From top: Denis O’Brien; Digicel’s 2020 debt yield rose to 15.4 percent from 8.5 percent, making it the ‘worst emerging markets performer this year’
It doesn’t rain but it pours.
O’Brien built his cell-phone empire, which stretches from Haiti to Papua New Guinea, on high-risk, high-yield debt. Since 2001, Digicel has accumulated about $6.5 billion of borrowings, mostly to build out networks across 31 regions.
More than two years after the company shelved a planned share sale in New York that was in part designed to pay down debt, and with recent earnings disappointing investors, bondholders want a positive catalyst. Digicel faces a $1.3 billion maturity in 2021, as well as the 2020 payment.
“We expect Digicel to address that with anticipation,” said Marie Fischer-Sabatie, an analyst at Moody’s Investors Service. “If the company doesn’t make material progress in 2018 and does not start to address the issue by the middle of this year, then we could start to see some pressure on ratings.”
REDACTED’s Digicel Q4,2017 results according “to a person familiar”, quarterly revenue down 3% to US$580m, EBITDA down 3% to $246m.
It has around $150m/qtr of interest & $100m/qtr of depreciation. So, it’s probably making a net loss.https://t.co/ctZqVDYzaz pic.twitter.com/UOd1mgwPTY
— NAMAwinelake (@namawinelake) April 13, 2018