S&P has cut Netia’s long-term corporate credit rating from B+ to B. According to S&P release Netia’s future earnings outlook is negative. Netia’s activities can have negative impact on free operating cash flow profile and there could be deterioration to its capital structure in the near term. Netia took a responsibility to capture 1 million broadband customers within three years. S&P release states that if the company does not meet its near future goals on investments in broadband, rating could be cut even further.
Our view: We expect the news, which has been announced on Friday afternoon, to have a negative on today’s trading.