(The following statement was released by the rating agency)
April 27 - With U.S. economic growth remaining subdued, Standard & Poor's
Ratings Services' outlook for the credit quality of U.S. consumer products
companies in the personal care, consumer services, apparel, and tobacco sectors
is slightly negative in 2012.
"We see rating stability for the majority of the investment-grade companies in
these sectors, but believe that some speculative-grade companies may have
difficulty turning their operating performance around, while others may have
difficulty refinancing," said Standard & Poor's credit analyst Diane Shand, in
a report published today.
"Although, we have stable outlooks on 76% of the issuers in these sectors, we
believe downgrades will outpace upgrades for all of 2012," added Ms. Shand.
According to the report, titled "Slow Recovery And Elevated Costs Could Mean
Downgrades Outpace Upgrades In 2012 For U.S. Personal Care, Consumer Services,
Apparel, And Tobacco Companies," Standard & Poor's believes inflation will be
more moderate in 2012 than 2011. Our 2012 baseline forecast calls for
continued slow economic growth, which will enable some companies in the
personal care, consumer services, apparel, and tobacco sectors to modestly
"This should support continued credit stability for the majority of companies
in these sectors," said Ms. Shand. "Thus, we believe we will be revising some
of the rating outlooks to stable from negative, and that the
downgrade-to-upgrade ratio in 2012 could be slightly better than in 2011."
(Caryn Trokie, New York Ratings Unit)