Bloomberg the Company & Products

Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Oi Says Debt Levels Manageable as It Affirms 2012 Forecasts

Nov. 28 (Bloomberg) -- Oi SA, Brazil’s third-largest telecommunications company, affirmed 2012 earnings forecasts as Treasurer Bayard Gontijo said the credit-rating reduction by Moody’s Investors Service last month was unjustified.

The company’s leverage is within guidance provided to investors, Gontijo, who is also the company’s director of investor relations, said in telephone interview from New York. Oi is comfortable with its current level of debt and doesn’t foresee any challenges next year when it will move to refinance less than 10 percent of its outstanding obligations, he said.

“Investors are still comfortable with the credit risk of the company,” Gontijo said. “I do not see any reasons for any kind of doubts or questions about the quality of the credit.”

Oi became Brazil’s third-largest mobile-phone provider by revenue in the second quarter and retained that ranking in the third quarter, according to a presentation to investors made when the company announced its results for the three months ended in September. Moody’s cited an increase in Oi’s gross debt-to-earnings ratio over the past 2 1/2 years and regulators’ push for additional investment when it cut the company’s rating to the lowest investment grade on Oct. 30. Moody’s assigned a negative outlook to the rating.

Oi forecasts net revenue of 28.9 billion reais ($13.8 billion) this year and earnings before interest, taxes, depreciation and amortization of 8.8 billion reais.

The company’s benchmark notes due 2022 fell 0.08 cent to 103.28 cents on the dollar at 5:48 p.m. in New York, pushing the yield up one basis point, or 0.01 percentage point, to 5.29 percent, according to data compiled by Bloomberg. The shares have declined 26 percent this year in Sao Paulo.

To contact the reporter on this story: Boris Korby in New York at bkorby1@bloomberg.net;

To contact the editor responsible for this story: David Papadopoulos at papadopoulos@bloomberg.net

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.