Fitch raises Cableuropa, ONO outlook

Fitch Ratings raised its outlook on Cableuropa SA and for ONO Finance plc to positive from stable and confirmed their ratings including Cableuropa's senior unsecured debt at B-, its €800 million senior secured bank facility at B+ and ONO Finance's senior unsecured notes at B-.

Fitch said the ratings reflect the company's solid performance to date in the execution of its business plan and in particular the achievements made in network build and residential customer penetration, both of which have exhibited strong momentum since commercial operations were launched in 1998.

With residential penetration in mature network nodes exceeding 40%, and current sell-in penetration (penetration achieved within a month of marketing) in the 15-25% range, the company has established a credible service proposition and level of customer acceptance, Fitch said.

Overall residential penetration of 30.7% (at end March 2002) and first quarter ARPUs (Average Revenue Per User) of €47.5 are solid achievements given the relative nascence of the business and the cable industry generally in Spain, Fitch said.

Fitch also acknowledges the company's strong brand name (recognition is 100%), the quality and capacity of its digital-ready bi-directional network, and its strong shareholder base, which includes GE Capital, Banco Santander Central Hispano (a leading Spanish bank) and Ferrovial (a major Spanish construction company).

Shareholder support was underlined in the first quarter when a further €300 million of equity was injected into the business in the absence of an IPO, bringing total contributions to €850 million, Fitch noted.

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