NEW YORK–(BUSINESS WIRE) – Kroll Bond Rating Agency (KBRA) has taken the following rating actions in relation to the following Clark County, Nevada commitments:
Allocation of a long-term rating of AA- with a stable outlook to:
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Airport system Subordinated lien repayment of income bonds Series 2021A (Non-AMT)
Assigned a long-term rating of A + with a stable outlook:
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Airport System Junior Subordinate Lien Revenue Notes Series 2021B (AMT)
Confirms the long-term rating of AA with a stable outlook for:
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Airport System Revenue Bonds Senior Series 2019C (Non-AMT)
Confirms the long-term rating of AA- with a stable outlook for:
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Airport System Subordinated Pfandbrief Repayment Series 2019D (Non-AMT)
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Las Vegas-McCarran International Airport Passenger Facility Charge Refunding Revenue Bonds Series 2019E (Non-AMT)
Important creditworthiness considerations
KBRA continues to monitor the direct and indirect effects of the COVID-19 virus. Click here to access KBRA’s ongoing research on the subject.
The rating measures reflect the following key credit considerations:
Credit positives
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Large, mainly O&D (~ 90% of travelers) passenger base with varying market shares of the airlines.
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Reduced, if still satisfactory, coverage margins for debt servicing and strong liquidity.
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Moderate debt metrics that are likely to improve if the debt amortizes and no additional debt is incurred.
Credit challenges
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An unprecedented drop in passenger traffic in recent times due to COVID-19-related public health measures and an uncertain recovery path.
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The concentration of the leisure and hospitality base is a weak point in a severe economic downturn.
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Bonds / swaps with variable interest rates require constant monitoring and are associated with risks.
Valuation sensitivities
For upgrade
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Significant progress in moving to a fixed income debt structure that reduces the facility’s liquidity and renewal risk.
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Improved debt metrics through retirement of outstanding issues and limited or no additional debt issuance.
For downgrade
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Reduction in coverage and / or liquidity
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Troubled and weak rebound from pandemic-related passenger declines.
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The ongoing number of passengers is decreasing due to the lower relevance of the air trading area as a leisure / conference destination.
ESG considerations
Governance factors
Online Safety: The district operates a large and complex IT infrastructure to support internal and external operations. The county has a team of nine IT staff dedicated to protecting against cybersecurity attacks and enforcing security policies and procedures. The county has invested in anti-virus programs, extensive log monitoring and multi-factor authentication systems. The county meets the requirements of the PCI Data Security Standards Council and also has cyber liability insurance.
To access reviews and relevant documents, click here.
Disclosure
A description of all material material sources used in establishing the rating and information on the methodology (s) (including any material models and sensitivity analyzes of the relevant material rating assumptions, if applicable) that were used in determining the rating is available in the information disclosure form (s) here.
Information on the meaning of the individual assessment categories can be found here.
Further information on this rating measure can be found in the information disclosure forms mentioned above. For more information on KBRA guidelines, methods, rating scales and indications, please visit www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered as an NRSRO with the Securities and Exchange Commission. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered with the UK Financial Conduct Authority as a CRA under the temporary registration system. In addition, KBRA has been named by the Ontario Securities Commission as the designated rating organization for issuers of asset-backed securities for the submission of a short prospectus or shelf prospectus. KBRA is also recognized as a credit rating provider by the National Association of Insurance Commissioners.
