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/raid1/www/Hosts/bankrupt/TCRLA_Public/190322.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, March 22, 2019, Vol. 20, No. 59 Headlines A R G E N T I N A ARGENTINA: Monthly Inflation Remains High, IMF Says BUENOS AIRES: Fitch Affirms B Ratings, Outlook Still Negative B R A Z I L AVIANCA BRASIL: Flights Operating Normally After Court Order AVON PRODUCTS: Fitch Affirms 'B+' IDR & Alters Outlook to Negative DESENVOLVE SP: Fitch Affirms Then Withdraws 'BB-/B' IDRs ECONORTE: Fitch Lowers Rating on BRL246MM Debentures to CC(bra) GLOBO: S&P Affirms BB+ ICR on Solid Cash Position, Outlook Stable D O M I N I C A N R E P U B L I C DOMINICAN REPUBLIC: Big Business Split on Medina's Reelection Bid E C U A D O R INTERNATIONAL AIRPORT: Fitch Rates $400MM Sr. Secured Notes 'B' M E X I C O MEXICO: President Signs One-Term Pledge N I C A R A G U A NICARAGUA: Opposition Sets Forth its Agenda in Negotiations P U E R T O R I C O STONEMOR PARTNERS: Needs Additional Time to File its Form 10-K V E N E Z U E L A VENEZUELA: Brazil Says Terrorists Threaten Venezuela - - - - - ================= A R G E N T I N A ================= ARGENTINA: Monthly Inflation Remains High, IMF Says --------------------------------------------------- An International Monetary Fund (IMF) mission led by Mr. Roberto Cardarelli visited Argentina during February 11-22, 2019 to conduct discussions on the Third Review of Argentina's IMF-supported program under the Stand-By Arrangement (SBA). Talks continued in Washington DC after the end of the mission. Mr. Cardarelli issued the following statement today: "IMF staff and the Argentine authorities have reached an agreement on the third review of the economic program supported by the Stand-By Arrangement. Subject to the approval of the Executive Board, Argentina would have access to about US$10.87 billion (equivalent to SDR 7.8 billion). The Executive Board's review is expected in the coming weeks. "We commend the authorities' policy efforts and strong determination to address macro-economic imbalances and advance their economic stabilization plan. The high fiscal and external deficits, the two imbalances at the heart of the 2018 financial crisis, are in the midst of a significant correction. Economic activity has been weak but there are good prospects for a gradual recovery. "Monthly inflation remains high and breaking inflation inertia will be a lengthy process that will require persistence and consistency in the Central Bank's cautious approach to monetary base targeting. Staff, therefore, welcomes the authorities' decision to extend the zero-base money growth until November and to lessen the pace at which the edges of the non-intervention zone will increase. This tightening of the monetary framework will contribute to bringing down inflation and re-anchoring inflation expectations. "The authorities have met their 2018 primary deficit target, demonstrating their resolve to eliminate the vulnerability associated with Argentina's fiscal imbalance. Achieving a zero primary deficit in 2019 will require further restraint in government spending. Such efforts will place Argentina's debt-to-GDP on a decisive downward path. It will be critical that high-impact social spending programs are preserved during the course of this year and beyond. "Staff is supportive of the government's plan to undertake transparent, pre-announced daily FX auctions (of US$60 million per day that start in mid-April) to meet the federal government's fiscal spending needs of US$ 9.6 billion. Insofar as the currency is more appreciated than the central bank's non-intervention zone, sales will be made directly to the central bank in the amount consistent with its announced unsterilized FX purchase policy. The authorities' strategy will allow for a smooth utilization of IMF budget support. "Weak economic activity and high inflation are taking a toll. We strongly support the authorities' efforts to mitigate the social impact of the needed stabilization policies, including through recently announced increases in social spending (which will be accommodated with the program through an increase in the adjustor for social assistance spending from 0.2 to 0.3 percent of GDP). "Continued steadfast implementation of the Argentine government's stabilization plan remains essential to solidify Argentina's return to macroeconomic stability, to lower inflation, and to lay the ground for strong, equitable, and sustainable growth. A new impetus for supply side reforms will also be needed to consolidate the gains already made by the government and to ensure a sustained improvement in the living standards for all of Argentina's citizens. "The mission met with the Minister of the Economy Nicolas Dujovne, the Governor of the Central Bank Guido Sandleris, as well as other government officials and members of the private sector and civil society. The mission team wishes to thank the authorities and all other interlocutors for their warm welcome, constructive dialogue, and cooperative spirit." As reported in the Troubled Company Reporter-Latin America on Nov. 14, 2018, S&P Global Ratings lowered its long-term foreign and local currency ratings on Argentina to 'B' from 'B+' and affirmed its short-term foreign and local currency ratings at 'B'. S&P said, "We also removed the long-term ratings from CreditWatch, where we placed them on Aug. 31, 2018, with negative implications. The outlook on the long-term ratings is stable. At the same time, we lowered our national scale ratings to 'raAA-' from 'raAA'. We also lowered our transfer and convertibility assessment to 'B+' from 'BB-'." S&P said, "The stable outlook reflects our expectation that the government will implement difficult fiscal, monetary, and other measures to stabilize the economy over the coming 18 months, gradually staunching the deterioration in the sovereign's financial profile and debt burden, reversing inflation dynamics, and restoring investor confidence. The combination of lower government financing needs, declining inflation and interest rates, and expectations of continuity in key economic policies after national elections in October 2019 could set the stage for economic recovery and contain external vulnerability. Fitch Ratings affirmed on May 8, 2018, Argentina's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'B' and revised the Outlook to Stable from Positive. On December 4, 2017, Moody's Investors Service upgraded the Government of Argentina's local and foreign currency issuer and senior unsecured ratings to B2 from B3. The senior unsecured shelves were upgraded to (P)B2 from (P)B3. The outlook on the ratings is stable. At the same time, Argentina's short-term rating was affirmed at Not Prime (NP). The senior unsecured ratings for unrestructured debt were affirmed at Ca and the unrestructured senior unsecured shelf affirmed at (P)Ca. As previously reported by the TCR-LA, Argentina defaulted on some of its debt late July 30, 2014, after expiration of a 30- grace period on a US$539 million interest payment. Earlier that , talks with a court-appointed mediator ended without resolving a standoff between the country and a group of hedge funds seeking full payment on bonds that the country had defaulted on in 2001. A U.S. judge had ruled that the interest payment couldn't be made unless the hedge funds led by Elliott Management Corp., got the US$1.5 billion they claimed. The country hasn't been able to access international credit markets since its US$95 billion default 13 years ago. On March 30, 2016, Argentina's Congress passed a bill that will allow the government to repay holders of debt that the South American country defaulted on in 2001, including a group of litigating hedge funds that won judgments in a New York court. The bill passed by a vote of 54-16. BUENOS AIRES: Fitch Affirms B Ratings, Outlook Still Negative ------------------------------------------------------------- Fitch Ratings affirms the City of Buenos Aires' (CBA) ratings at 'B'. The Rating Outlook remains Negative due to the cap from the sovereign rating of Argentina (B/Negative). KEY RATING DRIVERS The affirmation of Buenos Aires' ratings is based on the city's positive and sustained operating margins even in a macroeconomic context of structurally high inflation and currency depreciation. Other factors include the city's low leverage, adequate debt sustainability, and its key economic importance within the national context. The main limitations are moderate unhedged foreign currency debt exposure and high staff expenditure pressures and urban infrastructure needs. Institutional Framework: Weak, Stable Fitch considers Argentina's institutional framework weak given the country's complex and imbalanced fiscal regime with no equalization funding. Recent agreements between the nation and provinces tracked fiscal improvements for most Argentine subnational entities. Fitch believes the sustainability of fiscal improvements will depend on economic activity accompanying the process of fiscal convergence. CBA has high budgetary flexibility and adequate capability to make yearly adjustments, according to 2018 provisory information the city posted a positive overall surplus after net financing equivalent to 3.3% of total revenues, aligned with the Fiscal Pact's principles. Economy: Weak, Stable Buenos Aires is the economic centre and capital of the country and has a diversified economic profile, with business and financial services along with commerce being the main activity drivers. However, Fitch views the economy as weak for all Argentine subnationals compared to international peers, because they operate in a macroeconomic context of volatility, high inflation and currency depreciation, structural characteristics of Argentina's weak economy. Fiscal Performance: Strong, Stable According to provisory fiscal 2018 information, CBA's operating margin reached 23.4% of operating revenues, averaging 14.6% during 2014-2018 and a higher 17% in 2016-2018 after a re-composition of federal automatic transfers from the nation to the provinces and CBA, coupled with expenditure control policies. The city's autonomous status and economic weight translates into a high level of fiscal autonomy, with local revenue providing around 73% of total revenues. Compared with international peers argentine subnationals have structurally high levels of staff expenditure due to inflation pressures, CBA's staff expenditure/total expenditure ratio averaged 46% during 2014-2018. CBA's positive fiscal performance and high tax autonomy will provide buffer against the current macroeconomic recessionary context. Fitch estimates that for 2019 the city's margin will be close to the budgeted 22%, considering a real-term deceleration in operating revenues and expenditure re-composition. Debt and Other Long-Term Liabilities: Neutral, Stable In 2018, direct debt grew about 58% compared to year-end 2017 mainly because of currency depreciation, totalling around ARS104.5 billion equivalent to 42.2% of operating revenues. In the provisory fiscal year-end debt in foreign currency, unhedged, represented 67.6% of direct debt, Fitch estimates that in 2019 the ratio will lower to around 60.5% after the city re-taped a local market bond issuance for an additional ARS13 billion during February, which also proves the entity's favorable market access. Even with currency depreciation and local market rate hikes debt sustainability metrics remain low, at year-end 2018 CBA's debt payback ratio was 2.32x its current balance with a debt servicing coverage ratio of 2.7x its operating balance. CBA's policies aim towards maintaining a coverage level above 2x, Fitch estimates that in 2019 coverage will be above this target and around 2.3x. At year-end liquidity remained at adequate levels, with cash deposits totalling 4.1% of total revenues. CBA has an authorized short-term Treasury bill program for 2019 of ARS15.0 billion to mitigate cash fluctuations, to date around ARS3.7 billion were issued in February and historically treasury bill issuances are low at less than 5% of total revenues. To date, there are no relevant contingent risks for the city's finances. However, Fitch monitors the financial performance of the city's main public entities, including the Bank of the City of Buenos Aires, Autopistas Urbanas, S.A., and the city's subway system. At this time, Fitch believes any possible contingencies are manageable and under control. Management and administration: Neutral, Stable Fitch evaluates this attribute as Neutral. CBA's administration has a proven track record of policy continuity and financial prudence, especially regarding debt policies, which the city constantly seeks to re-profile and improve debt terms and conditions. CBA also funds an important part of its yearly capex with its current balance, and when debt is acquired it is mainly for public investments or debt improvements. Fitch will monitor policy continuity towards the coming years, as 2019 is an electoral year. RATING SENSITIVITIES A downgrade of Argentina's sovereign rating would impact the City of Buenos Aires's ratings, as per Fitch's criteria, which states that no subnational in Argentina can be rated above the sovereign. A stabilization of the Outlook on the sovereign rating would also stabilize CBA's Rating Outlooks. FULL LIST OF RATING ACTIONS Fitch has affirmed the following ratings: -- Long-Term Foreign-Currency IDR at 'B'; Outlook Negative; -- Long-Term Local-Currency IDR at 'B'; Outlook Negative; -- Short-Term Foreign-Currency IDR at 'B'; -- Short-Term Local-Currency IDR at 'B'; -- Euro medium-term note programme (EMTN) up to USD2.29 billion at 'B'; -- Series 11 8.950% senior unsecured notes for USD500 million due 2021 at 'B'; -- Series 12 7.50% senior unsecured notes for USD890 million due 2027 at 'B'. =========== B R A Z I L =========== AVIANCA BRASIL: Flights Operating Normally After Court Order ------------------------------------------------------------ Marcelo Rochabrun at Reuters reports that all Avianca Brasil flights were operating normally, a spokeswoman for the carrier said, a day after a Brazilian appeals judge lifted an order that allowed the carrier to operate 10 of its planes despite missed leasing payments. She added that the decision, which could disrupt the airline's ability to complete scheduled flights, would be appealed, according to Reuters. The ruling, a copy of which was reviewed by Reuters, is the latest development in a bitter legal fight between lessors and the carrier, which is going through bankruptcy protection, the report notes. Avianca Brasil filed for bankruptcy protection in December after falling behind on lease payments for most of its fleet of more than 45 Airbus planes, the report notes. Since then, it has obtained several court rulings that allowed it to hold onto the planes despite vigorous protests from its lessors, the report relays. The appellate judge said the carrier had failed to meet one of the conditions to keep the planes: That it resume and keep up with its regular monthly payments, the report says. Rival airline Azul struck a tentative deal earlier this month to take over most of Avianca Brasil's jet leases and landing slots, the report discloses. That transaction could be formalized in a March 29 bankruptcy court auction, the report says. No other potential bidders have yet publicly come forward, the report relays. Lessor Aircastle Ltd filed the appeal. Avianca Brasil is its single biggest customer and operates 10 Airbus planes owned by Aircastle, the report adds. As reported in the Troubled Company Reporter-Latin America on Dec. 13, 2018, Ana Mano and Marcelo Rochabrun at Reuters said that Brazil's fourth-largest airline, Avianca Brasil, filed for bankruptcy protection, saying its operations had been threatened by potential repossession of aircraft, which could prevent the carrier from continuing to operate. The unlisted airline said in its bankruptcy filing that leasing companies seeking to take back some 30 percent of its all-Airbus fleet threatened its ability to fly some 77,000 passengers in December, according to Reuters. Avianca said in a statement that the bankruptcy filing resulted from a failure to reach a "friendly agreement." It also said its flights would not be affected, the report relayed. The aircraft are still under Avianca Brasil's control for now and it remains unclear what their fate will be as the carrier is asking a Brazilian court to allow it to keep the planes for now, the report noted. The report disclosed that the airline said in the filing it largely blamed high fuel prices and a strong dollar for its troubles. AVON PRODUCTS: Fitch Affirms 'B+' IDR & Alters Outlook to Negative ------------------------------------------------------------------ Fitch Ratings has affirmed Avon Products, Inc.'s (API) Long-Term Issuer Default Rating (IDR) at 'B+'. Fitch has also assigned a 'BB+'/'RR1' rating to Avon International Capital p.l.c.'s (AIC) EUR200 million secured revolving credit facility due February 2022. The Rating Outlook has been revised to Negative from Stable. The Outlook revision to Negative reflects profitability pressures, elevated leverage, accelerated declines in reps and volume, and continued challenges in Brazil, its largest market representing 23% of total revenue. Avon's revenue will continue to exhibit greater volatility due to the company's focus on emerging markets, foreign currency fluctuations and continued declines in active reps and orders, all of which contributed to a 9.5% revenue decline in 2018, which excludes the impact of a new revenue recognition standard (ASC 606). In 2018, Avon's EBITDA declined 29% to USD347 million, FCF declined to negative USD2 million from USD165 million and gross leverage increased to 5.1x from 4.4x relative to 2017. In order to stabilize the Outlook, Avon needs to demonstrate stabilization in reps, volume and organic revenue growth, refinance its USD386 million of 4.6% notes due March 2020 prior to Dec. 15, 2019 to avoid early termination of the RCF and sustain gross leverage in the mid-4x range, implying EBITDA of USD520 million absent any incremental debt reduction. Gross leverage sustained at or above 5x would likely result in a downgrade. KEY RATING DRIVERS Profitability Pressures: Avon's EBITDA declined to USD347 million, or 29%, in 2018 compared with Fitch's expectations for relatively flat EBITDA on a like-for-like (LFL) basis, which excludes the effects of ASC 606. Revenue was in-line with Fitch's 2018 forecast but margins declined markedly in the second half of 2018 due to adverse foreign exchange movements, increased investments in representatives and advertising, and supply chain inflation in material and logistics costs, partially offset by cost reduction initiatives. On a LFL basis, EBITDA margin in the second half of 2018 declined 320 basis points to 7.1% versus the corresponding year-ago period, resulting in a full year 2018 EBITDA margin of 6.9%, which is 193 basis points less than the 8.8% achieved in 2017. Fitch estimates negative FX and operational challenges accounted for 49% and 51%, respectively, of the nearly USD143 million year-over-year decline in EBITDA in 2018. There is increased risk that greater-than-anticipated supply chain inflation may mitigate the benefits of Avon's cost reduction initiatives, which are required to offset increased investments associated with the company's Open Up Avon strategy. This would make it more challenging for the company to improve its profit margin and FCF, particularly if revenue trends remain negative. Elevated Leverage: As a result of the aforementioned profitability pressures, Avon's gross leverage increased to approximately 5x, the upper end of Fitch's negative rating sensitivity, at year-end 2018 compared with 4.4x in 2017, despite USD300 million of debt reduction in 2018. Fitch estimates year-over-year gross leverage remained flat at 4.4x in 2018, excluding the negative effects of foreign currency fluctuations. Fitch forecasts gross leverage will remain relatively flat at approximately 5x in 2019 due to continued FX headwinds in the first half of 2019 and inflationary pressures, partially offset by cost savings and pricing actions to mitigate inflation. The company has the option of pursuing incremental debt reduction in the first half of 2019 funded with at least USD60 million of proceeds from asset sales. The company's decision to repay incremental debt using divestiture proceeds is contingent on market conditions in 2019 when the company seeks to refinance its USD386 million of sr. unsecured notes due in March 2020. Accelerated Declines in Reps and Volume: Declines in certain of Avon's key performance indicators (KPIs) accelerated in the second half of 2018, particularly active representatives and volume, despite turnaround efforts made to date. Active reps declined nearly 6% in the second half of 2018 led by South Latin America (largely Brazil), down 7%, and EMEA (largely Russia), down 6%. Avon's total active reps declined to approximately five million at year-end 2018 compared with approximately six million at year-end 2017. Lack of improvement in active reps and volume may jeopardize Fitch's expectations for gradual improvement in organic revenue growth trends on a constant currency basis through 2022 and potentially result in negative rating actions. On the positive side, revenue declines attributable to lower reps and volume in the fourth quarter of 2018 were mitigated by increasing rep productivity as evidenced by 4% growth in average rep sales, which also bodes well for rep retention, and 6% increase in price/mix due to greater product bundling and enhanced revenue management, including inflationary pricing in Argentina. Brazil Underperforms Key Markets: Brazil is Avon's largest (23% of revenue) and worst performing market relative to Avon's top five markets, reflecting the scale and depth of the challenges in Brazil. Quarterly revenue from Brazil has declined at a mid- single to low double-digit rate at constant currency since the second quarter of 2017. Avon's results in Brazil continue to be negatively affected by competitive pressures, a difficult macroeconomic environment, weaker volume and lower appointments of new representatives, partly attributable to stricter credit requirements. Avon appointed a new general manager in Brazil, effective Sept. 17, 2018, to lead the company's efforts to improve service quality and training for reps. Downsized RCF Reduces Liquidity: Avon International Capital p.l.c. (AIC), obtained a new EUR200 million, or USD230 million, senior secured RCF due Feb 2022, which replaced a prior USD400 million secured RCF. Borrowings under the new RCF are available for general corporate and working capital purposes. The credit implications of the downsized RCF are partially offset by greater flexibility to issue secured debt to refinance existing borrowings. The prior facility restricted secured borrowings to a USD600 million basket, of which Avon had previously issued USD500 million of secured debt due August 2022, which limited the company's ability to issue incremental first-lien secured debt to refinance existing unsecured debt. The new RCF credit agreement allows incremental secured debt beyond Avon's existing secured debt, consisting of the secured RCF and USD494 million of secured notes due August 2022, and is a Euro-denominated facility, which more closely aligns the company's capital structure to its operations. Refinancing Risk: Avon's EUR200 million RCF is subject to early termination in mid-December 2019 if the company fails to redeem, repay or otherwise refinance in full its USD387 million of unsecured notes due March 2020 by Dec. 15, 2019. In addition to first-lien debt, AVP also has the flexibility to issue second-lien debt to refinance the notes due 2020. Increased Investments to Support Strategy: Avon's strategy to strengthen the company's competitive position and modernize the core business requires USD300 million of incremental investments, including USD230 million of capex, from 2019-2021. The investments will be in two areas: commercial spend and digital/IT infrastructure. Commercial spend consists of tools and training for reps, advertising to modernize the Avon brand, processes to accelerate the pace of product innovation, new expansion into markets, such as China and India, and channel investments, primarily e-commerce. Digital and IT infrastructure spend targets data center modernization and digital tools, including individual, personalized on-line store pages for reps, new mobile tools to assist with the rep's sale process, analytics and digital marketing. Fitch expects the costs of these investments will be cash flow neutral in aggregate through 2021 due to USD400 million of targeted costs savings across manufacturing, distribution, procurement, back office, as well as lower taxes and interest expense due to Avon's early debt prepayment in June 2018. FX, Emerging Markets Exposure: Avon's revenue base is geographically diverse, selling or distributing products in 56 countries and territories. Avon's top-10 markets, mostly emerging markets, account for 70% of revenue. Latin America represents 52% of revenue, with Brazil, the single largest market, contributing 23% of total revenue in 2018. Negative FX translation has an outsized impact on Avon's financials as most its cash flows and profits are generated outside the U.S. Economic and political volatility also can have a significant impact. Strong Competition: The beauty industry is structurally attractive and tends to be a resilient category throughout economic cycles, but it's a highly competitive market, the degree of which varies by Avon's end market. Avon's competitors include large and well-known cosmetics, fragrance and skincare companies and niche firms that have benefitted from lower barrier to entry due to low cost marketing via social media. Avon's competes with other direct selling companies as well as products sold to consumers via alternate distribution channels, including e-commerce, mass market retail and prestige retail. DERIVATION SUMMARY Avon's rating (B+/Stable) reflects its significant scale as a leading direct-selling beauty company with USD5.4 billion revenue in 2018 and its well-recognized brand in the beauty industry. The Outlook revision to Negative reflects profitability pressures, elevated leverage, accelerated declines in reps and volume, and continued challenges in Brazil, its largest market representing 23% of total revenue. Avon's revenue and profitability will continue to exhibit greater volatility due to the company's focus on emerging markets, foreign currency fluctuations and continued declines in active reps and orders, all of which contributed to a 9.5% revenue decline in 2018. In 2018, Avon's EBITDA declined 29% to USD347 million, FCF declined to -USD2 million from USD165 million and gross leverage increased to 5.1x from 4.4x relative to 2017. In order to stabilize the Outlook, Avon has to demonstrate stabilization in reps, volume and organic revenue growth, refinance its USD387 million of 4.6% notes due March 2020 prior to Dec. 15, 2019 to avoid early termination of the RCF and sustain gross leverage in the mid-4x range. Gross leverage sustained at or above 5x would likely result in a downgrade. In terms of comparable companies, Fitch rates Anastasia Intermediate Holdings, LLC's (ABH), a prestige cosmetics brand primarily focused in the U.S., 'BB-'/Stable Outlook. The ratings reflect the company's strong track record of growth and customer connections, good financial profile including above-average EBITDA margin, positive FCF and leverage of mid-3x following a debt-financed dividend. Fitch projects leverage will trend toward high 2x over the next two to three years. The rating also considers the company's narrow product and brand profile, recent explosive growth that could reverse course, and risk that continued beauty industry market share shifts could weaken ABH's projected growth through the risk of new entrants or existing players regaining share. KEY ASSUMPTIONS Fitch's Key Assumptions Within Its Rating Case For The Issuer To Stabilize the Outlook Include: -- Revenue is forecast to decline nearly 7%, including a 5% point headwind from FX, to USD5.1 billion in 2019 and remain relatively flat through 2022, barring further currency movements; -- Operating EBITDA is forecast to be approximately USD365 million in 2019 and approximately USD450-USD475 million through 2022 due to cost savings, enhanced revenue management and increasing rep productivity; -- Fitch expects the incremental investment plan, which also includes USD230 million of capex and USD130 million for cash restructuring, will be cash flow neutral through 2021 due to expense reductions, working capital improvements from inventory, tax planning and lower interest expense; -- FCF is expected to be approximately USD30 million in 2019, including approximately USD130 million of cash restructuring charges and incremental capex associated with Avon's investment plan. Fitch expects FCF will increase to approximately USD100 million in 2020, reflecting EBITDA margin expansion and lower cash restructuring costs, and exceed USD150 million in 2021 and 2022. Fitch assumes the company's dividend remains suspended throughout the forecast period and cash interest on the cumulative preferred stock continues to be deferred; -- Fitch expects gross leverage (total debt to operating EBITDA) to remain flat in 2019 at approximately 5.0x and decline to the low 4.0x range through 2022. RATING SENSITIVITIES Future Developments That May, Individually or Collectively, Lead to Stabilization of the Rating -- Signs of stabilization in reps, volume and organic revenue growth; -- Refinances USD387 million of 4.6% notes due March 2020 prior to Dec. 15, 2019, which also avoids early termination of the RCF; -- Gross leverage (total debt to operating EBITDA) in the mid-4x range; -- Lease adjusted gross leverage (total adjusted debt/EBITDAR) of 5x. Future Developments That May, Individually or Collectively, Lead to Positive Rating Action -- Flat-to-modestly positive reps and volume growth as well as low-single digit organic growth; -- Gross leverage of 3.5x; -- Lease adjusted gross leverage of 4x; -- FCF margin sustained at or above 1.5%. Future Developments That May, Individually or Collectively, Lead to Negative Rating Action -- Accelerating declines in key performance indicators in 2019, particularly active reps and orders, which would indicate a greater probability of extended declines in revenue; -- Significant currency challenges in key markets, such as Brazil or Russia, which affect Avon's ability to service its dollar-denominated debt; -- Sustained increase in gross leverage and lease adjusted gross leverage over 5.0x and 5.5x, respectively; -- Sustained FCF margin less than 1%. LIQUIDITY Adequate Liquidity: As of Dec. 31, 2018, Avon had nearly USD533 million of cash and USD201 million in revolver availability, net of USD29 million in outstanding letters of credit. The new senior secured revolving credit facility has total capacity of EUR200 million, or USD230 million, and expires in February 2022, provided that it shall terminate on the 91st day prior to the maturity of the 4.60% Notes due 2020, if on such 91st day, the applicable notes are not redeemed, repaid, discharged or otherwise refinanced in full. New EUR200 million Senior Secured RCF: Avon's U.K.-based financing subsidiary, Avon International Capital p.l.c. (AIC), obtained a new three-year EUR200 million, or USD230 million, senior secured RCF, which replaced a prior USD400 million secured RCF. Borrowings under the new RCF are available for general corporate and working capital purposes. The RCF maturity date is not to exceed (a) the maturity date of Feb. 12, 2022 and (b) the date falling 91 days prior to the final scheduled maturity date of the existing USD387 million of outstanding notes due March 15, 2020, which equates to Dec. 15, 2019, if the notes have not been redeemed, repaid or otherwise refinanced in full on such date. The credit implications of a downsized RCF are partially offset by greater flexibility to issue secured debt to refinance existing borrowings. The prior facility restricted secured borrowings to a USD600 million basket, of which Avon had previously issued USD500 million of secured debt due August 2022, which limited the company's ability to issue incremental secured debt to refinance existing unsecured debt. Furthermore, the new RCF is a Euro-denominated facility, which more closely aligns the company's capital structure to its operations. All obligations of AIC under the 2019 facility, and AIO under the senior secured notes are unconditionally guaranteed by the API, AIO and each other material United States or English restricted subsidiary of the API (collectively, the Obligors), in each case, subject to certain exceptions. The obligations of the Obligors are secured by first priority liens on and security interests in substantially all of the assets of the Obligors, in each case, subject to certain exceptions. Capital Structure: As of Dec. 31, 2018, Avon had total debt principal outstanding of USD1.8 billion, consisting of USD500 million of senior secured bonds due 2022, USD1.09 billion of senior unsecured bonds, and USD492 million of preferred stock (includes accrued dividends), which Fitch assigned 50% equity credit. AIC is the borrower for the revolving credit facility, AIO is the borrower for the senior secured notes, whereas the senior unsecured notes are obligations of the parent, Avon Products Inc. The revolving credit facility contains a minimum interest coverage ratio and a maximum total leverage ratio. Recovery Analysis: Fitch's recovery analysis assumes USD370 million of operating EBITDA on a going concern basis. The going concern EBITDA assumes the company exits smaller or underperforming markets, potentially including Brazil, and the remaining markets benefit from greater senior management attention and allocation of financial resources, resulting in an operating profit margin in the low teens on a smaller revenue base of approximately USD3.5 billion. Fitch then applies a recovery multiple of 4x, resulting in an estimated enterprise value (EV) of nearly USD1.5 billion. The recovery multiple of 4x EV/EBITDA multiple is at the low end of recent consumer products transactions, but considers Avon's operating challenges, particularly top-line growth, reliance on a single distribution channel (direct selling) and greater relative risk profile due to its emerging market focus. AIC's senior secured revolver and AIO's senior secured notes are expected to have outstanding recovery prospects (91%-100%) and as such are rated 'BB+'/'RR1' with 100% recovery prospect. The RCF is secured by first-priority liens on and security interests in substantially all of the assets of AIC, the subsidiary guarantors and by certain assets of API, in each case, subject to certain exceptions and permitted liens. The collateral package for the senior secured notes consists of the equity of AIO and Avon Capital Corp. and the intellectual property rights of AIO. Avon's senior unsecured notes are perceived to have good recovery prospects (51%-70%) due to Avon's repayment of USD300 million of unsecured debt in 2018. However, Fitch believes there is a strong possibility that Avon issues secured debt to refinance its existing unsecured debt in 2019 and, therefore, assumes average recovery prospects (31%-50%) for the unsecured debt ('B+'/'RR4') and recovery is based on the midpoint (40%) of the 'RR4' recovery range. FULL LIST OF RATING ACTIONS Fitch has affirmed these ratings: Avon Products, Inc. -- Long-Term IDR at 'B+'; -- Senior unsecured notes at 'B+'/'RR4'. Avon International Operations, Inc. -- Long-Term IDR at 'B+'; -- Senior secured notes at 'BB+'/'RR1'. Fitch has assigned this rating: Avon International Capital p.l.c. -- Senior secured revolver at 'BB+'/'RR1'; The Rating Outlook has been revised to Negative from Stable. DESENVOLVE SP: Fitch Affirms Then Withdraws 'BB-/B' IDRs -------------------------------------------------------- Fitch Ratings has affirmed and withdrawn the ratings for Desenvolve SP - Agencia de Fomento do Estado de Sao Paulo SA's (Desenvolve SP). Fitch is withdrawing the ratings for commercial reasons and will no longer provide ratings (or analytical coverage) for the issuer. KEY RATING DRIVERS The affirmation of Desenvolve SP's ratings reflects limited change in its credit profile since Fitch's last review on Dec. 17, 2018. The Rating Outlook was Stable prior the withdrawal. RATING SENSITIVITIES Rating Sensitivities do not apply as the ratings have been withdrawn. Fitch has affirmed and withdrawn the following ratings: Desenvolve SP - Long-term Foreign and Local Currency IDRs at 'BB-' - Short-term Foreign and Local Currency IDR at 'B' - Support Rating at '3' - National Long-Term Rating at 'AA(bra)' - National Short-Term Rating at 'F1+(bra)' ECONORTE: Fitch Lowers Rating on BRL246MM Debentures to CC(bra) --------------------------------------------------------------- Fitch Ratings downgraded from CCC (bra) to 'CC (bra)', the National Long-Term Rating of the third issuance of debentures issued by Companhia Concessionaria de Rodovias do Norte SA (Econorte) in the amount of BRL246 million and maturing in 2020. MAIN RATIONALE RATIONALE The lowering of the rating of the third issue of Econorte's debentures reflects the increase in uncertainty regarding the payment of the debt resulting from the inability to fill the payment account, as a consequence of the reduction in cash generation of the project. Despite the reversal of the tariff discount, the low liquidity is a result of the lack of reopening of the Jacarezinho or Cambara toll plazas in the State of Parana. Predicting the difficulties of filling the payment account in March, Econorte convened a general meeting of debenture holders, which approved the "waiver" of this obligation for sixty days. In return, the debenture holders requested partial payment of the installment of the maturing debt service in April 2019. Payment was made with the cash that was available in the payment account, and corresponded to approximately 83% of the estimated amount. Fitch expects the concessionaire to seek a debt restructuring to accommodate the amortization of the debentures to the company's new cash generation profile. RATING SENSITIVITY Developments that may, individually or collectively, lead to a positive rating action include: - A rating upgrade is unlikely in the short term. Developments that may, individually or collectively, lead to a negative rating action include: - Announcement of a plan to restructure debt, setting up Distressed Debt Exchange (DDE). - Default or Standstill in the residual debt service of April 2019. - Announcement of request for judicial recovery. GLOBO: S&P Affirms BB+ ICR on Solid Cash Position, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings revised downward Globo's stand-alone credit profile (SACP) to 'bbb' from 'bbb+' on weaker profitability prospects. Still, S&P affirmed its 'BB+' issuer credit and issue-level ratings on the company. The stable outlook primarily reflects the company's exceptional liquidity that would allow it to focus on improving profitability without significant financial pressure or refinancing risk. S&P expectd Globo to post EBITDA margin slightly below 15% in the coming years, compared with a record low of 9.9% in 2018. S&P said, "We believe Globo will continue facing challenges to improve and stabilize profitability in the next two years, mainly due to the still depressed advertising market in Brazil and the company's relatively high fixed-cost structure. Globo implemented some efficiency measures in the past years, such as labor force reduction and revision of third-party contracts. However, these measures weren't enough to offset the high-cost structure to support future growth and long-term contracts with strategic casting, authors, and producers. Consequently, we now forecast Globo to post EBITDA margin of 13.0%-14.5% in the next two years. Weaker profitability prompted our revision of Globo's business risk profile to fair from satisfactory, and consequently, its stand-alone credit profile to 'bbb' from 'bbb+'." =================================== D O M I N I C A N R E P U B L I C =================================== DOMINICAN REPUBLIC: Big Business Split on Medina's Reelection Bid ----------------------------------------------------------------- Dominican Today reports that prominent business leaders expressed their for-and-against president Danilo Medina's reelection during the inaugural of a soft drink company's new production line. However, National Business Council (Conep) vice president Cesar Dargam, said it's not the time to talk about the Constitutional amendment needed to reelect the president, according to Dominican Today. For Campos de Moya, of the Vinci group, on a personal level he agrees with the reelection, citing the country's economic growth, the report notes. The report relays that Mr. Dargam said the President's reelection is not on Conep's agenda but respects individual positions voiced by some of its members. "In the Conep we have prioritized for this year that Congress can expedite a productive agenda," the report quoted Mr. Dargam as saying. The report relays that business leader Circe Almanzar agrees, "I'm proud that the Dominican economy keeps growing and the need to continue supporting the investment and the measures that the Competitiveness Council is adopting to continue creating jobs." "We're in competitiveness and productivity and we're not going to wrap ourselves with the issue of the political agenda. "For this growth is why all Dominicans have to work regardless of who you are, whoever comes, whoever is behind, who can be in front," she said, as quoted by Diario Libre, 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. ============= E C U A D O R ============= INTERNATIONAL AIRPORT: Fitch Rates $400MM Sr. Secured Notes 'B' --------------------------------------------------------------- Fitch Ratings has assigned a 'B' rating to the fixed-rate senior secured notes (the notes) for USD400 million issued by International Airport Finance S.A. (the issuer) in connection with Corporacion Quiport S.A. (Quiport), the concessionaire of Ecuador's Aeropuerto Internacional Mariscal Sucre. The Rating Outlook is Negative. KEY RATING DRIVERS Summary: The rating reflects Quiport's strategic but somewhat modest traffic base, comprising mostly origin and destination (O&D) and leisure-oriented passenger traffic, a history of moderate volatility, and some competition from Guayaquil's Jose Joaquin de Olmedo International Airport, the country's second largest airport. It also reflects a tariff setting mechanism that allows for adjustments for local and U.S. consumer prices and the rated debt's strong structural features. The rated debt has no refinancing risk and includes additional liquidity, most notably a 12-month offshore Debt Service Reserve Account (DSRA) and a capex reserve account covering staggered percentages of the next 18 months of capex needs. Quiport's ability to service its debt can withstand domestic economic shocks, supported by the participation of international traffic-related revenues of over 50% of total revenue and the proven resiliency of the concession framework to adverse political environments. Break-even analysis shows minimal dependency on domestic traffic and no dependency on international traffic growth. Average rating case debt service coverage ratio (DSCR) is 1.8x, while minimum DSCR is 1.4x in year 2032; maximum leverage, measured as net debt to cash flow available for debt service (CFADS), is 4.5x in year 2020. Credit metrics are commensurate with higher ratings according to Fitch's applicable criteria. An additional layer of comfort is provided by the eight-year tail before the concession's maturity. However, the rating is constrained by Ecuador's sovereign risk. The presence of a 12-month DSRA provides sufficient liquidity to preserve debt service should short lived capital controls be imposed, supporting a rating of 'B' with a Negative Outlook, one notch above Ecuador's Country Ceiling (B-). The Negative Outlook on the notes reflects the Negative Outlook on Ecuador's Long-Term Foreign-Currency Issuer Default Rating (LT FC IDR) of 'B-'. O&D, Leisure-Oriented Airport - Revenue Risk: Volume - Midrange The airport is located in Quito's metropolitan region, which accounts for 16% of the country's population (2.7 million people), and has an enplanement base of 2.6 million paying passengers (pax). The airport's traffic base is mostly O&D, with leisure-oriented exceeding business traffic. Traffic volatility is moderate with the largest historic peak to trough of 13.7% occurring between 2014 and 2016, with traffic yet to recover. Positively, traffic increased between 2017 and 2018. Carrier concentration in terms of revenue is low. There is some competition from Ecuador's second largest airport, Guayaquil's Jose Joaquin de Olmedo International Airport. Dual Till Regulation - Revenue Risk: Price - Midrange Regulated revenue tariffs are readjusted according to inflation in Ecuador and the U.S., and commercial revenues have no tariff-setting restrictions. The framework does not include a price recovery model or an adjustment mechanism for declines in pax. Modern Infrastructure - Infrastructure Development/Renewal: Stronger The airport is modern and well-maintained and has detailed short- and long-term expansion plans. Future expansions are to be funded with internal cash flow generation, while the associated expenditures are smoothed through a rolling capex reserve. The concession framework does not provide a recovery of expenditures via rate adjustment. Fully Amortizing Debt Structure - Debt Structure: Stronger Senior secured debt composed of a single U.S. Dollar-denominated tranche with a fully amortizing repayment profile. Structural features include offshore debt service, O&M, maintenance and capex reserve accounts, as well as robust debt incurrence and dividend distribution tests. Financial Profile Rating case financial metrics are consistent with higher ratings, according to applicable criteria for airports with midrange attributes for volume and price risks. Leverage, measured as net debt to CFADS, is 4.5x at its maximum in year 2020 and decreases progressively. Coverage, measured as average DSCR for 2019-2033, is at 1.8x, while minimum DSCR is at 1.4x for 2032. PEER GROUP Quiport's closest peer is ACI Airports Sudamerica (ACI; BBB-/Stable), the indirect owner of Puerta del Sur S.A., who holds the concession for Montevideo's Carrasco International Airport in Uruguay. Both airports are the main international gateways to their countries, and both are O&D assets that share volume and price risk attributes. Conversely, Quiport is more exposed to leisure-oriented traffic than ACI. Maximum leverage at Quiport is expected to be 4.5x in 2020, slightly higher than ACI's 4.4x. ACI's average DSCR for 2019-2031 is 1.5x, lower than Quiport's 1.8x. Sovereign risk is materially different for the two projects, with Quiport located in Ecuador (LT FC IDR: B-/Negative; Country Ceiling: B-) and ACI in Uruguay (LT FC IDR: BBB-/ Negative; Country Ceiling: BBB+). RATING SENSITIVITIES Future developments that may, individually or collectively, lead to negative rating action: -- A negative rating action on Ecuador's sovereign rating; -- Severe and prolonged traffic underperformance with respect to Fitch's rating case. Future developments that may, individually or collectively, lead to positive rating action: -- A positive rating action on Ecuador's sovereign rating. TRANSACTION SUMMARY The issuer used the net proceeds of the notes to (i) irrevocably purchase and assume all of Quiport's existing lenders' rights and obligations under the existing loans, and (ii) make new loans to Quiport (the new loans). Quiport applied part of the proceeds of the new loans to repay in full all amounts outstanding under its intercompany loans and for certain general corporate purposes and will apply the reminder of the proceeds to make a retained dividend earnings distribution to its shareholders following completion of its corporate reorganization,. The aggregate principal amount of the new loans will equal the aggregate principal amount of the notes. Aeropuerto Mariscal Sucre is Ecuador's main airport, with 48% of the country's offer (6.2 million seats), and acts as its main international gateway both for passengers and cargo. The airport is owned by Empresa Publica Metropolitana de Servicios Aeroportuarios - Municipality of Quito (EPMSA) and is currently operated by Quiport under a 35-year concession agreement; the airport will be handed back to EPMSA at the end of the concession in 2041. The concession included the administration and maintenance of the old airport until cease of operations. It also included development, design, financing and construction of the new airport, as well as its operation, administration, and maintenance once completed and until January 2041. Quiport transitioned to the new airport in 2013, with operations in the old airport ceasing that same year. The new airport allows more efficient and safer operations (larger runaway and capacity for larger planes to operate), adaptable facilities (land available for expansions), and compliance with all international regulations. Fitch Cases Key Assumptions: -- Inflation rate for base case (BC) and rating case (RC) in Ecuador: 2019: 0.5%; 2020: 1.5%; onward: 2.0% / year; -- Inflation rate for BC and RC in the U.S.: 2019: 2.1%; 2020 onwards: 2.0% / year; -- International PAX compounded average growth rate (CAGR): 3.5% (BC); 1.3% (RC); -- Domestic PAX CAGR: 3.2% (BC); 1.0% (RC); -- Opex: +3% (BC); +5% (RC); -- Capex: +3% (BC); +5% (RC); -- Litigations Cost: 0 (BC); USD100 million amortized over 10 yearly payments of USD10 million (RC). Credit Metrics: -- Average DSCR: 2.2 x (BC); 1.8x (RC); -- Minimum DSCR: 1.9x (BC); 1.4x (RC); -- Net Debt / CFADS: 3.8x (BC); 4.5x (RC). Break-even analysis is performed on each of the Quiport's main risk factors while using base case assumptions for the other variables; break-evens represent the compounded average growth or decrease rate of a single variable up until the year in which the transaction no longer supports additional stresses in the relevant variable. The additional liquidity in the transaction, mainly present in the expansion capex reserve account and the DSRA, provides enough support for it to withstand stresses in the key variables as well as short lived capital controls. Break-even results and the corresponding year are: -- International pax growth: -7% - 2031 -- Domestic pax growth: -100% -- Opex: +180% - 2020 -- Capex: +270% - 2032 Security The notes are secured for the benefit of the noteholders by a first-priority security interest in (a) all of the capital stock of the issuer, (b) the issuer's rights under the new loans, (c) the issuer's debt service payment account and DSRA and amounts on deposit therein, (d) all of the capital stock of Quiport, (e) subordinated indebtedness incurred by the issuer or Quiport (with limited exceptions) and (f) any proceeds of the foregoing clauses. =========== M E X I C O =========== MEXICO: President Signs One-Term Pledge --------------------------------------- EFE News reports that President Andres Manuel Lopez Obrador signed a letter pledging not to seek a change to Mexico's constitution that would allow him to seek a second term. "We are going to sign a document, a commitment to the people of Mexico. I will read it and I will sign it so it can be published and there is proof," he said during his morning press conference, according to EFE News. The lower house of Congress approved a constitutional amendment to allow a referendum at the midpoint of the six-year presidential term, giving voters the chance to decide whether the incumbent should remain in office, the report notes. The proposal is now before the Senate. According to the report, critics say the real intent of the initiative is to open the door to the possibility of presidential re-election. In the letter he signed in front of reporters, Lopez Obrador stressed that he submitted to a recall vote during his 2000-2005 tenure as Mexico City mayor and he had "reiterated that commitment in the three subsequent presidential campaigns," the report says. "I was elected for a six-year presidency, but according to the constitution, the people have the right and the possibility to change their government," he said of the referendum he plans for 2021, the report discloses. The leftist president dismissed as "unfounded" the suggestion that the proposed amendment represents a stealth attempt to eliminate the existing one-term limit, the report relays. The report notes that Lopez Obrador said that, like President Francisco I. Madero, who was assassinated in 1913, he believes that "power only has meaning and virtue when it is placed at the service of others." "I think that six years are enough to uproot corruption and impunity. And to transform Mexico into a prosperous, democratic and fraternal republic. I have no doubt we will have enough time to consummate the fourth transformation of the country's public life," he said, the report relays. Lopez Obrador added that he does not favor eliminating term limits for public office "under any circumstances," the report relays. "Understand, conservative gentlemen, that I will leave the presidency on the exact day set by the supreme law, and in 2024 I will go to Palenque," he said, referring to the town in the southern state of Chiapas where he has a ranch, the report notes. By 2024, he said, he hopes to have effected sufficient change to prevent Mexico from slipping back "into the stultifying and sad times when the mafia of power dominated," the report adds. ================= N I C A R A G U A ================= NICARAGUA: Opposition Sets Forth its Agenda in Negotiations ----------------------------------------------------------- EFE News reports that the opposition Civic Alliance for Justice and Democracy set forth its agenda in its negotiations with the Nicaraguan government to overcome the local crisis, noting that, besides expected court proceedings and elections, it desires the presence of international actors and guarantees that any agreements reached with the Daniel Ortega regime will be fulfilled. In a communique read by constitutional expert and Alliance member Azahalea Solis, the opposition movement explained the five points of its agenda whereby it seeks to establish democracy in Nicaragua and obtain justice for the victims of violence, according to EFE News. As reported in the Troubled Company Reporter-Latin America on Jan. 29, 2019, Moody's Investors Service has changed the outlook to negative from stable on the Government of Nicaragua's long-term issuer ratings and affirmed the ratings at B2. ===================== P U E R T O R I C O ===================== STONEMOR PARTNERS: Needs Additional Time to File its Form 10-K -------------------------------------------------------------- StoneMor Partners L.P. has filed a Notification of Late Filing on Form 12b-25 with respect to its Annual Report on Form 10-K for its fiscal year ended Dec. 31, 2018. StoneMor Partners was unable to file its Annual Report by the prescribed filing deadline (March 18, 2019) without unreasonable effort or expense due to additional time needed for the Partnership to compile and analyze certain information and documentation and complete preparation of its financial statements in order to permit the Partnership's independent registered public accounting firm to complete its audit of the financial statements to be included in the Form 10-K and complete its audit of the Partnership's internal controls over financial reporting as of Dec. 31, 2018. While there can be no assurances, the Partnership is working to file its Annual Report on Form 10-K on or before the fifteenth calendar day extension provided by Rule 12b-25. About StoneMor Partners StoneMor Partners L.P., headquartered in Trevose, Pennsylvania -- http://www.stonemor.com/-- is an owner and operator of cemeteries and funeral homes in the United States, with 322 cemeteries and 90 funeral homes in 27 states and Puerto Rico. StoneMor's cemetery products and services, which are sold on both a pre-need (before death) and at-need (at death) basis, include: burial lots, lawn and mausoleum crypts, burial vaults, caskets, memorials, and all services which provide for the installation of this merchandise. Stonemor reported a net loss of $75.15 million for the year ended Dec. 31, 2017, compared to a net loss of $30.48 million for the year ended Dec. 31, 2016. As of Sept. 30, 2018. StoneMor had $1.72 billion in total assets, $1.71 billion in total liabilities, and $13.46 million in total partners' capital. * * * As reported by the TCR on Feb. 13, 2019, Moody's Investors Service downgraded StoneMor Partners L.P.'s Corporate Family rating to Caa2 from Caa1 and Probability of Default rating to Caa3-PD from Caa1-PD. The Caa2 CFR reflects Moody's concern that if pre-need cemetery selling and liquidity pressures do not abate while the senior secured credit facility is being refinanced, a distressed exchange or other default event could become more likely. In February 2019, S&P affirmed its 'CCC+' issuer credit rating on StoneMor Partners LP. In April 2018, S&P Global Ratings affirmed its 'CCC+' corporate credit rating on StoneMor Partners L.P. S&P said, "The rating affirmation reflects our view that StoneMor's capital structure is unsustainable and reflects our expectation that the company will produce cash flow deficits in 2019." ================= V E N E Z U E L A ================= VENEZUELA: Brazil Says Terrorists Threaten Venezuela ---------------------------------------------------- EFE News reports that Brazilian Foreign Minister Ernesto Araujo said that "concern" exists about "the presence of terrorist elements in Venezuela" that, he said, could represent a "threat" to the security of the country and the region. "Up until recently, it had not been admitted that there was terrorism in South America and today it is known via intelligence (departments) . . . that that is a threat for Venezuela," Araujo said at a press conference in Brasilia after returning from an official trip to the United States, according to EFE News. As reported in the Troubled Company Reporter-Latin America, S&P Global Ratings in May 2018 removed its long- and short-term local currency sovereign credit ratings on Venezuela from CreditWatch with negative implications and affirmed them at 'CCC-/C'. The outlook on the long-term local currency rating is negative. At the same time, S&P affirmed its 'SD/D' long- and short-term foreign currency sovereign credit ratings on Venezuela. S&P's transfer and convertibility assessment remains at 'CC'. ********* 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 2019. 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 * * *