S&P lifts Kansas City Southern view to positive

Standard & Poor’s said it revised the outlook on Kansas City Southern and its subsidiaries, Kansas City Southern de Mexico SA de CV and Kansas City Southern Railway Co., to positive from stable.

The agency also said it affirmed the group’s BBB- corporate credit rating, along with the A-3 rating on its commercial-paper program.

The outlook revision reflects an expectation that, despite weaker demand for certain traffic, the company should be able to maintain its credit metrics over the next year before improving in 2017, S&P said.

The company’s free operating cash flow-to-debt ratio also is expected to continue to improve due largely to lower spending on lease conversions, the agency said.

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