Fitch affirms Xerox

Fitch Ratings said it affirmed Xerox Corp.'s long-term issuer default rating at BBB, short-term issuer default rating at F2, revolving credit facility at BBB, senior unsecured debt at BBB and commercial paper at F2.

The agency also affirmed the company's wholly owned subsidiary Affiliated Computer Services, Inc.'s issuer default rating and senior notes at BBB.

The outlook is stable.

Xerox's ratings reflect services growth led by business process outsourcing, substantial recurring revenue, solid liquidity, a highly diverse revenue mix, investments in research and development, and management's conservative financial policies and strong commitment to maintaining an investment grade rating, the agency said.

Concerns are some revenue pressures, underfunded defined benefit pension plans and competitive nature of industry, the agency said.

Total debt-to-operating EBITDA and core non-financing leverage were 2.9x and 1.2x as of Sept. 30, respectively, compared with 3.7x and 1.6x in the year-ago period.

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