Telecom Credit Rating Remains Among Highest In NZ

Telecom's credit rating remains among the highest in New Zealand after a downgrade of its domestic currency rating by New York based credit rating agency Moody's Investor Service.

Moody's has downgraded its New Zealand dollar rating for Telecom Corporation of New Zealand Limited and its subsidiaries to Aa2 from Aa1 for senior debt and to Aa3 from Aa2 for subordinated debt. Moody's placed the domestic currency rating on review on 3 June.

"Telecom's current Moody's credit rating for New Zealand dollar denominated debt is as high as any other New Zealand based corporate," Chief Financial Officer Jeff White said today.

"The domestic debt market is well aware of Telecom's financial strength," he said.

Moody's said it had expanded its review to include Telecom's foreign currency ratings. Moody's said its review will include the funding of any future purchases of AAPT shares as well as Telecom's revenue growth prospects, potential investment opportunities, and operating and financial risk profile.

Telecom yesterday reported a 6.3 percent increase in earnings to $202 million for the three month period to 30 June 1999, based on a 2.7 percent increase in operating revenue to $848 million.

"These results demonstrate Telecom's profitability and financial strength," Mr White said.

ENDS

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