WASHINGTON (Sputnik) — The Fitch ratings agency has revised on Friday the outlook for Russian telecommunication holding T2 RTK from stable to negative, affirming the company’s long-term issuer default rating at ‘B+’.
"The change in the Outlook reflects our expectations that leverage will be higher than previously expected in 2017 and 2018," the agency said in a press release. "The company's entrance into the Moscow market and an active expansion in other new regions has put pronounced pressure on its margins and cash flows."
Fitch added that the company’s entrance into the Moscow market was effective as it brought over 2 million new subscribers for the company. However, the operating success came at high price with overall low profitability for the business.
T2 RTK owns the Tele2 brand that provides cellular services in 41 subjects of the Russian Federation.