The ratings on American Builders&Contractors Supply Co. Inc. (ABC) incorporate the company's leading position in the wholesale distribution of roofing products and relatively stable product demand. These positives are offset by highly competitive and fragmented markets, a narrow product line, low distribution operating margins (about 5% on average), and aggressive debt leverage. ABC is the largest wholesale distributor of roofing products and one of the largest distributors of vinyl siding in the U.S., primarily serving small and medium-size contractors. Business strengths include broad geographic coverage through about 200 company-owned distribution centers with their strong customer service focus, significant purchasing leverage (ABC is the largest customer of its major suppliers), and full range of roofing products. Moreover, not all
