GOAA Bonds Receive Significant Upgrade From Key Rating Agency

Press Release

ORLANDO, Fla. – S&P Global Ratings expressed a strong vote of confidence in the financial structure of the Greater Orlando Aviation Authority (GOAA). In a report released today, the ratings agency raised its long-term rating and underlying rating on GOAA’s senior-lien airport facilities revenue bonds from ‘AA-‘ to ‘AA’ and its rating on the Aviation Authority’s subordinate-lien debt from ‘A+’ to ‘AA-‘. The outlook is stable.

The upgraded ratings reflect Orlando International Airport’s (MCO) very high activity levels and long history of favorable enplanement trends supported by serving an expanding service area economy with strong visitor demand; demonstrated financial resiliency during periods of lower air travel demand; and the expectation that GOAA will maintain strong-to-very-strong financial metrics considering future capital requirements.

Key credit strengths were noted as:

• A robust post-pandemic recovery and high activity levels (27.9 million enplanements in fiscal 2023; 112% of 2019 levels).
• MCO’s favorable and very high air travel demand, which is supported by serving the unique Orlando tourist market, strong GDP per capita, above average expected population growth, and generally low unemployment rates.
• MCO’s diverse carrier mix and limited competition from other airports.
• Very experienced and effective management team that employs prudent financial planning and risk management practices in the successful operation of an airport the size and scale of MCO.

The stable outlook reflects expectations that air travel demand for MCO will remain high and that GOAA will adjust revenues, expenses, and capital spending as needed to maintain financial metrics considered strong to very strong as it increases its leverage from debt financing a large Capital Improvement Program (CIP).

Credit Opinion

S&P also upgraded GOAA’s Enterprise Risk Profile to Extremely Strong. The improvement reflected the agency’s opinion of MCO’s role and importance as the principal provider of commercial air travel in central Florida.

S&P noted that MCO’s large, primarily Origination & Destination (O&D) passenger base is supported by a large and economically vibrant service area with several major theme parks nearby that have continually added new attractions. Besides its reputation as a popular leisure destination, the region was recognized for expanding its health care industry, anchored by a developing medical city project that has led to thousands of new non-leisure/hospitality sector jobs. Limited competition from other airports and good carrier diversity also contribute to GOAA’s generally favorable enplanement trends.