Sri Lanka Telecom rating outlook cut to negative from stable - S&P

Standard & Poor's Ratings Services said it has cut its ratings outlook on Sri Lanka Telecom PLC (SLT) to negative from stable, reflecting a similar rating action on Sri Lanka.

The negative outlook on SLT reflects country risk factors and the business environment in which the company operates, S&P said.

The outlook revision reflects concerns about Sri Lanka's weakening fiscal consolidation effort and the unfavourable trends evident in the country's debt profile, the ratings agency said.

Although there is no immediate impact on SLT's credit profile and its short-term liquidity is adequate, operating and funding risks could increase in the near to medium-term given the country's weakening economic and political conditions, S&P said.

S&P has also affirmed the company's 'BB-' corporate credit rating and long-term debt rating, after affirming the sovereign ratings on Sri Lanka.

SLT's ratings reflect intensifying competition, weak regulatory environment and high capital expenditure requirements, S&P said.