U.S. CABLE TV CREDIT UNLIKELY TO IMPROVE, SAYS S/P
Standard and Poor's Corp said that the
credit quality of most U.S. cable television companies is
unlikely to improve in the near term.
    S and P said that after two years and many delays and
disappointments, the cable television industry has firmly
established a net cash generating position.
    However, rather than using their improved position to
decrease the leverage of current capital structures, the
companies' cash flows are being fully leveraged to finance a
wave of consolidations, S and P said.
    Many cable television companies exhibit greater financial
risk because of their asset growth aspirations and
debt-financed consolidation. That delays a lower risk profile
for many of them, Standard and Poor's said.
    The acquisition and financial growth policies of many
company executives heavily influenced the ratings outlook.
    Citing aggressive capital structures, acquisitions and cash
flow coverages of interest expense of between 1.0 and 1.5
times, S and P noted that the companies are more debt intensive
now than in their building phase. These factors keep their
ratings at speculative grades, the agency concluded.
 Reuter
