London, 03 December (STA) - Rating agency Moody's has downgraded Telekom Slovenije's corporate rating by one notch to Ba2 with a negative outlook, citing the company's weak liquidity. The company's probability of default rating was downgraded to Ba2-PD from Ba1-PD and its baseline credit assessment to ba2 from ba1.
Moody's performed the downgrade due to concern about the company's liquidity, high reliance on the troubled banking sector and its reduced cash balance as a result of its larger-than-expected dividend paid in August."
Looking forward, Moody's expects a potentially high cash outflow at the early-2014 spectrum licence, which will reduce the free cash flow for debt repayment and force the company to rely more heavily on tapping financial markets.
Moody's last downgraded Telekom in April, citing similar concerns.