Fitch downgrades EDC debt outlook to ‘negative’

NEW YORK – Fitch Ratings has assigned an underlying ‘A’ rating to two R.I. Economic Development Corporation airport revenue bonds totaling $32 million. Fitch also downgraded EDC’s debt outlook from “stable” to “negative.”
The bonds, which are special obligations of the R.I. Airport Corporation, are payable principally from net revenues and pledged funds generated principally from T.F. Green International Airport (PVD) in Warwick, Fitch said in a news release last week. Bond proceeds are slated to be used to fund components of RIAC’s capital improvement plan.
Fitch said the revision was based on two consecutive years of decreasing passengers at T.F. Green and rising costs per passenger. The ratings firm also noted T.F. Green’s growing reliance on Southwest Airlines and general increased pressures in the domestic airline industry created by the increased cost of oil and anticipated system-wide service reductions.
www.riedc.com.
Fitch said that should T.F. Green “successfully implement planned cost-reduction efforts, … generate non-airline revenues above the minimum annual guarantee, … and/or maintain or increase passenger throughput over the next few years, the outlook may be returned to ‘stable.’” •