Colt - 2005 New Year, New Highs.............

This was posted in Oct 2004 it gives the level of debt that CTM find themselves , they are using cash to buy back debt at the expense of expanding the business ... which has stagnated

Investors in Colt Telecom, the European business communication services provider, may be tired of reading about the woes of the telecoms sector. For alternative carriers like Colt the problems relate to the level of debt and the lack of demand. The debt is a legacy of the technology bubble hysteria that convinced firms to take on greater levels of capital expenditure to meet expected demand. The take up of these services, however, did not materialise and the sector was quickly faced with the problems of overcapacity and falling prices. The retrenchment of the sector that ensued, evidenced by falling share prices, has not been deep enough, it would seem, to eradicate the excess of supply and allow companies to generate sufficient revenue, which has increased their debt position. The questions Colt Telecom investors must be asking themselves is given these problems what action have the management team taken to turn things around? And more pertinently is this enough?


The level of debt at the end of August last year amounted to some £1.4 billion.