Moody's affirms Procter & Gamble; outlook up to stable

Moody's Investors Service said it affirmed the Aa3 senior unsecured rating and the Prime-1 short-term rating of the Procter & Gamble Co. and revised the outlook to stable from negative.

The revision to a stable outlook reflects the resiliency of P&G's operating and financial metrics despite the weak global economy and meaningfully slower organic growth, the agency added.

While Moody's said it expected significantly increased share repurchases initiated in August 2007 to delay margin and cash flow improvements, credit metrics have improved over the last several years and have been nearly restored to pre-Gillette levels.

"P&G's Aa3 rating reflects its position as one of the best consumer products companies in the world with top tier brands and strong and stable cash flows," stated Janice Hofferber, vice president and senior credit officer at Moody's.

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