The ratings on Phoenix-based PetSmart Inc. reflect Standard&Poor's Ratings Services' expectation that the company's operations will remain steady and credit metrics will at least remain at current levels. The company's fair business profile reflects its established market position in the highly fragmented and competitive pet supplies retail industry, its solid operating performance, and good protection measures. We view PetSmart's financial risk profile as significant, based on credit measures that are generally typical of a 'BB' category rating. PetSmart is the leading specialty retailer of products and services in the $47 billion pet products industry. The company primarily competes with PETCO Animal Supplies Inc., but other competitors include supermarkets, mass retailers, warehouse clubs, and other specialty pet supply stores,
