S&P cuts Domtar's view to negative

Standard & Poor's said it affirmed its BB+ long-term corporate credit rating on paper producer Domtar Inc.

S&P also said it revised the outlook on the company to negative from stable, reflecting heightened concerns regarding the negative effect of an appreciating Canadian dollar and other cost pressures on the company's cash flow generation and earnings.

The ratings reflect the company's exposure to cyclical paper prices, aggressive debt leverage and a declining cost position due to a stronger Canadian dollar, S&P said.

These risks are partially offset by good fiber and energy integration and some revenue diversity, S&P noted.

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