DUFF & PHELPS: SOUTHWESTERN BELL TELEPHONE COMPANY $150 MILLION 7 1/4 PERCENT DEBENTURES DUE 2025 RATED 'A+'
CHICAGO, July 7 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of "A+" (Single-A-Plus) to Southwestern Bell Telephone's (SWBT) $150 million issue of 7 1/4 percent debentures due July 15, 2025. The debentures are non-callable for 10 years and were priced at 98.471 to yield 7.375 percent to maturity. Proceeds will be applied toward the early retirement of $450 million of 8 5/8 percent debentures which have been called for redemption on July 19, 1993. Southwestern Bell Telephone demonstrates good pretax interest coverage, funds its construction expenditures largely through internal funds, and has a moderate debt ratio. Pretax interest coverages are expected to improve modestly in 1993 as a result of revenues from new services and continued operating expense controls. The Oklahoma rate proceeding remains the major uncertainty. The Oklahoma Corporation Commission has issued an order calling for SWBT to lower revenues by $93 million and refund $148 million to customers. The company has appealed this decision to the Oklahoma Supreme Court. Southwestern Bell Telephone is on the threshold of stronger expected financial performance. Continued expense control and maintenance of margins in competitive services will be key factors. Southwestern Bell Telephone provides local telecommunications services to 13 million access lines in Texas (57 percent of lines), Missouri (17 percent), Oklahoma (11 percent), Kansas (9 percent), and Arkansas (6 percent). The company is a wholly owned subsidiary of Southwestern Bell Corporation. -0- 7/7/93 /CONTACT: James J. Stork, CFA, of Duff & Phelps Credit Rating, 312-368-3125/ (SBC)
CO: Southwestern Bell Telephone Company ST: IN: TLS SU: RTG
LG -- NY030 -- 9034 07/07/93 11:06 EDT
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|Date:||Jul 7, 1993|
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