S&P ups Aspect Communications

Standard & Poor's said it raised its corporate credit rating on Aspect Communications Corp. to B+ from B. The outlook is stable.

S&P said the rating action is based on a strengthened financial profile following several quarters of improved profitability and free operating cash flow generation resulting from cost-cutting actions. The company has also recently refinanced its funded debt, pushing maturities out until 2007.

The ratings on Aspect Communications reflect a limited revenue base and an inconsistent earnings record, combined with a difficult IT spending environment. These factors are partially offset by improved cost controls that have restored profitability and adequate financial flexibility.

Aspect has adequate liquidity to meet any near-term cash needs. In addition to cash flow generated from operations, Aspect had a $195 million cash balance as of March 2004 and about $60 million in availability under its $100 million revolving credit line.

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