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The Latest UPS Headlines
S&P cuts UPS' outlook to negative
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<blockquote data-quote="clueless" data-source="post: 678297" data-attributes="member: 15572"><p>Here's the actual ratings action from S&P:</p><p></p><p><em>Ratings On United Parcel Service Inc. Affirmed; Outlook Revised To Negative</em></p><p><em></em></p><p><em>United Parcel Service Inc.'s (UPS) credit metrics have deteriorated over </em></p><p><em>the past year due to profit pressures related to the global economic </em></p><p><em>downturn and a large increase in unfunded postretirement obligations.</em></p><p><em>In response, the company has taken measures to cut costs and improve </em></p><p><em>operating performance. It also has curtailed share repurchases to bolster </em></p><p><em>its financial profile.</em></p><p><em></em></p><p><em>We are affirming the ratings on UPS, including the 'AA-' corporate credit </em></p><p><em>rating and 'A-1+' commercial paper rating.</em></p><p><em></em></p><p><em>We are also revising the outlook to negative from stable to reflect our </em></p><p><em>intention to lower ratings if funds from operations (FFO) to total debt </em></p><p><em>(adjusted for off-balance sheet items) fails to improve to at least 40% </em></p><p><em>over the next 18 to 24 months. Over the longer term, we expect FFO to </em></p><p><em>total debt to return to the 50% level.</em></p><p><em></em></p><p><em>NEW YORK (Standard & Poor's) Jan. 26, 2010--Standard & Poor's Ratings Services </em></p><p><em>today affirmed its ratings on United Parcel Service Inc. (UPS), including the </em></p><p><em>'AA-' corporate credit rating and 'A-1+' commercial paper rating. We also </em></p><p><em>revised the long-term rating outlook to negative from stable.</em></p><p><em></em></p><p><em> The ratings on Atlanta-based UPS reflect its very strong position in </em></p><p><em>ground parcel delivery and substantial earnings and cash flow. UPS' adoption </em></p><p><em>in early 2008 of a somewhat more aggressive (albeit still conservative) </em></p><p><em>capital structure, and its participation in a competitive industry with some </em></p><p><em>exposure to cyclical demand pressures somewhat offset these strengths. UPS </em></p><p><em>benefits from its position as the leading provider of ground package delivery </em></p><p><em>in the U.S. and from its significant presence in domestic air express package </em></p><p><em>delivery, international package delivery, and logistics services.</em></p><p><em></em></p><p><em> "The ratings assume that UPS' focus on improving yields, cutting costs, </em></p><p><em>and a gradual recovery in market conditions, combined with management's </em></p><p><em>commitment to restoring credit metrics, will enable the company to generate </em></p><p><em>FFO to total debt of at least 40% over the next 18 to 24 months," said </em></p><p><em>Standard & Poor's credit analyst Christopher DeNicolo. Failure to do so could </em></p><p><em>result in rating downgrades. "We could revise the outlook back to stable if </em></p><p><em>these actions result in FFO to total debt improving to 40% and we believe it </em></p><p><em>will stay there and approach the 50% area," he continued.</em></p><p></p><p><a href="http://www.standardandpoors.com/prot/ratings/articles/en/us/?assetID=1245205388803" target="_blank">http://www.standardandpoors.com/prot/ratings/articles/en/us/?assetID=1245205388803</a></p></blockquote><p></p>
[QUOTE="clueless, post: 678297, member: 15572"] Here's the actual ratings action from S&P: [I]Ratings On United Parcel Service Inc. Affirmed; Outlook Revised To Negative United Parcel Service Inc.'s (UPS) credit metrics have deteriorated over the past year due to profit pressures related to the global economic downturn and a large increase in unfunded postretirement obligations. In response, the company has taken measures to cut costs and improve operating performance. It also has curtailed share repurchases to bolster its financial profile. We are affirming the ratings on UPS, including the 'AA-' corporate credit rating and 'A-1+' commercial paper rating. We are also revising the outlook to negative from stable to reflect our intention to lower ratings if funds from operations (FFO) to total debt (adjusted for off-balance sheet items) fails to improve to at least 40% over the next 18 to 24 months. Over the longer term, we expect FFO to total debt to return to the 50% level. NEW YORK (Standard & Poor's) Jan. 26, 2010--Standard & Poor's Ratings Services today affirmed its ratings on United Parcel Service Inc. (UPS), including the 'AA-' corporate credit rating and 'A-1+' commercial paper rating. We also revised the long-term rating outlook to negative from stable. The ratings on Atlanta-based UPS reflect its very strong position in ground parcel delivery and substantial earnings and cash flow. UPS' adoption in early 2008 of a somewhat more aggressive (albeit still conservative) capital structure, and its participation in a competitive industry with some exposure to cyclical demand pressures somewhat offset these strengths. UPS benefits from its position as the leading provider of ground package delivery in the U.S. and from its significant presence in domestic air express package delivery, international package delivery, and logistics services. "The ratings assume that UPS' focus on improving yields, cutting costs, and a gradual recovery in market conditions, combined with management's commitment to restoring credit metrics, will enable the company to generate FFO to total debt of at least 40% over the next 18 to 24 months," said Standard & Poor's credit analyst Christopher DeNicolo. Failure to do so could result in rating downgrades. "We could revise the outlook back to stable if these actions result in FFO to total debt improving to 40% and we believe it will stay there and approach the 50% area," he continued.[/I] [url]http://www.standardandpoors.com/prot/ratings/articles/en/us/?assetID=1245205388803[/url] [/QUOTE]
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