Fitch Affirms Tri-City Port Dist, Illinois' Rev Bonds at 'BBB'; Outlook to Positive
Posted on: Wednesday, 3 August 2005, 15:01 CDT
Fitch affirms the 'BBB' rating for the Tri-City Regional Port District, Illinois' approximately $2.46 million outstanding Port and Terminal Facilities (the port) revenue refunding bonds, series 2003-A (The Delivery Network Project). The Rating Outlook is revised to Positive. The bonds are payable from all net revenues generated by the port. The port intends to repay the bonds from revenues received under a lease with The Delivery Network, Inc.
The 'BBB' rating reflects the port's status as a landlord facility, which serves to limit operational risk and provide a stable financial base, as well as the port's favorable location along the Mississippi River, excellent access to the national rail and highway networks, and strong position in the St. Louis market. Credit concerns include the competitive nature of the shipping industry, construction and financing risk related to the port's long-term development, and the somewhat concentrated nature of the port's revenue stream.
The Outlook revision to Positive is based on the port's strong financial operations of the past two years due to increased rental revenues associated with its takeover of adjacent land previously occupied by an army depot, which resulted in coverage of annual debt service requirements exceeding 4.5 times (x) for the past two fiscal years. Therefore, the potential for a rating upgrade exists over time, provided the port sustains its improved financial performance and continues to finance planned capital improvements through alternative sources including federal and state grants and third parties, limiting its external borrowing needs.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
Source: Business Wire
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