Standard & Poor's Ratings Services said it raised its long-term rating and underlying rating to A-plus from A on Hawaii Airport System's previously issued senior-lien revenue bonds, and its long-term rating to A from A-minus on the system's series 2013 lease revenue subordinate-lien certificates of participation.
In addition, it assigned its A-plus long-term rating to Hawaii Airport System's $222.5 million series 2015A (alternate minimum tax [AMT]) and $18.8 million series 2015B (non-AMT) revenue bonds. The outlook is stable.
"The rating action reflects our view of the system's consistently very strong liquidity, which management reports will be sustained, but also its moderately low debt burden and low cost structure," said Standard & Poor's credit analyst Paul Dyson. S&P said both of these will remain moderately low and consistent with the raised ratings, despite a large capital plan.
"The rating action also reflects our view of the system's good enplanement trends and the state's generally positive economic and tourism trends, which, in our view, support continued strong demand for the airport system," Dyson added.
The extensive 15-airport system consists of one large-hub airport, one medium-hub airport, three small-hub airports, and 10 nonhub or small secondary airports.
It is the sole provider of commercial aviation facilities in the state, and this is a key credit strength that few other U.S. airports or systems can match. Multiple airports in the system can accommodate overseas flights (direct flights from the U.S. mainland to the neighboring islands is a growing trend) and inter-island flights, and this helps to diversify system risk. Hawaii continues to be one of the most-visited states in the U.S.
