The National Aquarium in Baltimore was downgraded to Baa1 from A3 by Moody’s Investors Service last Tuesday.

The rating affects $30.8 million of variable- and fixed-rate bonds issued in 2002 through the Maryland Industrial Development Financing Authority. The downgrade reflects investment losses, variable-rate debt exposure, and attendance pressures.

At the end of fiscal 2008, the aquarium’s financial resources covered its outstanding debt 0.4 times from 1.2 times in fiscal 2003, Moody’s said. Attendance levels, the aquarium’s largest revenue stream, fell 3.5% in 2008 and 6.3% in 2007. About one million visitors toured the aquarium last year. But Moody’s said attendance is up 4% year to date over comparable 2008 levels.

The value of the aquarium’s investments fell 37.6% in the last 12 months. Additionally, Moody’s said the aquarium’s philanthropic donations are below average for comparable not-for-profits.

The increase in attendance this year combined with an increase in ticket prices bodes well for the aquarium. Moody’s said that the aquarium’s fiscal 2009 operating performance “is better than originally budgeted and in line with fiscal 2008 operating performance.”

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