S&P: Synagro outlook positive

Standard & Poor's said it affirmed all ratings, including its CCC+ corporate credit rating, on Synagro Technologies Inc. and revised the outlook to positive from negative.

The agency said Synagro has demonstrated improvement in its operating results and credit measures in recent periods and has improved the level of headroom under its financial covenants. The positive outlook reflects these improved results, though S&P said there is still some uncertainty regarding the consistency or reliability of the earnings stream.

The ratings on Synagro reflect the company's highly leveraged financial risk profile, the agency said. And although the essential nature of services and the high percentage of sales under long-term contracts provide stability to the top line, challenging economic conditions continue to hurt municipalities, which account for more than 90% of the company's revenues, S&P said.

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