Fitch Affirms Comcast's IDR at 'BBB+'; Upgrades NBCUniversal's IDR to 'BBB+'; Outlook Positive

  Fitch Affirms Comcast's IDR at 'BBB+'; Upgrades NBCUniversal's IDR to
  'BBB+'; Outlook Positive

Business Wire

CHICAGO -- February 13, 2013

Fitch Ratings has affirmed the 'BBB+' Issuer Default Ratings (IDRs) assigned
to Comcast Corporation (Comcast) and its wholly owned subsidiaries included in
Comcast's cross-guaranty structure that hold all of the company's cable
businesses. Fitch has also upgraded the IDR assigned to NBCUniversal Media,
LLC (NBCUniversal, a direct wholly owned subsidiary of NBCUniversal, LLC) to
'BBB+' from 'BBB'. In addition, Fitch has affirmed specific issue ratings
assigned to Comcast and its subsidiaries and upgraded NBCUniversal's senior
unsecured issue ratings to 'BBB+' from 'BBB'. Lastly, the Rating Outlook for
all of Comcast's ratings has been revised to Positive from Stable.

Approximately $43.4 billion of Comcast's consolidated debt, including $11.2
billion outstanding at NBCUniversal as of Dec. 31, 2012 (pro forma for
Comcast's $2.95 billion issuance of senior unsecured notes during Jan. 2013)
is affected by Fitch's action.

KEY RATING DRIVERS

--Comcast's pending acquisition of the remaining 49% ownership stake in
NBCUniversal it does not own from General Electric Corporation (GE) is neutral
to Comcast's current ratings.

--Amendment of the existing cross guaranty structure to include the debt
issued by NBCUniversal leads to linkage of the ratings.

--The adoption of a more conservative 1.5x to 2x leverage target signals
leverage will further strengthen during ratings horizon.

Fitch believes Comcast has sufficient capacity within the current ratings to
accommodate the modest increase in leverage expected in connection with the
redemption of GE's ownership interest. The proposed transaction is viewed as a
positive event because it provides Comcast with unfettered access to
NBCUniversal's strong cash flow generation and removes the ownership overhang
from Comcast's credit profile. However, Comcast's redemption of GE's ownership
interest in NBCUniversal does not change the company's or NBCUniversal's
operating profile.

Fitch expects a large portion of the transaction will be funded with existing
cash. Comcast and NBCUniversal have executed several capital market and asset
sale transactions that have built the company's consolidated cash balance to
approximately $13.9 billion as of Dec. 31, 2012(pro forma for Comcast's $2.95
billion issuance of senior unsecured notes during January 2013). The balance
of the funding requirement will be satisfied through the issuance of $6
billion of incremental debt, including $4 billion of senior notes issued to
GE. Comcast's leverage increases to 2.4x pro forma for the transaction from an
estimated 2x as of year-end 2012. Fitch anticipates consolidated leverage to
improve to 2.2x by year-end 2013 and strengthen to 2x by the end of 2014.

The Positive Outlook reflects the foreseen improvement of Comcast's credit
protection metrics over the near term along with the more conservative
leverage target adopted by management. In Fitch's opinion, the company's
strong cable operating profile along with the margin improvement opportunities
within NBCUniversal's broadcasting segment and modest debt reduction will
enable Comcast to drive leverage within its new target during the current
ratings horizon.

The upgrade of NBCUniversal's IDR and senior unsecured ratings follows the
inclusion of NBCUniversal into Comcast's cross guaranty structure, which
effectively renders the NBCUniversal indebtedness to rank pari passu with the
debt currently included in the cross guaranty. Fitch estimates 88% of
consolidated debt will be included in the cross guaranty structure pro forma
for the GE redemption transaction. Comcast's and NBCUniversal's IDRs will be
linked by Fitch going forward. Comcast's addition of NBCUniversal Media's debt
into the cross guaranty structure together with the strong strategic tie and
ownership consolidation provide sound rationale for linking the ratings.

Fitch does not expect any material change to Comcast's capital allocation
strategy over the near term. The company maintains an appropriate balance
between returning capital to shareholders, in the form of dividends and share
repurchases, repaying debt, and investing in the strategic needs of its
business in Fitch's estimation. Cash returned to shareholders (dividends plus
buybacks) totaled $4.6 billion or approximately 58% of cash flow before
dividends during 2012. Comcast has elected to pull back from $3 billion to $2
billion on share repurchases during 2013 to facilitate the GE redemption
transaction. However Fitch expects the company's pre-dividend pay-out ratio
will increase over the medium term. As of Dec. 31, 2012 approximately $3.5
billion of capacity remains under Comcast's share repurchase authorization.

Fitch believes Comcast's strong operating profile and solid free cash flow
metrics afford the company a high degree of financial flexibility at the
current rating category. The company generated approximately $7.5 billion of
consolidated free cash flow (defined as cash provided by operating activities
less capital expenditures and dividends) during the latest-12-month (LTM)
period ended Dec. 31, 2012. Fitch anticipates that the company will
consistently generate consolidated free cash flow in excess of $7 billion.

Comcast's liquidity position and overall financial flexibility are strong
owing to Fitch's expectation that the company will continue to generate
material amounts of free cash flow. Fitch acknowledges that Comcast's share
repurchase program represents a significant use of cash; however, Fitch
believes that the company would reduce the level of share repurchases should
the operating environment materially change in order to maximize financial
flexibility. The liquidity position is further supported by cash on hand
(which totaled $11.0 billion on a consolidated basis as of Dec. 31, 2012) and
available borrowing capacity from Comcast's $6.25 billion revolver (of which
approximately $5.8 billion was available for borrowing). Comcast's revolver
will expire during June 2017.

Comcast's debt maturity profile on a consolidated basis is well laddered and
within Fitch's free cash flow (FCF) expectation for the company. Scheduled
maturities during 2013 total approximately $2.4 billion followed by $2 billion
during 2014 including approximately $900 million at NBCUniversal.

Fitch's ratings incorporate Comcast's strong competitive position as one of
the largest video, high speed internet and phone providers to residential and
business customers in the United States and the company's compelling
subscriber clustering profile with operations in 39 states and the District of
Columbia. In Fitch's view NBCUniversal's size, scale, leading brand positions
and diversity of operations and business risk as one of the world's leading
media and entertainment companies, lowers the business risk attributable to
Comcast's credit profile and creates new avenues for revenue and cash flow
growth while limiting the near-term impact on Comcast's balance sheet and
credit profile.

NBCUniversal's portfolio of leading cable networks is a key consideration
supporting Fitch's ratings and a key strength of the company's credit profile.
Fitch considers cable networks one of the strongest subsectors in the media
and entertainment industry, providing NBCUniversal with a revenue base largely
consisting of stable, recurring and high margin affiliate fee revenue
generated from multichannel video programming distributors as well as a
significant source of NBCUniversal's free cash flow generation. Fitch
acknowledges that increasing programming expense will weigh on cable network
operating margins.

Outside of a change to Comcast's financial strategy or event driven merger and
acquisition activity, rating concerns center on Comcast's ability to adapt to
the evolving operating environment while maintaining its relative competitive
position given the challenging competitive environment and soft housing and
employment trends. Considering the mature nature of video services and growing
penetration of high speed data services, Comcast's ability to grow consumer
revenues while maintaining operating margins remains a key rating
consideration.

Within NBCUniversal, rating concerns center on the secular issues challenging
NBCUniversal's Broadcast Television segment, including time-shifting
technologies and internet based content, as well as the cyclicality of
advertising revenues. Fitch believes that on a total company basis
NBCUniversal generates less than half of its revenues from advertising - in
line with its media peer group. The operating margins generated by
NBCUniversal's Broadcast Television segment lag its peer group. The company
believes that improved programming and scheduling can improve operating
margins. While the Filmed Entertainment business has a level of volatility,
Fitch believes there is sufficient capacity within NBCUniversal's current
ratings to accommodate the 'hit natured' fluctuation of the Filmed
Entertainment segment operating profile.

RATING SENSITIVITIES:

--Positive rating action would likely coincide with Comcast achieving leverage
below 2x on a sustained basis.

--Comcast would need to demonstrate that its operating profile will not
materially decline in the face of competition and less than robust housing and
employment conditions.

--Negative rating actions would likely coincide with discretionary actions of
Comcast's management including, but not limited to, the company adopting a
more aggressive financial strategy or an event driven merger and acquisition
activity, that drive leverage beyond 2.75x in the absence of a credible
de-leveraging plan.

Fitch affirms the following ratings with a Positive Outlook:

Comcast Corporation

--IDR at 'BBB+';

--Senior unsecured Debt at 'BBB+';

--$6.25 billion revolving bank facility (co-borrower with Comcast Cable
Communications LLC) at 'BBB+';

--Short-term IDR at 'F2';

--Commercial Paper at 'F2'.

Comcast Holdings Corporation

--IDR at 'BBB+';

--Subordinated Exchangeable Notes at 'BBB-'.

Comcast Cable Communications, LLC

--IDR at 'BBB+';

--Senior unsecured debt at 'BBB+';

--$6.25 billion revolving bank facility (co-borrower with Comcast) at 'BBB+'.

Comcast Cable Holdings, LLC

--IDR at 'BBB+';

--Senior unsecured debt at 'BBB+'.

Comcast MO Group, Inc.

--IDR at 'BBB+';

--Senior unsecured debt at 'BBB+'.

Comcast MO of Delaware, LLC

--IDR at 'BBB+'.

Fitch upgrades the following ratings for NBCUniversal with a Positive Outlook:

NBC Universal Media, LLC

--IDR to 'BBB+' from 'BBB';

--Senior unsecured debt to 'BBB+' from 'BBB';

--Senior Unsecured Revolver to 'BBB+' from 'BBB'.

Additional information is available at 'www.fitchratings.com'. The ratings
above were solicited by, or on behalf of, the issuer, and therefore, Fitch has
been compensated for the provision of the ratings.

Applicable Criteria and Related Research:

--'Corporate Rating Methodology' (Aug. 8, 2012);

--'Parent and Subsidiary Rating Linkage (Fitch's Approach to Rating Entities
Within a Corporate Group Structure)' (Aug. 8, 2012);

--'Rating Telecom Companies' (Aug. 9, 2012).

Applicable Criteria and Related Research:

Corporate Rating Methodology

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=684460

Parent and Subsidiary Rating Linkage

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=685552

Rating Telecom Companies

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=682323

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Contact:

Fitch Ratings
Primary Analyst
David Peterson, +1-312-368-3177
Senior Director
Fitch Ratings, Inc.
70 W. Madison Street
Chicago, IL 60602
or
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Senior Director
or
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Managing Director
or
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Email: brian.bertsch@fitchratings.com
 
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