On Aug. 31, 2006, Standard&Poor's Ratings Services affirmed its 'BB-' long-term corporate credit rating on Grupo Posadas S.A. de C.V. (Posadas). At the same time, it revised the outlook to positive from stable. Standard&Poor's also affirmed the 'BB-' senior unsecured debt rating. The outlook revision acknowledges the consistent operating performance, a manageable debt maturity schedule, and the expected stability of its cash flow, which will support improved coverage measures. Offsetting these positive credit factors are the company's somewhat high financial leverage, the cyclicality of the hotel industry, and geographic concentration within Mexico. As of June 2006, Posadas operated 92 hotels with a total of 17,478 rooms. The company's operations are concentrated in Mexico, where it runs
