The ratings on Rochester, N.Y.-based medical and dental imaging systems provider Carestream Health Inc. (Carestream) reflect the company's "weak" business risk profile and "aggressive" financial risk profile. Although we expect Carestream's EBITDA margin to remain below 20% because of elevated commodity costs, we believe the company's modest capital expenditures should enable the company to continue to generate good free cash flow of more than $100 million and maintain leverage of 4x to 5x--a level we consider appropriate for the rating. Carestream manufactures and sells traditional film and digital imaging products in the rapidly changing and challenging diagnostic-imaging industry. Their products include analog film, laser imagers, digital print film, computed and digital radiography systems, digital dental imaging systems, dental practice management
