Barbados: Digicel CEO says company sound

Barbados Today:-Telecommunications company Digicel says it “fundamentally disagrees” with a report by independent research provider CreditSights that the company was facing an uncertain future due to high debt, currency fluctuations and change in consumer behaviour.

The report, published on Saturday in the Irish Examiner, quoted CreditSights analyst Michael Chakardijan as saying in London last Wednesday that Digicel’s high debt levels of more than $6 billion left little room for manoeuvre.

It also contended that the change in Digicel users’ habits may hamper the company’s ability to increase margins by 24 percentage points by March 2018, while cutting costs by using technology and changing back office functions.

It said the company had been suffering from a decline in phone call revenue as users switch to the likes of Viber, WhatsApp and Skype.

Asked by Barbados TODAY to respond to the report and if there were any implications for the Barbados market, Chief Executive Officer of Digicel Barbados Conor Looney said: “Digicel fundamentally disagrees with the conclusions of the report”.

“Digicel’s outlook remains positive with robust plans to deliver by monetizing our network investment and through realistic cost management initiatives,” he added.

Digicel has said it was focusing on growing its earnings in order to reduce the company’s debt-to-earnings ratio while cutting costs.

As part of its upgrade earlier this year it was reported that by the end of 2016 Digicel would have invested over BDS$100 million in building out a state-of-the-art fibre network.

In November last year it was reported that the company had invested US$100 million in fibre technology and new services in Jamaica.

The UK publication reported that Digicel had two loans maturing in the near future. A $210 million loan it said that was due to be repaid in March 2018 and $90 million in project finance debt on its South Pacific business due to mature in August 2017.

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