/raid1/www/Hosts/bankrupt/TCRLA

/raid1/www/Hosts/bankrupt/TCRLA_Public/181207.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, December 7, 2018, Vol. 19, No. 243 Headlines B R A Z I L BRAZIL: Industrial Production Rises 0.2% COMPANHIA SIDERURGICA: Fitch Keeps B- LT IDRs on Watch Negative PETROLEO BRASILEIRO: To Boost Asset Sales, Deepwater Investment D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Sugar Oligopoly Could Spook Investments DOMINICAN REPUBLIC: Approved Budget Taps 45% For Social Services M E X I C O MEXICO: Bondholders Oppose Airport Debt Restructuring * MEXICO: Defends Choice of Taibo II as Head of Gov't Publisher P A R A G U A Y PARAGUAY: Floods Leave Riverside Areas Increasingly Unhealthy P U E R T O R I C O HARAS SANTA: Case Summary & 20 Largest Unsecured Creditors X X X X X X X X X LATAM: Rural Areas Slide Back into Poverty - - - - - =========== B R A Z I L =========== BRAZIL: Industrial Production Rises 0.2% ---------------------------------------- EFE News reports that Brazilian industrial production rose by 0.2 percent in October compared to the month before, snapping a three- month losing streak, the government reported. With the positive result, the industrial sector's total growth rate for the first 10 months of the year has exceeded the same period in 2017 by 1.8 percent, according to data provided by the IBGE statistics agency, according to EFE News. COMPANHIA SIDERURGICA: Fitch Keeps B- LT IDRs on Watch Negative --------------------------------------------------------------- Fitch Ratings has maintained Companhia Siderurgica Nacional's Long-Term Foreign and Local Currency Issuer Default Ratings of 'B-', its National Scale rating of 'BB-(bra)' and its 'B-'/'RR4' senior unsecured notes on Rating Watch Negative. The 'B-' rating reflects CSN's stressed financial profile during the past few years due to high leverage and elevated refinancing risks. Weak iron ore prices during 2015/2016, the severe macroeconomic recession in Brazil that led to soft demand for steel products and high interest rates all hurt CSN's cash flow and led to an unsustainable capital structure. The combination of a relatively better scenario for iron ore prices, lower local interest rates and improving steel industry in Brazil has led the company to improve its operating cash flow. These factors, coupled with a reduction in inventory days and lower capital expenditures have allowed CSN to post positive FCF over the LTM ended Sept. 30, 2018, which had been persistently negative. Despite the operational improvements, Fitch believes that asset sales remain imperative in order to effectively deleverage its strained capital structure and provide the framework to proceed with the refinancing of its bonds in the international market. Maintenance of the Negative Watch that has been in effect since December 2017 reflects the ongoing challenges CSN faces with its high refinancing risks and strained financial flexibility. The company has completed 90% of the refinancing of its bank debt during this period, one of the conditions to resolve the Negative Watch and which has provided some relief. The most significant refinancing outstanding involves its USD480 million of notes maturing on Sept. 21, 2019 and USD870 million of notes due in 2020. CSN's delivery of asset sales over the next quarter to provide it with the means to successfully meet these upcoming obligations is vital in stabilizing the rating. Should CSN encounter further delay or difficulty to execute these plans, the ratings may be downgraded. KEY RATING DRIVERS Asset Sales Critical: Delivery of asset sales are crucial in order for CSN to further improve its capital structure and for upcoming negotiations to refinance its USD480 million of notes maturing on Sept. 21, 2019 and USD870 million of notes due in 2020. CSN sold its U.S. subsidiary, Companhia Siderurgica Nacional, LLC (LLC), for USD400 million during May 2018. Completion of additional asset sales such as a sale of an iron ore prepayment agreement, sale of CSN's shares in other steelmaker Usiminas, the port terminal Tecon, and its steel operation in Germany have been sluggish. The delay in asset sales prompts concerns the company will have difficulty refinancing its cross-border issuances over the coming months. Elevated Refinancing Risks: CSN's debt amortization schedule is highly skewed to the short to medium term with amortizations of BRL4.6 billion in 2019; BRL5.9 billion in 2020 and BRL6.4 billion between 2021 and 2022. CSN reported BRL3.9 billion of cash and marketable securities as of Sept. 30, 2018, a very tight position compared to its short-term debt of BRL6.4 billion and total debt of BRL30.1 billion, per Fitch's calculation. During 2019 and 2020, CSN faces BRL4.5 billion of cross-border issuances. Fitch's Base Case assumes CSN will raise cash from asset sales over the next quarter to repay its 2019 notes by the second quarter 2019 and assumes that the company will refinance part of its 2020 international bonds in the next 12 months. Leverage to Decline: Fitch's base case assumption indicates 2019's net leverage will be 5.2x with a mid-cycle price assumption of USD60 per ton. Net leverage would decline to 4.5x in 2019 under a scenario of iron ore price at USD65 and would be 3.9x if prices averaged USD70/ton. These ratios include Fitch's assumption of BRL3.3 billion of asset sales concluded in 2019, lower than management guidance. Excluding these asset sales, net leverage would be 6.1x, 5.2x and 4.5x, respectively. These net leverage ratios represent an improvement from 6.9x during 2017 and 7.2x in 2016. Improvement in Sector Fundamentals: Higher global iron ore and steel prices correspond with an upward trend in domestic steel prices, and a solid recovery in volumes has benefited CSN's operating cash flow generation. Fitch projects that CSN's local steel sales volumes will increase by 12% in 2018, after growing 5% in 2017, mostly reflecting the strong rebound in automobile production in Brazil. As a result, local steel producers have been able to apply several price increases since the mid-2016 due to strong international prices. Fitch expects an average price increase of approximately 8%-10% during 2019. Operating Cash Flow Recovery: CSN's operating cash flow (CFFO) recovery relies on increasing flat steel sales, the ability to continue passing along price increases in the domestic steel segment, manageable coal costs, and sustained iron ore prices above USD60 per ton. Fitch's base case scenario projects CSN's Fitch-adjusted EBITDA at approximately BRL4.3 billion, considering Fitch's iron ore price deck of USD65 for 2018 and EBITDA of BRL3.9 billion considering iron ore price of USD60 for 2019. If iron ore prices average USD65 during 2019, the company's EBITDA would be BRL4.5 billion. At USD70, EBITDA would be BRL5 billion. During the LTM ended Sept. 30, 2018, CSN generated BRL4.0 billion of EBITDA and BRL2.1 billion of CFFO; free cash flow (FCF) was positive BRL420 million, after dividends payment of BRL502 million, per Fitch's calculation. These results compare with BRL3.7 billion, BRL572 million and negative FCF of BRL488 million, respectively, in 2017. Capital Allocation to Drive FCF Trend: Fitch projects CSN to generate positive FCF of around USD230 million during 2018, driven by lower domestic interest rates (2018 interest burden of BRL2.2 billion vs. BRL2.6 billion in 2017), improvement in its cash conversion cycle to below 50 days compared to 67 days in 2017, and lower capex disbursements. Fitch expects FCF to revert to negative in 2019, driven by the assumption of BRL900 million of dividends to be paid next year. Absent Fitch's dividend assumptions and considering capex of BRL1.3 billion, FCF would remain positive in 2019. Working capital requirements will also return since inventories are already at low levels, and accounts receivable will be pressured in order to support continued sales expansion. Good Business Position: CSN's business position as an integrated steelmaker remains solid, underpinned by captive access to raw materials (iron ore/energy), high value-added portfolio of products and an important share in the flat steel industry in Brazil. The company has a diversified portfolio of assets with operations in the mining, steel, energy, cement and interests in railways and ports operations. The company has a poor cost competitive position in its iron ore segment per CRU, operating towards the high end of the iron ore cost curve. Given its integrated steel operations, CSN has a better position in the global HRC curve (first quartile). Largely Dependent on the Brazilian Market: CSN's operations are concentrated in Brazil (around 60% of consolidated historical revenues). As a result, its operations have been significantly impacted by the recessionary environment in the country over the last few years. Flat steel domestic sales in Brazil are strongly linked to macroeconomic performance. During 2013-2016, CSN's flat steel volume sales dropped 40%, while its steel EBITDA declined 23%. For 2017, local flat steel sales started a recovery trend exhibiting a 5% increase. During the nine months ended Sept. 30 2018, local sales grew 11%, mostly influenced by the increase in the auto production in Brazil. DERIVATION SUMMARY CSN's 'B-'/Rating Watch Negative ratings reflect its highly leveraged capital structure and elevated refinancing risks. The company's more integrated business profile and diversified portfolio of assets compares well with Usinas Siderurgicas de Minas Gerais S.A.'s (Usiminas; B+/Positive). Both issuers are highly exposed to the local steel industry in Brazil. CSN and Usiminas show much weaker business position compared to the other Brazilian steel producer Gerdau S.A (Gerdau; BBB-), which has a diversified footprint of operations with important operating cash flow generated from its assets abroad, mainly in U.S., and flexible business model (mini-mills) that allow it to better withstand economic and commodities cycles. From a financial risk perspective, Usiminas and CSN are far weaker than Gerdau, which has been able to maintain positive free cash flow generation, strong liquidity and no refinancing risks over the last few years. CSN's faces elevated refinancing risks in the short to medium term while has the challenge to effectively rebalance its capital structure trough ongoing asset sales. In contrast, after concluding its debt restructuring, Usiminas has a more manageable debt schedule amortization and balanced capital structure. CSN's first quartile position on the hot rolled coil steel cost curve compares similarly to global peers such as PAO Severstal (BBB-/Stable) and U.S. Steel Corp. (BB-/Positive), as the company benefits from its vertical integration and as well as the weak BRL. CSN and Severstal both benefit from a significant share of high value-added products, which make up their sales. CSN exhibits much weaker credit metrics when compared to Severstal (Net Debt / EBITDA greater than 1.0x) and U.S. Steel Corp. (Net Debt / EBITDA greater than 2.0x), and its significant refinancing risks reflect the differential between its rating and its global peers. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case for the Issuer -- 12% increase in steel volumes sold during 2018; -- Average iron ore price of USD65 per ton during 2018 and USD60 per ton in 2019, following Fitch's mid-price assumption; -- Asset sales of BRL3.3 billion within first half of 2019; -- Repayment of 2019 cross-border notes with cash and refinancing of 2020 cross-border notes by year end 2019; -- Dividends of BRL900 million in 2019. KEY RECOVERY RATING ASSUMPTIONS The recovery analysis assumes that CSN would be considered a going concern in bankruptcy and that the company would be reorganised rather than liquidated. Fitch has assumed a 10% administrative claim. Going-Concern Approach: CSN's going concern EBITDA is based on 2015 EBITDA that reflects a scenario of intense volatility in the steel industry in terms of sales volumes and prices, during a period of low iron prices. The going-concern EBITDA estimate reflects Fitch's view of a sustainable, post-reorganisation EBITDA level upon which Fitch's bases the valuation of the company. The EV/EBITDA multiple applied is 5.5x, reflecting CSN's strong market share in the flat steel market and it also reflects a mid-cycle multiple. Fitch applies a waterfall analysis to the post-default enterprise value (EV) based on the relative claims of the debt in the capital structure. Its debt waterfall assumptions take into account the company's total debt at Sept. 30, 2018. The waterfall results in a 42% 'RR4' Recovery Rating for senior unsecured debt. Therefore, the senior unsecured notes due 2019, 2020 and perpetual notes are rated 'B-'/'RR4'. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action -- Delivery of planned asset sales and detailed plan to refinance its cross-border debt; -- Better than expected scenario for the local steel sales in Brazil and healthy iron ore fundamentals, which would lead improvement in FCF and net leverage to below 5.0x on sustainable basis, could lead a positive rating action. Developments That May, Individually or Collectively, Lead to Negative Rating Action -- Unsuccessful refinancing of cross-border bonds before mid- 2019 in the short term; -- Deterioration of the steel industry in Brazil, or inability to proceed with price increases would also pressure free cash flow generation and liquidity, and consequently the ratings. LIQUIDITY CSN reported BRL3.9 billion of cash and marketable securities as of Sept. 30, 2018, a very tight position compared to its short- term debt of BRL6.4 billion and total debt of BRL30.1 billion, per Fitch's calculation. CSN's debt schedule amortization shows high concentration in the short to medium term with amortization of BRL4.6 billion in 2019; BRL5.9 billion in 2020 and BRL6.4 billion between 2021 and 2022. During 2019 and 2020, CSN faces BRL4.5 billion of maturities for cross-border issuances. CSN's debt primarily consists of prepayment export financings (19%), local bank loans (31%), senior notes (23%) and perpetual bonds (13%). The leverage at the shareholder level, which Fitch believes is high, is a concern for Fitch. FULL LIST OF RATING ACTIONS Fitch has maintained the following ratings on Negative Watch: -- CSN Long-term Foreign and Local currency IDRs 'B-'; -- CSN National Long-Term rating 'BB-(bra)' ; -- CSN Islands XI Corp. senior unsecured Long-Term rating guaranteed by CSN 'B-'/'RR4'; -- CSN Islands XII Corp. senior unsecured Long-Term rating guaranteed by CSN 'B-'/'RR4'; -- CSN Resources S.A. senior unsecured USD Note Long-Term rating guaranteed by CSN 'B-'/'RR4'. PETROLEO BRASILEIRO: To Boost Asset Sales, Deepwater Investment --------------------------------------------------------------- Gram Slattery and Alexandra Alper at Reuters report that Brazilian state-run oil company Petroleo Brasileiro SA plans to raise some $26.9 billion via asset sales and partnerships by 2023 while boosting investments on the front edge of an anticipated production boom in Brazil. Petrobras intends to make $84.1 billion in investments from 2019 to 2023, above the $74.5 billion forecast in its 2018 to 2022 plan, it said in a five-year investment program unveiled, according to Reuters. The firm also moderately cut its oil production forecast, but still forecast production to increase by 10 percent next year, and then 5 percent every year through 2023, the report notes. Petrobras is trying to stay the course on efforts to reduce one of the heftiest debt loads among oil companies worldwide -- $88 billion in gross debt -- through divestments and an investment focus on Brazil's coveted offshore pre-salt area, the report relays. "The strategic plan came within the expectations of the market, a reasonable increase in oil prices, with important refining divestments and an ambitious leverage target," said Adriano Pires, a consultant at Brazil's Center for Infrastructure, the report discloses. In a call with investors, Petrobras Chief Financial Officer Rafael Grisolia said the company expects to attract partners for its refineries in the short term, the report relays. While the plan appeared to contain no major surprises, it was released just as prosecutors in Brazil alleged that trading giants Vitol, Trafigura [TRAFGF.UL], and Glencore paid over $30 million in bribes to Petrobras employees, the report says. The allegations are another black eye for Petrobras, which has been at the center of Brazil's sprawling "Car Wash" corruption investigations, and the firm is eager to clean up its image, the report notes. Preferred Brazil-listed shares in Petrobras edged up 0.3 percent in afternoon trade, paring earlier losses, while Brazil's benchmark Bovespa index, the report notes. BVSP was little changed. Whether or not the company sticks to the plan, Mr. Pires added, will depend on the incoming government of right-wing President- elect Jair Bolsonaro, the report says. "The challenge of the next government is to maintain this plan," he added. Mr. Bolsonaro, a former lawmaker and military officer, last month named Roberto Castello Branco, a University of Chicago-trained economist, to succeed current Chief Executive Officer Ivan Monteiro, who is set to step down on Jan. 1, the report relays. While Castello Branco has said he favors selling noncore assets, some of the generals close to Bolsonaro, who see the oil company as a "strategic asset," may put the brakes on any radical restructuring bid, the report notes. Petrobras will maintain its focus on deepwater exploration and production, particularly in Brazil's coveted pre-salt blocks, an offshore area where billions of barrels are locked beneath a thick layer of salt under the ocean, the report notes. Even so, the company reduced its oil production target to 6 percent in annualized growth from 8 percent in its last plan, the report says. "Frankly, I've lost count of how many times the production targets have been slashed over the past five-plus years," said Pavel Molchanov, an energy analyst at Raymond James, the report notes. The oil company also disclosed its return on invested capital should be above 11 percent in 2020, as it sells assets and cuts debt, the report relays. Its ratio of net debt to earnings before interest, taxes, depreciation, and amortization should fall to 1.5 times by the end of that year, it added, from a goal of 2.5 by the end of 2018, the report adds. As reported in the Troubled Company Reporter-Latin America on Feb. 14, 2017, S&P Global Ratings raised its global scale ratings on Petroleo Brasileiro S.A. (Petrobras) to 'BB-' from 'B+', including its corporate credit rating and the ratings on the senior unsecured notes issued through the company's financing vehicles (Petrobras International Finance Co. and Petrobras Global Finance B.V.). =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Sugar Oligopoly Could Spook Investments ----------------------------------------------------------- Dominican Today reports that industrialists warn that as many as seven companies could withdraw their investment from the country over the high cost of sugar caused by an alleged oligopoly in that industry. Their ceasing of operations would affect 6,000 jobs, according to Herrera Industries Association (Aneih) president Antonio Taveras Guzman, according to Dominican Today. He warned that it would affect several segments of national production, including laboratories, soft drink companies and others, which can be attracted to Central America, the report relays. The business leader labeled the price differential, "a non- transparent scheme" of import licenses, which creates "a perverse incentive" to maintain a production aimed exclusively at the export quota to the United States, the report relays. As for the list of companies that would abandon the country, Mr. Taveras said they wouldn't be disclosed due to fear of reprisals, the report notes. The business leader cautioned the Pro-Competitiveness agency to deal with the specific problem and ensure the market's proper functioning, "without distortions in prices," the report adds. As reported in the Troubled Company Reporter-Latin America on Sept. 24, 2018, Fitch Ratings affirmed Dominican Republic's Long-Term, Foreign-Currency Issuer Default Rating (IDR) at 'BB-' with a Stable Outlook. DOMINICAN REPUBLIC: Approved Budget Taps 45% For Social Services ---------------------------------------------------------------- Dominican Today reports that the Senate approved the 2019 Budget of RD$921.8 billion(US$18.4 billion), which includes current expenditure of RD$643.9 billion and capital expenditure of RD$121.5 billion. Senator budget commissioner Dionis Sanchez said the budget's highest allocation is for social services with RD$348.7 billion, or 45.6% of the total expenditure, according to Dominican Today. He said most of the funds would be consigned to education, health and social protection to continue training human capital, expand social programs and increase the coverage of health services, the report notes. In the session, a dissenting report was read by opposition PRM party deputies Ginette Bournigal and Wellington Arnaud, who form part of the bicameral commission, the report adds. As reported in the Troubled Company Reporter-Latin America on Sept. 24, 2018, Fitch Ratings affirmed Dominican Republic's Long-Term, Foreign-Currency Issuer Default Rating (IDR) at 'BB-' with a Stable Outlook. =========== M E X I C O =========== MEXICO: Bondholders Oppose Airport Debt Restructuring ----------------------------------------------------- Jude Webber at The Financial Times reports that holders of more than $1 billion of the bonds issued to finance a new Mexico City airport that President Andres Manuel Lopez Obrador wants to scrap have rejected an offer by the government to buy back some of the debt. The bondholder group said it could not support the plan, which would also alter the terms of the remaining debt-bonds that currently have a claim on revenues from the new airport, according to The Financial Times. The report notes that the group said that it had not been consulted before the plan was made public by the finance ministry and that it "has some concerns such that it cannot support the proposal in its current form". International investors have zeroed in on the airport issue as a test of Lopez Obrador's attitude to the financial markets, amid concern the newly sworn-in leftwing president could take the Mexican economy in a more interventionist and populist direction, the report relays. Lopez Obrador has not formally scrapped the airport project yet, but his decision to uphold the result of an informal "people's poll" that came out against the project in October has nonetheless spooked investors, the report says. A total of $6 billion of bonds were issued to finance the $13 billion Norman Foster-designed airport, which is about a third built and was some 70 per cent financed, the report notes. The new government proposed a buyback of $1.8bn of the bonds and changes to the rest of the debt such that scrapping the new airport would not trigger a default, the report relays. Passenger fees from both the existing airport and new airport project currently serve as collateral for the bonds, as do concessions to operate both locations, the report says. The bondholder group, which is represented by Hogan Lovells law firm, said it was concerned about the removal of collateral, the report discloses. The restructured bonds would not only no longer have the backing of revenues from the new airport, but revenues from the existing airport could also come under threat, the group said, given the president's plan to expand two other airports in the Mexico City area instead, the report says. "The proposed buyback was a walk-back aimed at making bondholders more comfortable, but the longer-term implication of what the government has done is large and it could have significant negative ramifications going forward," said Penny Foley, a portfolio manager at TCW Group Inc, the report relays. Mr. Obrador has said he would save 100 billion pesos by scrapping the new airport and instead revamping the Santa Lucia military airport base, and upgrading an existing airport in the city of Toluca, the report says. Under the government's debt restructuring plan, announced two days after Mr. Lopez Obrador's inauguration, the trust responsible for financing the new airport would purchase $1.8 billion of the bonds at between 90 cents and par, the report notes. Investors have until December 17 to accept the tender offer, and the bondholder group said it was willing to hold talks with the trust, the report relays. Financial markets had on Dec. 3 given an initial welcome to the finance ministry's proposal. A $3 billion bond due in 2047 jumped to as high as 87 cents on the dollar, having been trading at just 75 cents before the announcement, the report relays. However, on Dec. 4, it fell back to 83 cents, the report says. Owners of the bonds include asset managers Schroders, T Rowe Price and Lombard Odier, the report adds. * MEXICO: Defends Choice of Taibo II as Head of Gov't Publisher --------------------------------------------------------------- EFE News reports that Mexican President Andres Manuel Lopez Obrador defended his choice of writer Paco Ignacio Taibo II as head of the Economic Culture Fund (FCE), despite a controversial comment made by the writer that the head of state himself described as "unfortunate." "I would very much like him to take over at the Economic Culture Fund because he is a great writer and an intellectual of the first order, and Paco Ignacio also has a social dimension," Lopez Obrador said in a press conference, according to EFE News. =============== P A R A G U A Y =============== PARAGUAY: Floods Leave Riverside Areas Increasingly Unhealthy ------------------------------------------------------------- EFE News reports that many inhabitants of Asuncion's river banks, known as the Banado Sur district, have been forced to live in the unhealthiest of conditions caused by the stagnant water submerging its streets from the flooding Paraguay River, which has driven 7,500 families out of their homes after rising 5.94 meters (19 1/2 feet). Despite the large number of people relocated that has remained "stable for a month," according to the National Emergency Secretariat (SEN), some families have decided to stay in their homes, either because the water hasn't entered their dwellings yet or for questions of security, according to EFE News. As reported in the Troubled Company Reporter-Latin America on June 28, 2018, S&P Global Ratings, on June 25, 2018, affirmed its 'BB/B' long-and short-term sovereign credit ratings on Paraguay. The outlook remains stable. At the same time, S&P affirmed its 'BB+' transfer and convertibility assessment on Paraguay. ====================== P U E R T O R I C O ====================== HARAS SANTA: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Haras Santa Isabel Inc. PO Box 13398 San Juan, PR 00908 Tel: 787-825-6344 Business Description: Haras Santa Isabel Inc. is a privately held company in Coamo, Puerto Rico in the horse breeding business. The Company previously sought bankruptcy protection on July 27, 2010 (Bankr. D.P.R. Case No. 10-06672). Chapter 11 Petition Date: December 4, 2018 Court: United States Bankruptcy Court District of Puerto Rico (Old San Juan) Case No.: 18-07077 Judge: Hon. Enrique S. Lamoutte Inclan Debtor's Counsel: Charles Alfred Cuprill, Esq. CHARLES A CUPRILL, PSC LAW OFFICES 356 Calle Fortaleza, Second Floor San Juan, PR 00901 Tel: 787 977-0515 Email: cacuprill@cuprill.com ccuprill@cuprill.com Total Assets: $2,579,669 Total Liabilities: $8,787,638 The petition was signed by Maria Teresa Baragano Amadeo, president. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/prb18-07077.pdf List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ Abbey REO PR Corp $2,976,760 7 Metro Office Park Suite 204 Guaynabo, PR 00968 ADM Alliance Nutrition of PR, Inc. Horse Feed $114,000 American Express Corporate Credit Card $17,557 Charges AMG PSC Attorneys at Law Legal Fees $47,051 Banco de Desarollo Economico $1,333,054 PO Box 2134 San Juan, PR 00922-2134 Banco de Desarollo Economico Bank Loan $1,205,566 PO Box 2134 San Juan, PR 00922-2134 Banco Popular de Puerto Rico Line of Credit $40,000 Banco Santander Puerto Rico Bank Loan $279,200 PO Box 362589 San Juan, PR 00936-2589 CRIM $29,850 Departamento del Trabajo Unemployment $23,139 Insurance Department of Treasury of PR Payroll Taxes $91,712 El Borincano Feed Mills Inc. Animal Food $55,777 Eurobank Commercial Loan $88,016 Firstbank Deficiency $19,311 (Car Loan) Gregory Jackson Transportation $38,046 Services Hecto Berrios Fuentes Lawsuit $53,505 Internal Revenue Service Payroll Taxes $126,837 Jose A Santana CPA Accounting $13,440 Services Seminole Horse Feed $37,000 State Insurance Fund Corp. Workmen $140,544 Compensation Insurance ================= X X X X X X X X X ================= LATAM: Rural Areas Slide Back into Poverty ------------------------------------------ Caribbean360.com reports that for the first time in a decade, the number of people falling into poverty in rural Latin America and the Caribbean has increased by two million, according to a United Nations Food and Agriculture Organization (FAO) report, which called the worrying trend a "historical reversal." The first edition of FAO's Panorama of Rural Poverty in Latin America and the Caribbean warned of an historical reversal in the struggle to improve the region's rural, which now totals 59 million people, according to Caribbean360.com. The last regional setback of this magnitude was a result of 2008 international financial crisis, the report notes. "We cannot tolerate that one of every two rural inhabitants is poor, and one-in-five, indigent," said Julio Berdegue, FAO Regional Representative. "Worse still, we have suffered a historical reversal, a break in the trend that makes it clear that we are leaving our rural areas behind," the report relays. According to the report, poverty, insecurity and environmental vulnerability have driven much involuntary migration from the region's rural areas between 2014 and 2016, Caribbean360.com discloses. It indicates that most of the people who leave in Central America flee from rural municipalities, including small towns and cities with less than 100,000 inhabitants, Caribbean360.com notes. "Irregular and insecure migration from the countryside is a social and politically priority," Mr. Berdegue explained, saying the solution lies in "turning rural territories into prosperous and socially cohesive places," Caribbean360.com relays. According to FAO, eliminating rural poverty would help to tackle the illegal activities, including human and drug trafficking, that increase the region's insecurity, Caribbean360.com notes. Even though only 18 per cent of the region's population lives in rural areas, they account for 29 per cent of Latin America's poor. Moreover, 27 million people, or 41 per cent of those who suffer extreme poverty in the region, live in rural areas, the report says. "The countryside and the rural areas are key for the economic growth of the countries, for the development of their exports and for the employment of millions," Mr. Berdegue maintained, the report notes. "It is there that we find the roots of agro-industry -- which drives scientific and technological innovation in the region -- as well as thousands of family farmers that produce the majority of food for local consumption," he added. A key target of the first Sustainable Development Goal (SDG) calls for reducing by at least half the proportion of people living in poverty by the year 2030, the report relays. According to the report, this will be out of reach for several regional countries without major improvement, Caribbean360.com notes. "Without rural development there will be no sustainable development, since 132 of the 169 goals of the SDGs are intimately linked to rural development, and two-out-of-ten goals can only be achieved in these areas," warned Mr. Berdegue, Caribbean360.com adds. *********** Monday's edition of the TCR-LA delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR-LA editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR-LA constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR-LA editor holds some position in the issuers' public debt and equity securities about which we report. Tuesday's edition of the TCR-LA features a list of companies with insolvent balance sheets obtained by our editors based on the latest balance sheets publicly available a day prior to publication. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. Submissions about insolvency-related conferences are encouraged. Send announcements to conferences@bankrupt.com *********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter-Latin America is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA, Marites O. Claro, Joy A. Agravante, Rousel Elaine T. Fernandez, Julie Anne L. Toledo, Ivy B. Magdadaro, and Peter A. Chapman, Editors. Copyright 2018. All rights reserved. ISSN 1529-2746. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR Latin America subscription rate is US$775 per half-year, delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are US$25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. . * * * End of Transmission * * *