D&P: SOUTHWESTERN BELL TELEPHONE COMPANY $200 MILLION 5.75 PERCENT NOTES DUE 2004 AND $200 MILLION 6.625 PERCENT DEBENTURES DUE 2024 RATED 'A+'
CHICAGO, Sept. 9 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of 'A+' (Single-A-Plus) to Southwestern Bell Telephone's (SWBT) issuance of $200 million of 5.75 percent notes due Sept. 1, 2004, and $200 million of 6.625 percent debentures due Sept. 1, 2024. Proceeds will be used to refinance long-term debt. 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. Interest savings from the refinancing of debt and an ongoing restructuring plan that is expected to result in the elimination of an additional 1,500 management jobs over the next 18-24 months are evidence of the company's continuing effort to bring down expense levels. 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 12.8 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- 9/9/93 /CONTACT: James J. Stork, CFA of Duff & Phelps Credit Rating Co., 312-368-3125/ (SBC)
CO: Southwestern Bell Telephone Company ST: Illinois IN: TLS SU: RTG
WB -- NY052 -- 0350 09/09/93 13:08 EDT
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|Date:||Sep 9, 1993|
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