S&P lowers Avery Dennison long-term ratings

NEW YORK - Standard & Poor's Ratings Services slightly lowered its long-term ratings on Avery Dennison Corp. on Friday, citing weak sales and higher costs at the packaging and consumer products company.

S&P cut the corporate credit and senior unsecured debt ratings to "BBB" from "BBB+", both of which are considered lower medium grade ratings. It reaffirmed a stable outlook for the company.

"The company's financial profile is unlikely to strengthen in the next several quarters to the extent necessary to support the former ratings," said S&P credit analyst Cynthia Werneth, in a statement.

S&P said Pasadena, Calif.-based Avery's credit measures have been subpar since it doubled its debt to finance the June 2007 buyout of Paxar Corp. As of Sept. 27, the company had $2.5 billion in total debt.

Avery Dennison should be able to support its current ratings through the economic downturn, S&P said.

Shares of Avery Dennison rose 29 cents to $27.41 Friday.

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