Lake Charles Harbor And Terminal District, LA Port Revenue Bond Rating Raised To 'A+' From 'A-' On Criteria Application

CENTENNIAL (S&P Global Ratings) April 12, 2019--S&P Global Ratings raised its long-term rating on Lake Charles Harbor and Terminal District, La.'s port revenue bonds outstanding to 'A+' from 'A-', using its "U.S. And Canadian Not-For-Profit Transportation Infrastructure Enterprises" (TIE) criteria, published March 12, 2018. The outlook is stable.
"The rating reflects our opinion of the port's strong enterprise risk profile and very strong financial risk profile," said S&P Global Ratings credit analyst Ken Biddison.
The enterprise risk profile reflects our view of the port's:
  • Adequate market position;
  • Extremely strong service area economic fundamentals
  • Low industry risk relative to that of other industries and sectors; and
  • Strong management and governance.
The financial risk profile reflects our view of the port's:
  • Debt service coverage (S&P Global Ratings-calculated) that we expect will remain near current levels, offset by the possible effects of potential additional borrowing;
  • Extremely strong debt and liabilities capacity; and
  • Very strong liquidity and financial flexibility.
The stable outlook reflects our expectation the port will maintain very strong financial performance and a low debt burden, and that activity levels will remain generally stable with modest fluctuations.
We do not expect to raise the rating during our outlook period, given our expectation of pro forma financial metrics, the relatively small size of the port, and its concentration on petroleum.
Although unlikely, we could lower the rating if the port's activity levels decrease significantly, suggesting a weaker market position, or if the port has substantially higher debt needs than we currently expect.
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