Moody's: Hurricane Irma negatively affects Caribbean infrastructure concessions
Wednesday, September 13 2017 @ 04:59 PM AST
Contributed by: AleemKhan
"The island of St. Maarten (Baa2 stable) was among the most affected. Princess Juliana International Airport (SXM) in St. Maarten had not resumed regular commercial operations as of Tuesday evening, although the extent of its damages were unknown as of publication," Moody's said.
SXM is owned by Princess Juliana Intl Airport Op Company N.V. (Baa2 stable), which the St. Maarten government wholly owns. The airport is a key infrastructure asset and a critical gateway for emergency support to the island. Moody's said: "Non-commercial emergency operations have resumed and we expect that the airport will benefit from extraordinary support from the government of St. Maarten."
Nonetheless, tourism travel, the large majority of traffic and revenue for the airport, will have a profound and lasting reduction. "We anticipate that the airport will have enough liquidity to meet debt service payments in the next six months, and that if its cash generation capacity is materially affected over the next 12 months, the airport would be able to draw additional liquidity from the six-month debt-service reserve," Moody's said.
Other rated infrastructure assets in the region, Aerostar Airport Holdings, LLC (Ba2 negative) and Metropistas (Ba3 negative) in Puerto Rico and Aeropuertos Dominicanos Siglo XXI, S.A. (Ba3 stable) in the Dominican Republic appear not to have been materially affected by the hurricane.
Moody's said: "We anticipate that post-hurricane traffic declines will be short lived and that operations will resume to a closer-to-normal trend before year-end."
- Photo by Chris B. Pye