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S&P lifts Rock-Tenn view to positive
Standard & Poor's said it revised the outlook on Rock-Tenn Co. to positive from stable.
The agency also said it affirmed Rock-Tenn's ratings, including its BBB- corporate credit rating.
The outlook revision reflects improved expectations of EBITDA growth for Rock-Tenn in fiscal 2013 and 2014, said Tobias Crabtree, an S&P analyst.
If the implementation of recently announced containerboard price increases is successful, S&P said it believes Rock-Tenn's trailing 12-month EBITDA could increase to $1.6 billion or more over the next year.
The ratings reflect the company's satisfactory business risk profile and intermediate financial risk profile, the agency said.
The ratings also consider Rock-Tenn's good end market and customer diversity, as well as increased size and scope following the Smurfit-Stone Container Corp. acquisition, S&P said.
These positive rating factors are mitigated somewhat by its participation in a cyclical and mature industry and its exposure to volatile raw material costs, the agency said.
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