World leading positions in its core businesses. High-quality products and technological leadership. Diverse production and sales, with an increasing share of service and aftermarket sales. Cyclical demand patterns for the company's products. High degree of vertical integration, resulting in volatile operating margins and cash flow. Volatile free operating cash flow generation. Relatively high adjusted debt. Fairly shareholder-friendly dividend policy. Currently subdued credit ratios for the rating. The negative outlook on Sweden-based capital goods manufacturer Sandvik AB reflects Standard&Poor's Ratings Services' view that there is a one-in-three possibility that Sandvik's credit ratios will not improve to levels we consider commensurate with the current rating over the next 12 months. These levels would include an un-interrupted improvement in Sandvik's credit
