44x against combined senior and subordinate debt
Key credit considerations include the establishment and operational implementation of a conceptual legal framework that incorporates an extension of the underlying terminal lease and restructures subordinate debt
obligations, a rapidly improving demand profile, combined with the underlying strength of JFK airport as a major domestic and international travel destination, strengthening financial performance, and increased levels of available liquidity.
6% have subordinate debt
in the form of junior participations or mezzanine financing.
As a result, net revenues are expected to be insufficient to pay senior and first tier subordinate debt
service (series 2001D first tier subordinate bonds are not rated by Fitch).
Fitch's 'BB' rating and Stable Outlook on the first tier subordinate bonds reflects a demonstrated base level of growing traffic demand, though well below the authority's 2001 forecast; a moderate level of economic rate-making ability; and a flexible debt structure with strong covenants that accommodate cash flow variability to pay subordinate debt
The significantly lower revenue profile combined with escalating debt service requirements pose a significant financial challenge that if left as is will likely result in a draw on the senior and first-tier subordinate debt
service reserve funds in fiscal 2007.
Fitch's policy for deeply subordinated debt requires a three-notch differential between the ratings of the senior and subordinate debt
unless other circumstances suggest greater notching.
Ascension's ratings are supported by its geographic diversity and breadth of operations, industry-leading management practices, modest debt burden even with the addition of the subordinate debt
, and improving profitability.
Prior to the early 1990s, public power credits used subordinate debt
sparingly and usually only for relatively minimum amounts of variable-rate debt.
20 times (x), while coverage on combined senior and subordinate debt
service, excluding payments made from mortgage recording tax revenues (which, post-debt restructuring, are no longer used as a security for a portion of subordinate debt
service) was at least 1.
Liquidity is further supplemented by fully funded debt service reserve funds that are sufficient to cover nearly the first four years of senior bond debt service and the first two years of subordinate debt
78x coverage of maximum allowable senior debt service and maximum annual debt service on outstanding subordinate debt