Fitch: Asia-Pacific Telecom Sector Well-Positioned to Manage Risks
Fitch Ratings stated today that its overall outlook for the Asia-Pacific telecommunications sector in 2008 is stable, with 24 out of its total 28 rated telecommunications issuers bearing a Stable Outlook. Highlighting its newly published “Asia-Pacific Telecoms Credit Outlook 2008″ 20 page report, the agency outlines its expectations on how key financial metrics will move for 26 operators across Asia-Pacific in 2008, concluding that while revenue growth is likely to slow, cash flow from operations (CFO) and free cash flow (FCF) after dividends are likely to rise on aggregate.
Nevertheless the agency cautioned that it expects FCF to actually fall for half of its rated operators across Asia-Pacific.
“While 24 out of our 28 rated telecom issuers have a Stable Outlook, and average leverage levels are expected to remain flat at 1.2x, this is not to say that the sector will be quiet, but rather reflects our view that the operators are relatively well-positioned to manage the risks,” says Matt Jamieson, senior director and head of Fitch’s Asia-Pacific telecommunications, media and technology team. Fitch believes the overall themes for 2008 will be competition, regulation, M&A and new technologies.