S&P boosts Mitsubishi

Standard & Poor's said it raised its long-term corporate credit and senior unsecured debt ratings on Mitsubishi Motors Corp. to B- from CCC+, reflecting progress in the company's revitalization efforts and reduced downside risks in its earnings and financial profile.

The outlook on the long-term rating is stable.

The agency added that Mitsubishi Motors substantially reduced its net losses in fiscal 2005 and its funds from operations turned positive.

Nevertheless, Mitsubishi Motors still faces challenges in sustaining a recovery in profitability, such as its low production capacity utilization in North America, Europe and Australia and the profitability pressures in the most lucrative geographic segments in Asia and other regions, S&P noted.

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