The ratings on France-based Compagnie de Saint-Gobain S.A. reflect its very strong business profile. The ratings are tempered, however, by the group's moderate financial profile, acquisitive strategy, and exposure to asbestos-related litigation in the U.S. Reported net unadjusted financial debt was €5.6 billion ($7.3 billion) at year-end 2004. With sales of €32 billion in 2004, up 8.2% from 2003 with a 4.6% increase at constant exchange rates and scope, Saint-Gobain holds worldwide and European leadership positions in diversified industries (glass, industrial ceramics, plastics and abrasives, insulation and fiber reinforcements, building materials, and building-materials distribution). Saint-Gobain benefited from a pickup in industrial end markets, good activity levels in its construction end markets, and dynamic emerging markets in 2004. The operating margin
