Moody's upgrades STC's long-term issuer rating to A1

Moody's Investors Service upgraded Saudi Telecom Company's (STC) long-term issuer rating to “A1” from “A2”, with a stable outlook, it said in a statement on Thursday.

The upgrade follows a reassessment of STC under the rating agency's government-related issuers (GRIs) rating methodology, which factors in improvements in the sovereign and operating environment for STC in the Kingdom since 2016.

STC's baseline credit assessment is unchanged at a2 and it recognizes the growth in revenue and EBITDA margin in 2018 following a period of operating pressure.

Moody's also expects that STC will maintain strong standalone creditworthiness as expressed by its baseline credit assessment of “a2” factoring its planned capital spending initiatives, it added.