Financial Times

S&P downgrades SLT rating after cable damage
By Akhry Ameer
The telecommunications infrastructure took a bad hit with Sri Lanka Telecom's (SLT) main coastal cable network damaged and full restoration not possible for at least three months.

The damage prompted the international rating agency, Standard and Poor's Ratings Services, to revise downward SLT's rating outlook to negative from stable.

SLT's coastal cable connecting Jaffna, Batticaloa, Kalmunai, Amparai, Pottuvil, Hambantota, Matara, Galle was badly damaged and is out of operation. Besides the cable network, the damage included parts of the Hambantota exchange and the complete Kosgoda exchange. Parts of the network in Kalutara, Panadura and Moratuwa have also been affected.

"We have now managed to provide all important places like hospitals and police stations with connections," said G.S.P. Rodrigo, Chief Operations Officer of the restoration work. On Thursday, SLT was busy restoring connections in Embilipitiya, Sevanagala and Udawalawe and planned to restore links in Tangalle, Weeraketiya and Walasmulla areas on Friday.

Exchanges in affected areas have been equipped with facilities to provide free telephone calls to those who call over. A 101 short code has also been enabled at the call centre where staff is able to divert incoming calls to emergency locations to establish contact with friends and relatives.

The cost of damage is still being estimated, according to Rodrigo. Temporary connections have been provided through radio lines, Mobitel satellite phones and ordinary Mobitel mobile phones where additional lines are needed. Temporary restoration work is ongoing on a daily basis and full restoration would take at least 3-4 months, Rodrigo said.

SLT responded immediately to the disaster through its prior experience handling flood situations. Special units have been deployed in groups to service disaster areas. SLT unions have also voluntarily stepped forward to assist general relief activity and 100 staff members are at work in various areas.

Meanwhile, Standard & Poor's Ratings Services has given SLT a B+ rating for its foreign currency debt and a BB- rating for its local debt. "The outlook revision reflects the possibility of weakening in SLT's credit profile due to the devastating tidal waves that hit Sri Lanka," S&P said in a statement.

It said the ratings could be lowered if the damage caused by tidal waves substantially hurts SLT's business or financial profiles.

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