Moodys.com
Close
Please Note
We brought you to this page based on your search query. If this isn't what you are looking for, you can continue to Search Results for ""
The maximum number of items you can export is 3,000. Please reduce your list by using the filtering tool to the left.
Close
Close
Email Research
Recipient email addresses will not be used in mailing lists or redistributed.
Recipient's
Email

Use semicolon to separate each address, limit to 20 addresses.
Enter the
characters you see
Close
Email Research
Thank you for your interest in sharing Moody's Research. You have reached the daily limit of Research email sharings.
Close
Thank you!
You have successfully sent the research.
Please note: some research requires a paid subscription in order to access.
Already a customer?
LOG IN
Don't want to see this again?
REGISTER
OR
Accept our Terms of Use to continue to Moodys.com:

PLEASE READ AND SCROLL DOWN!

By clicking “I AGREE” [at the end of this document], you indicate that you understand and intend these terms and conditions to be the legal equivalent of a signed, written contract and equally binding, and that you accept such terms and conditions as a condition of viewing any and all Moody’s inform​ation that becomes accessible to you [after clicking “I AGREE”] (the “Information”).   References herein to “Moody’s” include Moody’s Corporation, Inc. and each of its subsidiaries and affiliates.

Terms of One-Time Website Use

1.            Unless you have entered into an express written contract with Moody’s to the contrary, you agree that you have no right to use the Information in a commercial or public setting and no right to copy it, save it, print it, sell it, or publish or distribute any portion of it in any form.               

2.            You acknowledge and agree that Moody’s credit ratings: (i) are current opinions of the future relative creditworthiness of securities and address no other risk; and (ii) are not statements of current or historical fact or recommendations to purchase, hold or sell particular securities.  Moody’s credit ratings and publications are not intended for retail investors, and it would be reckless and inappropriate for retail investors to use Moody’s credit ratings and publications when making an investment decision.  No warranty, express or implied, as the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any Moody’s credit rating is given or made by Moody’s in any form whatsoever.          

3.            To the extent permitted by law, Moody’s and its directors, officers, employees, representatives, licensors and suppliers disclaim liability for: (i) any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with use of the Information; and (ii) any direct or compensatory damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud or any other type of liability that by law cannot be excluded) on the part of Moody’s or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with use of the Information.

4.            You agree to read [and be bound by] the more detailed disclosures regarding Moody’s ratings and the limitations of Moody’s liability included in the Information.     

5.            You agree that any disputes relating to this agreement or your use of the Information, whether sounding in contract, tort, statute or otherwise, shall be governed by the laws of the State of New York and shall be subject to the exclusive jurisdiction of the courts of the State of New York located in the City and County of New York, Borough of Manhattan.​​​

I AGREE
Rating Action:

Moody's upgrades Port of Oakland's (CA) intermediate bonds to A2, assigns A2 to Series 2017, stable outlook

09 Jun 2017

New York, June 09, 2017 -- Issue: Intermediate Lien Refunding Revenue Bonds 2017 Series F (Private Activity/Non-AMT); Rating: A2; Rating Type: Underlying LT; Sale Amount: $30,350,000; Expected Sale Date: 06/21/2017; Rating Description: Revenue: Government Enterprise;

Issue: Intermediate Lien Refunding Revenue Bonds 2017 Series G (Federally Taxable); Rating: A2; Rating Type: Underlying LT; Sale Amount: $38,330,000; Expected Sale Date: 06/21/2017; Rating Description: Revenue: Government Enterprise;

Issue: Intermediate Lien Refunding Revenue Bonds 2017 Series D (Private Activity/AMT); Rating: A2; Rating Type: Underlying LT; Sale Amount: $99,595,000; Expected Sale Date: 06/21/2017; Rating Description: Revenue: Government Enterprise;

Issue: Intermediate Lien Refunding Revenue Bonds 2017 Series E (Governmental/Non-AMT); Rating: A2; Rating Type: Underlying LT; Sale Amount: $91,070,000; Expected Sale Date: 06/21/2017; Rating Description: Revenue: Government Enterprise;

Summary Rating Rationale

Moody's Investors Service has upgraded the Port of Oakland, California's $656 million of senior lien bonds to A1 from A2, $324 million of intermediate lien bonds to A2 from A3, and subordinate lien bank note rating to A3 from Baa1. Moody's has assigned an A2 rating to the port's $260 million Intermediate Lien Refunding Bonds, Series 2017 (DEFG). The outlook is stable.

The upgrades reflect significant improvement in the port's credit profile, driven by a long-term and ongoing deleveraging; strengthened activity levels in its two principal business lines; improved debt service coverage ratios (DSCRs) and a materially improved cash position.

From FY 2009 - 2017, enplanements and twenty-foot equivalent units (TEUs) will have increased by an estimated 26% and 16%, respectively, stabilizing the port's primary businesses and driving improvements in consolidated DSCRs. Over the same period, debt outstanding has decreased by 30%, while unrestricted cash is estimated to have increased more than fourfold.

The strengthened activity levels, DSCRs and cash position provide greater financial flexibility for the port, and are complemented by a trajectory of decreasing leverage, which we expect will continue. The port is scheduled to amortize $376 million of principal over the next five years (includes $94 million of commercial paper), and has sufficient sources to fund its capital budget without additional long-term debt (expects to issue $24 million of commercial paper).

The ratings reflect the strong security pledge of consolidated revenues and our expectation that the combined enterprise will continue to produce senior net revenue DSCRs between 2.5-3.0 times and intermediate net revenue DSCRs between 1.5-1.7 times.

We expect continued operational stability in the port's two largest divisions, aviation and maritime, as these businesses have relatively stable and imperfectly correlated demand profiles, competitive assets, and benefit from their roles as providers of essential infrastructure for large and economically robust - and ultimately different - service areas. While both businesses have cyclical aspects of demand, the port's strong financial profile and manageable short-term capital needs provide flexibility to manage fluctuations in activity.

At the same time, the ratings reflect our view that operating cost pressures and competitive constraints on pricing will continue to challenge margins in the port's primary business lines, and that the port's cash position will narrow from the current level as cash is contributed for capital spending over the next five years.

Rating Outlook

The stable outlook reflects our expectation of stability in air passenger traffic and marine cargo volume; ongoing vitality in the regional economy; and manageable risk in the maritime division due to the landlord model employed, which will support financial stability through a period of operational transition and potential short term revenue volatility. These factors combine to support our expectation of continued healthy financial performance and strong DSCRs in aviation, stable financial performance and satisfactory intermediate DSCRs in maritime, and intermediate DSCRs of 1.5 - 1.6 times for the combined enterprise as a whole.

Factors that Could Lead to an Upgrade

Extension of major marine terminal leases with fixed revenues providing greater revenue visibility and insulation from cargo volatility

Intermediate DSCRs for maritime maintained above 1.5 times for a sustained period

Continued deleveraging combined with the maintenance of 500 days cash on hand

Continued enplanement growth, coupled with the prospective maintenance of a competitive cost per enplanement (CPE) and low leverage, in the aviation division

Factors that Could Lead to a Downgrade

Inability to align operating costs with operating revenues to sustain current and expected DSCRs

Significant declines in maritime revenues, with maritime intermediate DSCRs below 1.25 for a sustained period

Multi-year trend of enplanement declines and or air service reductions

Significant deterioration in DSCRs and liquidity for the combined enterprise, with intermediate DSCRs below 1.4 times for a sustained period

Legal Security

The senior lien bonds, intermediate lien bonds and subordinate lien obligations are secured by a pledge of gross revenues on a senior, intermediate and subordinate basis, respectively. PFCs, CFCs, and certain other amounts are specifically excluded from pledged revenues. The rate covenant for the senior lien bonds is 1.25 times aggregate annual senior lien debt service coverage by net revenues, and the additional bonds test (ABT) is 1.25 times maximum annual senior lien debt service (MADS) based on net revenues. The senior lien bonds are secured by a common reserve fund, sized at average annual debt service and funded with cash.

The intermediate lien rate covenant is 1.10 times coverage of aggregate annual intermediate lien debt service by net revenues. The ABT is equal to 1.10 times coverage of aggregate MADS (intermediate) using net revenues from any of the 12 consecutive months out of the 24 consecutive months immediately preceding. The intermediate lien bonds are secured by a common reserve fund, sized at average annual debt service and funded with an investment grade surety.

The subordinate lien bank note rating applies to the bank note that would arise should the provider make a liquidity payment that is not reimbursed by the port. Under the terms of the reimbursement agreement with both banks, after 90 days any liquidity payment not reimbursed would become a term loan due to the bank and covered by the bank note in the reimbursement agreement. The liquidity would bear interest at an elevated rate and principal payments would be accelerated to be paid within three years.

There is currently no other debt on parity with the commercial paper or residing below the intermediate lien bonds. The one notch distinction between the intermediate lien debt and bank note rating reflects the subordinate status of the bank note in the priority of claims and the lack of limitation on the amount of debt that could be issued above the commercial paper on the subordinate lien (there is a rate covenant on the intermediate lien, which provides a degree of limitation).

Use of Proceeds

Proceeds will be used to refund the port's 2007 intermediate lien bonds within the current maturity schedule.

Obligor Profile

The Port of Oakland is an independent department of the City of Oakland (Aa2 stable), per the city charter. Exclusive control and management of port facilities were delegated to the board in 1927 by an amendment to the city charter.

The port operates three principal divisions, maritime (44% of FY 2016 operating revenues), aviation (51%) and commercial real estate (5%).

The seaport is the 3rd busiest seaport in California and the 7th busiest seaport in the US as measured by TEUs. OAK is a medium hub, 86% O&D airport and is the 4th busiest airport in California and the 2nd busiest airport in the San Francisco Bay Area.

Methodology

The principal methodology used in this rating was Public Port Revenue Bonds published in December 2013. The additional methodology used in this rating was Publicly Managed Airports and Related Issuers published in November 2015. Please see the Rating Methodologies page on www.moodys.com for a copy of these methodologies.

Regulatory Disclosures

For ratings issued on a program, series or category/class of debt, this announcement provides certain regulatory disclosures in relation to each rating of a subsequently issued bond or note of the same series or category/class of debt or pursuant to a program for which the ratings are derived exclusively from existing ratings in accordance with Moody's rating practices. For ratings issued on a support provider, this announcement provides certain regulatory disclosures in relation to the credit rating action on the support provider and in relation to each particular credit rating action for securities that derive their credit ratings from the support provider's credit rating. For provisional ratings, this announcement provides certain regulatory disclosures in relation to the provisional rating assigned, and in relation to a definitive rating that may be assigned subsequent to the final issuance of the debt, in each case where the transaction structure and terms have not changed prior to the assignment of the definitive rating in a manner that would have affected the rating. For further information please see the ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.

Regulatory disclosures contained in this press release apply to the credit rating and, if applicable, the related rating outlook or rating review.

Please see www.moodys.com for any updates on changes to the lead rating analyst and to the Moody's legal entity that has issued the rating.

Please see the ratings tab on the issuer/entity page on www.moodys.com for additional regulatory disclosures for each credit rating.

Moses Kopmar
Lead Analyst
Project Finance
Moody's Investors Service, Inc.
7 World Trade Center
250 Greenwich Street
New York 10007
US
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Kurt Krummenacker
Additional Contact
Project Finance
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

Releasing Office:
Moody's Investors Service, Inc.
250 Greenwich Street
New York, NY 10007
U.S.A
JOURNALISTS: 212-553-0376
SUBSCRIBERS: 212-553-1653

No Related Data.
© 2019 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All rights reserved.

CREDIT RATINGS ISSUED BY MOODY'S INVESTORS SERVICE, INC. AND ITS RATINGS AFFILIATES (“MIS”) ARE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES, AND MOODY’S PUBLICATIONS MAY INCLUDE MOODY’S CURRENT OPINIONS OF THE RELATIVE FUTURE CREDIT RISK OF ENTITIES, CREDIT COMMITMENTS, OR DEBT OR DEBT-LIKE SECURITIES. MOODY’S DEFINES CREDIT RISK AS THE RISK THAT AN ENTITY MAY NOT MEET ITS CONTRACTUAL FINANCIAL OBLIGATIONS AS THEY COME DUE AND ANY ESTIMATED FINANCIAL LOSS IN THE EVENT OF DEFAULT OR IMPAIRMENT. SEE MOODY’S RATING SYMBOLS AND DEFINITIONS PUBLICATION FOR INFORMATION ON THE TYPES OF CONTRACTUAL FINANCIAL OBLIGATIONS ADDRESSED BY MOODY’S RATINGS. CREDIT RATINGS DO NOT ADDRESS ANY OTHER RISK, INCLUDING BUT NOT LIMITED TO: LIQUIDITY RISK, MARKET VALUE RISK, OR PRICE VOLATILITY. CREDIT RATINGS AND MOODY’S OPINIONS INCLUDED IN MOODY’S PUBLICATIONS ARE NOT STATEMENTS OF CURRENT OR HISTORICAL FACT. MOODY’S PUBLICATIONS MAY ALSO INCLUDE QUANTITATIVE MODEL-BASED ESTIMATES OF CREDIT RISK AND RELATED OPINIONS OR COMMENTARY PUBLISHED BY MOODY’S ANALYTICS, INC. CREDIT RATINGS AND MOODY’S PUBLICATIONS DO NOT CONSTITUTE OR PROVIDE INVESTMENT OR FINANCIAL ADVICE, AND CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT AND DO NOT PROVIDE RECOMMENDATIONS TO PURCHASE, SELL, OR HOLD PARTICULAR SECURITIES. NEITHER CREDIT RATINGS NOR MOODY’S PUBLICATIONS COMMENT ON THE SUITABILITY OF AN INVESTMENT FOR ANY PARTICULAR INVESTOR. MOODY’S ISSUES ITS CREDIT RATINGS AND PUBLISHES MOODY’S PUBLICATIONS WITH THE EXPECTATION AND UNDERSTANDING THAT EACH INVESTOR WILL, WITH DUE CARE, MAKE ITS OWN STUDY AND EVALUATION OF EACH SECURITY THAT IS UNDER CONSIDERATION FOR PURCHASE, HOLDING, OR SALE.

MOODY’S CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY RETAIL INVESTORS AND IT WOULD BE RECKLESS AND INAPPROPRIATE FOR RETAIL INVESTORS TO USE MOODY’S CREDIT RATINGS OR MOODY’S PUBLICATIONS WHEN MAKING AN INVESTMENT DECISION. IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER PROFESSIONAL ADVISER.

ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED, DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.

CREDIT RATINGS AND MOODY’S PUBLICATIONS ARE NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT IN THEM BEING CONSIDERED A BENCHMARK.

All information contained herein is obtained by MOODY’S from sources believed by it to be accurate and reliable. Because of the possibility of human or mechanical error as well as other factors, however, all information contained herein is provided “AS IS” without warranty of any kind. MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot in every instance independently verify or validate information received in the rating process or in preparing the Moody’s publications.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability to any person or entity for any indirect, special, consequential, or incidental losses or damages whatsoever arising from or in connection with the information contained herein or the use of or inability to use any such information, even if MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers is advised in advance of the possibility of such losses or damages, including but not limited to: (a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant financial instrument is not the subject of a particular credit rating assigned by MOODY’S.

To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liability for any direct or compensatory losses or damages caused to any person or entity, including but not limited to by any negligence (but excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt, by law cannot be excluded) on the part of, or any contingency within or beyond the control of, MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers, arising from or in connection with the information contained herein or the use of or inability to use any such information.

NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY CREDIT RATING OR OTHER OPINION OR INFORMATION IS GIVEN OR MADE BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.

Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s Investors Service, Inc. have, prior to assignment of any rating, agreed to pay to Moody’s Investors Service, Inc. for ratings opinions and services rendered by it fees ranging from $1,000 to approximately $2,700,000. MCO and MIS also maintain policies and procedures to address the independence of MIS’s ratings and rating processes. Information regarding certain affiliations that may exist between directors of MCO and rated entities, and between entities who hold ratings from MIS and have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted annually at www.moodys.com under the heading “Investor Relations — Corporate Governance — Director and Shareholder Affiliation Policy.”

Additional terms for Australia only: Any publication into Australia of this document is pursuant to the Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136 972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access this document from within Australia, you represent to MOODY’S that you are, or are accessing the document as a representative of, a “wholesale client” and that neither you nor the entity you represent will directly or indirectly disseminate this document or its contents to “retail clients” within the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or any form of security that is available to retail investors.

Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc., a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization (“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit rating agencies registered with the Japan Financial Services Agency and their registration numbers are FSA Commissioner (Ratings) No. 2 and 3 respectively.

MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated by MJKK or MSFJ (as applicable) have, prior to assignment of any rating, agreed to pay to MJKK or MSFJ (as applicable) for ratings opinions and services rendered by it fees ranging from JPY125,000 to approximately JPY250,000,000.

MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory requirements.

​​​​​​
Moodys.com