DUFF & PHELPS: NEW YORK TELEPHONE COMPANY $100 MILLION 7-5/8 PERCENT DEBENTURES DUE 2023 RATED 'A'
CHICAGO, Jan. 29 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has assigned a rating of "A" (Single-A) to New York Telephone's issuance of $100 million of 7-5/8 percent debentures due Feb. 1, 2023. The debentures were priced at 98.133 to yield 7.787 percent to maturity. The company has $400 million remaining for sale on prior shelf registrations. New York Telephone operates in a highly competitive service territory, has high cost operations despite recent expense reductions, and an historically difficult regulatory environment. Aggressive operating expense cuts coupled with reductions in interest expense caused by lower interest rates led to a modest improvement in pretax interest coverages in the first nine months of 1992. Cost control efforts remain critical in order for New York Telephone to maintain or improve operating earnings in the face of strong competition and the weak economy in New York. Internal funds generation over 1992-1994 (assuming an 85 percent dividend payout to NYNEX) should fund estimated construction expenditures of $4.3 billion. Duff & Phelps Credit Rating Co. rates the refunding mortgage bonds and debentures of New York Telephone at the same level (Single-A) since New York Telephone covenants that no new refunding mortgage bonds will be issued while any debentures remain outstanding. New York Telephone provides local exchange telecommunications services to 9.8 million access lines in New York and a small portion of Connecticut. Three-quarters of its access lines are in the highly competitive New York metropolitan area. New York Telephone is a wholly owned subsidiary of NYNEX Corporation. -0- 1/29/93 /CONTACT: James J. Stork, CFA of Duff& Phelps, 312-368-3125/
CO: New York Telephone ST: New York IN: TLS SU: RTG
TS -- NY037 -- 0705 01/29/93 11:04 EST
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|Date:||Jan 29, 1993|
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