Company's recent
purchase of Morada Servicos Financeiros Ltda. for BRL80 million,
through this letter:

We hereby inform you that this Company by means of its
subsidiary Finasa Promotora de Vendas Ltda. (Finasa) on
4.15.2005, entered into with Banco Morada S.A. and Morada
Investimentos S.A. (hereinafter referred to as Morada Group), an
Agreement for the assignment and transfer or quotas and other
covenants, related to the transfer of Consumer's Financing
Business, comprising the operations of Personal Loan and
Consumer's Direct Loan, by means of the acquisition of the
totality of the capital stock of Morada Servicos Financeiros
Ltda. (Morada Servicos), for the amount of BRL80 million, to be
paid in cash.

Morada Group has been operating in the domestic financial market
for more than 36 years and will continue regularly operating in
other segments of the market, in operations not competing with
the business transferred herein to Bradesco.

This acquisition shall enable Finasa to expand the offering of
its retail products, including Bradesco's products, from
checking account to insurance, supplementary private pension,
savings bonds and consortium products, by means of Morada
Servicos' operational platform.

With this acquisition, Finasa's network will be increase as
follows:

Main Data                   Finasa   Morada Servicos   Total
Affiliated Establishments   19,259   3,600             22,859
Registered Clients
(in millions)                10.1     1.1               11.2
Branches                       123      33                156

A 28%-growth in the production of Personal Loans and a 15%-
growth in Consumer's Direct Loans of Finasa are expected, taking
into consideration the budget for these products and the
maintenance of Morada Servicos' current productivity.

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


EMBRATEL: Results of First Reoffering for Unsubscribed Shares
-------------------------------------------------------------
Embratel Participacoes S.A. announced Wednesday, based on
information provided by Banco Itau S.A., the registrar for the
Company's shares, the number of new Embrapar common shares (ON),
preferred shares (PN) and American Depositary Shares (ADSs),
subscribed for in the Brazilian and U.S. markets, respectively,
during the first reoffering round of unsubscribed shares that
began on April 15, 2005 and ended on April 19, 2005, in
connection with Embrapar's capital increase by private
subscription of shares approved by Embrapar's Board of Directors
on February 3, 2005 and rectified and ratified on February 23,
2005, and the number of remaining unsubscribed shares that are
available for subscription in the second reoffering round by
Embrapar shareholders who subscribed for shares during the first
reoffering round and indicated an interest in subscribing for
additional shares.

The financial amount subscribed to date was of approximately
R$1,562.2 million. Embrapar shareholders who subscribed for
shares during the first reoffering round and indicated an
interest in subscribing for additional shares in the first
reoffering round will have the right to subscribe up to
0.3600332088295 shares for each share subscribed during the
first reoffering round, according to the criteria described in
the notice to shareholders dated March 2, 2005.

Embrapar reminds shareholders that the period for subscription
of the remaining unsubscribed shares in the second reoffering
round by preferred and common shareholders who indicated an
interest in purchasing additional shares in the second
reoffering round starts on April 25, 2005 and ends on April 27,
2005.

After that date, if there are any remaining unsubscribed shares,
a special public auction is expected to be held at the Sao Paulo
Stock Exchange (BOVESPA) where such unsubscribed shares are
expected to be offered to the public.

The procedures relating to holders of ADSs are described in the
prospectus referred to below.

A registration statement on Form F-3 ("F-3") has been filed with
the U.S. Securities and Exchange Commission ("SEC") regarding
the preferred shares, ADSs and the related subscription rights
to be offered in the United States of America and has been
declared effective. This press release does not constitute an
offer to sell or the solicitation of an offer to buy preferred
shares, ADSs or the related subscription rights in the United
States or to U.S. persons (as such term is defined under
Regulation S under the U.S. Securities Act of 1933, as amended,
nor shall there be any sale of shares or subscription rights in
any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the laws
of any such state.

The prospectus relating to the offering of subscription rights,
preferred shares and ADSs may be obtained from the following
address: www.embratel.com.br/ir

The offering of rights described herein is made for the
acquisition of securities of a Brazilian Company. The offering
is subject to disclosure requirements in Brazil, which are
different from those of the United States.

Embratel is the premier communications provider in Brazil
offering a wide array of advanced communications services over
its own state of the art network. It is the leading provider of
data and Internet services in the country and is well positioned
to be the country's only true national local service provider
for corporate customers. Service offerings include: telephony,
advanced voice, high-speed data communication services,
Internet, satellite data communications, corporate networks and
local voice services for corporate clients. Embratel is uniquely
positioned to be the all-distance telecommunications network of
South America. The Company's network has countrywide coverage
with 32,466 km of fiber cables.

To view subscription process results:
http://bankrupt.com/misc/Embratel.htm

CONTACT: Ms. Silvia M.R. Pereira
         Investor Relations
         Phone: (55 21) 2121-9662
         Fax: (55 21) 2121-6388
         E-mail: silvia.pereira@embratel.com.br
                 invest@embratel.com.br


MRS LOGISTICA: S&P Revises Outlook to Positive
----------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB-' local and
foreign currency corporate credit ratings on MRS Logistica S.A.
(MRS). The outlook on the local currency rating was revised to
positive from stable. The outlook on the foreign currency rating
remains stable.

"The outlook change reveals MRS' enhanced cash flow protection
measures, an improved debt profile, and our expectations that
MRS will continue increasing its transported volumes, adding new
cargos in future years, and keeping firm control over its costs
with the objective of improving operating profitability," said
Standard & Poor's credit analyst Beatriz Degani.

The positive outlook also considers the prospects of strong
demand for transoceanic iron ore and a favorable domestic
scenario, although to a lesser extent compared to 2004, and the
maintenance of its more conservative financial profile, with
extended tenors and reduced currency mismatches.

The ratings assigned to MRS reflect the Company's relatively
high financial leverage (as adjusted to include the present
value of operating leases and concession obligations, which in
December 2004 added US$564 million to MRS' total debt), some
client concentration (with reliance on iron ore captive
cargoes), limited scope of its assets (in fact, a comparatively
short railroad), and the capital-intensive nature of the
railroad business, in the context of the fast-growing strategy
developed in recent years. These aspects are partially offset by
the long-term nature of its debt profile (21 years for the
concession payments) and MRS' favorable tariff model with its
main captive-cargo clients, which allows them to pass on cost
increases and maintain strong profitability and cash flow to
face its debt service. Moreover, the Company has continuously
improved its operational efficiency by reducing costs,
increasing volume and gradually improving its diversification
with the capture of new cargo.

The strong demand for transoceanic iron ore has indirectly
benefited MRS' results. The Company's total volume has increased
consistently, featuring 98 million in 2004, 14% higher than the
previous year. In spite of the growing diversification of the
transported cargo, MRS should remain concentrated on iron ore
transportation (72% of the total volume in 2004) during the next
several years.

In addition to volume growth, the Company's profitability has
strengthened due to the tariff agreement and to the Company's
efforts to control costs. While the Company faced significant
cost increases in 2004 (like fuel, due to higher transported
volumes in 2004, and general maintenance, 7% and more than 20%
up from 2003, respectively), it reported an OLA adjusted EBITDA
margin of 52% in 2004, in line with 54% in 2003, driven by a 20%
increase in revenues combined with productivity gains. Even
though Standard & Poor's believes that most of these gains
(which can be translated as enhanced profitability) will be
preserved in the future, the reduction of the Company's leverage
could make the tariff agreement less important for the Company's
profitability. Even though this process could result in lower
nominal margins, Standard & Poor's believes that the Company's
FFO will remain strong.

The positive outlook reflects improved cash flow credit
measures, strong profitability, and our expectations that MRS'
favorable market position in iron ore transportation will permit
the maintenance of this positive cash flow trend, which is a key
factor for financing its investment strategy and maintaining
indebtedness levels. MRS' ratings could be raised if the Company
continues the positive trend of its cash-flow protection (with
ratios of EBITDA coverage above 3x), an FFO to total debt above
25%-30% throughout 2005, and profitability (measured by EBITDA
margin adjusted by its concession) of about 50%-55%, together
with its improved debt profile (with extended tenors and reduced
FX exposure) and a reasonable capex (in line with the Company's
plans) that would not halt this more conservative financial
tendency. On the other hand, a reversal in the trend of these
ratios due to the increase in MRS' debt, reduction in the
Company's cargo transportation, or other external factors like
the unfavorable revision of its tariff model or shareholder's
disagreements, could put negative pressure on the Company's
rating outlook. The stable outlook on the foreign currency
rating mirrors the outlook assigned to the ratings of the
Federative Republic of Brazil.



===================================
D O M I N I C A N   R E P U B L I C
===================================

* DOMINICAN REPUBLIC: Opens $1.1B Bond Swap
-------------------------------------------
The Dominican Republic revealed Wednesday the launching of a
long-anticipated offer to exchange US$1.1 billion in sovereign
bonds as part of an IMF-backed debt restructuring plan.

Mr. Temistocles Montas, the top economic adviser to President
Leonel Fernandez, disclosed that the government issued sovereign
bonds worth US$500 million at a 9.5 percent interest rate that
expire in 2011. They will be swapped for bonds of the same
amount and interest rate that expire in 2006.

Montas said also informed that the government issued bonds worth
US$600 million at a 9.4 percent interest rate that expire in
2018. They will be swapped for bonds of the same amount with 9.5
percent interest rate and a 2013 expiration date.

The government made interest payments that were due March 27 on
the original bonds, Montas said. The Dominican Congress approved
the debt restructuring plan last month.

The exchange, which expires on May 4 at 4:15 p.m. EDT, "was
essential" if the country was to meet its external financing
obligations, the office of President Fernandez said.


* DOMINICAN REPUBLIC: S&P Cuts Ratings on Global Bonds to `D'
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its long-term foreign
currency ratings on the Dominican Republic's 2006 and 2013
global bonds to 'D' from 'CC' following an announcement of a
bond exchange offer.

On Feb. 1, 2005, Standard & Poor's lowered its long- and short-
term foreign currency sovereign credit ratings on the republic
to 'SD' due to arrears to private commercial bank creditors.

Standard & Poor's considers the bond offering transaction a
distressed exchange because the new bonds provide bondholders
with less-favorable terms (maturities are being extended at
interest rates similar to those in existing bond agreements with
some of the interest capitalized) and because of the possible
consequences should the exchange fail. The Dominican Republic's
fiscal position and amortization schedule indicate that existing
bondholders may have few alternatives to accepting the exchange
offer.

Once the new bonds are issued in May 2005, Standard & Poor's
will consider the default on the bonds to be cured. However, an
agreement with commercial bank creditors could take longer to
complete and the foreign currency ratings will remain at 'SD'
until that time. Once the exchange and commercial bank agreement
have concluded, Standard & Poor's will likely raise its ratings
on the Dominican Republic to 'B', reflecting a forward-looking
assessment of the republic's creditworthiness.

A commitment to engineer a sustained fiscal adjustment and
improved expectations following a reprofiling of scheduled
amortization will likely ease real interest rates and boost
business confidence. This in turn, could put the government's
robust growth projections-4% per annum for several years,
beginning in 2006-within reach and contribute to a further
lowering of its already-moderate debt burden.

CONTACT:  Primary Credit Analyst:
          Richard Francis, New York
          Tel: (1) 212-438-7348
          E-mail richard_francis@standardandpoors.com

          Secondary Credit Analyst:
          John Chambers, CFA, New York
          Tel: (1) 212-438-7344
          E-mail: john_chambers@standardandpoors.com



=============
J A M A I C A
=============

AIR JAMAICA: 40 Pilots Likely to Lose Jobs in Two Month's Time
--------------------------------------------------------------
Officials of the embattled national airline Air Jamaica
announced Tuesday that 40 of the airline's 220 pilots will be
laid off in the next two months as part of a restructuring
program.

Chairman Vin Lawrence said the pilots who will be laid off are
23 staff members and 17 contracted workers. The executive said
the airline needed fewer pilots since it had cut four routes.

Air Jamaica recently cut several of its routes including
Manchester, England; Antigua; Houston, Texas and London to
Havana and reduced the frequency of flights on others.

The job cuts came despite the fact that both the airline and the
Jamaica Airline Pilots Association (JALPA) are yet to reach an
agreement on salary negotiations.

The airline said it had notified the affected pilots, and that
the redundancies would be carried out in full accordance with
the existing labor agreement with JALPA. It said that all
payments, including redundancy packages, would be paid to the
affected pilots in accordance with the law.

The pilots' contracts of employment will be terminated in
accordance with the 'last in, first out' principle, the airline
added.

CONTACT: Air Jamaica
         8300 N.W. 33rd Street Suite 440
         Miami Fl. 33122
         Phone:  (305) 670 3222
         Fax:  (305) 669 6631



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

CINTRA: Airlines to Hike Commission of Ticket Sales
---------------------------------------------------
Cintra-controlled leading carriers Aeromexico and Mexicana de
Aviacion are set to raise commission of ticket sales to Mexican
travel agencies starting this month. Mexico Analytica suggests
the increase could be up to 5% over the total amount.

According to Mr. Jorge Hernandez, president of the Mexican
Association of Travel Agencies, the increase comes on top of the
1% hike that they are currently receiving.

In 1999, air companies reduced commissions higher than 7% to 1%,
which led to the closure of more than 500 businesses in the
sector.

Cintra announced in February that Aeromexico and Mexicana would
be sold separately. Aeromexico will be sold with regional
airline Aeroliteral and Mexicana will be packaged with
Aerocaribe, a small unit now being turned into a no-frills, low-
cost carrier.

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


EMPRESAS ICA: Secures $36M Construction Contract
------------------------------------------------
Empresas ICA Sociedad Controladora, S.A. de C.V. (BMV and NYSE:
ICA), the largest engineering, construction, and procurement
Company in Mexico and Fluor Corporation (NYSE: FLR) announced
Wednesday the signing of a contract for the engineering,
procurement, construction and start-up support services for a
modular cryogenic plant for PEMEX Gas and Basic Petrochemicals.

Located in Reynosa, Tamaulipas, Mexico the cryogenic plant will
have a capacity of 200 million cubic feet per day, and will cool
feed gas in order to separate and recover liquid hydrocarbons.
The consortium formed by ICA Fluor and Linde Process Plants
Inc., will execute the project, which is scheduled to be
completed in 16 months, and the total contract value is US$ 36
million.

PEMEX Gas and Basic Petrochemicals is a subsidiary of PEMEX,
Mexico's national oil and gas company.

ICA Fluor is the leading industrial engineering Company in
Mexico, dedicated to the engineering, procurement, and
construction of oil, gas, electricity generation, petrochemical
and chemical plants, as well as automotive and telecommunication
installations.

ICA was founded in Mexico in 1947. ICA has completed
construction and engineering projects in 21 countries. ICA's
principal business units include civil construction and
industrial construction. Through its subsidiaries, ICA also
develops housing, manages airports, and operates tunnels,
highways, and municipal services under government concession
contracts and/or partial sale of long-term contract rights.

Fluor Corporation (NYSE: FLR) provides services on a global
basis in the fields of engineering, procurement, construction,
operations, maintenance and project management. Headquartered in
Aliso Viejo, Calif., Fluor is a FORTUNE 500 Company with
revenues of $9.4 billion in 2004.

CONTACT: Empresas ICA Sociedad Controladora S.A. de C.V.
         Col. Escandon Del Migual Hidalgo
         Mexico City, 11800
         Mexico
         Phone: 525-272-9991
         Web site: http://www.ica.com.mx


GRUPO SIMEC: Boosts Sales 75% Year-on-Year in 1Q05
--------------------------------------------------
Grupo Simec, S.A. de C.V. (AMEX: SIM) ("Simec") announced
Wednesday its results of operations for the three-month period
ended March 31, 2005. Net sales increased 75% to Ps. 1,764
million in the first quarter of 2005, compared to Ps. 1,007
million in the same period of 2004, primarily due to the
inclusion of net sales generated by the newly acquired plants in
Apizaco and Cholula of Ps. 706 million. Primarily as a result of
the foregoing, Simec recorded net income of Ps. 321 million in
the first quarter of 2005, versus net income of Ps. 278 million
for the first quarter of 2004.

On September 10, 2004, Simec completed the acquisition of the
property, plant and equipment and inventories, and assumed
liabilities associated with seniority premiums of employees of
the Mexican steel-making facilities of Industrias Ferricas del
Norte, S.A. (Corporacion Sidenor of Spain), located in Apizaco,
Tlaxcala, and Cholula, Puebla. Simec's total investment in this
transaction was approximately U.S. $135 million, funded with
internally generated resources of Simec and capital
contributions from its parent Company Industrias CH, S.A. de
C.V. of U.S. $19 million for capital stock to be issued in the
second quarter of 2005. Simec began to operate the plants on
August 1, 2004, and, as a result, the operations of both plants
are reflected in Simec's financial results as of such date.

Simec sold 246,202 metric tons of basic steel products during
the three- month period ended March 31, 2005 (including 98,068
tons produced by the newly acquired plants in Apizaco and
Cholula), an increase of 44% as compared to 170,389 metric tons
in the same period of 2004. Exports of basic steel products were
36,796 metric tons in the first quarter of 2005 (including 9,353
tons produced by the newly acquired plants in Apizaco and
Cholula), versus 25,698 metric tons in the same period of 2004.
Additionally, Simec sold 12,870 tons of billet in the three-
month period ended March 31, 2005, as compared to 19,505 tons of
billet in the same period of 2004. Prices of finished products
sold in the first three months of 2005 increased 26% in real
terms versus the same period of 2004.

Simec's direct cost of sales was Ps. 1,123 million in the three-
month period ended March 31, 2005 (including Ps. 500 million
relating to the newly acquired plants in Apizaco and Cholula),
or 64% of net sales, versus Ps. 666 million, or 66% of net
sales, for the 2004 period. The average cost of raw materials
used to produce steel products increased 23% in real terms in
the three-month period ended March 31, 2005, versus the same
period of 2004, primarily as a result of significant increases
in the price of scrap and certain other raw materials. Indirect
manufacturing, selling, general and administrative expenses
(including depreciation) were Ps. 182 million during the three-
month period ended March 31, 2005 (including Ps. 62 million
relating to the newly acquired plants in Apizaco and Cholula),
compared to Ps. 122 million in the same period of 2004.

Simec's operating income increased 110% to Ps. 459 million
during three- month period ended March 31, 2005 (including Ps.
143 million relating to the newly acquired plants in Apizaco and
Cholula), from Ps. 219 million in the first quarter of 2004.
Operating income was 26% of net sales in the three- month period
ended March 31, 2005, compared to 22% of net sales in the same
period of 2004.

Simec recorded other income, net, from other financial
operations of Ps. 5 million in the three-month period ended
March 31, 2005, compared to other income, net, of Ps. 10 million
in the same period of 2004. In addition, Simec recorded a
provision for income tax and employee profit sharing of Ps. 143
million in the three-month period ended March 31, 2005, versus a
positive provision of Ps. 65 million in the same period of 2004.

Simec recorded financial expense of Ps. 0 million in the three-
month period ended March 31, 2005, compared to financial expense
of Ps. 16 million in the same period of 2004 as a result of (i)
net interest income of Ps. 2 million in the three-month period
ended March 31, 2005, compared to net interest expense of Ps. 4
million in the same period of 2004; (ii) an exchange gain of Ps.
6 million in the three-month period ended March 31, 2005,
compared to an exchange gain of Ps. 0 million in the same period
of 2004, reflecting lower debt levels in the three-month period
ended March 31, 2005, and a decrease of 0.3% in the value of the
peso versus the dollar in the three-month period ended March 31,
2005, compared to an increase of 0.7% in the value of the peso
versus the dollar in the three-month period ended March 31,
2004, and (iii) a loss from monetary position of Ps. 8 million
in the three-month period ended March 31, 2005, compared to a
loss from monetary position of Ps. 12 million in the three-month
period ended March 31, 2004, reflecting the domestic inflation
rate of 0.8% in the three-month period ended March 31, 2005,
compared to the domestic inflation rate of 1.6% in the same
period in 2004 and lower debt levels during the 2005 period.

At March 31, 2005, Simec's total consolidated debt consisted of
approximately $0.3 million of U.S. dollar-denominated debt. At
December 31, 2004, Simec had outstanding approximately $0.3
million of U.S. dollar- denominated debt.

All figures were prepared in accordance with Mexican generally
accepted accounting principles and are stated in constant Pesos
at March 31, 2005.

Simec is a mini-mill steel producer in Mexico and manufactures a
broad range of non-flat structural steel products.

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


HYLSAMEX: Net Income Declines 59% From Previous Quarter
-------------------------------------------------------
HIGHLIGHTS

- Hylsamex registered solid volumes in 1Q05, supported by a 20%
year-over-year growth in exports. Shipments were 745,500 tons in
1Q05, down 5% and 3% compared to the same quarter of 2004 and
the previous quarter, respectively, due to first quarter
seasonality and a major maintenance program.

- Revenues amounted to US$573 million during 1Q05. Revenue per
ton reached US$769/ton in 1Q05, which represents a rise of 31%
from the amount registered in the same quarter of 2004 and a
slight decrease of 4% compared to the previous quarter. The
slight decrease versus the prior period resulted from an
unfavorable change in mix from higher exports and a reduction in
domestic prices for long products.

- COGS reached US$548/ton in 1Q05, 23% higher than the
US$446/ton recorded in the same quarter of 2004 and 1% greater
than the US$543/ton attained in the previous quarter. The
Company has been able to significantly contain cost increases in
raw materials which have affected the steel industry as a whole.

- In 1Q05, Hylsamex generated EBITDA of US$161 million, 46% more
than the US$110 million in EBITDA for 1Q04. The EBITDA margin
reached 28% in 1Q05.

- On a per ton basis, EBITDA reached US$216/ton in 1Q05, an
increase of 54% in relation to the US$140/ton obtained in the
same quarter of 2004 and a decrease of 15% compared to the
US$255/ton attained in the prior quarter.

- Free cash flow generation of US$100 million during 1Q05 led to
a reduction in leverage, as debt net of cash declined US$88
million during the quarter, for a balance of US$458 million.
Cash reserves reached US$217 million, up US$92 million over
year-end 2004. The Net Debt to LTM EBITDA ratio was 0.6x for
1Q05, while LTM Interest Coverage improved to 10.8x.

- Net income for 1Q05 amounted to US$95 million (Ps.1,071
million), increasing 51% compared to the US$63 million (Ps.732
million) of net income registered in the same quarter of 2004
and decreasing 59% from the US$234 million (Ps.2,676 million) of
net income reported in the previous quarter.

OVERVIEW

During the first quarter of 2005, Hylsamex continued producing
excellent results in terms of operating cash flow. The Company
recorded EBITDA of US$161 million in 1Q05, an increase of 46%
compared to the EBITDA of US$110 million generated in the same
quarter of 2004.

Hylsamex continues to capitalize on the favorable trends in the
global steel industry, its vertical integration, and its modern
facilities.

Hylsamex's free cash flow reached US$100 million in 1Q05, more
than two times the US$49 million generated in the same quarter
of 2004. This significant increase in free cash flow resulted
from solid EBITDA generation, coupled with modest capital
expenditures and net working capital requirements. In addition,
a downward trend in interest expenses due to the deleveraging
carried out in 2004, has produced a sizeable drop in Hylsamex's
financial burden, enhancing free cash flow.

The Company's profit margins experienced a relatively small
decline in the quarter-over-quarter comparison. Two key reasons
are behind the decline. First, tonnage sold decreased, mainly
because of the major maintenance program carried out in the Flat
Products Division's minimill during January, which reduced
production by 30 thousand tons. Further, domestic volumes appear
lower as the first quarter of the year is traditionally a slow-
moving one and this year in particular, Easter Week occurred in
late March. Second, as a result of greater exports and softness
in domestic long product prices, Hylsamex's revenue per ton
decreased 4% compared to the previous quarter. The observed
strong fundamentals in the global steel industry and the world
economies, as well as Hylsamex's robust operating model, has
allowed the Company to show attractive levels of profitability.

The global steel industry continues to experience an
extraordinary period. During 1Q05, steel producers around the
world accepted record cost increases in raw materials. For
example, 2005 contract prices for iron ore pellet increased 86%
while coking coal surged 119%1, when compared to the year
before.

While Hylsamex remains unaffected by these cost increases thanks
to its vertical integration, these higher costs could provide
additional support under steel prices. In addition, the industry
has seen some of the benefits of industry consolidation -which
is still at an early stage- as some large producers in developed
countries have started to favor pricing over volumes, paying
more attention to managing production and inventory levels to
maintain pricing.

In the NAFTA region, several key drivers will determine steel
prices in the short term. The significant inflow of imports into
the U.S. observed in the second half of 2004 was reduced during
1Q05. As prices in Asia rose and U.S. prices softened during the
quarter, arbitrage opportunities decreased. The weakness of the
U.S. dollar and expensive transportation costs also discouraged
these imports. At the same time, steel inventories in the NAFTA
region remained high because consumers had built reserves during
the last months of 2004. When excess inventories are worked off,
steel demand should pick up again. Scrap prices decreased
slightly during the quarter but at an average price of
US$198/ton for 1Q05, they continue above historic levels.

Hylsamex's management is considering capital expenditures of up
to US$100 million in 2005. Approximately 30% would be aimed at
normal investments, consisting of equipment replacement, mine
preparation, and energy conservation and substitution projects.
The remainder would be focused on strategic investments to grow
the Company's processing capacity and distribution network.
These latter investments are subject to Board approval.
Additionally, the Company plans to seek Board approval and begin
construction of its first industrial scale Molten Iron Process r
("MIP") plant during the second half of 2005. The MIP plant is
meant to reduce the Company's exposure to natural gas. The plant
will have an annual capacity to produce 250 thousand tons of
molten iron with an initial investment of approximately US$40
million.

Hylsamex remains cautiously optimistic about the rest of 2005.
The Company is well positioned to capitalize on current industry
trends, both in terms of pricing as well as demand. Volume-wise,
the Company is observing continued dynamism in the Mexican
construction sector and finding export opportunities at
attractive prices. Margin stability is expected, considering
Hylsamex's vertical integration that cushions raw material costs
impacts, including an effective ongoing natural gas hedging
program to mitigate potential energy price increases.

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

FREE CASH FLOW

Hylsamex generated excellent free cash flow of US$100 million in
1Q05, more than two times the US$49 million recorded in the same
quarter of 2004, but below the US$128 million obtained in the
preceding quarter. Lower interest expense and working capital
requirements enhanced free cash generation during 1Q05. As a
result of improved profitability, Hylsamex disbursed greater
cash taxes in 1Q05 as the Company began making interim income
tax payments. However, with the use of asset tax credits in the
annual 2005 tax return, the Company's 2005 tax burden will be
reduced through a tax refund early in 2006.

During 1Q05, Hylsamex generated sufficient free cash flow to
meet the US$100 million dividend payment on April 13th, 2005.

STEEL MARKET

Hylsamex recorded sales volume of 745,500 tons during 1Q05, 5%
or 42,300 tons less than the 787,800 tons shipped during the
same quarter of 2004 and 3% or 19,300 tons lower than the
764,800 tons sold in the previous quarter. The decrease versus
the previous quarter is mainly due to lower sales of wirerod and
flat products (including coated and tubular products). The
slight drop in flat product volumes resulted from the major
scheduled maintenance program carried out during January. Lower
volumes of semi-finished billet and wirerod caused most of the
reduction in volume in the comparison against the same quarter
of 2004.


Volume sold in the domestic market totaled 556,600 tons in 1Q05,
12% or 73,200 tons lower than the 629,800 tons registered in the
same quarter of 2004 and 5% or 28,200 tons less than the 584,800
tons of the prior quarter. Both decreases were primarily due to
less tonnage sold of flat products and wirerod. The drop against
the same quarter of 2004 was also caused by smaller volumes of
semi-finished billet. Domestic demand for Hylsamex's products
remains solid; during 1Q05, volumes appear lower since the first
quarter of the year is traditionally a slower one and this year
included Easter Week in late March rather than in April.

Hylsamex recorded strong export volume again in 1Q05,
particularly boosted by a strong rise in exports of flat
products during March. Hylsamex has seen a pick up in flat steel
demand from several Asian countries and the NAFTA region. The
Company continues to sense export opportunities at attractive
prices for the months ahead. The Flat Products Division is
operating Mill #1 to complete most of these export orders.

Exports in 1Q05 reached 188,900 tons, 20% or 30,900 tons more
than the 158,000 tons exported in the same quarter of 2004 and
5% or 8,900 tons more than the 180,000 tons of the previous
quarter.

The variations are mostly explained by changes in the export
volume of flat products, which increased 23% or 31,400 tons
compared to the same quarter of 2004, reflecting a robust global
demand for steel, and rose 9% or 14,300 tons versus the previous
quarter. Export prices for 1Q05 calculated in nominal dollars
increased 35% versus the same quarter of 2004 but decreased 6%
compared to the previous quarter. The latter figure was due to a
slight decrease in international steel prices, particularly U.S.
prices, while the former resulted from the positive year-over-
year trend observed in international steel prices. Solid export
volumes and prices allowed Hylsamex to generate significant
export revenues of US$148 million in 1Q05, 61% greater than the
export revenue obtained in the same quarter of 2004 and 3% lower
than in the previous quarter.

REVENUE

Hylsamex registered solid revenue generation in 1Q05. Hylsamex
generated sales revenue of US$573 million (Ps.6,460 million) in
1Q05, 24% greater than the US$461 million (Ps.5,371 million)
achieved in the same quarter of 2004 and 7% lower than the
US$615 million (Ps.7,078 million) obtained in the previous
quarter.

Compared to the previous quarter, a slight decrease was observed
due to a lower sales volume and a small reduction in revenue per
ton.

Hylsamex's revenue per ton in 1Q05 reached US$769/ton,
consisting of an average steel price of US$732/ton and a
US$37/ton contribution from other steel revenue. Hylsamex's
revenue per ton of US$769/ton for 1Q05 represents a surge of 31%
or US$184/ton in relation to the US$585/ton achieved in the same
quarter of 2004 and reflects a slight decrease of 4% or
US$35/ton compared to the US$804/ton obtained in the previous
quarter.

Hylsamex registered excellent pricing levels across most product
categories, but a slight decrease in revenue per ton versus the
previous quarter was observed. It was caused mainly by three
factors: a less rich product mix due to higher exports, a
marginally lower export revenue per ton as prices in the U.S.
softened during the quarter, and lower prices of long products
in the Mexican market.

COST OF GOODS SOLD

Hylsamex continues operating at high utilization levels to cope
with strong steel demand. In 1Q05, Hylsamex's cost advantage
from its vertical integration persisted, allowing the Company to
register only a slight increase in cost per ton compared to the
preceding quarter. The Company continues producing DRI at
maximum capacity, sourcing 100% of iron ore requirements from
its own mines.

As a sign of continued robust demand, Mill #1 of the Flat
Products Division (the primary flat products facility in use
before the mid-1990s modernization program) produced 121,700
tons during 1Q05, the highest production level since the second
quarter of 2000. Mill #1 allowed Hylsamex to take advantage of
export opportunities and to partially compensate for the 30
thousand tons of lost production from the minimill's major
maintenance carried out during January. Production at Mill #1 is
entirely on a variable cost basis (i.e. no additional fixed
costs are incurred) and is easily started and stopped as needed.

In 1Q05, Hylsamex incurred scrap costs similar to the previous
quarter, with a reduction in the cost of imported scrap. The
market for scrap remained tight during 1Q05, with U.S. scrap
prices3 prices hovering around US$200/ton. So far, early in
2Q05, scrap prices are seen at US$216/ton, as of April 15th,
2005. As a result of lofty scrap prices and despite a high cost
of natural gas, Hylsamex's DRI cost advantage persisted and DRI
production carried on. During 1Q05, Hylsamex utilized 2% less
DRI than in the prior quarter. The Company carried out a
maintenance program of its Puebla DRI plant during the quarter.
The shutdown was scheduled during the winter, when natural gas
prices usually peak, to reduce consumption of this fossil fuel.

COGS for 1Q05 amounted to US$408 million (Ps.4,601 million), 16%
greater than the US$352 million (Ps.4,097 million) registered in
the same quarter of 2004 and 2% lower than the US$415 million
(Ps.4,776 million) recorded in the preceding quarter. The
decrease in COGS versus the previous quarter mainly resulted
from less tonnage sold. The rise against the same quarter of
2004 was due to higher costs for energy, scrap and externally-
sourced steel for the coating operations.

On a per ton basis, COGS in 1Q05 reached US$548/ton, US$102/ton
or 23% above the US$446/ton recorded in the same quarter of 2004
and US$5/ton or 1% greater than the US$543/ton attained in the
previous quarter. The US$102/ton increase in cost per ton
compared to the same quarter of 2004 consisted of US$81/ton and
US$21/ton increases in variable and fixed costs per ton, in that
order. The increase in variable costs resulted from higher
energy costs, greater prices for scrap metal, and a higher cost
for externally-sourced steel for the coating operations. The
increase in fixed cost was due to greater maintenance expenses
and a lower spread of fixed cost due to less volume sold. The
US$5/ton increase in cost per ton against the previous quarter
was caused entirely by an increase in variable cost per ton,
since fixed cost per ton remained unchanged. A higher
electricity bill and costlier externally sourced steel mainly
explain the rise in variable cost. An explanation of the
quarterly behavior of the main components of COGS follows:

Energy Inputs: The effective natural gas price for Hylsamex
during 1Q05 was US$5.32/MMBtu (corresponding to a US$5.77/MMBtu
average reference price in South Texas), 3% greater than the
US$5.15/MMBtu recorded in the same quarter of 2004 and 6% lower
than the US$5.64/MMBtu observed in the previous quarter. The
savings versus market prices are the result of the current
financial hedging program. The Company is constantly monitoring
and studying the natural gas markets to manage this exposure. As
of the date of this report, the natural gas hedges consist of
the following positions:

2005

- The South Texas price for April 2005 was set at US$6.65/MMBtu.
As a result of financial hedges in place, Hylsamex's cost of
natural gas for this month for the first 200 contracts of
consumption will be approximately US$5.005/MMBtu. April's
consumption in excess of 200 contracts will be charged at the
market price.

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

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

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

2007

- The Company sold a swaption at US$4.20/MMBtu for 32% of the
requirements for the year.

Note: While the Company's financial hedges are referenced to
NYMEX natural gas prices, all of the Company's financial hedges
described above are shown at their South Texas equivalent price.
In 2004, South Texas prices were on average US$0.30 lower than
the NYMEX price.

The cost of electricity for 1Q05 was USŤ4.73/Kwh, 19% higher
than the USŤ3.96/Kwh recorded in the same quarter of 2004 and 4%
greater than the USŤ4.56/Kwh registered in the previous quarter.
The increase in electricity costs versus both periods was the
result of higher international prices for fossil fuels.

Metallic Inputs: In 1Q05, the weighted average cost of the
Company's metallic charge was US$39/ton higher than the cost
during the same quarter of 2004 and US$10/ton lower compared to
the previous quarter. In the comparison against the same quarter
of 2004, the metallic charge's cost increase is mainly
attributed to a higher cost of domestic scrap and to a lesser
extent a greater DRI cost. The metallic charge's cost decrease
versus the previous quarter resulted from a lower cost of
imported scrap and a small drop in the cost of DRI.

In 1Q05, DRI's cost rose US$15/ton compared to the same period
of 2004 and slightly decreased by US$5/ton versus the previous
quarter. This stability is due to the fairly steady effective
cost of natural gas for Hylsamex, which oscillated around
US$5.50/MMBtu in 2004, in part as a result of the Company's
natural gas hedging strategy. Since late in 2003, DRI has
regained competitiveness vis-ů-vis steel scrap as a result of
high scrap prices. Accordingly, Hylsamex's competitive position
has been enhanced compared to less integrated producers.

As a sign of continued tightness in the steel scrap markets, the
cost of Hylsamex's overall scrap mix remained relatively high
compared to prior years. The cost of Hylsamex's domestic scrap
mix in 1Q05 rose US$77/ton compared to the same quarter of 2004
and increased by US$1/ton as measured against the preceding
quarter.

During 1Q05, the cost of Hylsamex's imported scrap mix decreased
by US$17/ton in the comparison versus the same quarter of 2004.
The cost of imported scrap diminished by US$22/ton compared to
the previous quarter. These reductions are related to lower
scrap prices in the U.S., which softened slightly during 1Q05
compared to previous quarters. However, scrap prices remain
relatively high, induced by increased worldwide demand for steel
products.

OPERATING EXPENSES

Operating expenses for 1Q05 totaled US$38 million (Ps.423
million), 23% higher than the US$30 million (Ps.354 million)
registered in the same quarter of 2004 and 5% greater than the
US$36 million (Ps.411 million) spent in the previous quarter. In
a comparison against the same quarter of 2004, a transient
increase in operating expenses was observed, as Hylsamex resumed
payment of management fees to its parent Company Alfa.
Hylsamex's payment for 1Q05 was US$8 million, identical to the
amount recorded in the prior quarter. The ratio of operating
expenses to sales reached 6.5% in 1Q05, slightly lower than the
6.6% observed in the same quarter of 2004 and higher than the
5.8% of the previous quarter.

OPERATING INCOME AND EBITDA

Hylsamex continued generating very good operating profitability.
During 1Q05, operating income totaled US$127 million (Ps.1,436
million), US$48 million more than the US$79 million (Ps.919
million) obtained in the same quarter of 2004 and US$37 million
less than the US$164 million (Ps.1,890 million) gained in the
previous quarter. Hylsamex's operating profit margin for 1Q05
reached 22%, above the 17% operating profit margin obtained in
the same quarter of 2004 and below the 27% registered in the
preceding quarter.

Hylsamex reported an excellent level of EBITDA in 1Q05. The
Company's EBITDA in 1Q05 of US$161 million (Ps.1,812 million)
was 46% greater than the US$110 million (Ps.1,281 million)
achieved in the same quarter of 2004 and was 17% less than the
US$195 million (Ps.2,244 million) generated in the previous
quarter.

Hylsamex's EBITDA margin reached 28% during 1Q05, above the
EBITDA margin of 24% registered in the same quarter of 2004 and
below the prior quarter's EBITDA margin of 32%. On a per ton
basis, EBITDA reached US$216/ton in 1Q05, US$76/ton more than
the US$140/ton obtained in the same quarter of 2004 and
US$39/ton less than the US$255/ton registered in the previous
quarter.

Operating profitability remained at very good levels, due to the
favorable steel pricing environment and Hylsamex's vertical
integration that helped it maintain relatively stable costs.
Compared to the previous quarter, a small decrease in
profitability was observed both in absolute terms and profit
margins. This reduction is primarily explained by the 3% drop in
tonnage sold, higher exports, which carry lower margins, and
softness in domestic long product prices. In comparison against
the same quarter of 2004, Hylsamex not only enjoyed the benefit
of higher prices, but also the Company's enhanced position as an
efficient, vertically integrated minimill, allowed it to expand
profit margins more than other steel producers since the
Company's cost per ton increased to a lesser degree.

COMPREHENSIVE FINANCIAL RESULT (CFR)

Hylsamex recorded in 1Q05 a net financial cost of US$13 million
Ps.146 million), as compared to a net financial gain of US$1
million (Ps.19 million) recorded in the same quarter of 2004 and
net financial cost of US$1 million (Ps.14 million) registered in
the previous quarter. The CFR variations are largely
attributable to fluctuations in the Peso-dollar exchange rate
and its effect on Hylsamex's basically dollarized debt. Against
both comparable periods, Hylsamex also recorded a lower monetary
position gain in 1Q05, due to lower inflation and a reduction in
monetary liabilities in the last months of 2004 coming from the
decrease in debt, long-term accounts payable and pension
liabilities. The Company continued experiencing sizeable
decreases in net interest expense in 1Q05, measured against both
comparable periods, as a result of the deleveraging and
refinancing efforts made during 2004. Net interest expense for
1Q05 decreased 31% or US$7 million versus the same quarter of
2004 and dropped 13% or US$2 million compared to the previous
quarter.

CONSOLIDATED NET INCOME

Net income for 1Q05 amounted to US$95 million (Ps.1,071
million), increasing 51% compared to the US$63 million (Ps.732
million) of net income registered in the same quarter of 2004
and decreasing 59% from the US$234 million (Ps.2,676 million) of
net income reported in the previous quarter. Net income
increased compared to the same quarter of 2004 mainly due to
greater operating income, partially offset by greater tax
accruals and CFR cost.

The reduction in net income versus the previous quarter was
caused mainly by higher tax accruals and lower operating income.
In the comparison against the previous quarter, Hylsamex
recognized a tax accrual in 1Q05 instead of the tax gain of
4Q04, which resulted mostly from the cancellation of reserves
against tax assets. These reserves were created in the past when
the Company estimated it would not fully take advantage of its
accumulated tax shields. Given the improved profitability
observed throughout 2004, the Company cancelled the reserves in
4Q04.

NET DEBT & OTHER ITEMS

NET DEBT VARIATION 1Q05

Debt Net of Cash: Hylsamex's net debt as of March 31, 2005
decreased to US$458 million, US$88 million or 16% less than the
US$546 million registered as of December 31, 2004. This
reduction was mainly obtained through free cash flow generation,
which allowed the Company to increase cash reserves by US$92
million during the quarter.

Cash Taxes Paid: Cash taxes paid during 1Q05 amounted to US$19
million, US$9 million and US$12 million more than the amounts
paid in the same quarter of 2004 and the previous quarter,
respectively. As a result of improved profitability, Hylsamex
disbursed greater cash taxes in 1Q05 as the Company began making
interim income tax payments. However, with the use of asset tax
credits in the annual 2005 tax return, the Company's 2005 tax
burden will be reduced through a tax refund early in 2006. As of
March 31, 2005, the Company holds US$88 million and US$130
million in tax loss carry forwards and asset tax credits,
respectively.

Tax loss carry forwards can be used to reduce future taxable
income and consequently diminish income tax incurred.
Furthermore, if the remaining future income tax incurred is
greater than the asset tax, asset tax credits can be utilized to
reduce income tax payments to the asset tax level. Since most of
the remaining tax loss carry forwards belong to non-operating
companies, management does not foresee the immediate use of
these carry forwards during 2005. During the second quarter of
2005, the Company will pay US$31 million in statutory employee
profit sharing generated in 2004.

Net Working Capital (NWC): During 1Q05, net working capital
represented a use of funds of US$23 million, which compares to
uses of funds of US$15 million and US$34 million in the same
quarter of 2004 and in the previous quarter, respectively. In
1Q05, the Company directed funds primarily to accounts
receivable and payable; a slight seasonal reduction in raw
material inventories at Hylsa and Galvak produced a small source
of funds at the Hylsamex inventory line.

Capital Expenditures: Capital expenditures amounted to US$13
million during 1Q05, similar to the disbursements made in the
same quarter of 2004, and a decrease of US$2 million compared to
the investments made in the previous quarter. Galvak invested
US$4 million while Hylsa's capital expenditures totaled US$9
million; Hylsa's investments remained focused on normal
investments at the basic steel facilities. Additionally, Hylsa
destined funds to increase Pena Colorada's pellet feed capacity.

LIQUIDITY AND CASH RESERVES

Hylsamex continued with its excellent overall liquidity during
1Q05. Strong free cash flow increased cash reserves, which
reached US$217 million as of March 31, 2005, US$82 million more
than the balance of US$135 million at the end of the same
quarter of 2004 and US$92 million higher than the balance of
US$125 million at the end of the previous quarter. Hylsa's US$60
million Liquidity Facility, which was obtained to support
general corporate purposes and working capital needs, remains
unused.

KEY FINANCIAL RATIOS

The significant reduction in net debt achieved during the
quarter further improved Hylsamex's healthy financial ratios.
The Company recorded Net Debt to LTM EBITDA of 0.6x as of the
end of 1Q05, decreasing from the 3.9x and 0.7x observed in the
same period of 2004 and the preceding quarter, in that order.
The Interest Coverage ratio (LTM EBITDA to LTM Net Interest
Expense) followed a similar trend: it reached 10.8x as of the
end of 1Q05, compared to 2.5x in the same quarter of 2004 and
9.3x in the previous quarter.

EQUITY INCOME FROM ASSOCIATED COMPANIES (SIDOR)

Hylsamex's minority stake in Amazonia generated a gain of US$8
million (Ps.93 million) in 1Q05, as compared to the gains of
US$4 million (Ps.50 million) and US$31 million (Ps.356 million)
recorded in the same quarter of 2004 and in the previous
quarter, respectively. The variation versus the previous quarter
was mainly due to extraordinary items (reversal of asset
impairment) recorded in 4Q04 and not repeated in the first
quarter of 2005.

The comparison against the same quarter of 2004 shows similar
levels reflecting the continued solid operating performance, as
a result of favorable fundamentals in the global steel market,
the Company's position as one of the world's lowest-cost steel
producers with vertical integration, and its privileged
geographic location that allows it to efficiently supply the
domestic and export markets.

OTHER DEVELOPMENTS

HYLSA TO REFINANCE NOTES DUE 2007

On April 6th, 2005, Hylsamex announced that its subsidiary
Hylsa, S.A. de C.V. ("Hylsa") has called all of its 9 1/4% 2007
Notes. Hylsa will pay holders of the Notes on May 12th, 2005
approximately US$141 million, representing US$139 million in
principal and US$2 million in call premium. In addition, the
Company will pay interest accrued as of the payment date. Hylsa
will use medium-term bank financing, obtained at more favorable
terms, to carry out the prepayment.

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

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

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

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


TV AZTECA: Registers 1Q05 EBITDA of Ps.630 Million
--------------------------------------------------
TV Azteca, S.A. de C.V. (NYSE: TZA; BMV: TVAZTCA, Latibex:
XTZA), one of the two largest producers of Spanish language
television programming in the world, announced Wednesday first
quarter net sales up 4% to a record level of Ps.1,668 million
(US$148 million), and EBITDA of Ps.630 million (US$56 million),
unchanged from the prior year period. EBITDA margin for the
quarter was 38%.

"Despite challenging comparables due to fewer working days and
the Holy Week this quarter, we managed to deliver the highest 1Q
revenue level ever recorded by the Company," said Mario San
Roman, Chief Executive Officer of TV Azteca. "Solid drivers of
growth in Mexico and in the US allowed us to continue with an
uninterrupted trend of five years of top line increases."

"On the strategic front, in close adherence to our cash-usage
plan, we are on track to submit for shareholders' approval later
this month distributions of US$80 million planned for 2005, as
previously approved by our board," added Mr. San Roman.

As has been detailed, the Company's plan for uses of cash
entails distributions of over US$500 million and reductions in
TV Azteca's debt by approximately US$250 million within a six-
year period that started in 2003.

First Quarter Results

Net sales grew 4% to a record high of Ps.1,668 million (US$148
million), up from Ps.1,607 million (US$142 million) for the same
quarter of 2004. Total costs and expenses rose 6% to Ps.1,038
million (US$92 million), from Ps.979 million (US$87 million) for
the same period last year.

The Company reported EBITDA of Ps.630 million (US$56 million),
compared with Ps.628 million (US$56 million) in the first
quarter of 2004. Net income was Ps.202 million (US$18 million),
6% higher than Ps.191 million (US$17 million) for the same
period of 2004.

Millions of pesos(1) and dollars(2) except percentages and per
share amounts.


Change
   Net Sales       1Q 2004      1Q 2005           US$          %
     Pesos        Ps. 1,607    Ps. 1,668
     US$          US$ 142      US$ 148            5          +4%
   EBITDA(3)
     Pesos        Ps. 628      Ps. 630
     US$          US$ 56       US$ 56             0           0%
   Net Income
     Pesos        Ps. 191      Ps. 202
     US$          US$ 17       US$ 18             1          +6%
    Income per ADS(4)
     Pesos        Ps. 1.03     Ps. 1.09
     US$          US$ 0.09     US$ 0.10          0.01        +6%

    (1) Pesos of constant purchasing power as of March 31, 2005.
    (2) Conversion based on the exchange rate of Ps.11.29 per US
dollar as of March 31, 2005.
    (3) EBITDA is Operating Profit Before Depreciation and
Amortization under Mexican GAAP.
     (4) Calculated based on 185 million ADSs outstanding as of
         March 31, 2005.

    Net Sales

"Favorable economic conditions domestically, together with
targeted programming initiatives boosted sales in Mexico to
record-high levels," said Mr. San Roman. "Adding to the domestic
dynamism, Azteca America further contributed to consolidated top
line expansion, with increases at both the network and the Los
Angeles station."

First quarter revenue includes sales from Azteca America-the
Company's wholly-owned broadcasting network focused on the US
Hispanic market-of Ps.79 million (US$7 million), a 16% increase
from Ps.68 million (US$6 million) for the same period a year
ago. Azteca America revenue this quarter was comprised of Ps.43
million (US$4 million) in sales from the Los Angeles station
KAZA-TV, and Ps.35 million (US$3 million) from network sales.

TV Azteca also reported sales of programming to other countries
of Ps.33 million (US$3 million), compared with Ps.38 million
(US$3 million) in the same period a year ago. This quarter's
programming exports were primarily driven by the Company's
novelas La Otra Mitad del Sol, sold in Latin America, as well as
La Hija del Jardinero, which was sold in European and Latin
American markets.

TV Azteca reported Ps.33 million (US$3 million) in advertising
sales to Unefon, compared with Ps.35 million (US$3 million) in
the first quarter of 2004. In accordance with the terms of the
advertising agreement between Unefon and TV Azteca, during the
first quarter Unefon paid to TV Azteca in cash the Ps.33 million
(US$3 million) of advertising purchases placed within the prior
three month period.

During the first quarter of 2005, content and advertising sales
to Todito.com were Ps.29 million (US$3 million), compared with
Ps.73 million (US$6 million) in the same period of the prior
year. This quarter marked the end of a five-year service
contract, entered in February 2000, in which TV Azteca acquired
50% of Todito.com. The service contract provided for advertising
time to Todito.com on TV Azteca networks, the exclusive online
use of the Company's content by Todito.com, and TV Azteca sales
support to sell online advertising on Todito.com. The value of
the service agreement was US$100 million at the time of the
contract's execution.

Barter sales were Ps.65 million (US$6 million), compared with
Ps.54 million (US$5 million) in the same period of last year.
Inflation adjustment of advertising advances was Ps.53 million
(US$5 million), compared with Ps.54 million (US$5 million) for
the first quarter of 2004.

Costs and Expenses

The 6% increase in first quarter costs and expenses resulted
from the combined effect of a 10% rise in programming,
production and transmission costs to Ps.766 million (US$68
million), from Ps.694 million (US$61 million) in the prior year
period, and a 5% decrease in administration and selling expense
to Ps.272 million (US$24 million), from Ps.285 million (US$25
million) in the same quarter a year ago.

"Within the dynamic economic environment in Mexico, we developed
a number of programming initiatives to better tap a rising
domestic market," said Carlos Hesles, Chief Financial Officer of
TV Azteca. "The programming efforts increased production costs,
and simultaneously provided advertisers with ample choices to
reach their target markets, which had a positive effect on net
sales."

Consistent with the increased production efforts this quarter,
TV Azteca's in-house produced content rose to 2,278 hours in the
three month period a 9% rise from 2,093 hours a year ago.

The 5% reduction in administration and selling expense reflects
lower operating, services, personnel and travel expenses in the
first quarter, despite increasing operations in Mexico and the
US.

EBITDA and Net Income

The 4% increase in first quarter net sales, combined with the 6%
growth in costs and expenses, resulted in EBITDA of Ps.630
million (US$56 million), compared with Ps.628 million (US$56
million) a year ago. The EBITDA margin was 38%, compared with
39% in the same period of 2004.

Below EBITDA, the Company recorded depreciation and amortization
of Ps.97 million (US$9 million) from Ps.102 million (US$9
million) a year ago, primarily reflecting a Ps.4 million (US$0.4
million) decline in the depreciation line due to increases in
fully depreciated assets this quarter.

The Company recorded other expense of Ps.105 million (US$9
million), compared with Ps.106 million (US$9 million) a year
ago. Other expense for the quarter was primarily comprised of
legal fees of Ps.40 million (US$4 million), unchanged from the
first quarter a year ago, charitable donations of Ps.39 million
(US$3 million), the recognition of 50% of the net loss of
Todito.com of Ps.15 million (US$1 million), pre-operating
expenses of Azteca America of Ps.10 million (US$1 million), and
the net effect of the recognition of the results from Monarcas-
TV Azteca's soccer team-and other items of Ps.1 million (US$0.1
million).

Net comprehensive financing cost during the quarter was Ps.181
million (US$16 million) compared with Ps.179 million (US$16
million) a year ago. There was a Ps.33 million (US$3 million)
decrease in interest income primarily resulting from a reduction
in the Company's cash balance. Additionally, foreign exchange
gain decreased Ps.12 million (US$1 million) due to a reduction
in TV Azteca's US$ monetary position. Other financing expense
rose Ps.7 million (US$1 million) reflecting the payment of tax
surcharges. Increases in net comprehensive financing cost were
partly offset by a Ps.45 million (US$4 million) reduction in
loss on monetary position resulting from symmetry of the
Company's monetary assets and liabilities for the quarter.

Provision for income tax was Ps.45 million (US$4 million),
compared with Ps.50 million (US$4 million) in the same period of
the prior year, reflecting similar taxable bases among the
quarters.

Net income for the period was Ps.202 million (US$18 million), up
6% from Ps.191 million (US$17 million) for the same quarter of
2004.

Azteca America

During the quarter, TV Azteca signed a distribution agreement in
which EchoStar Communication Corporation's DISH Network made
Azteca America available nationwide via satellite television,
starting on April 1, 2005.

The parties signed a contract through which the Azteca America
channel will be available as part of EchoStar's DISH Latino
programming packages, and settled all prior disputes. EchoStar
has also obtained the right to air the 24-hour live transmission
of the Company's musical reality show, La Academia 4, on another
EchoStar channel.

"We are thrilled that viewers will now be able to turn from
seeing TV Azteca's channel 13 to our Network's programming,
allowing Azteca America to benefit from the tremendous
subscriber growth that EchoStar has established during the past
five years," said Luis J. Echarte, President and CEO of Azteca
America.

Azteca America Network's signal is seen through 39 affiliate
stations across the US, of which 30 have cable carriage and, in
most cases, also satellite transmission. The Company anticipates
that Azteca America Network's positive results in reaching a
growing number of US Hispanic markets will lead advertisers to
consider it a consolidated national network for the upcoming US
upfront season.

Debt Outstanding

As of March 31, 2005, the Company's total outstanding debt was
Ps.6,470 million (US$573 million). TV Azteca's cash balance was
Ps.1,062 million (US$94 million), resulting in net debt of
Ps.5,408 million (US$479 million). The total debt to last twelve
months (LTM) EBITDA ratio was 1.8 times, and net debt to EBITDA
was 1.5 times. LTM EBITDA to net interest expense ratio was 5.8
times.

Excluding-for analytical purposes-Ps.1,353 million (US$120
million) debt due 2069, total debt was Ps.5,117 million (US$453
million), and total debt to EBITDA ratio was 1.4 times.

Management Oversight

As previously announced, on November 24, 2004 the Company's
shareholders approved measures for management oversight, which
were approved by TV Azteca's board on October 19, 2004. The
Company has advanced in its implementation, as follows.

TV Azteca has completed the formation of its nominations
committee with Ignacio Morales Lechuga, Notary Public, former
Mexico's General Prosecutor, and Dean of the Escuela Libre de
Derecho-one of Mexico's top law schools- Jos?? Represas, Counsel
for International Businesses and former President and CEO of
Nestle Mexico, and Andres Holzer, a renowned Mexican investor,
with activities in the manufacturing, services and real estate
sectors. The nominations committee will propose prospective
independent board members for appointment by the Company's
shareholders.

TV Azteca has named Pedro Zamora, former Enforcement Vice
President at the Mexican Banking and Securities Commission
(CNBV) as the Company's Chief Oversight Officer. Mr. Zamora will
supervise the compliance of the code of business conduct and
ethics of the Company.

Pursuant to the resolution of the November 24, 2004
shareholders' meeting, TV Azteca included in its bylaws a new
Audit Committee, which will consist of three independent
directors, who will take over, among others, the current
responsibilities of the Related Party Transactions Committee.
The Company's Nominations Committee will propose the members of
the Audit Committee to the shareholders as discussed above.

TV Azteca noted that the rest of the management oversight
measures are in process of implementation, and are expected to
be presented to the Company's shareholders for final approval
prior to May 31.

SEC Case

As previously announced, on January 4 the US Securities and
Exchange Commission (SEC) issued a press release informing that
it filed a civil action against the Company, its parent Company,
Ricardo B. Salinas, founder, chairman and majority shareholder,
and Pedro Padilla L., board member and former CEO, in a US
Federal Court.

TV Azteca is certain that the Company, and its officers and
directors acted in full compliance with the applicable legal
framework and are determined to continue to do so, and to firmly
defend what they believe to be correct. The Company, its
officers and directors believe they will prevail because they
acted correctly.

Unefon Holdings

As was previously detailed, on October 6, 2003 TV Azteca's board
unanimously approved the split off of the Company's 46.5% equity
stake in Unefon and a 50% stake in Cosmofrecuencias, a wireless
broadband Internet access provider.

On December 19 of the same year, TV Azteca shareholders ratified
the separation of TV Azteca's telecommunications assets through
the creation of Unefon Holdings, returning TV Azteca to a pure
media Company. Unefon Holdings became a legal Mexican entity
independent from TV Azteca that same month.

On July 2004 Unefon Holdings began the registration process with
the Mexican Banking and Securities Commission (CNBV) and the
Mexican Stock Exchange (BMV) to have its shares listed on the
BMV. Previously, Unefon Holdings applied to the SEC for an
exemption from registration of its shares in the US, to allow
for over-the-counter trading in the United States. Public
trading of Unefon Holdings will allow TV Azteca shareholders to
receive the value of the telecommunications business, and decide
their participation in Unefon Holdings.

The SEC granted the exemption on October, 2004. Notwithstanding
the CNBV made several requests for additional financial and
operating information for Unefon Holdings, which has impeded
Unefon Holdings from obtaining its registration. Unefon Holdings
has not received a decision, nor a date of a potential
definition of the listing on the BMV from Mexican authorities.

TV Azteca does not know the reasons for the delays at the CNBV,
but is certain that the lengthy decision making process
adversely affects the Company's minority shareholders, who are
not allowed to make investment decisions regarding Unefon
Holdings.

Company Profile

TV Azteca is one of the two largest producers of Spanish
language television programming in the world, operating two
national television networks in Mexico, Azteca 13 and Azteca 7,
through more than 300 owned and operated stations across the
country. TV Azteca affiliates include Azteca America Network, a
new broadcast television network focused on the rapidly growing
US Hispanic market, and Todito.com, an Internet portal for North
American Spanish speakers.

CONTACT:  TV Azteca, S.A. de C.V.
          Investors, Bruno Rangel
          Tel: +5255-3099-9167
          E-mail: jrangelk@tvazteca.com.mx

          Media, Tristan Canales
          Tel: +5255-1720-5786
          E-mail: tcanales@tvazteca.com.mx

          Daniel McCosh
          Tel: +5255-1720-0059
          E-mail: dmccosh@tvazteca.com.mx
          URL: http://www.irtvazteca.com/


UNEFON: Denies Reports About Impending Sale
-------------------------------------------
Mobile operator Unefon denied reports suggesting that a takeover
by a market competitor is in the offing, reports Business News
Americas.

"Although over recent years Unefon has sustained formal talks
with various telecommunications companies about a possible sale,
at this moment there are currently no formal negotiations with
any Company," Unefon said in a statement to the local stock
exchange BMV.

"However, that does not rule out the possibility that Unefon
will consider any future offer that it finds interesting," the
Company continued.

Reports about the imminent sale emerged last week after Unefon,
which is 46.5%-owned by the country's No. 2 broadcaster TV
Azteca (NYSE: TZA), announced it would delist from the BMV,
citing poor liquidity of its stock. Local press took it to mean
that the Company was in trouble and ready to sell.

Unefon holds the number three position in Mexico's mobile market
behind America Movil (NYSE: AMX) subsidiary Telcel and Movistar
(Telefonica Moviles).

CONTACT: Unefon Press Relations
         Mr. Tristan Canales
         E-mail: tcanales@tvazteca.com.mx
         Phone: (011-5255) 3099 5786

         Unefon Investor Relations
         Mr. Alan Infante
         E-mail: ainfante@unefon.com.mx
         Phone: (011-5255) 8582 5134

         VeriSign Media Relations
         Mr. Leslie Rubin
         E-mail: lrubin@verisign.com
         Phone: 650-426-5363

         VeriSign Investor Relations
         Mr. Tom McCallum
         E-mail: tmccallum@verisign.com
         Phone: 650-426-3744



=====================
P U E R T O   R I C O
=====================

DORAL FINANCIAL: Lowered & Placed on Rating Watch Negative
----------------------------------------------------------
Fitch Ratings has downgraded and placed the ratings of Doral
Financial Corporation (Doral) on Rating Watch Negative. A list
of ratings is provided at the end of this release.

The rating action is in response to Doral's announcement that
they have changed the methodology used to value its portfolio of
floating rate interest only strips (IOs). Doral's preliminary
estimate is that this correction will result in a decrease in
the fair value of its floating rate IOs of between $400 million
to $600 million as of Dec. 31, 2004. While Fitch has and
continues to recognize the volatility associated with the IO
asset, the source of the valuation change was unexpected and
raises concern with other accounting and valuation practices
employed by Doral.

In recognition of this heightened risk, Doral has stated that
they are conducting a comprehensive review that will cover all
the assumptions and processes used to value its IOs and mortgage
servicing rights as well as those used to calculate the gains on
sale. The review will also test and evaluate the effectiveness
of internal controls pertaining to financial reporting. Although
Fitch does not have evidence of any additional charges related
to the review, the probability of such is heightened with the
aforementioned fundamental change in IO valuation.

The change in the IO valuation practice to using the forward
LIBOR curve rather than the static LIBOR rate moves Doral's
practices toward more standard industry convention. The sizable
adjustment will erode Doral's capital cushion, an area that
Fitch has pointed to as a rating strength and a compensating
factor for a less robust risk management framework. However, the
change in valuation does show that Doral is adding conservatism
to its practices and is one step among many that firm has
recently taken to strengthen the tools and discipline employed
in the risk management process.

The Rating Watch Negative status will be evaluated following
Fitch's review with management on future valuation methodology,
asset/liability management, funding and liquidity in conjunction
with the prospective changes to the business model. Fitch
expects that the restatement process will be completed within a
time frame that will allow Doral to resume normal financial
reporting by the end of May 2005.

The restated financials will allow Fitch to fully assess the
actual writedown and resulting capital position. Offsetting the
near-term concerns is Doral's capital, liquidity, and market
position. Based on the high end of the charge to the IO's,
equity to assets will decline to approximately 9.75%-10% from
13% at Dec. 31, 2004. Capitalization, after the charge, remains
good for the current rating category. Doral's liquidity position
remains good as the Company has $2.5 billion in money market
investments as of Dec. 31, 2004. Importantly, Fitch does not
believe the negative financial news should significantly curtail
the predominately retail business flow of Doral's residential
mortgage operation.

Fitch has lowered the following ratings and also placed them on
Rating Watch Negative:

Doral Financial Corporation

--Long-term senior unsecured to 'BBB' from 'BBB+';

--Preferred stock to 'BB+' from 'BBB-'.

Doral Bank

--L-T deposit obligations to 'BBB+' from 'A-';

--L-T non-deposit obligations to 'BBB' from 'BBB+'.

Ratings affirmed by Fitch:

Doral Financial Corporation

--Short-term 'F2';

--Individual 'B/C';

--Support '5'.

Doral Bank

--S-T deposit obligations 'F2';

--S-T non-deposit obligations 'F2'

--Individual 'B/C';

--Support '5'.

CONTACT:  Peter Shimkus +1-312-368-2063
          James E. Moss +1-312-368-3213, Chicago

MEDIA RELATIONS: Kenneth Reed +1-212-908-0540, New York


DORAL FINANCIAL: SEC Conducts Probe on Results Restatements
-----------------------------------------------------------
Doral Financial Corporation (NYSE:DRL) a diversified financial
services Company, announced Wednesday that on April 19, 2005,
the Company was informed by a letter from the U.S. Securities
and Exchange Commission (the "Commission") that the Commission
was conducting an informal investigation regarding (i) the April
19, 2005 announcement that the Company would restate its
financial statements, and (ii) the underlying issues addressed
in that press release. The Company intends to fully cooperate
with and assist the Commission in this informal investigation.

The Company, a financial holding Company, is the largest
residential mortgage lender in Puerto Rico, and the parent
Company of Doral Bank, a Puerto Rico based commercial bank,
Doral Securities, a Puerto Rico based investment banking and
institutional brokerage firm, Doral Insurance Agency, Inc. and
Doral Bank FSB, a federal savings bank based in New York City.

CONTACT: Doral Financial Corporation
         Mr. Salomon Levis
         Chairman and Chief
         Executive Officer
         Tel: (787) 474-1111
             or
         Mr. Ricardo Melendez
         Executive Vice President
         and Chief Financial Officer
         Tel: (787) 474-1111


DORAL FINANCIAL: Declares $0.18 per Share Quarterly Dividend
------------------------------------------------------------
Doral Financial Corporation (NYSE:DRL), a diversified financial
services Company, announced Wednesday that the Board of
Directors declared a regular quarterly dividend of $0.18 per
common share to be paid on June 3, 2005 to shareholders of
record on May 16, 2005.

The Company, a financial holding Company, is the largest
residential mortgage lender in Puerto Rico, and the parent
Company of Doral Bank, a Puerto Rico commercial bank, Doral
Securities, a Puerto Rico based investment banking and
institutional brokerage firm, Doral Insurance Agency, Inc. and
Doral Bank FSB, a federal savings bank based in New York City.

CONTACT: Doral Financial Corporation
         Mr. Ricardo Melendez
         Phone: 787-474-6764



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

ANCAP: CEO to Meet With PDVSA, Petrobras Executives Next Week
-------------------------------------------------------------
Mr. Daniel Martinez, the CEO of state oil Company Administracion
Nacional de Combustibles Alcohol y Portland (ANCAP), is
scheduled to meet next with officials from Brazilian and
Venezuelan state oil companies Petrobras and PDVSA respectively
to discuss cooperation agreements.

According to Business News Americas, talks with Petrobras will
take place in Rio de Janeiro and discussions with PDVSA will
take place in Caracas.

The scheduled talks follow up on memorandums of understanding
signed by Uruguay's President Tabare Vazquez with Brazil's
President Luiz Inacio Lula da Silva and Venezuela's President
Hugo Chavez in March-April this year.

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


UTE: Shelves Tender for Contract to Build 400MW Thermo Project
--------------------------------------------------------------
The Uruguayan government, led by President Tabare Vazquez,
ordered state power Company UTE to indefinitely suspend a tender
for a contract to build a 400MW thermoelectric project given the
high costs that the project would have incurred.

Citing a UTE source, Business News Americas reports that the
Company instead will call within the next two weeks for bids for
200MW capacity to be operating by August.

There are no specifications on how many plants should provide
the new 200MW capacity, the source said. Aero-derivative gas
turbines would be located in capital Montevideo and take only
some 70 days to construct.

The source also revealed that the ministry is preparing
legislation that would allow UTE to buy surplus power of up to
50MW from industrial companies. A ballpark reference price for
the purchases is some US$28/MWh, the source revealed.

The purchase of industrial surpluses and the 200MW capacity are
short-term reactions to the combined effects of the drought
affecting Uruguayan hydro plants and the suspension of power
imports from Argentina.



=================
V E N E Z U E L A
=================

PDVSA: Likely to Win Cammesa Fuel Oil Contract
----------------------------------------------
Venezuela's state oil company PDVSA is likely to win a tender to
supply Argentina's wholesale electricity market administrator
Cammesa up to 280,000 tonnes of fuel oil for power generation,
according to Business News Americas.

PDVSA is competing in the tender against Spain's Repsol YPF,
which offered to supply 120,000t; and Glencore, which offered
all the fuel oil that Cammesa could eventually want.

Although both Repsol and Glencore offered a lower price than
PDVSA, neither offered the terms of payment that PDVSA put on
the table, a source close to the process said.

The governments of Venezuela and Argentina signed an agreement
in 2004 by which PDVSA could supply fuel oil to Argentina for up
to three years in annual contracts. PDVSA terms of payment are
for the purchases to be paid for within 12 months at 2% annual
interest.

Moreover, Argentina pays into an account in New York from which
Venezuela can only withdraw money to buy Argentine goods, making
the deal even more attractive to Argentina, the source said.

Cammesa considered the technical aspects of the three bids on
Monday and passed on details to the energy department for its
consideration. An official decision has yet to be made.

CONTACT: Petroleos de Venezuela S.A.
         Edificio Petroleos de Venezuela
         Avenida Libertador, La Campina, Apartado 169
         Caracas, 1010-A, Venezuela
         Phone: +58-212-708-4111
         Fax: +58-212-708-4661
         Web site: http://www.pdvsa.com.ve

                            ***********


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

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