Moody's Investors Service has downgraded to Baa1 from A3 the rating of the Manchester (N.H.) Airport Enterprise's $174.2 million outstanding general airport revenue bonds. The rating outlook has been revised to stable from negative.
Moody's said the downgrade reflects its assessment of a weakened market position of the airport caused by operational changes of network carriers in the U.S. towards service into dominant regional airports with larger aircraft, a change that has manifest itself through a long-term decline in enplanements at the airport. The rating weighs the weakened market position against steady financial performance throughout the decline in enplanements, with key metrics such as debt service coverage and days cash on hand remaining within their recent historical bands. The rating additionally considers the heavy reliance on Southwest at 57.4 percent of enplanements, Moody's said.
Despite capturing among the highest load factors in its system at Manchester, the firm said Southwest continues to grow its presence at Boston's Logan International. Moody's noted that the rating is additionally supported by limited capital capacity or construction requirements as the facility is relatively new and built to withstand higher service levels.