KEY RATING DRIVERS
AMX's ratings reflect its diversified fixed and wireless operations across
NET LEVERAGE EXPECTATION BELOW 1.5x:
The ratings reflect AMX's firm commitment to reduce net debt-to-EBITDA to below 1.5x. Fitch expects AMX to keep financial discipline with respect to uses of cash flow until leverage decreases. Failure to achieve this due to increasing competition, or higher-than-expected cash outflows related to acquisitions, including the planned stake increase in Telekom Austria, would pressure the ratings.
For the 12 months ended
REGULATORY PRESSURES IN
Fitch believes that the competitive intensity will increase over the medium to long term for AMX's Mexican operation due to regulatory reform. This could pressure the company's operating margins. The company was declared 'preponderant' in
Stable Free Cash Flow:
Fitch forecasts AMX to continue its solid positive FCF generation over the medium term, underpinned by stable internal cash generation which should fully cover its capital expenditures of about
AMX has historically maintained a strong liquidity position. As of
A positive rating action is unlikely given its increased leverage compared to the historical levels. A negative rating action can be triggered if net leverage increases to between 1.5x-2.0x on a sustained basis as a result of operational or strategic factors.
Fitch currently rates America Movil as follows:
--Local currency IDR 'A';
--Foreign currency IDR 'A';
--Senior notes issuances 'A';
--Subordinated notes issuances 'BBB+';
--Mexican national scale rating 'AAA(mex)';
--Certificados Bursatiles issuances 'AAA(mex)';
--UF30 million Chilean Notes Program, including Series A and D issuances for a combined amount of UF9 million, 'AA+(cl)'.
Additional information is available at 'www.fitchratings.com'
--'Corporate Rating Methodology',
Corporate Rating Methodology - Including Short-Term Ratings and Parent and Subsidiary Linkage
Source: Fitch Ratings
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