S&P shifts DKT view to negative

S&P said it revised the outlook for DKT Holdings ApS to negative from stable and affirmed its B+ ratings.

“The negative outlook on DKT Holdings reflects our expectation that the company will maintain heavy network- and content-investment efforts, while at the same time bearing the costs of its ongoing transformation and optimization initiatives. This could more than offset the benefits from potentially better pricing in the consumer segment, content monetization and cost savings,” S&P said in a press release.

DKT is the parent of TDC A/S, which S&P expects to invest heavily in developing its 5G network. “We therefore think free operating cash flow (FOCF) may remain negative in 2020, compared with our previous forecast of a rebound to positive territory after its non-recurring outlay on spectrum in 2019,” the agency said.

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