The ratings on Rosemont, Ill.-based U.S. Foodservice Inc. (USF) reflect Standard&Poor's Ratings Services' business risk profile assessment of "fair" and financial risk profile assessment of "highly leveraged," as our criteria define the terms. It is our opinion that the food service distributor's profit margins will remain under pressure due to continued weak demand and higher expenses, specifically escalating food and fuel costs; however, credit measures should remain near current levels due to interest cost savings and the lower amount of debt associated with its May 2011 refinancing. Nevertheless the company's credit protection measures are weak for the 'B' rating category medians, including leverage in the high-7x area and a ratio of funds from operations (FFO) to total debt
