www.wilmingtonstar.com Last changed: March 10. 2003 5:34PM

The Associated Press Crude oil futures fell on both sides of the Atlantic on Monday, as supply concerns eased somewhat ahead of a looming war in Iraq. The Organization of Petroleum Exporting Countries said the market is adequately supplied and that the group will ensure supply availability in the event of war in Iraq. "We will raise whatever we can to satisfy demand if there is a shortage," said OPEC President Abdullah bin Hamad Al-Attiyah. OPEC ministers are meeting in Austria to discuss output policy and what action, if any, the group will consider in case of a supply disruption in Iraq. Al-Attiyah wouldn't say whether OPEC ministers will discuss contingency plans, such as a Saudi-Kuwaiti proposal to suspend the group's official output quotas. He said OPEC's customers - especially those in Asia - say there is no need for extra oil at the moment. OPEC can tap about 3 million barrels a day in spare capacity, Al-Attiyah said, adding that about $6 to $7 of the current price of crude reflects a "war premium." Algerian Oil Minister Chakib Khelil, meanwhile, said the price of the group's reference basket of crude - now hovering around $33 a barrel - could tumble below $22 a barrel after a war in Iraq. The comments "took some of the steam out of the market," said Tom Bentz, an analyst at BNP Paribas Futures. At the New York Mercantile Exchange nearby April crude oil futures fell 51 cents to close at $37.27 a barrel. April heating oil fell 2.28 cents to close at $1.0857 a gallon, while April gasoline futures dropped 2.85 cents to settle at $1.1282 a gallon. At the International Petroleum Exchange in London, April Brent fell 35 cents to close at $33.75 a barrel. Natural gas for April delivery plunged 47.8 cents to settle at $6.515 per 1,000 cubic feet. OPEC has sharply increased its output in recent months in response to a disruption in Venezuelan production and the potential loss of Iraqi oil. Despite the increase, however, U.S. crude oil inventories have shrunk because of the disruption in Venezuelan exports and cold weather. But with Saudi and Venezuelan output on the rise, analysts expect crude inventories to continue to build. Five of seven analysts surveyed by Dow Jones Newswires on Monday expect crude stocks to grow by 2.15 million barrels in weekly data from the Department of Energy after increasing by 1.7 million barrels in last week's report. "We have seen a huge increase in both Saudi and Venezuela production in February. Some of those barrels should start trickling in now," said Peter Beutel, an analyst at Cameron Hanover in Connecticut. The Bush administration is facing an uphill battle at the Security Council as it seeks a vote on a resolution that gives Iraq until March 17 to disarm or face war. The United States wants to bring the resolution to a vote later this week. Britain and Spain support the resolution, but France, Russia and Germany remain opposed. French President Jacques Chirac said France will vote against any resolution that contains an ultimatum "no matter what the circumstances." Russian Foreign Minister Igor Ivanov warned earlier Monday that Russia will block the resolution. It was the first time Russia has explicitly said it would use its veto.

www.msnbc.com By John W. Schoen MSNBC

March 10 — If, like most investors, you’re hoping for a strong rebound in corporate profits this quarter, it looks like you’ll have to wait at least another three months. Of the more than 700 companies that have already tipped their hand by “pre-announcing” profits, some 57 percent came up short of expectations. CEOs have a lot of things to blame this quarter on, from high energy prices to an unusually cold winter. But expect “war worries” to be the most popular excuse.          CORPORATE hand-wringing about the possibility of war has sent Wall Street slashing earnings estimates sharply. At the beginning of the year, for example, analysts at Standard & Poor’s were expecting year-over-year profit gains of roughly 15 percent for the companies that make up the S&P 500. As of last week, that number had been pared to 9 percent.        Uncertainties about war have also scared both consumers and businesses into cutting spending, and that slowdown will clearly have an impact on corporate America’s bottom line. But analysts expect to hear “war worries” cited a lot this quarter — regardless of the real underlying problem.        “What happened after 9/11?” said Chris Wolfe, an equity strategist at J.P. Morgan. “Everyone blamed that, and you had a pass well into 2002. Now, it’s shifted to war with Iraq. If I don’t hear this 100 times on conference calls this quarter, I’ll be surprised.”        The trick for investors will be to sort out which companies have been legitimately hurt by war uncertainties and which ones are using it to hide other problems. One of the clearest cases will be profit reports from companies that use a lot of oil. Oil prices have shot up this quarter as cold weather raised demand and war worries stoked concerns about supplies.        “If your business is impacted by oil prices then Iraq is a legitimate excuse,” said Phil Dow, and equity strategist at RBC Dain Raucher. “But if it’s not, maybe it’s a hiding place.          Falling forecasts Profit forecasts having been moving lower since the beginning of the year. (Oper. profit year-over-year growth) Sector as of Jan.1 as of Feb.1 as of Mar. 7 Financials 7%   5%   4%   Technology 16%   15%   15%   Health Care 8%   6%   6%   Consumer Cycl 13%   15%   10%   Industrials 2%   -6%   -9%   Consumer Stpls 6%   3%   2%   Energy 90%   106%   143%   Comm Services 10%   3%   1%   Materials 58%    33%   5%   Utilities -16%   -19%   -28%   Transports 99%   -77%   -93%   S&P500 Total 11.7%   8.8%    7.3%  SOURCE:Thomson Financial/First Call        Manufacturing companies — including chemical companies that use oil as a raw material — have been most directly affected. Food processors and retailers, transportation companies and utilities have all seen their fuel bills skyrocket, potentially leaving a big hole in the bottom line.

Playing now: • Blue chips slide again • OPEC keeps quotas in check • ImClone founder fined $800,000       While some companies have been able to pass these costs in the form of a surcharge, others will be stuck with a big, unexpected fuel bill.         RETAIL STILL WEAK, DESPITE DUCT TAPE        War worries may have helped boost sales of duct tape and plastic sheeting, but retailers have already begun warning that sales have been weaker than expected. But war may have little to do with a consumer’s decision to skip the trip to the mall. In many parts of the country, a bitter cold winter — complete with repeat snow storms — kept consumers home. And rising layoffs — begun long before the world approached the brink of war — isn’t helping either, according to Sam Stovall at Standard & Poor’s.        “It’s eroding consumer confidence, and the focus is on not really spending a lot of money,” he said. “People are saying, ‘I’m worried about my job; I won’t be spending the money I thought I might maybe on discretionary items.”        Businesses are also still tight-fisted with their budgets for new equipment — in part due to uncertainty about the prospect of war. But Wolfe thinks war fears are only only part of the reason businesses are hunkering down.        “Companies have been paying down debt, buying back stock, and increasing dividends,” he said. “Until we have much more balance-sheet healing, I think the idea of an immediate flipover to reinvesting the company for growth — when we already have excess capacity — is just way, way early.”

       About the only sector that you won’t hear blaming lower profits on war is the oil sector, where the rise in oil prices has helped fuel a sharp rise in profits. Analysts surveyed by Thomson Financial/First Call are looking for industry profits to jump 143 percent in the first quarter compared to last year.        Some analysts argue that the profit shortfall just means a rebound will be delayed until later in the year. But most concede the outlook for the second quarter depends a lot on what happens to energy prices. The big concern is that any major interruption in oil production would cause crude prices to move even higher than current inflated levels. But barring any major destruction of oil production in the region, Saudi Arabia has pledged to make up any shortfall from Iraq or other oil producers.        “They’re putting a lot into storage right now,” said Ed Silliere, a trader at Energy Merchant Corp. “They’ve got some 15 million barrels in storage in Saudi Arabia waiting to move onto the market if, in fact, we have a war. They’ve got some 20 million barrels reportedly somewhere in the Caribbean waiting to hit the market if this occurs. So if we do see a war, I’m not sure you’re going to see a big spike unless something really strange happens.”        Still, it’s unlikely oil prices will fall sharply as they did following the outbreak of the Gulf War in 1991. That’s because the recent run-up in prices was driven by more than war worries. A two-month shutdown of production in Venezuela cut into crude oil supplies while and this winter’s bitter cold weather stoked demand for heating oil and natural gas. Analysts say it could be months before supply shortages are eased — war or no war.   Get the latest earnings news •  Nokia warns on sales •  Kroger reports higher earnings •  Heinz quarterly earnings lower •  Deutsche Telekom posts huge loss •  Bristol-Myers restates earnings        

reuters.com Mon March 10, 2003 01:18 PM ET By Hugh Bronstein

NEW YORK, March 10 (Reuters) - Emerging market bond prices fell on Monday as investors grew jittery about the threat of a U.S.-led war against Iraq, but analysts said the market was holding onto an impressive chunk of its recent gains despite the geopolitical angst.

"It's surprising that we're not weaker than we are," one trader said. "Emerging markets continue to be resilient."

Brazilian bonds lost more than one percentage point, according to total returns measured by JP Morgan's Emerging Markets Bond Index Plus. But the dip still left Brazilian total returns more than 15 percent higher so far this year.

The index as a whole fell 0.32 percent, after rising more than 7 percent since Jan. 1.

Following an early-year rally driven in part by Wall Street's approval of the policies articulated by Brazil's new government, many analysts expected investors to flee risky emerging market assets as the United States set the stage for a war against Iraq that could depress global economic activity.

"But that appears to have been offset by inflows into the asset class," said Matt Ryan, an emerging markets portfolio Manager at MFS Investment Management, based in Boston.

As global stock markets wobble, he added, "We've seen allocations from equities into fixed income, and within fixed income there's a demand for the higher yields that are offered by emerging market bonds."

Emerging market bond spreads widened by five basis points to 695 over U.S. Treasuries, according to the EMBI-Plus. Brazil's portion of the index widened 20 basis points to 1139.

Wider spreads reflect the perception of increased risk as measured against safe-haven U.S. Treasury bonds. Yet Brazil remained much tighter, and much more popular with investors, than at the beginning of the year, when the country's spreads hovered in the range of 1450 basis points over Treasuries.

Despite the fact that Brazilian bonds have already rallied strongly this year and the risk that anticipated structural reforms may take a long time to implement, Latin America's biggest country remained a logical spot for new emerging market investors to put money, Ryan said.

"If you think Brazil's fundamentals are reasonably constructive, it has a good risk/reward so long as the government continues to say the right things," Ryan said.

In addition to pursuing long-elusive social security and tax reforms, Brazil's new government wooed Wall Street by increasing its primary surplus target to 4.25 percent of gross domestic product from the 3.75 percent set by the previous government.

While Brazilian total returns, which include price movements and accrued interest, have risen 3 percent so far this month, troubled Latin American countries like Ecuador and Venezuela have lagged.

In the wake of a national strike, organized by a coalition of opposition groups bent on forcing leftist President Hugo Chavez from office, Wall Street is worried about the governability of Venezuela.

And while investors like the policies articulated by Ecuador's new president, Lucio Gutierrez, implementation of those policies depends on the country's fractious Congress.

As investors search for higher-yielding bonds, such Latin American trouble spots tend to help make Brazil look good.

"If Brazil was at 800 (basis points) over, you could say the market is pricing in too many positive expectations," the trader said. "So if you are a portfolio manager with new money to invest, where are you going to put it? You are not going to put it in Venezuela or Ecuador."

Russia, which has seen its bonds clock total returns of more than 10.3 percent so far this year after a dramatic rally in 2002, "looks expensive," the trader added.

"Mexico is OK, but the upside in Mexico is not anywhere near what it is in Brazil. Plus Brazil has liquidity, so it's a logical candidate for money coming into the market," the trader said.

www.unstrung.com 03.10.03

ROME -- The Board of Directors of TIM (Telecom Italia Group), chaired by the Chief Executive Officer Marco De Benedetti, has today examined the results for fiscal year 2002.

TIM Group

It should be noted that the income and financial aggregate values of the former company Blu S.p.A. (merged by incorporation into TIM S.p.A in January 2002 for accounting and fiscal purposes) are only included in the consolidated results of the TIM Group as of the date of acquisition (October 7, 2002).

In the 2002 fiscal year the consolidated revenues of the TIM Group amounted to euro 10,867 million representing a 6% growth with respect to the 2001 fiscal year (euro 10,250 million). This growth actually reached 11.9% if cleaned off of the effect of exchange rate devaluations in 2002 mainly in Brazil and Venezuela.

Gross operating profit amounted to euro 5,039 million, representing a 5.9% increase with respect to the preceding fiscal year (euro 4,760 million). Net of the foregoing exchange rates devaluation, the increase in the gross operating profit stands at 8.6%. The gross operating profit/revenues ratio, at 46.4%, is in line with the figure recorded in 2001.

Operating income amounting to euro 3,358 million grew by 7.1% compared to the 2001 fiscal year (euro 3,136 million). The gross operating profit/revenues ratio has improved to 30.9% against 30.6% recorded for the 2001 fiscal year.

Consolidated net income pertaining to the parent company TIM amounted to euro 1,165 million and recorded a 22.6% increase with respect to the 2001 fiscal year (euro 950 million). This result reflects non-recurrent earnings for euro 1,182 million relative to extraordinary capital gains produced from the disposal of minority shareholdings in the operators Bouygues Telecom, Mobilkom Austria and Auna, mainly for tax benefits equal to euro 337 million deriving from prepaid taxes and the tax deductibility of the losses posted by the former Blu S.p.A. in the fiscal year 2002 Non-recurring charges net of the relative tax benefits, amount to euro 1,424 million of which approximately euro 1,410 million are due to the write-off of the balance sheet value and allocations to provisions for risks and charges for the associate company Aria - IS TIM while the remaining amount is ascribed to the write-down of Digitel Venezuela, Maxitel Brasil and other adjustments.

Comparing the 2002 fiscal year results before extraordinaries and taxes to the corresponding result posted in 2001, an improvement of euro 483 million (+19.3%) can be observed.

TIM Group's investments amounted to euro 2,359 million with respect to euro 5,154 million for the 2001 fiscal year. The 2001 results reflected significant investments made for the acquisition of licences by foreign subsidiaries. In the 2002 fiscal year investments mainly referred to technology and improvements to the network; industrial investments amounted to euro 1,715 million while financial investments and investments in goodwill amounted to euro 644 million.

Operating free cash flow (Operating income+Amortization/Depreciation- Industrial Investments- Variations in working capital), at euro 2,932 million, has shown an improvement of euro 639 million with respect to the 2001 fiscal year as a result of the increase in operating income (+7.1%) and a reduction in industrial investments made in 2002 with respect to 2001. Net borrowings amounted to euro 1,922 million (euro 1,532 as of 31.12.2001) following the payment dividends for euro 3,617 million, inclusive of the anticipated payment made in December 2002. The number of mobile lines of the TIM Group stood at about 39.1 million representing a 12.2% increase on a like for like comparison with December 31, 2001 (34.9 million) excluding the mobile lines of Bouygues Télécom, the Mobilkom Austria Group and Amena. (Auna's subsidiary mobile operator).

The TIM Group's personnel amounts to 18,702 units, an increase of 1,981 units with respect to December 31, 2001.

TIM S.p.A.

It should be noted that the results posted in the financial statements of TIM S.p.A.. .f.or the 2002 fiscal year include, in conformity to law, the income and financial results of the entire 2002 fiscal year of the former company Blu S.p.A..

In the 2002 fiscal year revenues stood at euro 8,915 million (euro 9,022 million including the contribution of the former Blu S.p.A.), compared to euro 8,357 million posted in the 2001 fiscal year, representing a 6.7% growth. Value-added service (VAS) revenues amounting to euro 752 million, are 41% higher than in 2001.

ARPU (Average Revenue per User)in 2002 stood at euro 28, an increase of 1% with respect to the same indicator in 2001.

Gross operating profit reached euro 4,529 million (euro 4,404 million considering the contribution of the former Blu SpA) representing a 7.2% growth with respect to the preceding year (euro 4,225 million). The gross operating profit/ revenues ratio stands at 50.8%, (50.6% in 2001).

Operating income amounted to euro 3,323 million (euro 3,153 million including the contribution of the former Blu S.p.A.) representing a 2.8% increase (euro 3,231 million in 2001), while as a ratio to revenues it reached 37.3% (38.7% in 2001).

These results are net of the fiscal amortisation of the UMTS licence, which began in January 2002 (euro 121 million).

Net income stated in the statutory financial statements amounted to euro 264 million (euro 1,907 million in 2001) after deduction of non-recurrent charges for euro 1,733 million, net of the relative tax benefits. Such charges mainly refer to the write-downs of the subsidiary TIM International N.V. and to the allocations to provisions for risks and charges made in respect of the associate company Aria IS-TIM.

The net income reflects tax benefits from the incorporation of the former Blu SpA relative to the use of prepaid taxes and to the deductibility of carried forward losses from preceding years for a net gain of euro 283 million in 2002 statutory accounts.

Investments in the period (net of variations in fixed assets following the incorporation of former Blu S.p.A.'s balance sheet totalled euro 1,842 million, of which euro 1,065 million for industrial investments and euro 777 million for financial investments in subsidiaries.

Net borrowings as of 31.12.2002, net of the effects of the former Blu S.p.A. amounted to euro 1,492 million. TIM, confirms its position as domestic market leader with about 25.3 million lines as of December 31, 2002 (+5.7% with respect to December 31, 2001)

TIM S.p.A.'s personnel as of December 31, 2002 following the incorporation of former Blu S.p.A. totalled 10,261 units

Telecom Italia Mobile SpA

new.stockwatch.com 2003-03-10 12:49 ET - News Release

NEW YORK, March 10 /PRNewswire-FirstCall/ -- BBVA Securities Inc. and BBVA Continental SAB announced today the successful placement of Corporacion Andina de Fomento's ("CAF") inaugural Condor Bond. The Condor Bond, a US$75 million Floating Rate Notes offering was increased from US$ 50 million and matures in 2006.

The Condor is the first of its kind targeting a unique Andean investor base. The Notes bear interest of Libor + 87.5 bps, payable semi-annually and are listed on both the Luxembourg and Lima Stock Exchanges. BBVA Securities acted as Bookrunner taking advantage of its local distribution capabilities in Latin America and its international markets expertise. BBVA Continental Bolsa acted as Local Placement Agent in Peru.

"We are proud of this milestone for BBVA Securities and the BBVA group. The Condor Bond has enabled us to capitalize on our local network distribution while offering a exciting investment opportunity for local investors in the Andean region," said Jaime Saenz de Tejada, Head of BBVA Wholesale Banking Americas.

The Regulation S Notes were offered under CAF's existing EMTN Program and distributed on a private placement basis among a select group of institutional investors in Peru, Colombia, Ecuador and Venezuela. The Bond saw strong interest from regional investors looking to invest in high-grade dollar denominated assets, while the floating rate offered protection versus future interest rate increases.

The offering complements CAF's traditional funding sources from US, European and Japanese investors. CAF has a proven track record of successfully tapping the international capital markets. CAF is currently rated A, A2, A by Standard and Poor's, Moody's and Fitch, respectively.

BBVA aims to facilitate the breadth and diversity of investment alternatives for local investors across markets as well as to foster local opportunities for global issuers. BBVA's local presence and market knowledge makes BBVA a natural partner of choice. BBVA Securities Inc.

CONTACT: Janifer Burns, Head of Dept Capital Markets, BBVA, +1-212-728-2389

Web site: www.bbv.es

Company News On-Call: www.prnewswire.com