Mexico’s largest media company Televisa posted a net profit of $54 million in the first quarter, up 21% year-on-year. Sales rose 17% to $575 million, while the company’s total debt load came in at $1.8 billion ($210 million of which is short term). Televisa also announced it has bought the rights to broadcast the 2006 World Cup, which will take place in Germany.
Category: Daily Brief
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Telmex’s Net Rises
Net profit at Mexico’s biggest telecom network Telmex rose 10% in the first quarter to $568 million, while revenue jumped 28% to $3.5 billion. The company’s total debts rose 54% to $9.3 billion. Telmex is taking on debt to invest in Brazil and other parts of South America. Revenues from Mexico, where Telmex controls 95% of the market, have stagnated in recent years.
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Peugeot Ups Investments
French carmaker PSA Peugeot Citroën plans to invest $125 million in its plants in Argentina to boost output in the country by 110% this year. PSA also plans to start exporting from Argentina to markets beyond Latin America, including South Africa.
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América Móvil Up Slightly
Mexican cellphone giant América Móvil posted net profit of $407 million for the first quarter, up a disappointing 2% year-on-year. However, revenue was $3.50 billion, up 33% year-on-year. América Móvil, with 66 million subscribers in Latin America, is the leading wireless network in the region.
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Bradesco to Issue Bonds
Banco Bradesco, Brazil’s biggest private sector bank, will sell $1.6 billion worth of 20-year bonds on the domestic market and scale back borrowing overseas. The bank will cut by more than half the $2 billion of bonds it planned to sell on international markets this year. Brazilian companies have boosted domestic bond sales as the fastest economic growth in a decade helps drive demand for local-currency debt. Bradesco’s leasing arm will issue the debt, and use the proceeds to meet increased demand for financing.
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Brazil’s External Accounts Strengthen
Brazil posted a March balance of payments surplus of $3.6 billion, even after making its first payment of the year to the IMF of $1.17 billion. The current account was $1.76 billion in surplus. The current account surplus hit a new record of $12.71 billion in the twelve months through March, equivalent to 2.05% of GDP. Profit and dividend remittances were $661 million, down from February’s $1.35 billion. The capital and financial accounts posted a $1.56 billion surplus. Total private sector debt amortizations were $800 million. FDI flows were $1.4 billion. Gross international reserves climbed to $61.96 billion, or about $38 billion in net terms.
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Chile Posts Trade Surplus
Chile posted a trade surplus of $770 million from April 1 to 15, with exports at $1.97 billion and imports at $1.20 billion. Copper exports stood at $475 million. Chile is the world’s largest copper producer, accounting for one third of global copper output.
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Condoleezza’s Message
Condoleezza Rice is on her first trip to Latin America as secretary of state and she is trying to stress a positive agenda. This is well and good, but Rice has also made it clear that Washington’s main issue with Latin America concerns trade. She wants to revive the moribund Free Trade Area of the Americas, the grand vision of creating a single trading bloc stretching from Alaska to Tierra del Fuego.
That dream will remain a fantasy. Even though free trade would help Latin America grow faster, attract more investment and build more sophisticated societies closely integrated with the emerging global civilization, politicians throughout the hemisphere will keep sabotaging progress. Rice called on Brazil to “reenergize” FTAA but the Bush administration has scarcely lifted a finger to push the far less challenging CAFTA trade pact with Central America through Congress. Business lobbies, labor unions and ignorant nationalists in the US and throughout Latin America have blocked full-blown trade integration at every turn.
That’s the bad news. The less bad news is that a great many Latin American companies now realize that exports are an integral part of their business. Trade is flourishing even without any grand trade pacts. The great challenge for Latin America is to ensure that this positive outlook for trade, investment and growth will survive the Chinese-driven commodity cycle. It would be a tragedy if Latin America resigns itself to being no more than a supplier of base metals and low-value farm goods to China and the rest of the world.
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Condoleezza’s Message (1)
Hundreds of road warriors responded to our travel poll. One of them — Gabriel Puricelli, an analyst at the Canadian Embassy in Buenos Aires — claims an Ipod Mini as a prize for taking part. Participants in our latest survey to identify the best CEOs and corporations in Latin America are entered in a drawing for a $200 American Express Gift Cheque. There’s still time to take part in that poll. To take the survey, click here
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Grupo México’s Net Jumps
Strong demand for copper and higher metals prices helped boost Grupo México’s first-quarter net income to $251 million, up 51% year-on-year. Sales jumped 43% to nearly $1.3 billion. The Mexico City-based miner cited a rise in global copper demand, with particular upswings recorded in China and the United States, as a key contributor to its results.