S&P affirms Sadia

Standard & Poor's said it affirmed Sadia SA's BB long-term corporate credit rating.

The outlook is stable.

The agency said the ratings on Sadia reflect the company's operations in the highly volatile and competitive meat and food-processing industries; its exposure to the Brazilian market environment, where the company sells a larger share of its industrialized, higher value-added product line; and the company's high gross debt level, which results from its significant financial arbitrage position and a large capital budget.

These negative factors are balanced by Sadia's leading market position in Brazil and its competitiveness and solid track record in exports; the company's low-cost position and profitability levels compared to peers; its progressively more diversified product and client mixes; its rigorous operating and financial risk-control measures; and the company's sound liquidity position, S&P said.

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