The ratings reflect Appleton Paper Inc.'s leading positions in niche specialty paper markets, a fairly stable cost base, limited product diversity, high customer concentration, and an aggressive financial profile. Appleton, based in Appleton, Wis., is the world's largest manufacturer of carbonless paper, which is used in multi-part forms such as invoices, credit card receipts, and packing slips. The industry is modestly cyclical and highly concentrated. MeadWestvaco Corp., a larger, diversified forest products company, is Appleton's primary competitor. Carbonless paper volumes in the U.S. have been declining by about 9% per year because of the development of alternate technologies. This trend is expected to continue, although Appleton has recently experienced a lower rate of decline due to new account gains. The
