Airports ratings safe if financial risk addressed: S&P

Thursday 15th April 2010

Australasian airports should be able to maintain their current credit ratings if they attend to financial risk according to Standard & Poor’s Ratings Service.

In its report ‘For Australian and New Zealand airports, the focus is on financial risk as spending resumes’, S&P points to global airline industry recovery with better than forecast passenger traffic in recent months as the reason the sector is likely to maintain a sound credit outlook in the near term.

“A key credit factor over the next two years is the sector’s funding approach for capital works, which have been largely deferred or reduced in size over the past 12 to 18 months because of difficult credit market and business conditions,” said S&P’s credit analyst Parvathy Iyer. “What’s more, significant debt-refinancing tasks, combined with higher debt costs, could reduce the financial headroom at some airports, especially if debt usage is not prudently controlled.”

The report discusses the implication of the improved market conditions and debt-funded capital-spending projects on the credit profiles of Australasian airports, as well as examining the debt-maturity profile of the sector.

Businesswire.co.nz

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