Fitch lowers Tiphone, bonds

Fitch Ratings Indonesia said it downgraded PT Tiphone Mobile Indonesia Tbk.'s national long-term rating to B+(idn) from BBB+(idn) and Rp 500 billion bonds due in July 2018 to B+(idn) from BBB+(idn).

All ratings were placed on rating watch negative.

Fitch said the downgrade was driven by Tiphone's weak cash flow generation and liquidity profile due to sustained negative CFO. Negative CFO of Rp 583 billion at end-2017 was much worse than the agency’s previous expectation of less than Rp 200 billion.

This resulted in adjusted debt/EBITDAR rising to 5.7 times as at end-2017 (2016: 4.8 times).

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