You are here: Home » News-CM » Economy » News
Business Standard

Moody's: APAC telecommunications sector sees slowing but healthy revenue and EBITDA growth; outlook stable

Capital Market 

Investors Service says that slowing but still healthy revenue and growth drive its stable outlook for the Asia Pacific telecommunications sector over the next 12-18 months.

"Organic revenue growth will be broadly in line with our forecast average growth for the region, but lower than the 5.2% growth recorded in 2015, owing to increasing mobile penetration rates and ongoing competition," says Annalisa Di Chiara, a Vice President and Senior Credit Officer.

"Aggregate will grow, albeit slightly, as it did in 2015, but the portfolio's average margin will contract slightly amid intensifying competition, higher costs for providing data services and investments in margin-dilutive digital businesses," adds Di Chiara.

conclusions are contained in its recently-released report "Telecommunications -- Asia Pacific: Slowing but Still Healthy Revenue and Growth Drive Stable Outlook."

Revenue growth, generation and margins, and capex intensity are the three factors driving the outlook for the region's telecommunications industry.

expects year-on-year average revenue growth of 3%-4% over the next 12-18 months, growth of 0%-2%, and capex as a percentage of revenue to remain in the 23%-24% range.

margins, however, will on average contract slightly to around 39% by year-end 2017 from around 40% at year-end 2015.

Although capex will increase slightly in 2017 as operators continue to build out their 4G networks to handle larger volumes of data traffic, revenue growth will keep the capex-to-revenue ratio stable.

Average debt to will also rise slightly in 2016 on incremental debt used for acquisitions, capex and shareholder returns, but will return to 2015 levels next year in 2017 as incremental from acquired businesses will help offset the debt raised by these companies.

Liquidity remains a key credit strength for the sector, says Moody's, given the resilience of demand, which provides steady, recurring cash flows. The sector also has demonstrated strong access to the capital markets.

The rated portfolio's cash and projected cash flow from operations can cover all their cash demands, including capex, dividends and scheduled debt maturities, over the next 12 months.

Powered by Capital Market - Live News

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

RECOMMENDED FOR YOU

Moody's: APAC telecommunications sector sees slowing but healthy revenue and EBITDA growth; outlook stable

"Organic revenue growth will be broadly in line with our forecast average GDP growth for the region, but lower than the 5.2% growth recorded in 2015, owing to increasing mobile penetration rates and ongoing competition," says Annalisa Di Chiara, a Moody's Vice President and Senior Credit Officer. Investors Service says that slowing but still healthy revenue and growth drive its stable outlook for the Asia Pacific telecommunications sector over the next 12-18 months.

"Organic revenue growth will be broadly in line with our forecast average growth for the region, but lower than the 5.2% growth recorded in 2015, owing to increasing mobile penetration rates and ongoing competition," says Annalisa Di Chiara, a Vice President and Senior Credit Officer.

"Aggregate will grow, albeit slightly, as it did in 2015, but the portfolio's average margin will contract slightly amid intensifying competition, higher costs for providing data services and investments in margin-dilutive digital businesses," adds Di Chiara.

conclusions are contained in its recently-released report "Telecommunications -- Asia Pacific: Slowing but Still Healthy Revenue and Growth Drive Stable Outlook."

Revenue growth, generation and margins, and capex intensity are the three factors driving the outlook for the region's telecommunications industry.

expects year-on-year average revenue growth of 3%-4% over the next 12-18 months, growth of 0%-2%, and capex as a percentage of revenue to remain in the 23%-24% range.

margins, however, will on average contract slightly to around 39% by year-end 2017 from around 40% at year-end 2015.

Although capex will increase slightly in 2017 as operators continue to build out their 4G networks to handle larger volumes of data traffic, revenue growth will keep the capex-to-revenue ratio stable.

Average debt to will also rise slightly in 2016 on incremental debt used for acquisitions, capex and shareholder returns, but will return to 2015 levels next year in 2017 as incremental from acquired businesses will help offset the debt raised by these companies.

Liquidity remains a key credit strength for the sector, says Moody's, given the resilience of demand, which provides steady, recurring cash flows. The sector also has demonstrated strong access to the capital markets.

The rated portfolio's cash and projected cash flow from operations can cover all their cash demands, including capex, dividends and scheduled debt maturities, over the next 12 months.

Powered by Capital Market - Live News

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

image
Business Standard
177 22

Moody's: APAC telecommunications sector sees slowing but healthy revenue and EBITDA growth; outlook stable

Investors Service says that slowing but still healthy revenue and growth drive its stable outlook for the Asia Pacific telecommunications sector over the next 12-18 months.

"Organic revenue growth will be broadly in line with our forecast average growth for the region, but lower than the 5.2% growth recorded in 2015, owing to increasing mobile penetration rates and ongoing competition," says Annalisa Di Chiara, a Vice President and Senior Credit Officer.

"Aggregate will grow, albeit slightly, as it did in 2015, but the portfolio's average margin will contract slightly amid intensifying competition, higher costs for providing data services and investments in margin-dilutive digital businesses," adds Di Chiara.

conclusions are contained in its recently-released report "Telecommunications -- Asia Pacific: Slowing but Still Healthy Revenue and Growth Drive Stable Outlook."

Revenue growth, generation and margins, and capex intensity are the three factors driving the outlook for the region's telecommunications industry.

expects year-on-year average revenue growth of 3%-4% over the next 12-18 months, growth of 0%-2%, and capex as a percentage of revenue to remain in the 23%-24% range.

margins, however, will on average contract slightly to around 39% by year-end 2017 from around 40% at year-end 2015.

Although capex will increase slightly in 2017 as operators continue to build out their 4G networks to handle larger volumes of data traffic, revenue growth will keep the capex-to-revenue ratio stable.

Average debt to will also rise slightly in 2016 on incremental debt used for acquisitions, capex and shareholder returns, but will return to 2015 levels next year in 2017 as incremental from acquired businesses will help offset the debt raised by these companies.

Liquidity remains a key credit strength for the sector, says Moody's, given the resilience of demand, which provides steady, recurring cash flows. The sector also has demonstrated strong access to the capital markets.

The rated portfolio's cash and projected cash flow from operations can cover all their cash demands, including capex, dividends and scheduled debt maturities, over the next 12 months.

Powered by Capital Market - Live News

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

image
Business Standard
177 22

Upgrade To Premium Services

Welcome User

Business Standard is happy to inform you of the launch of "Business Standard Premium Services"

As a premium subscriber you get an across device unfettered access to a range of services which include:

  • Access Exclusive content - articles, features & opinion pieces
  • Weekly Industry/Genre specific newsletters - Choose multiple industries/genres
  • Access to 17 plus years of content archives
  • Set Stock price alerts for your portfolio and watch list and get them delivered to your e-mail box
  • End of day news alerts on 5 companies (via email)
  • NEW: Get seamless access to WSJ.com at a great price. No additional sign-up required.
 

Premium Services

In Partnership with

 

Dear Guest,

 

Welcome to the premium services of Business Standard brought to you courtesy FIS.
Kindly visit the Manage my subscription page to discover the benefits of this programme.

Enjoy Reading!
Team Business Standard