S&P ups Rhodia view to positive

Standard & Poor's said it revised its outlook on Rhodia SA to positive from stable and affirmed its B+ long-term and B short-term corporate credit ratings.

The outlook revision reflects Rhodia's significantly improved operational and financial results in 2006, due in particular to management's turnaround strategy, S&P said. The company has the potential for a higher rating in the medium term if Rhodia is able to generate positive free operating cash flow and improve its cash flow metrics, the agency added.

Rhodia's financial profile remains the main rating constraint, although S&P said it believes that it has room for improvement. The agency noted that Rhodia remains exposed to significant competition and material capital intensity.

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