Kansas City International Airport, MO GARB Rating Lowered To 'A' From 'A+' On Increased Debt, Capital Plans

SAN FRANCISCO (S&P Global Ratings) May 24, 2019--S&P Global Ratings has lowered its underlying rating (SPUR) on Kansas City, Mo.'s senior general airport revenue bonds, issued for the Kansas City International Airport (MCI), to 'A' from 'A+'. At the same time, S&P Global Ratings has assigned its 'A' rating to MCI's $98.5 million series 2019A airport special obligation bonds, which were privately placed, and its combined $875 million 2019B-C airport special obligation bonds. The outlook is stable.
"The downgrade reflects the significant impact from these issuances and additional debt plans in the near term because of financing the terminal-modernization plan," said S&P Global Ratings credit analyst Kevin Archer.
Our enterprise risk profile assessment reflects our view of the airport's:
  • Strong market position;
  • Extremely strong service area economic fundamentals;
  • Low industry risk relative to that of other industries and sectors; and
  • Very strong management and governance.
Our financial risk profile assessment reflects our view of the airport's:
  • Strong financial performance;
  • Strong debt and liabilities capacity; and
  • Strong liquidity and financial flexibility.
The stable outlook reflects our view that despite MCI's significant additional debt plans as part of the capital plan, we expect financial metrics and enplanement levels to remain at levels supportive of the 'A' rating.
We do not expect to raise the rating during the two-year outlook horizon, given the risks associated with the significant capital plans.
We do not expect to lower the rating unless enplanement levels materially decline, leading to revision of our market position assessment, or if changes to the scope of the capital plan or project delays require significantly more debt than is currently expected.
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