THE Digicel Group’s growth in Jamaica for 2015 was described as weak by USbased Fitch Ratings. Meanwhile, the company sees strong growth in Papua New Guinea (PNG). “Papua New Guinea continues to grow strongly, offsetting weak growth in other major countries of operation, such as Jamaica and Haiti,” said Fitch. The report comes as Fitch affirmed a ‘B’ rating for the Digicel Group and its subsidiaries, with a stable outlook. Digicel pointed out its commitment to growing the 4G sector in its response to the Fitch report.

“The Fitch report highlights the strength and solidity of Digicel’s business with both geographic and product diversification underpinned by a period of investment. Digicel Jamaica has invested heavily in its network to ensure that it remains the network of choice for data lovers.

4G revenues are growing rapidly and we are committed to making the 4G experience available to the widest possible audience by continuing to expand our 4G network coverage, offering affordable smartphones and innovative pricing packages such as Digicel Zero,” said a Digicel spokesperson in response to Jamaica Observer queries. In its report, Fitch indicated that Digicel generated stable operating results in the first nine months of fiscal 2015, ending on March 31, 2015. It also expects this trend to continue over the medium term.

The rating agency in its assessment avoided revealing financials of the group, only indicating that its revenues grew 5.0 per cent with a “solid” earning before interest, taxation, depreciation and amortisation (EBITDA) margin of 41.4 per cent. “This was mainly driven by increasing data revenue supporting average revenue per user, and steady growth in Papua New Guinea, Trinidad & Tobago, and the other market segments,” it added.

Stable subscriber base expansion continued, with the total subscriber base reaching 13.8 million as of December 2014 up from 13.4 million a year ago. It added that although revenue growth as reported in United States dollars is likely to remain weak due to the local currency depreciation in some of its markets, the operational impact should not be material, given the close revenue-cost currency match.

Additionally Fitch forecasts that Digicel will have negative free cash flow generation until financial year 2016 due to high capital expenditure. “During financial year 2015, the company’s annual capex is forecast to have peaked at about US$650 million, from US$552 million in financial year 2014, as a result of network expansion and upgrades, including cable networks as well as a tower project in Myanmar,” stated Fitch.

Digicel Group operates in 33 markets in the Caribbean, Central America and Asia Pacific. After 13 years of operation, total investment to date stands at over US$5 billion worldwide.