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UPDATE 2-Qwest aims to cut debt 25 pct in next 12 months

Sees improving debt/EBITDA ratio in 2010, 2011

 

Reuters

Sinead Carew

February 25, 2010

 

* Qwest shares down 0.9 pct (Adds details on debt outlook, share move)

NEW YORK, Feb 25 (Reuters) - Telecommunications carrier Qwest Communications International Inc (Q.N) said on Thursday it expected to reduce its debt by $3.5 billion, or 25 percent, over the next 12 months.

In presentation materials for an analysts' meeting, Qwest also reiterated a forecast for its year-on-year revenue decline to slow to a low-to-mid single digit rate by the fourth quarter of 2010.

Denver-based Qwest, which has experienced a fall in landline subscribers as the economy weakened and as customers shifted to mobile phones, ended 2009 with net debt of $11.8 billion.

Qwest said it expected to improve its ratio of debt to adjusted earnings before interest, tax, depreciation and amortization (EBITDA) to 2.5 this year from 2.7 in 2009.

It aims for further improvement next year, targeting a ratio of 2.2. The company said the estimate assumed flat EBITDA and growth in cash through 2011.

Qwest shares were down 0.89 percent at $4.47 in late trading, in line with the overall market. (Reporting by Sinead Carew; Editing by Ted Kerr)