Solid competitive positions supported by different businesses and exposure to different end markets. Extensive geographic diversity. Efficient cost management. Exposure to cyclicality in most end markets. Solid track record of free cash flow generation. Large dividend payout and acquisition program. The stable outlook on French electrical distributor Schneider Electric S.A. reflects our belief that over the next two years Schneider should be able to achieve funds from operations (FFO) to adjusted debt of 35%, our minimum for the current ratings, and generate positive discretionary cash flow. The outlook also factors in our assumption that the company won't adopt a more aggressive dividend policy. We see limited headroom for large debt-financed acquisitions at the current rating. We would consider taking a
