Fitch: 2015 Latin America Telecom Outlook Stable Despite Weakening Trend Amid Market Maturity

CHICAGO--()--Fitch Ratings expects Latin American telecom operators' credit profile to remain broadly stable in 2015 underpinned by stable operational cash generation. On-going margin erosion coupled with high capex would result in modest leverage increase; however, most operators should have enough financial capacity to withstand the effects.

High mobile penetration rates in the region indicates subdued underlying growth potential in coming years, although increasing data consumption should mitigate this risk to an extent. Also, potential mergers and acquisitions in Mexico and Brazil would have far-reaching effects and materially change the competitive landscapes.

Main downside risks, aside from M&A events, include heated price competition for additional market share, as well as excessive shareholder distributions, which could further dampen the weak cash generation.

For more information on Fitch's expectations for the sector in the coming year, see 'Outlook 2015: Latin America Telecommunications' on www.fitchratings.com or by clicking on the link above.

Additional information is available at 'www.fitchratings.com'

Applicable Criteria and Related Research: 2015 Outlook: Latin America Telecom (Weakening Trend amid Market Maturity)

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=816248

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Contacts

Fitch Ratings
Primary Analyst
Alvin Lim, CFA
Director
+1 312-368-3114
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Sergio Rodriguez, CFA
Senior Director
+52 81-8399-9100
or
Media Relations, New York
Alyssa Castelli, Tel: +1 212-908 0540
alyssa.castelli@fitchratings.com

Contacts

Fitch Ratings
Primary Analyst
Alvin Lim, CFA
Director
+1 312-368-3114
Fitch Ratings, Inc.
70 West Madison Street
Chicago, IL 60602
or
Secondary Analyst
Sergio Rodriguez, CFA
Senior Director
+52 81-8399-9100
or
Media Relations, New York
Alyssa Castelli, Tel: +1 212-908 0540
alyssa.castelli@fitchratings.com