US telecoms remained stable in 2012, says Fitch Ratings

08 January 2013 | Kavit Majithia


The US telecoms and cable sector’s liquidity and margin remained stable throughout 2012, according to Fitch Ratings.

Fitch commented on competitive pressures and minimal organic growth opportunities that existed in the US throughout the year, but maintained that Q3 revenues remained strong.

Free cash flow in the sector also improved in Q3, to $36 billion, and short-term investment balance sheets across the sector increased by over $10 billion mainly through debt issuance.

According to Fitch, Comcast generated almost $7 billion more than Q2 balances by the end of the year, largely due to Verizon’s deal to acquire SpectrumCo.

Capital intensity in the US telecoms sector ranged between 13.5% and 14%, but Fitch expects this to be lower in 2013.

It does expect operators to continue to invest in wireless spending with the deployment of 4G LTE technology, and AT&T has announced it will boost capital spend until 2015 to expand wireless and wireline broadband networks.

To read Fitch Ratings’ assessment of western European operators click here.