Fitch: Continental Air outlook stable

Fitch Ratings said it has affirmed the senior unsecured debt rating of Continental Airlines Inc. at CCC+ and affirmed the rating for Continental's TIDES preferred equity securities at CCC-.

The outlook was revised to stable from negative.

Fitch said ratings for Continental reflect concerns regarding the company's ability to deliver substantial improvements in its credit profile in the face of a heavy debt and lease burden, significant cash obligations related to upcoming debt maturities, and a relatively constrained liquidity position.

Senior management remains focused on a goal of delivering break-even profitability results in 2004, but persistently high jet fuel costs and a weak pricing environment will limit the airline's capacity to show significant gains in operating cash flow generation this year. With a need to maintain cash balances at or above current levels to safeguard against the risk of external shocks, Continental will likely make only limited progress toward debt reduction and balance sheet repair over the next year, the agency said.

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