KBRA Affirms AA Rating on the Greater Orlando Aviation Authority, FL Airport Facilities Revenue Bonds; Outlook is Stable

18 Jan 2024 | New York

KBRA affirms the long-term rating of AA on the Greater Orlando Aviation Authority's (GOAA's) Airport Facilities Revenue Bonds. The Outlook is Stable.

The rating was affirmed because of the following key credit considerations:

Credit Positives

Steady historical growth and resilient post-pandemic recovery in passenger traffic supported by MCO’s unique market position as a premier global tourist destination and its rapidly expanding population and resource base.
Mainly O&D passenger base with highly diverse airline mix.
Sound financial operations, with significant funding derived from non-airline sources. CPE remains low and liquidity is ample.

Credit Challenges

The largely discretionary nature of the air service market makes MCO more susceptible to exogenous shocks, though growth and diversification of the service area economy continues.
Projected issuance of $1.09 billion of additional Senior Lien GARB and PFC-supported debt over the next two fiscal years, potentially leading to significant declines in Senior Lien DSC.

For Upgrade

Realization of forecasted enplanement growth with accompanying strong revenue performance and continued diversification of non-aviation funding streams.

For Downgrade

Trend of diminished liquidity levels and/or debt metrics.
Persistent, severe declines in passenger traffic that pressure operating performance and liquidity.

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