/raid1/www/Hosts/bankrupt/TCRLA_Public/250424.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
Thursday, April 24, 2025, Vol. 26, No. 82
Headlines
A R G E N T I N A
ARGENTINA: Central Bank Reserves Hit US$36BB After 1st IMF Tranche
B R A Z I L
BRAZIL: Chinese Imports Soared to USD19BB in 1Q of 2025
J A M A I C A
JAMAICA: BoJ Accepts 126 Offers for Latest Certificate of Deposit
PARAMOUNT TRADING: Net Profit Drops by 50% to $9MM in 3Q
P E R U
HUDBAY MINERALS: Fitch Affirms 'BB-' Long-Term IDR, Outlook Stable
TELEFONICA DEL PERU: Fitch Cuts Long-Term IDR to 'RD'
P U E R T O R I C O
CONVENTION CENTER: Seeks Approval to Tap Tamarez CPA as Accountant
T R I N I D A D A N D T O B A G O
TRINIDAD & TOBAGO: Global Tensions, Trade War Impacts Country
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A R G E N T I N A
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ARGENTINA: Central Bank Reserves Hit US$36BB After 1st IMF Tranche
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Buenos Aires Times reports that Argentina's Central Bank reserves
soared as US$12 billion in fresh funds arrived from the
International Monetary Fund.
The tranche of funding, part of a new US$20-billion agreement with
the multilateral lender, was eagerly awaited by markets and
government officials, according to Buenos Aires Times.
Total reserves climbed to US$36.799 billion, according to the
Central Bank, increasing US$12.494 billion, the report notes.
Economy Minister Luis Caputo confirmed that, in addition to the IMF
funding, Argentina will receive at least another US$1.5 billion
from other multilateral organisations, such as the World Bank, the
report relays.
Total funding from multilateral lenders could total more than US$42
billion, according to reports, Buenos Aires Times says.
The Central Bank, known by its acronym BCRA, now has increased
firepower to protect the peso in the wake of the removal of most
restrictions limiting access to foreign currency -- a set of rules
known locally as "el cepo."
The new exchange rate scheme establishes a managed float of between
1,000 and 1,400 pesos per dollar, the report says. The Central
Bank will be able to intervene to maintain the exchange rate within
that level, the report notes.
Individuals can now acquire an unlimited amount of dollars via
banking operations and a maximum of US$100 if it is in cash, the
report discloses. Companies, on the other hand, must wait until
2026 to take dividends abroad, says the report.
Following the initial devaluation of the peso, due to the
relaxation of rules, the official exchange rate was trading at
1,233.40 pesos per greenback, the report relays.
As for the Banco Nacion, the currency traded at 1,230 pesos, the
report relays.
Economists have noted the relative "calm" of operations, while
warning of a renewed "carry trade" because the rates in pesos are
above the implicit rates of the future dollar, the report
discloses.
As for the blue dollar, it fell five pesos, quoting at 1,260 pesos
per greenback to buy and 1,280 pesos for sale, the report notes.
The MEP rate stood at 1,242.87 pesos (down 0.8 percent), and the
CCL at 1242.86 pesos (down one percent), the report says.
Meanwhile, Argentina's country risk rate -- tracked by investment
bank JP Morgan -- fell to 725 points, the lowest level in five
weeks and a far cry from the near 1,000 recorded before the removal
of currency controls, the report relays.
Argentines track the exchange rate carefully, the report says. Any
change in its value has an immediate impact on prices, the report
notes.
"The market has started to understand how this floating mechanism
works," economist Sebastian Menescaldi, associate director of the
EcoGo consultancy firm, told the AFP news agency.
Regarding the pass-through of the peso's depreciation to prices, he
added that for now, the increase "is not so frantic," the report
relays.
"People are waiting to see what happens," the expert went on, notes
the report. "Initially, we estimate the impact could be between
four and five percent inflation this month, and something similar
next month."
Inflation control is President Milei's main political asset, the
report discloses. This year, he will face his first electoral test
in the October midterms, the report says.
His stringent austerity plan -- which balanced the books by
imposing drastic cuts to pensions, education and healthcare -- led
to a drop in inflation from 211 percent in 2023 to 118 percent in
2024, the report notes.
However, the trend was broken in February, when inflation reached
2.4 percent and then accelerated to 3.7 percent in March, the
report adds.
About Argentina
Argentina is a country located mostly in the southern half of South
America. Its capital is Buenos Aires. Javier Milei is the current
president of Argentina after winning the November 19, 2023 general
election. He succeeded Alberto Angel Fernandez in the position.
Argentina has the third largest economy in Latin America. The
country's economy is an upper middle-income economy for fiscal year
2019, according to the World Bank. Historically, however, its
economic performance has been very uneven, with high economic
growth alternating with severe recessions, income maldistribution
and in the recent decades, increasing poverty.
In March 2022, the International Monetary Fund (IMF) approved a new
30-month arrangement under an Extended Fund Facility for Argentina
in the amount of SDR 31.914 billion (equivalent to US$44 billion,
or 1000 percent of quota). The IMF Executive Board's decision
allowed the authorities an immediate disbursement of an equivalent
of US$9.65 billion in March 2022.
Argentina's IMF-supported program seeks to improve public finances
and start to reduce persistent high inflation through a
multi-pronged strategy, involving a gradual elimination of monetary
financing of the fiscal deficit and enhancements in the monetary
policy framework.
On April 11, 2025, the International Monetary Fund (IMF) approved
a 48-month Extended Fund Facility (EFF) arrangement for Argentina
totaling US$20 billion (or 479 percent of quota), with an immediate
disbursement of US$12 billion, and a first review planned for June
2025 with an associated disbursement of about US$2 billion. The
program is expected to help catalyze additional official
multilateral and bilateral support, and a timely re-access to
international capital markets.
On Feb. 17, 2025, S&P Global Ratings lowered its local currency
sovereign credit ratings on Argentina to 'SD/SD' from 'CCC/C' and
its national scale rating to 'SD' from 'raB+'. At the same time,
S&P affirmed its 'CCC/C' foreign currency sovereign credit ratings
on Argentina. The outlook on the long-term foreign currency rating
remains stable.
On Jan. 8, 2025, Moody's Ratings raised Argentina's local currency
ceiling to B3 from Caa1 and the foreign currency ceiling to Caa1
from Caa3. Moody's said the decision to raise the local and
foreign currency ceilings reflects the increased predictability and
the greater consistency in economic policy that has led to a rapid
reduction in monetary and fiscal imbalances that were stoking very
high inflation.
On Nov. 15, 2024, Fitch Ratings upgraded Argentina's Long-Term
Foreign-Currency Issuer Default Rating (IDR) to 'CCC' from 'CC',
and its Long-Term Local-Currency IDR to 'CCC' from 'CCC-'.
Argentina's upgrade to 'CCC' from 'CC' reflects developments that
have improved Fitch's confidence in the authorities' ability to
make upcoming foreign-currency bond payments without seeking relief
of some sort.
DBRS, Inc. upgraded Argentina's Long-Term Foreign and Local
Currency Issuer Ratings to B (low) from CCC on November 25, 2024.
The trend on all ratings is Stable.
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B R A Z I L
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BRAZIL: Chinese Imports Soared to USD19BB in 1Q of 2025
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Richard Mann at Rio Times Online reports that official data shows
that Chinese imports soared to $19 billion in the first quarter of
2025, a record for the period and a 35 percent jump compared to the
same months in 2024.
This surge came before the full impact of the new US tariffs,
highlighting how buyers rushed to stock up ahead of expected price
hikes. Brazil's trade relationship with China has reached a
critical juncture, according to Rio Times Online.
Recent data and industry voices reveal a market increasingly
saturated with Chinese goods, raising urgent questions about the
country's economic sovereignty and future resilience, the report
notes.
Chinese products now dominate Brazil's import landscape, notes the
report. In 2024, Brazil imported $63.6 billion in goods from China,
outpacing imports from any other country. The volume of Chinese
imports has surged by 9,800% since 1981, the report recalls.
Sectors like steel, chemicals, textiles, and automotive have seen
dramatic increases in Chinese imports, with automotive imports
alone rising 500% since the pandemic, the report discloses.
This influx has driven down prices but also squeezed local
manufacturers, leading to lower industrial capacity utilization and
job losses in key sectors, the report says.
Brazilian steelmakers and industrial leaders have sounded the
alarm, the report notes. They argue that the "unfair" influx of
cheap Chinese steel and manufactured goods poses a bigger threat
than US tariffs, the report relays.
The government has responded with import quotas and new tariffs,
such as a 20% tax on small international purchases, to protect
domestic industries from dumping practices and unfair competition,
the report says.
Brazil's Trade Imbalance with China
The trade imbalance is stark, according to Rio Times Online. While
40,000 Brazilian companies import from China, only 3,000 export to
the country. Brazil's exports to China -- $104.3 billion in 2023
-- are heavily concentrated in raw commodities like soybeans, iron
ore, and meat, the report relays.
China now buys nearly one-third of all Brazilian exports, and
two-thirds of Brazil's soybean production goes to China, the report
notes. This narrow focus leaves Brazil exposed to price swings and
policy shifts in Beijing, the report relays.
China's influence extends beyond trade. Chinese firms control key
assets in Brazil's energy and mining sectors, including a $3.4
billion power transmission contract and dominance in solar panel
imports, the report notes.
This deep penetration raises concerns about national security,
technological dependence, and the erosion of Brazil's industrial
base, the report discloses. The risks are clear. If China shifts
its buying patterns or faces economic turbulence, Brazil could
suffer severe shocks, the report relays.
The lack of export diversification and the overwhelming presence of
Chinese goods threaten the country's ability to chart an
independent economic course, the report says. Brazil must now
confront the reality of its dependence, the report discloses.
Policymakers and business leaders face a stark choice: continue
down a path of deepening reliance, or take urgent steps to
diversify trade, strengthen domestic industry, and protect national
interests, the report notes.
About Brazil
Brazil is the fifth largest country in the world and third largest
in the Americas. Luiz Inacio Lula da Silva won the 2022 Brazilian
general election. He was sworn in on January 1, 2023, as the 39th
president of Brazil, succeeding Jair Bolsonaro.
In October 2024, Moody's Ratings upgraded the Government of
Brazil's long-term issuer and senior unsecured bond ratings to Ba1
from Ba2, the senior unsecured shelf rating to (P)Ba1 from (P)Ba2;
and maintained the positive outlook. S&P Global Ratings raised on
Dec. 19, 2023, its long-term global scale ratings on Brazil to
'BB' from 'BB-'. Fitch Ratings affirmed on Dec. 15, 2023, Brazil's
Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BB' with
a Stable Outlook. DBRS' credit rating for Brazil was last reported
at BB with stable outlook at July 2023.
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J A M A I C A
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JAMAICA: BoJ Accepts 126 Offers for Latest Certificate of Deposit
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RJR News reports that the Bank of Jamaica received 197 offers,
valued at J$17.7 billion for the $8 billion it wanted to take out
of circulation with its latest Certificate of Deposit.
This was in order to reduce the amount of money available to buy
the US dollar and to drive up inflation, according to RJR News.
The bank said it accepted only 126 offers for the $8 billion at an
average interest rate of 5.56%, the report relays.
The lowest rate was 5.3% for $500 million, while the highest rate
was 7% per annum for $250 million, the report adds.
About Jamaica
Jamaica is an island country situated in the Caribbean Sea. Jamaica
is an upper-middle income country with an economy heavily dependent
on tourism. Other major sectors of the Jamaican economy include
agriculture, mining, manufacturing, petroleum refining, financial
and insurance services.
On Feb. 21, 2025, Fitch Ratings affirmed Jamaica's Long-Term
Foreign-Currency Issuer Default Rating (IDR) at 'BB-', with a
positive rating outlook. In October 2023, Moody's upgraded the
Government of Jamaica's long-term issuer and senior unsecured
ratings to B1 from B2, and senior unsecured shelf rating to (P)B1
from (P)B2. The outlook has been changed to positive from stable.
In September 2024, S&P affirmed 'BB-/B' longterm foreign and local
currency sovereign credit ratings on Jamaica and revised outlook to
positive.
PARAMOUNT TRADING: Net Profit Drops by 50% to $9MM in 3Q
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RJR News reports that Paramount Trading Company's net profits
dropped by 50 per cent to $9 million on revenues of $409 million
during the third quarter, which ended in February.
This in comparison to 18 million dollars during the corresponding
period last year, according to RJR News.
But the company recorded a loss of $43 million on revenues of $1.2
billion during the nine-month period ending February, compared with
a profit of $100 million during the nine month period, which ended
in February 2024, the report adds.
Loop News, in a separate report, says management cited growth in
the bleach segment and increased demand for technical and
food-grade products as positive contributors. However, declines in
the lubricants and construction segments weighed on overall
performance, the report relates.
Despite the dip in quarterly earnings, Paramount's leadership
remains optimistic, Loop News says.
"We will continue to explore new opportunities to grow the revenue
base in line with our strategic objectives, while containing the
costs," the report quotes Radcliff Knibbs, chairman of Paramount,
as saying.
Over the nine-month period, the company reported a net loss of
$43.1 million, a sharp reversal from a $100 million profit a year
earlier, according to Loop News. Revenue during the same period
fell 5.5 percent to $1.2 billion.
Free cash flow was negative, constrained by capital expenditures of
$39.3 million. Liquidity was boosted by a $188 million loan, which
increased the company’s cash and cash equivalents to $161
million, up from $130 million in February 2024, the report notes.
Shareholders' equity declined to $918.9 million from $1.15 billion
a year earlier, largely due to accumulated losses and the erosion
of retained earnings, relates the report.
While segment volatility and rising costs present ongoing
challenges, management pointed to the strong performance of the
bleach segment as a promising sign for future growth, Loop News
says.
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P E R U
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HUDBAY MINERALS: Fitch Affirms 'BB-' Long-Term IDR, Outlook Stable
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Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of Hudbay Minerals Inc. (Hudbay) and Hudbay Peru S.A.C. (HB
Peru) at 'BB-'. Fitch has also affirmed Hudbay's senior unsecured
debt rating at 'BB-' with a Recovery Rating of 'RR4' and Hudbay's
and HB Peru secured revolving credit facilities (RCF) at
'BB+'/'RR2'. The Rating Outlook is Stable.
Hudbay's ratings and Outlook reflect its mid-tier size,
concentration in three mines, and extensive track record of
operating copper mines from exploration to production. The ratings
also consider Hudbay's low-cost position at Snow Lake in Manitoba,
Canada, and Constancia in Peru, with mine lives extending through
2038. Fitch expects Hudbay to maintain EBITDA leverage below 3.5x.
Key Rating Drivers
Favorable Low-Cost Position: Fitch expects average annual payable
metal sold to be approximately 128,000 tonnes for copper and
240,000 ounces for gold over 2025-2026 and for Hudbay to retain its
relative cost position. According to the CRU Group, Snow Lake has a
first-quartile cost position and Constancia has a second-quartile
cost position in the 2024 global all-in sustaining cost curve.
The mine plan for Constancia supports a 17-year mine life, Snow
Lake supports a 14-year mine life and Copper Mountain supports a
20-year mine life. Hudbay has an extensive track record of
operating copper mines from exploration to production, and has a
number of projects in the exploration and development phases.
Conservative Financial Policies: Fitch views Hudbay's conservative
capital-allocation policy as favorable to its credit profile.
Hudbay's stated financing strategy for sanctioning Copper World
includes a committed minority joint venture partner, a renegotiated
optimal streaming transaction, net debt/EBITDA of less than 1.2x,
minimum cash of $600 million, and limited (up to $350 million)
nonrecourse project debt. Hudbay prioritizes operational
improvements, low-risk, and low capital requirement brownfield
expansions in advance of moving forward on large-scale greenfield
projects.
Hudbay's EBITDA leverage was 1.4x at Dec. 31, 2024. Under its
ratings case assumptions, which have copper prices moderating to
$7,500/tonne and gold prices moderating to $1,800/ounce through
2028, the capital budget can be funded with no incremental debt and
EBITDA leverage will remain below 3.0x.
Copper Mountain Incrementally Positive: Fitch believes the Copper
Mountain stabilization plan to improve mining and mill throughput
adds production and EBITDA but is unlikely to generate meaningful
FCF through 2026, given plans for discretionary stripping and mill
optimization efforts. Fitch believes that Hudbay's discretionary
spending is supported by cash on hand and will be beneficial in the
medium term. Fitch sees limited execution risk in stabilizing
operations, given Hudbay's capital resources and operational
expertise.
Copper Exposure: While copper accounted for 54% of consolidated
revenues in 2024, Fitch believes Hudbay has meaningful commodity
diversification through its gold production, and to a lesser
extent, its molybdenum and zinc production. Hudbay estimates that a
10% change in the price of copper from the company's 2025 base case
of $4.10/lb would change operating cash flow before working capital
by $100 million in 2025. Hudbay's average realized copper price was
$4.18/lb in 2024, compared to $3.84/lb in 2023. Spot prices are
approximately $4.12/lb, which compares with Fitch's assumptions of
$8,800/tonne ($3.99/lb) in 2025 and $8,000/tonne (about $3.63/lb)
in 2026 and 2027.
Copper World Potential: Fitch views the $1.5 billion phase 1
project favorably, given the 2023 pre-feasibility study indications
of 85,000 tonnes of annual copper production at sustaining cash
costs of USD1.81/lb over a 20-year mine life. Fitch's rating case
does not include production or capital spending, except relatively
minimal capex to advance studies, since the project is not expected
to be approved before 2026. Hudbay stated the project will only
proceed if the definitive feasibility study shows an IRR greater
than 15% and financial targets are met.
Recovery Rating Criteria Variation: Fitch has applied a criteria
variation for HB Peru and Hudbay's RCF ratings to be two notches
above the IDR at 'BB+' with an 'RR2' recovery rating, which is
above the RR3 that would result from applying the "Country-Specific
Treatment of Recovery Ratings Criteria." The over-collateralization
provided by the security directly for the Hudbay RCF and through
Hudbay's secured guaranty of the HB Peru RCF is consistent with a
higher recovery rating than the "RR3" that would result from based
on the weighted average of the caps of Canada and Peru where the
economic value could be realized under the criteria. The facilities
are cross-collateralized.
Peer Analysis
Hudbay, with 2024 payable copper sales at 125,094 tonnes, has
smaller production and fewer mines than copper producer Capstone
Copper Corp. (BB-/Stable), with 2024 payable copper sales at
175,202 tonnes, although Hudbay has a better cost position. Fitch
expects the companies to be fairly similar in terms of EBITDA after
distributions to noncontrolling interests as Capstone Copper's
Mantoverde mine continues to ramp-up.
Hudbay is smaller than First Quantum Minerals Ltd. (B/Negative),
with 2024 copper sales of 420,111 tonnes. However, Hudbay is more
than twice the size of Ero Copper Corp. (B/Stable), with 2024
copper production at 40,664 tonnes, and Taseko Mines Limited's
(B-/Stable) Gibraltar mine, with 2024 copper production at roughly
48,988 tonnes.
Hudbay's average second-quartile cost position of CRU's 2024 global
copper all-in sustaining cost curve is lower than First Quantum's
average cost position in the fourth quartile, Ero Copper's average
cost position in the third quartile and Taseko's average cost
position in the fourth quartile.
Hudbay's EBITDA leverage of 1.4x at YE 2024 is low for the rating
category and Fitch expects this to continue while copper and gold
prices remain above its mid-cycle assumptions.
Key Assumptions
- Average annual payable copper sold at about 136,000 tonnes and
average annual payable gold sold at about 238,000 oz. in
2025-2027;
- Copper prices of $8,800/tonne in 2025, $8,000/tonne in 2026 and
2027, and USD7,500/tonne thereafter;
- Gold prices of $2,400/oz in 2025, $2,100/oz in 2026, $2,000/oz in
2027, and $1,800/oz in 2028;
- Zinc prices of $2,700/tonne in 2025, $2,600/tonne in 2026, and
USD2,500/tonne thereafter;
- Average annual capex in 2025-2026 of approximately $570 million
dropping to approximately $330 million, thereafter;
- The bulk of the 2026 notes are refinanced within 12 months;
- No change in dividends;
- Significant Copper World capital spending is not included.
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead To Negative
Rating Action/Downgrade
- EBITDA leverage sustained above 3.5x;
- Sustained negative FCF before major development capital;
- A material reduction in average mine life.
Factors That Could, Individually or Collectively, Lead To Positive
Rating Action/Upgrade
- Reduced completion risk and funding strategy which mitigates risk
associated with the Copper World project;
- Improved size and scale;
- EBITDA leverage sustained below 2.5x.
Liquidity and Debt Structure
Cash on hand was approximately $542 million as of Dec. 31, 2024,
and $426 million was available under the aggregate $450 million
revolving credit facilities after $24 million for LOC. The Hudbay
Minerals revolver and the Hudbay Peru S.A.C. revolver both mature
on Nov. 13, 2028. Revolver covenants include maintaining secured
debt to EBITDA at less than 3.0x, interest coverage ratio at
greater than 3.0x, and net debt to EBITDA ratio at less than 4.0x.
Debt maturities are modest before the $575 million 4.50% notes are
due in April 2026. Fitch expects the company to refinance the
majority of the 2026 notes within the next 12 months.
Issuer Profile
Hudbay Minerals Inc., a mid-sized Americas based mining company,
produces copper with gold, silver and molybdenum by-products in
Constancia; copper with gold and silver by-products at Copper
Mountain British Columbia; and gold with copper, zinc and silver
by-products in Snow Lake, Manitoba.
External Appeal Committee Outcomes
In accordance with Fitch's policies the Issuer appealed and
provided additional information to Fitch that resulted in a rating
action that is different than the original rating committee
outcome.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
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Hudbay Peru S.A.C. LT IDR BB- Affirmed BB-
senior secured LT BB+ Affirmed RR2 BB+
Hudbay Minerals Inc. LT IDR BB- Affirmed BB-
senior unsecured LT BB- Affirmed RR4 BB-
senior secured LT BB+ Affirmed RR2 BB+
TELEFONICA DEL PERU: Fitch Cuts Long-Term IDR to 'RD'
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Fitch Ratings has downgraded Telefonica del Peru S.A.A.'s (TdP)
Long-Term Foreign and Local Currency Issuer Default Ratings (IDRs)
to 'RD' from 'C' and affirmed the senior unsecured notes at 'C'
with a Recovery Rating of 'RR4'.
The downgrade is due to TdP's failure to pay the principal and
interest installments on its 2027 international bond as of April
10, 2025, and local bonds due April 19. TdP is also undergoing an
Ordinary Restructuring Bankruptcy Process (Proceso Concursal
Ordinario; PCO), initiated on Feb. 14, 2025, to restructure its
financial obligations, which constitutes an event of default. In
addition, Fitch views the recent acquisition of TdP by Integra Tech
International Inc. (Integra) as neutral for TdP's ratings.
Key Rating Drivers
International and Local Bonds Default: On April 10, 2025, TdP
failed to pay the principal and interest installments of its 2027
international bond for PEN567 million and interest of PEN62
million, respectively. Fitch views this, paired with the ongoing
PCO, as an event of default. The 2027 international bond doesn't
consider a cure period for principal payment. The company does not
have the cash position to face upcoming financial commitments.
Restructuring Process: In February, TdP entered a PCO with the
intention to restructure its financial obligations, including its
tax commitments with Superintendencia Nacional de Aduanas y de
Administración Tributaria (SUNAT). The contingencies from
2000-2001 were recently formalized for PEN947 million. Once the
National Institute for the Defense of Free Competition and the
Protection of Intellectual Property (INDECOPI) approves the PCO,
expected in the coming weeks, Fitch would downgrade TdP's ratings
to 'D', indicating that the company has entered into bankruptcy
filings, administration, receivership, liquidation or another
formal winding-up procedure.
Integra Acquisition: Fitch sees the acquisition of TdP by the
Argentinean company Integra as neutral for TdP's ratings as the
restructuring process continues and TDP's ratings were assessed on
standalone basis. TdP announced in April 2025 that its shareholder
Telefónica Hispanoamérica S.A. (Telefonica HISPAM) had signed a
share purchase agreement in which it sold all its shares of TdP
(99.3% of its share capital) to Integra for PEN3.7 million (around
USD1 million). Both parties have agreed to keep the total undrawn
amount of the credit of PEN1.54 billion available to TdP, with
disbursements to be made partly by Telefónica Hispam and partly by
Integra.
Weak Cash Flow Generation: Fitch expects TdP's FCF to remain
negative throughout the rating horizon due to weak profitability
and capex needs. Fitch expects TdP's liquidity to remain poor in
2025-2026 given projected continuing operational weakness and
negative FCF. Its liquidity position is supported mainly by access
to a loan with Integra and Telefonica HISPAM of PEN1.54 billion to
support TdP's current operation.
Peer Analysis
TdP's RD ratings reflect that the company has entered a default
process following its missed payment on the principal and interest
of the 2027 international bond and local bonds, along with the
ongoing debt restructuring process with creditors.
Recovery Analysis
Going Concern Recovery Approach
Fitch undertakes a bespoke recovery analysis for issuers with IDRs
of 'B+' and below, per its criteria. The bespoke recovery analysis
assumes TdP would be considered a going concern in bankruptcy and
would be reorganized rather than liquidated. The enterprise
value/EBITDA multiple applied is 4.5x; this reflects TdP's
deteriorating operational performance and financial profile despite
its diversified business profile and strong brand recognition.
Fitch applies a waterfall analysis to the post-default enterprise
value based on the relative claims on the debt in the capital
structure.
These assumptions result in a Recovery Rating for the unsecured
bonds within the 'RR4' range after application of country-specific
consideration for Peru, which, per Fitch's "Corporates Recovery
Ratings Criteria," leads to an issuance rating of 'C'/'RR4' for an
IDR of 'RD'.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- A downgrade to 'D' is contingent on the acceptance of the
Ordinary Bankruptcy Procedure.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- An upgrade is contingent on the completion of the insolvency
process reflecting the post-financial structure of the company.
Liquidity and Debt Structure
TdP's liquidity is insufficient to sustainably cover its interest
payments or repay debt in the short term.
The acquisition by Integra considers that the credit facility of
PEN1.54 billion remains in place with future disbursements to be
made partly by Telefónica Hispam and partly by Integra. The
purpose of this credit facility is to finance the company's
operating deficit for the next 12 months.
Issuer Profile
Telefonica del Peru, S.A.A. is Peru's largest integrated telecom
operator in terms of revenue share. The company provides mobile and
fixed-line telephony, broadband, and Pay TV though its Movistar
brand, as well as IT solution services for corporate clients.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless
otherwise disclosed in this section. A score of '3' means ESG
issues are credit-neutral or have only a minimal credit impact on
the entity, either due to their nature or the way in which they are
being managed by the entity. Fitch's ESG Relevance Scores are not
inputs in the rating process; they are an observation on the
relevance and materiality of ESG factors in the rating decision.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Telefonica del
Peru, S.A.A. LT IDR RD Downgrade C
LC LT IDR RD Downgrade C
senior unsecured LT C Affirmed RR4 C
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P U E R T O R I C O
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CONVENTION CENTER: Seeks Approval to Tap Tamarez CPA as Accountant
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Convention Center Parking, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Puerto Rico to employ Tamarez
CPA, LLC as accountant.
The firm will render these services:
a) reconcile financial information to assist the Debtor in
the
preparation of monthly operating reports;
b) assist in the reconciliation and clarification of proof of
claims filed and amount due to creditors;
c) provide general accounting and tax services; and
d) assist the Debtor and its counsel in the preparation of the
supporting documents for the Joint Chapter 11 Reorganization Plan.
The firm will be paid at these hourly rates:
Albert Tamarez-Vasquez, CPA CIRA $165
CPA Supervisor $110
Senior Accountant $90
Staff Accountant $70
The firm received a post-petition retainer in the total amount of
$12,000.
Albert Tamarez Vasquez, CPA, owner of Tamarez CPA, disclosed in a
court filing that his firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Albert Tamarez Vasquez, CPA
Tamarez CPA, LLC
1519 Ave. Ponce De Leon, Suite 412
San Juan, PR 00909
Telephone: (787) 795-2855
Facsimile: (787) 200-7912
Email: atamarez@tamarezcpa.com
About Convention Center Parking
Convention Center Parking, Inc. filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. D.P.R. Case No.
24-04516) on Oct. 21, 2024. In the petition signed by David
Santiago Martinez, president, the Debtor disclosed $1 million in
assets and $45,229,691 in liabilities.
Judge Maria De Los Angeles Gonzalez oversees the case.
The Debtor tapped Alexis Fuentes-Hernandez, Esq., as counsel and
Albert Tamarez Vasquez, CPA, at Tamarez CPA, LLC as accountant.
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T R I N I D A D A N D T O B A G O
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TRINIDAD & TOBAGO: Global Tensions, Trade War Impacts Country
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Trinidad Express reports that the chaos in global trading networks
created by the United States' tariffs and the trade war between the
world's two biggest economies has serious implications for Trinidad
and Tobago, the Energy Chamber has said.
The most immediate impact is through the sharp drop in oil prices,
with Brent crude prices dropping from close to US$75 a barrel at
the beginning to April to US$64 by the end of April 13, according
to Trinidad Express.
This drop was in response to both the economic uncertainty created
by the tariffs and an OPEC decision to increase production, it
recalled in a statement, the report notes.
"While T&T is primarily a gas-based economy (with gas accounting
for almost 90% of hydrocarbon production on an energy equivalence
basis), oil is still an important source of Government revenue,
through petroleum profits taxes, supplemental petroleum taxes,
royalties and dividends from State-owned Heritage Petroleum. The
annual government revenue estimates for this fiscal year were based
on an oil price of US$77.80 per barrel," the chamber said, the
report discloses.
The new LNG pricing formulas agreed between the Government and the
Atlantic shareholders, based on a combination of Asian and European
LNG benchmark prices and Brent crude prices, mean that the lower
oil prices will also impact T&T LNG export prices, the report
says.
Japanese and European LNG prices have also retreated, though they
still remain at historically high levels, above US$10 per mmbtu
(compared to Henry Hub prices in the US$3.50 range), the Energy
Chamber observed, the report says.
The 2025 Government revenue estimates were based on an average
wellhead price of US$3.59, which is a combination of both LNG
marketing contract prices and domestic gas prices covering a range
of contracts, it added.
Methanol prices typically broadly follow global economic ups and
downs, given the fact that demand for methanol is closely
correlated with economic activity (it is an important basic
chemical input into a very broad range of products), the chanber
stated, the report notes.
"Methanol prices were relatively strong in the first quarter of
2025, but with a global downturn they may well face significant
downside risk over the next few months. Methanol exports from
Trinidad to the USA would be subject to the new 10% import tariffs,
but it is unclear how this will impact the market, especially as
the US is not a particularly important market for Trinidad
methanol," it said, the report relays.
For ammonia, by contrast, Trinidad is an important producer for the
US (accounting for over 40% of imported ammonia into the US), the
Energy Chamber noted, the report says.
It said: "Despite the tariff imposition, ammonia markets have
remained relatively muted. With most ammonia production going into
fertilisers, the impact of the US-China trade war on US agriculture
could play an important role in the market. Urea prices in the US
rose in response to the tariffs (with some urea producing
countries being threatened with the higher reciprocal tariffs) but
it is unclear how they will respond into the future. It might take
a while for the full picture to emerge," the report notes.
Positive and Negative
One positive from lower oil prices is that the price of imported
gasoline, diesel and jet fuel should also decline, the Energy
Chamber projected, the report relates.
"However, it needs to be remembered that we export approximately
two times more crude oil than we import petroleum products, the
report discloses.
The implications of the global trade and economic uncertainty go
beyond just falls in commodity prices. One crucial factor is how
the trade war between the US and China, and the across the board
10% tariff on US imports, might disrupt supply chains. With so
many imports coming from or through the United States, inflation
caused by the new tariffs will inevitably flow through to the
Caribbean," it stated, the report notes.
The chamber said while food inflation is the issue that will
probably hit the average citizen first and most obviously, there
are also implications of the supply chain disruptions for the
energy sector, the report discloses.
"China is an important manufacturer of many components that going
into equipment and other supplies used in the energy sector and if
those items are assembled in the US, the unprecedented tariffs
placed on Chinese imports into the US will lead to significant
price increases. The danger is that this will push up costs in the
Trinidad energy sector, especially for anything sourced out of the
US. The energy sector consumes a lot of steel and other speciality
metals which are impacted by the tariffs," it added, the report
notes.
Companies may well look to alternatives or to purchase directly
from Chinese, European or other Asian suppliers, the report
relays.
There may even be some upside potential for a few Trinidadian
manufacturers, such as IAL Engineering, who have the capacity to
produce some items for supply to domestic and regional markets, the
Energy Chamber argued, the report says.
"The general sense of uncertainty will inevitably lead to many
companies delaying investment decisions. Confidence is an important
commodity in any business, and it is in short supply around the
world and in Trinidad and Tobago," it concluded, note the report.
*********
S U B S C R I P T I O N I N F O R M A T I O N
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