Aeropuerto Internacional de Tocumen#s Proposed Senior Secured Bonds Assigned Preliminary #BBB# Rating, Outlook Stable

Stocks and Financial Services Press Releases Thursday April 26, 2018 09:50
BUENOS AIRES--26 Apr--S&P Global Ratings

BUENOS AIRES (S&P Global Ratings) April 25, 2018--S&P Global Ratings assigned its 'BBB' preliminary long-term issue-level rating on the proposed $225 million fixed-rate secured bonds due 2048 to be issued by Panama-based Aeropuerto International de Tocumen S.A. (Tocumen). The outlook on these bonds is stable.

At the same time, we affirmed the existing 'BBB' rating on the $650 million bonds due in 2023 and on the $575 million bonds due in 2036. The outlook also remains stable.

The final debt ratings will depend on our receipt and satisfactory review of all final transaction documentation; the issue margin on the new notes would need to be in line with our expectations. Accordingly, the preliminary ratings should not be construed as evidence of final ratings. If we do not receive the final documentation within a reasonable timeframe, or if the final transaction departs from our assumptions, we reserve the right to withdraw or change the ratings.

The rating action follows the Projects announcement of the incremental debt issuance that will be pari-passu with existing senior secured obligations, and our expectation that main relevant coverage metrics will remain strong. Our new base case scenario contemplates the additional $225 million senior bonds, a redistribution of funding, and a reorganization of timing for certain specific capital expenditures (capex) associated with the connection between new and existing terminals. These factors resulted in a slightly higher minimum debt service coverage ratio (DSCR; 1.47x versus 1.34x previously projected) and consequently improved our view of Tocumen's operational risk.

The stable outlook on the notes reflects our view that passenger growth will remain broadly in line with recent trends, at about 5% over the next two years, boosted by the country's favorable economic trends and the airport's satisfactory competitive position. The outlook further reflects our belief that, despite still-high capital investments in 2018 and 2019, the project will maintain a minimum DSCR at or above 1.45x, increasing from 2018 onward due to the entrance into operations of the new passenger terminal that will allow a larger passenger capacity and additional commercial spaces.

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