Moody's affirms VCA; outlook positive

Moody's Investors Service said it affirmed the Ba3 corporate family rating of VCA Antech, Inc. and changed the outlook to positive from stable.

The positive outlook anticipates a moderate increase in profitability and improving credit metrics in 2008, the agency said, noting that veterinary services are somewhat discretionary and a weakening economy should slow organic growth rates from the levels achieved in the past few years.

However, Moody's said it expects that a low to mid-single digit organic revenue increase combined with the effect of acquisitions completed in 2007 and early 2008 will drive profit improvement over the next year.

The Ba3 CFR is supported by strong financial strength metrics for the rating category, leading market positions in the animal hospital and veterinary testing markets and a consistent track record of organic revenue growth, the agency added.

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