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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 or 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of February, 2006
GRUPO IUSACELL, S.A. de C.V.
-----------------------------------------------
(Translation of registrant's name into English)
Montes Urales 460
Col. Lomas de Chapultepec, Deleg. Miguel Hidalgo
11000, Mexico D.F.
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(Address of principal executive office)
Indicate by check mark whether the registrant files or will fill annual reports
under cover of Form 20-F or Form 40-F:
Form 20-F [X] Form 40-F [ ]
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g-3-2(b) under the Securities and Exchange Act of
1934.
Yes [ ] No [X]
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Documents Furnished By the Registrant
1. Press Release of the Registrant dated February 24, 2006
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GRUPO IUSACELL, S.A. DE C.V.
Date: February 24, 2006
/s/
---------------------
Name: Fernando Cabrera
Title: Attorney in fact
/s/
---------------------
Name: Jose Luis Riera
Title: Attorney in fact
2
IUSACELL REPORTS FOURTH QUARTER 2005 RESULTS
- EBITDA INCREASES 126% DURING 2005
- NET INCOME OF PS $143 MILLION DURING 4TH QUARTER 2005
MEXICO CITY, Feb. 24 /PRNewswire-FirstCall/ -- Grupo Iusacell, S.A. de
C.V. (BMV: CEL) reported an increase of 30% in revenues for the fourth quarter
of 2005 and of 26% for the twelve months of 2005.
For the fourth quarter 2005, the Company recorded an operating income before
depreciation and amortization of Ps $269 million, compared with an operating
loss before depreciation and amortization of Ps $25 million for the fourth
quarter of 2004. For 2005, Iusacell recorded an operating income before
depreciation and amortization of Ps $1,039 million, which represented an
increase of 126% compared to the same period of 2004.
Iusacell recorded a net income for the quarter for the first time since the
second quarter of 2001. Iusacell recorded a net income of Ps $143 million for
the fourth quarter of 2005 compared to a net loss of Ps $375 million recorded
during the same period of 2004.
Recent Events
Iusacell reaches an agreement to Restructure its Debt.
On January 23, 2006, Grupo Iusacell, S.A. de C.V. and its main operating
subsidiary Grupo Iusacell Celular, S.A. de C.V. announced that they have
reached an agreement in principle with the majority of their respective
creditors to restructure their indebtedness.
Grupo Iusacell, S.A. de C.V.
Iusacell reached an agreement in principle with creditors representing a
majority of the principal amount of its US$350 million 14.25% notes due in 2006
to exchange such notes for new notes.
The new notes to be issued in exchange for the existing notes will be in a
principal amount of US$175 million and will bear interest at an annual rate of
10% with semi-annual interest payments in arrears (with Iusacell having the
option to capitalize up to 40% of each interest payment).
Iusacell is planning to launch the exchange offer and consent solicitation
on or before March 15, 2006. All existing notes tendered in the exchange offer
will be cancelled upon the consummation of the transaction, and past due
interest on the tendered existing notes will be forgiven. At December 31, 2005,
the past due interest was approximately US$150 million.
Grupo Iusacell Celular, S.A. de C.V.
Grupo Iusacell Celular, S.A. de C.V. reached an agreement in principle
with creditors representing the majority of its secured debt also involving an
exchange of the existing secured debt.
The agreement in principle contemplates that the US$190 million Existing
Tranche A loan be exchanged for US$190 million new first lien notes. Main terms
of the new first lien notes would include a first lien on substantially all of
Iusacell Celular's assets, in the terms and conditions of the existing lien,
with interest at Libor + 400 basis points, payable quarterly, and final maturity
2010.
Further, under this agreement the US$76 million Existing Tranche B loan and
USD$150 million existing senior notes would be exchanged for approximately $203
million of new second lien notes. Main terms of the new second lien notes
include a second lien on substantially all of the assets of Iusacell Celular,
under the terms and conditions of the existing lien, interest at 10% per annum
with semi-annual payments (the Company will have the option to capitalize up to
30% of each interest payment), and maturity in 2011. All existing senior notes
tendered in the exchange offer will be cancelled upon the consummation of the
transaction, and past due interest on the existing senior notes, which was
approximately US$44 million as of December 31, 2005, will be forgiven.
3
The New Notes, the New First Lien Notes and the New Second Lien Notes will
be issued pursuant to an exemption from the registration requirements of the
Securities Act of 1933. The exchange offers may be consummated as voluntary
exchanges or through any other legal means available to the Company and Iusacell
Celular, under applicable insolvency and business reorganization laws.
Bank of New York concluded the sale of the Company's shares corresponding to
the ADRs of Iusacell.
On December 15, 2005, Iusacell reported that The Bank of New York (BoNY)
concluded the sale on the Mexican Stock Exchange (BMV) of the Company's shares
underlying the American Depositary Receipts (ADRs) that were not exchanged by
shareholders within the period of time established, as part of the process of
termination of the Company's ADR program in the U.S.
As previously explained in press releases issued by the Company, ADR holders
had 60 days - from September 20 through November 20, 2005 -- to exchange ADRs
for shares traded on the BMV. As of November 21, 2005, BoNY started selling the
shares corresponding to ADRs that were not exchanged. The period for the sale of
shares by BoNY has concluded, and there are no remaining shares corresponding to
ADRs exchanged in the 60-day period.
Consolidated Financial Results
Revenues
Revenues in the fourth quarter of 2005 grew 30% to Ps $1,740 million,
compared to Ps $1,338 million in the same period 2004. For the twelve months of
2005, revenues increased 26% to Ps $6,122 million compared to Ps $4,862 million
recorded in the same period last year. The increase is primarily due to growth
in postpaid revenues mainly due to an increase in the subscriber base, as well
as higher revenues from value added services. Grupo Iusacell closed the fourth
quarter of 2005 with 1.80 million subscribers.
Costs and Expenses
During the quarter, total costs increased 7% to Ps $1,048 million compared
to Ps $976 million recorded in the fourth quarter of 2004. Operating expenses
increased 9% to Ps $424 million compared to Ps $387 million recorded in the
fourth quarter the prior year. When comparing twelve-month figures, the Company
recorded a 9% increase in total cost to Ps $3,382 million for 2005 from Ps
$3,093 million for 2004 as well as a 30% increase in operating expenses to Ps
$1,700 million for 2005 from Ps $1,309 million for 2004.
The increase in total costs, for the quarter of 2005 as compared to the same
period in 2004 is primarily due to an increase in interconnection and technical
expenses offset in part by a decrease in handset subsidy costs.
The increase in operating expenses for the quarter of 2005 as compared to
the same period in 2004, mainly reflects an increases in personnel expenses due
to an increase in the number of full-time and part-time employees, the creation
of regional sales and customer care structures in line with our strategy of
providing the best service to our clients, and an increase in professional fees
mainly related with the debt restructure.
Operating income before depreciation and amortization
Iusacell recorded an operating income before depreciation and amortization
during the fourth quarter of 2005 of Ps $269 million, compared to Ps $25 million
of operating loss before depreciation and amortization recorded in the same
period the preceding year. When comparing twelve-month figures, the Company
recorded an increase in operating income before depreciation and amortization of
126% to Ps $1,039 million for 2005 compared to Ps $461 million for 2004 the
prior.
4
Net Income
Iusacell recorded a net income of Ps$143 million during the fourth quarter
of 2005, reverting the net loss of Ps$375 million recorded in the same period
the preceding year. This increase is due mainly to the increase in operating
income before depreciation and amortization described above, as well as an
increase in gain from monetary position. When comparing twelve-month figures,
the Company recorded a reduction in net loss of 66% to Ps$706 million for 2005
as compared to Ps$2,055 million for 2004.
CAPEX
In the fourth quarter of 2005, the Company invested approximately US$16
million, mainly for the expansion of coverage and capacity of Iusacell's 3-G
network and EV-DO (Evolution Data Only) services. For the full year Iusacell
invested approximately US$64 million.
About Iusacell
Grupo Iusacell, S.A. de C.V. (Iusacell, BMV: CEL) is a wireless cellular and
PCS service provider in Mexico with a national footprint. Independent of the
negotiations towards the restructuring of its debt, Iusacell reinforces its
commitment with customers, employees and suppliers and guarantees the highest
quality standards in its daily operations offering more and better voice
communication and data services through state-of-the-art technology, such as its
new 3G network, throughout all of the regions in which it operate.
Legal Disclaimer
Grupo Iusacell, S.A. de C.V. quarterly reports and all other written
materials may from time to time contain statements about expected future events
and financial results that are forward-looking and subject to risks and
uncertainties. For those statements, the Company claims the protection of the
safe harbor for forward-looking statements contained in the Private Securities
Litigation Reform Act of 1995. A discussion of factors that may affect future
results is contained in our filings with the Securities and Exchange Commission.
Attached are the Consolidated Income Statements of each of Grupo Iusacell,
S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V. for the three-month and
twelve-month periods ended December 31, 2005, and the Consolidated Balance
Sheet of Grupo Iusacell, S.A. de C.V. and Grupo Iusacell Celular, S.A. de C.V.
at December 31, 2005.
Contacts:
Jose Luis Riera K. J. Victor Ferrer V.
Chief Financial Officer Finance Manager
Grupo Iusacell S.A. de C.V. Grupo Iusacell S.A. de C.V.
+52 (55) 5109-5927 +52 (55) 5109-5273
vferrer@iusacell.com.mx
5
GRUPO IUSACELL, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
4Q04 4Q05 Change
--------------------- --------------------- --------------------
QUARTERLY INCOME STATEMENT
Gross Revenues 106% 1,420 105% 1,833 413 29%
Commissions (6)% (83) (5)% (93) (10) (12)%
Net Revenues 100% 1,338 100% 1,740 403 30%
Cost of services 51% 685 46% 793 108 16%
Handset Subsidy 22% 291 15% 255 (36) (12)%
Total Cost 73% 976 60% 1,048 72 7%
Gross Profit 27% 362 40% 692 330 91%
Operating Expenses 29% 387 24% 424 37 9%
Depreciation and
Amortization 35% 469 23% 401 (68) (14)%
Total Expenses 64% 856 47% 825 (31) (4)%
Operating Loss (37)% (494) (8)% (133) 362 73%
Operating Profit before
Depreciation and
Amortization (2)% (25) 15% 269 294 n.m.
Loss from sale of fixed
assets and other
expenses 4% 52 1% 10 (42) (81)%
Comprehensive Financing
Cost
Interest Expense -
Net (22)% (299) (17)% (289) 10 3%
Exchange gain (loss) 18% 238 11% 189 (49) (21)%
Gain from net
monetary position 10% 129 19% 337 207 161%
5% 68 14% 237 168 n.m.
Loss before taxes (28)% (374) 7% 114 488 130%
Tax Provisions 1% 16 1% 17 2 10%
Equity in income (loss)
of subsidiaries (1)% (14) 0% -- 14 n.a.
Extraordinary item (0)% (6) 0% -- 6 n.a.
Minority interest 0% 3 1% 12 9 n.m.
Net income (loss) (28)% (375) 8% 143 517 138%
6
GRUPO IUSACELL, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
12M04 12M05 Change
--------------------- --------------------- --------------------
ACCUMULATED INCOME STATEMENT
Gross Revenues 107% 5,188 106% 6,507 1,319 25%
Commissions (7)% (326) (6)% (385) (59) (18)%
Net Revenues 100% 4,862 100% 6,122 1,260 26%
Cost of services 45% 2,197 45% 2,729 532 24%
Handset Subsidy 18% 896 11% 654 (243) (27)%
Total Cost 64% 3,093 55% 3,382 289 9%
Gross Profit 36% 1,770 45% 2,740 970 55%
Operating Expenses 27% 1,309 28% 1,700 392 30%
Depreciation and
Amortization 42% 2,027 26% 1,567 (460) (23)%
Total Expenses 69% 3,336 53% 3,267 (68) (2)%
Operating Loss (32)% (1,566) (9)% (528) 1,039 66%
Operating Profit before
Depreciation and
Amortization 9% 461 17% 1,039 579 126%
Loss from sale of fixed
assets and other
expenses 4% 203 (1)% (33) (236) (116)%
Comprehensive Financing
Cost
Interest Expense -
Net (23)% (1,119) (18)% (1,122) (3) (0)%
Exchange gain (loss) 1% 72 9% 574 502 n.m.
Gain from net
monetary position 10% 482 7% 450 (32) (7)%
(12)% (565) (2)% (98) 467 83%
Loss before taxes (40)% (1,928) (11)% (659) 1,269 66%
Tax Provisions (3)% (161) (1)% (55) 106 66%
Equity in income (loss)
of subsidiaries (0)% (14) 0% -- 14 n.a.
Extraordinary item 1% 42 0% -- (42) n.a.
Minority interest 0% 5 0% 8 2 44%
--
Net loss (42)% (2,055) (12)% (706) 1,350 66%
7
GRUPO IUSACELL, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
12M04 12M05 Change
--------------------- --------------------- ---------------------
Cash and cash
equivalents 4 0% 40 0% 35 n.m.
Customers 350 3% 312 3% (38) (11)%
Due from related
parties 43 0% 178 2% 135 n.m.
Advanced payments and
other receivables 325 3% 297 3% (28) (9)%
Unamortized handset
subsidy -- 0% 441 4% 441 100%
Inventories 340 3% 59 1% (281) (83)%
Current assets 1,062 9% 1,326 12% 264 n.m.
Fixed assets 7,308 64% 6,289 58% (1,019) (14)%
Goodwill - Net 1,856 16% 1,856 17% -- 0%
Other assets 1,112 10% 1,353 13% 241 22%
-- 0%
Total assets 11,338 100% 10,824 100% (514) (5)%
Short-term debt 9,128 81% 8,406 78% (722) (8)%
Accrued interest 1,685 15% 2,331 22% 646 38%
Short-term liabilities
with financial cost 10,813 95% 10,737 99% (76) (1)%
Suppliers 340 3% 431 4% 91 27%
Related parties 365 3% 324 3% (40) (11)%
Unaccrued air time 161 1% 117 1% (45) (28)%
Accumulated expenses
and other payables 819 7% 999 9% 179 22%
Short-term liabilities
without financial cost 1,686 15% 1,871 17% 185 11%
SHORT-TERM LIABILITIES 12,499 110% 12,608 116% 109 1%
LONG-TERM LIABILITIES 26 0% 1 0% (25) (96)%
Advances from customers -- 291 3% 291 100%
STOCKHOLDERS' EQUITY (1,187) (10)% (2,076) (19)% (889) (75)%
LIABILITIES + EQUITY 11,338 100% 10,824 100% (514) (5)%
8
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
4Q04 4Q05 Change
--------------------- --------------------- --------------------
QUARTERLY INCOME STATEMENT
Gross Revenues 106% 1,493 105% 1,885 392 26%
Commissions (6)% (83) (5)% (93) (10) (12)%
Net Revenues 100% 1,410 100% 1,792 382 27%
Cost of services 50% 706 45% 814 108 15%
Handsets' subsidy 21% 291 14% 255 (35) (12)%
Total Cost 71% 996 60% 1,069 73 7%
Gross Profit 29% 413 40% 723 310 75%
Operating Expenses 27% 380 23% 406 26 7%
Depreciation and
Amortization 30% 429 20% 363 (66) (15)%
Total Expenses 57% 809 43% 769 (40) (5)%
Operating Loss (28)% (395) (3)% (46) 349 88%
Operating Profit before
Depreciation and
Amortization 2% 34 18% 317 283 n.m.
(Loss) profit from sale
of fixed assets and
other (4)% (58) 1% 11 69 119%
Comprehensive Financing
Cost
Interest Expense -
Net (10)% (139) (7)% (134) 5 3%
Exchange gain
(loss) 8% 120 5% 93 (27) (22)%
Gain from net
monetary position 1% 8 5% 84 77 n.m.
(1)% (11) 2% 44 55 n.m.
Loss before taxes (33)% (465) 0% 9 473 102%
Tax Provisions 1% 20 1% 18 (2) (11)%
Equity in income (loss)
of subsidiaries (1)% (14) 0% -- 14 n.a.
Extraordinary item 0% -- 0% -- -- n.a.
Minority interest 0% 3 1% 12 9 n.m.
Net income (loss) (32)% (456) 2% 38 494 108%
9
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
12M04 12M05 Change
--------------------- --------------------- ---------------------
ACCUMULATED INCOME
STATEMENT
Gross Revenues 106% 5,360 106% 6,679 1,319 25%
Commissions (6)% (326) (6)% (385) (59) (18)%
Net Revenues 100% 5,034 100% 6,295 1,260 25%
Cost of services 45% 2,283 46% 2,917 635 28%
Handsets' subsidy 18% 896 10% 654 (242) (27)%
Total Cost 63% 3,178 57% 3,571 393 12%
Gross Profit 37% 1,856 43% 2,724 868 47%
Operating Expenses 25% 1,283 26% 1,660 377 29%
Depreciation and
Amortization 37% 1,863 23% 1,417 (446) (24)%
Total Expenses 62% 3,146 49% 3,076 (69) (2)%
Operating Loss (26)% (1,290) (6)% (353) 937 73%
Operating Profit before
Depreciation and
Amortization 11% 573 17% 1,064 490 86%
(Loss) profit from sale
of fixed assets and other 1% 61 (0)% (24) (85) (139)%
Comprehensive Financing
Cost
Interest Expense -
Net (9)% (462) (8)% (503) (41) (9)%
Exchange gain
(loss) 1% 31 4% 279 248 n.m.
Gain from net
monetary position 3% 176 2% 119 (57) (33)%
(5)% (256) (2)% (106) 150 59%
Loss before taxes (29)% (1,484) (8)% (482) 1,002 68%
Tax Provisions (3)% (139) (1)% (54) 86 64%
Equity in income (loss)
of subsidiaries (0)% (14) 0% -- 14 n.a.
Extraordinary item 0% -- 0% -- -- n.a.
Minority interest 0% 5 0% 8 2 44%
Net income (loss) (32)% (1,632) (8)% (528) 1,104 68%
10
GRUPO IUSACELL CELULAR, S.A. DE C.V. AND
SUBSIDIARIES
MILLIONS OF MEXICAN PESOS OF DECEMBER 31,
2005 PURCHASING POWER
(UNAUDITED FIGURES)
12M04 12M05 Change
------------------- ------------------- --------------------
Cash and cash
equivalents 2 0% 20 0% 18 n.m.
Customers 340 3% 313 3% (27) (8)%
Due from related
parties 516 5% 654 7% 138 27%
Advanced payments and
other receivables 259 3% 242 2% (18) (7)%
Unamortized handset
subsidy - 0% 441 5% 441 n.a.
Inventories 340 3% 59 1% (281) (83)%
Current assets 1,458 14% 1,728 18% 270 19%
Fixed assets 6,700 65% 5,668 58% (1,032) (15)%
Goodwill - Net 1,667 16% 1,667 17% -- 0%
Other assets 461 4% 715 7% 254 55%
Total assets 10,285 100% 9,777 100% (508) (5)%
Suppliers 328 3% 368 4% 40 12%
Accumulated expenses
and other payables 1,152 11% 1,343 14% 191 17%
Related parties 516 5% 540 6% 24 5%
Short-term debt 4,789 47% 4,410 45% (379) (8)%
Short-term liabilities 6,784 66% 6,661 68% (123) (2)%
Long-term debt 0 0% 0 0% (0) (3)%
TOTAL LIABILITIES 6,785 66% 6,661 68% (123) (2)%
DEFERRED CREDITS
Advances from customers -- 0% 291 3% 291 n.a.
STOCKHOLDERS' EQUITY 3,501 34% 2,825 29% (675) (19)%
LIABILITIES + EQUITY 10,285 100% 9,777 100% (508) (5)%
SOURCE Grupo Iusacell, S.A. de C.V.
-0- 02/24/2006
/CONTACT: Jose Luis Riera K., Chief Financial Officer,
+011-52-55-5109-5927, or J. Victor Ferrer V., Finance Manager,
+011-52-55-5109-5273, or vferrer@iusacell.com.mx, both of Grupo Iusacell/
/Web site: http://www.iusacell.com /
11