Business Wire | January 4, 2011 | Press Release
BUENOS AIRES, Argentina–(BUSINESS WIRE)–Fitch Ratings expects the Rating Outlook for Latin America telecom and media companies to be Stable during 2011. The sector continues to be one of the less volatile in terms of rating changes in the region despite the dynamics of the operating environments.
Affirmation of existing ratings have prevailed during economic downturns and upturns in part due to well-established operators with incumbent positions, while rating changes tend to be more biased to newer competitors. Industry cash flow generation and financial flexibility should positively balance against a strong competitive environment and a mature or near mature stage of traditional voice services.
With aggregate penetration approaching 100% in the region, net additions are expected to slow down in the next few years. Fitch expects mobile operators to turn more aggressively towards expanding value-added services and broadband- and data-enabled services in order to compensate for the stabilization of voice services as the voice price per minute continues to decline.
Strong operating results are expected for regional media companies. Fitch’s expectation of GDP growth of 4.5% in Brazil and 3.5% in Mexico should help Globo’s and Televisa’s broadcasting business to continue posting strong results even if there is no special event such as the World Cup or Olympics during 2011.
Press Release via Business Wire
