Our ratings on Ohio-based The Scotts Miracle-Gro Co. (Scotts) partly reflect our view of the company's current financial policy; we believe the company's financial risk profile, which we characterize as "significant" (as our criteria define the term), and credit metrics will remain relatively stable. Our ratings also reflect Scotts' business risk profile, which we characterize as "fair," reflecting the company' strong market positions, well-recognized brand names, and favorable long-term demographic trends in the consumer lawn and garden care segment. However, the company is exposed to fluctuations in operating performance as a result of the highly seasonal and weather-dependent nature of the industry, as well as fluctuations in commodity and energy costs. The ratings take into account, among other factors: Our
