Pakistan Credit Rating Agency Limited Revises Ratings of Worldcall Telecom Limited
Lahore: The Pakistan Credit Rating Agency Limited (PACRA) has revised the long-term and short-term entity ratings of Wordcall Telecom Limited (WTL) to “BBB-” (Triple B Minus) and “A3″ (A Three) respectively [Previous: A-/A2]. The ratings of the secured TFC issues of PKR 350mln and PKR 4,000mln have also been revised to “BBB” (Triple B)[Previous: A].
The ratings reflect stressed financial profile of the company. Over the recent period, WTL is experiencing weakening business prospects mainly due to heightened competition. Despite this its financial profile was uplift due to its association with Omantel.
The support was demonstrated in the form of US$ 35mln loan raised by WTL on the back of Omantel’s corporate guarantee. However, lately, this willingness to support has been hit by procedural snags, whereby committed injection of another US$ 35mln has been delayed. This has constrained WTL’s ability to timely meet its financial and commercial obligations.
WTL is pursuing grant of grace period (~60 days) for its debt obligations, mainly TFCs, while remaining current on interest payments. The management is hopeful to channelize funds from Omantel in this timeframe.
The negative outlook captures the uncertainty in timeliness of these actions. Meanwhile, the business and operating environment continues to remain challenging. WTL, in this scenario, is struggling to maintain its market share while rationalizing its cost structure.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town, Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425