Fitch cuts Deutsche Telekom view to negative

Fitch Ratings said it changed Deutsche Telekom's outlook to negative from stable, and affirmed its senior unsecured and issuer default ratings at A-. The company's short-term rating is downgraded to F2 from F1, which is consistent with Fitch's methodology for A- issuers with a negative outlook.

The change in outlook reflects building pressures in the domestic market, both in the fixed-line/broadband and mobile segments, while international growth may be insufficient to compensate for losses in Germany, Fitch said. The outlook also takes into account the company's ongoing labor strike and its increased leverage to a net debt-to-EBITDA ratio of 2.7x, the agency said.

Deutsche Telekom benefits from a strong business and geographical diversification of its revenues and earnings, the agency said.

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