Moody's lowers Optus view to negative

Moody's Investors Service said it revised the outlook on Singtel Optus Pty Ltd. (Optus) and Optus Finance Pty Ltd. to negative from stable.

Moody's also said it affirmed Optus' A2 issuer rating and Optus Finance's backed senior unsecured medium-term notes rating of provisional A2 and backed senior unsecured rating of A2.

Optus is the parent and guarantor of Optus Finance and both of their A2 ratings include a two-notch uplift based on Singapore Telecommunications Ltd.'s (Singtel) 100% ownership of Optus, which will result in credit support in times of financial stress, Moody's said.

The outlook revision for Optus and Optus Finance follows the recent change in the outlook for Singtel to negative from stable, the agency said.

Singtel's leverage had progressively increased to 2.03x for the 12 months that ended December 2018, Moody's said.

The negative outlook considers that the weakening in Singtel's financial profile may affect its ability to support Optus and Optus Finance, if needed, the agency said.

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