Global leadership in the concentrated graphite electrode market, Good cost position, and Favorable industry conditions. Exposure to cyclical swings of the steel industry, Raw-material cost pressures, and Aggressive financial leverage. The ratings on GrafTech International Ltd. reflect its aggressive financial leverage, poor free cash flow generation, significant exposure to the cyclical steel industry, and raw-material cost pressure, particularly for needle coke. Somewhat offsetting these negative factors are the company's favorable cost position compared with its competitors, its good market position in graphite electrodes, and currently favorable industry conditions. GrafTech manufactures carbon-based materials throughout the world for use in various applications. Its primary product, graphite electrodes, accounted for 63% of sales for the 12 months ended March 31, 2005. Because graphite
