The ratings reflect France-based Compagnie de Saint-Gobain S.A.'s superior business profile--attributable to the group's very strong diversification in terms of product, geographic area, and end markets--as well as its leading competitive positions in all of its activities. These strengths translate into solid and very consistent free cash flow generation (before acquisitions). The positive factors are tempered, however, by the group's subpar credit ratios and acquisitive strategy. With sales of €15.3 billion in first-half 2002, Saint-Gobain holds European or worldwide leadership positions in diversified industries such as glass, industrial ceramics, plastics and abrasives, insulation and fiber reinforcements, building materials, and building-materials distribution. Sales are more or less flat (down 0.3% like for like over first-half 2001), despite still-depressed industrial conditions (industry
