Leading global player in fast-growing oncology indication. Excellent late-stage pipeline of drugs in development. Product portfolio with no immediate patent expiry. Relatively high EBITDA margins in a peer context. Strong free cash flow generation. Financial policy turned more conservative again. The stable outlook reflects Roche's well entrenched market positions, both in pharmaceuticals and diagnostics. It also reflects Standard&Poor's Ratings Services' expectation that the group will predominantly use its enhanced free cash flow-generation for debt reduction in 2013 and beyond. We therefore expect management to abstain from large debt-funded acquisitions. We consider a sustainable pension-adjusted funds from operations (FFO)-to-net-debt ratio of 60% and rising further to be consistent with the current ratings. Moreover, the ratings provide some flexibility for
