Obbligazioni societarie Monitor bond Telecom Europa VI (gennaio - luglio 2009)
- Creatore Discussione Imark
- Data di Inizio
Imark
Forumer storico
Il riconoscimento di S&P a conferma del fatto che le maggiori telecom europee saranno uno dei comparti più resistenti alla crisi in essere.
Qualche problema in area EMEA verrà per alcune telecom HY (quelle russe in particolare, suppongo) e per alcune cable europee, per problemi quali l'alto leverage per le seconde e a qualche difficoltà di servire e rifinanziare il debito (spesso denominato in valuta pregiata) ed approvvigionarsi per il funding per le prime.
S&P Addresses The Top 10 Investor Questions For Europe's Telecoms And Cable Sector In 2009
MILAN (Standard & Poor's) April 16, 2009--Standard & Poor's Ratings Services has addressed the top 10 investor questions on the telecoms and cable sector in Europe, the Middle East, and Africa, in a report published today titled "Top10 Investor Questions For Europe's Telecoms And Cable Sector In 2009."
"At this stage, we expect the largest European telecom operators to be among the sectors least affected, from an operating standpoint, by the global economic recession," said Standard & Poor's credit analyst Guy Deslondes.
We anticipate a good degree of resilience in operating measures during 2009, at least in comparison to most industrial sectors.
However, it is important to differentiate between the various telecom
segments and geographies. We are particularly cautious with respect to some significant challenges facing several rated operators, mostly speculative grade. These include macroeconomic trends in emerging markets, the highly leveraged capital structure of some telecom and cable operators in a context of anemic growth, and operating leverage.
The article explains Standard & Poor's expectations for the rated issuers
in the sector. We focus on the 17 investment-grade European telecom operators, which reported a combined nearly €300 billion of gross financial debt at year-end 2008. We also review the main near-term risks for EMEA
speculative-grade telcos, and shed light on which ratings we perceive to be the most vulnerable to change.
We will also elaborate on our views for the sector during 2009 in the
seminars we are offering as a part of our telecoms road show across Europe in April and May. These events will take place in Frankfurt (April 30), Paris (May 6), London (April 29), Milan (May 26), Stockholm (May 29), and in Milan (to be determined in May).
Qualche problema in area EMEA verrà per alcune telecom HY (quelle russe in particolare, suppongo) e per alcune cable europee, per problemi quali l'alto leverage per le seconde e a qualche difficoltà di servire e rifinanziare il debito (spesso denominato in valuta pregiata) ed approvvigionarsi per il funding per le prime.
S&P Addresses The Top 10 Investor Questions For Europe's Telecoms And Cable Sector In 2009
MILAN (Standard & Poor's) April 16, 2009--Standard & Poor's Ratings Services has addressed the top 10 investor questions on the telecoms and cable sector in Europe, the Middle East, and Africa, in a report published today titled "Top10 Investor Questions For Europe's Telecoms And Cable Sector In 2009."
"At this stage, we expect the largest European telecom operators to be among the sectors least affected, from an operating standpoint, by the global economic recession," said Standard & Poor's credit analyst Guy Deslondes.
We anticipate a good degree of resilience in operating measures during 2009, at least in comparison to most industrial sectors.
However, it is important to differentiate between the various telecom
segments and geographies. We are particularly cautious with respect to some significant challenges facing several rated operators, mostly speculative grade. These include macroeconomic trends in emerging markets, the highly leveraged capital structure of some telecom and cable operators in a context of anemic growth, and operating leverage.
The article explains Standard & Poor's expectations for the rated issuers
in the sector. We focus on the 17 investment-grade European telecom operators, which reported a combined nearly €300 billion of gross financial debt at year-end 2008. We also review the main near-term risks for EMEA
speculative-grade telcos, and shed light on which ratings we perceive to be the most vulnerable to change.
We will also elaborate on our views for the sector during 2009 in the
seminars we are offering as a part of our telecoms road show across Europe in April and May. These events will take place in Frankfurt (April 30), Paris (May 6), London (April 29), Milan (May 26), Stockholm (May 29), and in Milan (to be determined in May).
lorenzo63
Age quod Agis
LONDON (Dow Jones)--A proposal toward fixing Italy's crowded telecoms market: Hutchison Whampoa Ltd. (0013.HK), owner of 3, the fourth Italian mobile operator, should swap shares with Spain's Telefonica S.A. (TEF.MC).
In a strange twist, this could make Argentina's regulator key to a restructuring of the Italian telecoms market. It might also satisfy parties all round.
Telecom Italia SpA (TIT.MI) is presently wanting to exercise its call option on Sofora, a holding company with a 37% stake in Telecom Argentina S.A. (TEO).
The deal is being blocked as Telefonica holds a stake in Telecom Italia via a holding company called Telco, meanwhile also having its own presence in the Argentine market.
One simple route out of the dilemma is for Telefonica to exit Telco - the problem being that it bought its Telecom Italia stake for EUR2.85 a share. Telecom Italia stock now languishes around EUR1 and Telefonica wouldn't want to walk away at this level.
Meanwhile, the market is speculating on the future of 3 Italia. Its recent results were weak, partly due to regulatory changes but mainly because of a saturated mobile market and a weak economy.
Analysts have penciled in an enterprise value of around EUR3.5 billion for the operator, a far cry from the EUR12 billion to EUR15 billion value Hutchison attempted to reach in a failed initial public offering a few years ago.
The problem for Hutchison is that it has ploughed in far more than the analysts' sum-of-the-parts calculation. The operation has yet to go free-cashflow positive - the license alone cost EUR3.3 billion - and net cash outflow totals more than EUR10 billion since inception.
But the rapid and similar decline of Telecom Italia and 3 Italia's value in the past few years allows for a face-saving share swap - 3 Italia merges with Telecom Italia with Hutchison Whampoa receiving Telecom Italia shares (via Telco or directly), while Telefonica receives shares in Hutchison Whampoa in lieu of its holding in Telco.
This would provide a number of sources of upside. The merger of two mobile operators would consolidate the Italian market; Hutchison Whampoa would no longer have a cash drain; Telefonica would exit Telecom Italia and reduce regulatory risk in Latin America; the transactions would be mostly in shares; lastly, the share swaps could be set at prices which match both parties' expectations.
All this needs is a round of Spanish-Italian-Chinese and Argentine cooperation. Easy really
In a strange twist, this could make Argentina's regulator key to a restructuring of the Italian telecoms market. It might also satisfy parties all round.
Telecom Italia SpA (TIT.MI) is presently wanting to exercise its call option on Sofora, a holding company with a 37% stake in Telecom Argentina S.A. (TEO).
The deal is being blocked as Telefonica holds a stake in Telecom Italia via a holding company called Telco, meanwhile also having its own presence in the Argentine market.
One simple route out of the dilemma is for Telefonica to exit Telco - the problem being that it bought its Telecom Italia stake for EUR2.85 a share. Telecom Italia stock now languishes around EUR1 and Telefonica wouldn't want to walk away at this level.
Meanwhile, the market is speculating on the future of 3 Italia. Its recent results were weak, partly due to regulatory changes but mainly because of a saturated mobile market and a weak economy.
Analysts have penciled in an enterprise value of around EUR3.5 billion for the operator, a far cry from the EUR12 billion to EUR15 billion value Hutchison attempted to reach in a failed initial public offering a few years ago.
The problem for Hutchison is that it has ploughed in far more than the analysts' sum-of-the-parts calculation. The operation has yet to go free-cashflow positive - the license alone cost EUR3.3 billion - and net cash outflow totals more than EUR10 billion since inception.
But the rapid and similar decline of Telecom Italia and 3 Italia's value in the past few years allows for a face-saving share swap - 3 Italia merges with Telecom Italia with Hutchison Whampoa receiving Telecom Italia shares (via Telco or directly), while Telefonica receives shares in Hutchison Whampoa in lieu of its holding in Telco.
This would provide a number of sources of upside. The merger of two mobile operators would consolidate the Italian market; Hutchison Whampoa would no longer have a cash drain; Telefonica would exit Telecom Italia and reduce regulatory risk in Latin America; the transactions would be mostly in shares; lastly, the share swaps could be set at prices which match both parties' expectations.
All this needs is a round of Spanish-Italian-Chinese and Argentine cooperation. Easy really
Imark
Forumer storico
Se in linea di massima le telecom sono destinate a resistere alla crisi meglio di aziende di altri comparti, non tutte sembrano in grado di confermare indicazioni di crescita moderata anche in questo contesto, come di recente hanno fatto KPN e PT.
Così ad esempio Deutsche Telekom ha ritenuto di dovere rivedere al ribasso il suo outlook per il 2009. D'altronde, non a caso si tratta di un recente pick dei simpatici danesi di Jyske Bank (che qualche lavoretto con i CDS, sotto sotto...
)
Intendiamoci, se si pensa alle case automobilistiche che vedono percipitare i fatturati e accumulare debito industriale, viene quasi da sorridere allo stimato calo dell'EBITDA previsto da DT nell'ordine del 2-4% rispetto al 2008 e della conseguente decisione di tagliare il capex per l'anno di 1 mld euro così da raggiungere l'obiettivo di conseguire un FCF di di 6,4 mld euro nel 2009, contro i 7 mld euro preventivati a febbraio.
Peraltro l'EBITDA del Q1/2009, stando a queste anticipazioni, dovrebbe essere salito cresciuto intorno al 3%.
Qualche rischio più serio, in prospettiva, resta in ordine alla forte realizzazione di fatturato in USD, e andrebbe verificato se è stato fatto hedging a fronte di una possibile forte svalutazione del dollaro nel futuro prossimo venturo. Probabilmente è su questo fattore che puntano gli amici della banca danese...
UPDATE 3-Deutsche Telekom slashes outlook as crisis hits
Tue Apr 21, 2009 12:29pm EDT
* Sees core profit down 2-4 percent in 2009
* Had earlier forecast steady adj EBITDA of 19.5 bln eur
* Shares fall more than 10 percent
(Adds details, fresh analyst comment, closing share price)
FRANKFURT, April 21 (Reuters) - The economic crisis finally hit Deutsche Telekom (DTEGn.DE), Europe's biggest telecoms group, as weak conditions and tough competition in major markets forced the company to slash its profit expectations for 2009.
Slumping profit in the United States and Britain as well as the falling Polish zloty and British pound will push down adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) by 2 percent to 4 percent from the 19.5 billion euros ($25.17 billion) in 2008, the company said on Tuesday.
The Bonn-based telecoms group had as late as February predicted profits would remain stable this year, but officials said the worsening environment made that untenable.
"Given the fact that Deutsche Telekom generates half of its total revenues outside the euro zone, negative affects from currency fluctuations might even get worse," said DZ Bank analyst Marcus Pratsch.
"Further risks result from the faster-than-anticipated decline in the U.S. business and from the aggressive competition in the imminent spectrum auctions."
Deutsche Telekom shares (DTEGn.DE) declined as much as 11 percent. They closed down 7.2 percent at 9.01 euros, the leading decliner among firmer German blue chips .GDAXI and European telecom companies.
The DJ Stoxx Telecoms index .SXKP declined 1.8 percent.
Telecommunications, a sector similar to utilities in which demand is usually little influenced from an economic downturn, is showing the first signs of a weakening business situation due to the economic crisis.
Swisscom AG (SCMN.VX) said on Tuesday the crisis will weigh on first-quarter results and niche telecom operator Millicom posted worse-than-expected core earnings in the first quarter.
Deutsche Telekom also competes with British Vodafone (VOD.L), Spain's Telefonica (TEF.MC), France Telecom (FTE.PA) and Telecom Italia (TLIT.MI).
In order to reach free cash flow -- the basis of its dividend -- of 6.4 billion euros in 2009, Telekom is freezing 1 billion euros in capital expenditure, it said.
First-quarter adjusted EBITDA of the German group rose around 3 percent to 4.8 billion euros, it said. It forecast 2009 free cash flow of around 6.4 billion euros versus the 7 billion it had expected in February. (Reporting by Nikola Rotscheroth, Peter Dinkloh, Nicola Leske and Christoph Steitz, writing by Michael Shields and Peter Dinkloh; Editing by Sharon Lindores) ($1=.7748 Euro)
Così ad esempio Deutsche Telekom ha ritenuto di dovere rivedere al ribasso il suo outlook per il 2009. D'altronde, non a caso si tratta di un recente pick dei simpatici danesi di Jyske Bank (che qualche lavoretto con i CDS, sotto sotto...
)Intendiamoci, se si pensa alle case automobilistiche che vedono percipitare i fatturati e accumulare debito industriale, viene quasi da sorridere allo stimato calo dell'EBITDA previsto da DT nell'ordine del 2-4% rispetto al 2008 e della conseguente decisione di tagliare il capex per l'anno di 1 mld euro così da raggiungere l'obiettivo di conseguire un FCF di di 6,4 mld euro nel 2009, contro i 7 mld euro preventivati a febbraio.
Peraltro l'EBITDA del Q1/2009, stando a queste anticipazioni, dovrebbe essere salito cresciuto intorno al 3%.
Qualche rischio più serio, in prospettiva, resta in ordine alla forte realizzazione di fatturato in USD, e andrebbe verificato se è stato fatto hedging a fronte di una possibile forte svalutazione del dollaro nel futuro prossimo venturo. Probabilmente è su questo fattore che puntano gli amici della banca danese...
UPDATE 3-Deutsche Telekom slashes outlook as crisis hits
Tue Apr 21, 2009 12:29pm EDT
* Sees core profit down 2-4 percent in 2009
* Had earlier forecast steady adj EBITDA of 19.5 bln eur
* Shares fall more than 10 percent
(Adds details, fresh analyst comment, closing share price)
FRANKFURT, April 21 (Reuters) - The economic crisis finally hit Deutsche Telekom (DTEGn.DE), Europe's biggest telecoms group, as weak conditions and tough competition in major markets forced the company to slash its profit expectations for 2009.
Slumping profit in the United States and Britain as well as the falling Polish zloty and British pound will push down adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) by 2 percent to 4 percent from the 19.5 billion euros ($25.17 billion) in 2008, the company said on Tuesday.
The Bonn-based telecoms group had as late as February predicted profits would remain stable this year, but officials said the worsening environment made that untenable.
"Given the fact that Deutsche Telekom generates half of its total revenues outside the euro zone, negative affects from currency fluctuations might even get worse," said DZ Bank analyst Marcus Pratsch.
"Further risks result from the faster-than-anticipated decline in the U.S. business and from the aggressive competition in the imminent spectrum auctions."
Deutsche Telekom shares (DTEGn.DE) declined as much as 11 percent. They closed down 7.2 percent at 9.01 euros, the leading decliner among firmer German blue chips .GDAXI and European telecom companies.
The DJ Stoxx Telecoms index .SXKP declined 1.8 percent.
Telecommunications, a sector similar to utilities in which demand is usually little influenced from an economic downturn, is showing the first signs of a weakening business situation due to the economic crisis.
Swisscom AG (SCMN.VX) said on Tuesday the crisis will weigh on first-quarter results and niche telecom operator Millicom posted worse-than-expected core earnings in the first quarter.
Deutsche Telekom also competes with British Vodafone (VOD.L), Spain's Telefonica (TEF.MC), France Telecom (FTE.PA) and Telecom Italia (TLIT.MI).
In order to reach free cash flow -- the basis of its dividend -- of 6.4 billion euros in 2009, Telekom is freezing 1 billion euros in capital expenditure, it said.
First-quarter adjusted EBITDA of the German group rose around 3 percent to 4.8 billion euros, it said. It forecast 2009 free cash flow of around 6.4 billion euros versus the 7 billion it had expected in February. (Reporting by Nikola Rotscheroth, Peter Dinkloh, Nicola Leske and Christoph Steitz, writing by Michael Shields and Peter Dinkloh; Editing by Sharon Lindores) ($1=.7748 Euro)
Ultima modifica:
nochicco
Forumer attivo
Caro mark
mi rivolgo a te che che sei un competentissimo in tlc oggi ho visto un volume spropositato su KPN 2015 4 % sai per caso la motivazione oppure si sono accorti che era un pochino sottovalutata io la ho in carico a 94 oggi 96 con un 1200000,00 di volume mai visti io le ho da 2 anni ,ti ringrazio
mi rivolgo a te che che sei un competentissimo in tlc oggi ho visto un volume spropositato su KPN 2015 4 % sai per caso la motivazione oppure si sono accorti che era un pochino sottovalutata io la ho in carico a 94 oggi 96 con un 1200000,00 di volume mai visti io le ho da 2 anni ,ti ringrazio
Imark
Forumer storico
mi rivolgo a te che che sei un competentissimo in tlc oggi ho visto un volume spropositato su KPN 2015 4 % sai per caso la motivazione oppure si sono accorti che era un pochino sottovalutata io la ho in carico a 94 oggi 96 con un 1200000,00 di volume mai visti io le ho da 2 anni ,ti ringrazio
Al post 532, un paio di pagine indietro, c'è la conferma degli obiettivi di crescita stimati per il 2010 da parte di KPN ... la ragione è quella...
nochicco
Forumer attivo
Grazie
molto gentile caro MarkAl post 532, un paio di pagine indietro, c'è la conferma degli obiettivi di crescita stimati per il 2010 da parte di KPN ... la ragione è quella...
Imark
Forumer storico
Pensavo avrebbero aspettato almeno la trimestrale Q1/2009 per upgradare Portugal Telecom, invece si sono mossi in anticipo, quantomeno quelli di S&P, e l'innalzamento del rating è arrivato già ieri...
Le ragioni, quelle indicate in passato: il graduale deleverage, che potrà accellerare ultimato l'adempimento agli impegni in termini di distribuzioni agli azionisti assunti nel respingere la scalata di Sonaecom; i margini operativi superiori alla media delle telecom europee; la ristrutturazione, coronata da successo della brasiliana Vivo, operante in un mercato per il quale è prevista ulteriore crescita anche nei prossimi anni; la stabilizzazione delle utenze portoghesi su linea fissa, legata al buon andamento dell'offerta dei servizi di IPTv e dei pacchetti di triple play.
Per un paio di anni, i portoghesi dovrebbero stazionare su questi livelli di rating.
[FONT=Arial, Helvetica, sans-serif]Portugal Telecom Ratings Raised To 'BBB/A-2' On Robust Operating Metrics And Moderating Leverage; Outlook Stable[/FONT]
LONDON (Standard & Poor's) April 21, 2009--Standard & Poor's Ratings Services said today that it raised its long-term corporate credit rating on leading Portuguese telecommunications provider Portugal Telecom SGPS S.A. (PT) to 'BBB' from 'BBB-' and its short-term corporate credit rating to 'A-2' from 'A-3'. The outlook is stable.
"The upgrade recognizes the improving dynamics in Portugal Telecom's domestic wireline business, the strengthening performance of the Brazilian operations to the extent that dividends can be paid, and consistently sound domestic mobile operations," said Standard & Poor's credit analyst Simon Redmond.
In addition, we anticipate leverage moderating from the currently elevated levels (for the 'BBB' rating level) because the April 2009 dividend payment will mark the end of the share buyback and distribution package that stemmed from Sonaecom SPGS S.A.'s bid for PT in 2006.
PT reported consolidated gross debt of €6.7 billion at Dec. 31, 2008, down from €7.1 billion at Sept. 30, 2008. Year-end fully adjusted debt was €7.6 billion.
The ratings on PT reflect the group's sound operating performance and established assets, adequate profitability after redundancy payments, and satisfactory free operating cash flow generation. These factors are offset by meaningful leverage, strong regulatory and competitive pressures, material pension commitments, some exposure to currency volatility, and only partial ownership and control of the Brazilian asset, Vivo Participacoes S.A. (Brazilian national scale rating brAA-/Stable/--).
PT's main three operating assets have leading market shares, and we expect that they should be able to defend their positions and cash generative capacity over the medium term.
In particular, the company reports that the rate of line loss at the Portuguese fixed line business is declining. PT attributes this to the strong uptake of its TV and bundled triple play offerings since their launch in 2008, albeit this has resulted in pressure on margins. We see customer retention as increasingly important because the economy may dampen growth across the main assets. Both mobile operations have to date continued to expand, more strongly in Brazil.
Regulatory pressures remain, as demonstrated by the 1 percentage point margin decline in the Portuguese mobile segment to 40.2% for the last quarter of 2008, mostly due to lower termination rates in 2008.
We anticipate relatively modest discretionary cash flow after dividends in 2009. The continued ramp-up in both costs and capital expenditure linked to the pay-TV business and fiber network investment in Portugal should offset relatively lower investment in Brazil.
Significantly, Vivo, PT's Brazilian mobile joint venture, is now able to make dividend distributions, and PT should receive about €40 million in 2009.
For the full year ended Dec. 31, 2008, debt to EBITDA--adjusted for operating leases, guarantees, unfunded postretirement benefit obligations, and redundancy costs--was 3.3x (on the basis of a 50% consolidation of Vivo). We anticipate this metric moderating to 3x during 2009 and toward 2.5x in 2010.
The stable outlook reflects our expectation that PT will sustain and expand consolidated operating cash flow generation such that moderating capital expenditures over the next two years will allow Standard &
Poor's-adjusted debt to EBITDA to decline toward 2.5x. This would leave PT well positioned at the rating level.
The outlook factors in PT's capacity to defend its core positions in the Portuguese telecoms market and the medium- to long-term benefit from Vivo's expansion. We also expect PT to generate solid funds from operations after redundancy payments and to contain net debt to EBITDA at about 3.0x by the end of 2009, on a Standard & Poor's-adjusted basis.
Downward rating pressure would be likely to develop if PT were to prioritize additional cash distributions to shareholders (beyond the ongoing dividends) or material acquisitions over debt reduction in the near term.
Alternatively, a reversal of currently improving operating trends might lead to a negative outlook revision.
We believe rating upside is unlikely given that the ratings assume an ongoing strengthening of metrics
Le ragioni, quelle indicate in passato: il graduale deleverage, che potrà accellerare ultimato l'adempimento agli impegni in termini di distribuzioni agli azionisti assunti nel respingere la scalata di Sonaecom; i margini operativi superiori alla media delle telecom europee; la ristrutturazione, coronata da successo della brasiliana Vivo, operante in un mercato per il quale è prevista ulteriore crescita anche nei prossimi anni; la stabilizzazione delle utenze portoghesi su linea fissa, legata al buon andamento dell'offerta dei servizi di IPTv e dei pacchetti di triple play.
Per un paio di anni, i portoghesi dovrebbero stazionare su questi livelli di rating.
LONDON (Standard & Poor's) April 21, 2009--Standard & Poor's Ratings Services said today that it raised its long-term corporate credit rating on leading Portuguese telecommunications provider Portugal Telecom SGPS S.A. (PT) to 'BBB' from 'BBB-' and its short-term corporate credit rating to 'A-2' from 'A-3'. The outlook is stable.
"The upgrade recognizes the improving dynamics in Portugal Telecom's domestic wireline business, the strengthening performance of the Brazilian operations to the extent that dividends can be paid, and consistently sound domestic mobile operations," said Standard & Poor's credit analyst Simon Redmond.
In addition, we anticipate leverage moderating from the currently elevated levels (for the 'BBB' rating level) because the April 2009 dividend payment will mark the end of the share buyback and distribution package that stemmed from Sonaecom SPGS S.A.'s bid for PT in 2006.
PT reported consolidated gross debt of €6.7 billion at Dec. 31, 2008, down from €7.1 billion at Sept. 30, 2008. Year-end fully adjusted debt was €7.6 billion.
The ratings on PT reflect the group's sound operating performance and established assets, adequate profitability after redundancy payments, and satisfactory free operating cash flow generation. These factors are offset by meaningful leverage, strong regulatory and competitive pressures, material pension commitments, some exposure to currency volatility, and only partial ownership and control of the Brazilian asset, Vivo Participacoes S.A. (Brazilian national scale rating brAA-/Stable/--).
PT's main three operating assets have leading market shares, and we expect that they should be able to defend their positions and cash generative capacity over the medium term.
In particular, the company reports that the rate of line loss at the Portuguese fixed line business is declining. PT attributes this to the strong uptake of its TV and bundled triple play offerings since their launch in 2008, albeit this has resulted in pressure on margins. We see customer retention as increasingly important because the economy may dampen growth across the main assets. Both mobile operations have to date continued to expand, more strongly in Brazil.
Regulatory pressures remain, as demonstrated by the 1 percentage point margin decline in the Portuguese mobile segment to 40.2% for the last quarter of 2008, mostly due to lower termination rates in 2008.
We anticipate relatively modest discretionary cash flow after dividends in 2009. The continued ramp-up in both costs and capital expenditure linked to the pay-TV business and fiber network investment in Portugal should offset relatively lower investment in Brazil.
Significantly, Vivo, PT's Brazilian mobile joint venture, is now able to make dividend distributions, and PT should receive about €40 million in 2009.
For the full year ended Dec. 31, 2008, debt to EBITDA--adjusted for operating leases, guarantees, unfunded postretirement benefit obligations, and redundancy costs--was 3.3x (on the basis of a 50% consolidation of Vivo). We anticipate this metric moderating to 3x during 2009 and toward 2.5x in 2010.
The stable outlook reflects our expectation that PT will sustain and expand consolidated operating cash flow generation such that moderating capital expenditures over the next two years will allow Standard &
Poor's-adjusted debt to EBITDA to decline toward 2.5x. This would leave PT well positioned at the rating level.
The outlook factors in PT's capacity to defend its core positions in the Portuguese telecoms market and the medium- to long-term benefit from Vivo's expansion. We also expect PT to generate solid funds from operations after redundancy payments and to contain net debt to EBITDA at about 3.0x by the end of 2009, on a Standard & Poor's-adjusted basis.
Downward rating pressure would be likely to develop if PT were to prioritize additional cash distributions to shareholders (beyond the ongoing dividends) or material acquisitions over debt reduction in the near term.
Alternatively, a reversal of currently improving operating trends might lead to a negative outlook revision.
We believe rating upside is unlikely given that the ratings assume an ongoing strengthening of metrics