KBRA Assigns A+ Rating to City of Pensacola, FL Airport Revenue Bonds, Series 2025 (AMT)

NEW YORK--(BUSINESS WIRE)--KBRA assigns a long-term rating of A+ with a Stable Outlook to the City of Pensacola, FL Airport Revenue Bonds, Series 2025 (AMT).

Key Credit Considerations

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

Credit Positives

• Balanced leisure, business, and military service area mix generates robust O&D traffic.
• Growing service area economy bolsters outlook for increasing passenger activity.
• Substantial nonairline revenues provide significant offset to airline rates and charges.

Credit Challenges

• Materially elevated debt service and operating costs following issuance of the Bonds.
• On-going vulnerability of the Airport’s small enplanement base to economic downturns and airline business decisions despite a balanced traffic mix.

Rating Sensitivities

For Upgrade

• Completion of the CIP projects on time and within budget accompanied by a track record of successful operation of the larger and more financially leveraged airport and materially better than forecast leverage and operating metrics.
• Continuing growth and diversification of the air trade area economy accompanied by consistent growth in passenger activity.

For Downgrade

• Sustained, material decrease in utilization due to adverse macroeconomic conditions and/or the cessation or severe curtailment of air service provided by one or more airlines at PNS.
• Substantial borrowing beyond what is currently contemplated resulting in leverage and operating metrics significantly exceeding the current forecast.

To access ratings and relevant documents, click here.

Methodologies

• Public Finance: U.S. General Airport Revenue Bond Rating Methodology
• ESG Global Rating Methodology

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1011582