The ratings on Switzerland-based Holcim Ltd. reflect the group's position as the second-largest cement producer in the world; effective geographical and product diversification, which has led to stable profitability over the past five years; and strong cash flow generation. These factors are offset by Holcim's moderate financial profile, and by its strategy of making debt-financed acquisitions. The inherent cyclicality, seasonality, and high capital intensity of the building materials industry also have negative implications for the ratings. At Sept. 30, 2005, Holcim had lease- and pension-adjusted net debt of Swiss franc (SFr) 14.0 billion, up from SFr8.8 billion a year earlier. The company has been integrating the business of Aggregate Industries, acquired earlier in 2005, with its existing operations. Together with
