Fitch Ratings has downgraded Telecom NZ’s long-term credit rating in the wake of a reduced earnings forecast for FY11-13.
Fitch downgraded Telecom’s foreign currency issuer default rating (IDR) and senior unsecured rating to A- from A and short-term IDR to F2 from F1.
Fitch also lowered Telecom’s senior subordinated rating to BBB+ from A-, even though Telecom has no debt of this type.
“Telecom has no senior subordinated debt and so Fitch’s announcement indicates its assessment of the long term debt we do have is A-,” Telecom CFO Russ Houlden said.
But he added that the company’s balance sheet remains strong and it has no requirement to borrow long-term during 2010.
Telecom yesterday downgraded its guidance for the net three years, blaming regulatory changes and a reduced revenue outlook.