Eircom 'won't sit still' on refinancing €2.3bn debt, says CFO
Published 08/12/2012 | 05:00
EIRCOM will assess any opportunity that crops up for refinancing its €2.3bn debt pile ahead of its 2017 maturity date, according to chief financial officer Richard Moat.
The company revealed a 10pc decline to €124m in earnings before interest, tax, depreciation and amortisation (EBITDA) in the first quarter of its financial year to the end of September. Mr Moat pointed out that the debt maturity date was still nearly five years away.
"Between now and then there's plenty of opportunities to take advantage of whatever happens in the market," he said.
"We could exchange a piece of it for longer maturity debt so it doesn't all mature at the same time – I can't foresee that at the moment – but these things will come along. We're not going to sit still. We'll monitor the possibilities all the time."
Eircom was subject to the largest examinership ever in Ireland earlier this year. Senior lenders took control of the business under a deal that secured court approval and slashed Eircom's debts from about €4bn to €2.3bn.
Mr Moat said he does not believe that the current debt levels are still too high.
"We don't think it's too much. We think that with the improvements in EBITDA that we're projecting that we'll be able to refinance it," he said. He said EBITDA figures would begin improving immediately.
Eircom chief executive Herb Hribar said the EBITDA and revenue declines reported for the first quarter are in line with expectations. Revenue fell 7pc in the period to €364m.
He declined to elaborate on how plans to lay off an additional 2,000 staff at Eircom are progressing. The cuts will reduce Eircom's workforce to about 3,500. Eircom's operating costs narrowed 4pc in the first quarter to €160m. Mr Moat said Eircom's cost base is currently about 15pc higher than western European peers.
Eircom's Meteor mobile business will launch its fast 4G network next summer, while broadband TV will be aimed at the "value end" of the market.
The company is also spending €400m rolling out a fibre network that will see high-speed broadband services available to one million premises by the end of 2014.