Fitch rates airport bonds ‘A-’ despite drop in traffic

JACKSON — Fitch Ratings affirms Jackson Municipal Airport Authority’s outstanding $43.5-million airport revenue and refunding bonds at “A-.” The rating outlook remains “stable.”

Fitch wrote: “The Jackson MSA is currently experiencing some setbacks from the economic recovery; however, Fitch expects resiliency in traffic levels given the airport’s limited competition from neighboring airports, with the closest medium hub 180 miles away.

“Enplanements at Jackson-Evers have returned to levels seen prior to Hurricane Katrina, following a significant increase in enplanements in fiscal year 2006 when the airport serviced evacuees and recovery efforts. Traffic in fiscal 2010 decreased by 3.3 percent to 616 thousand, but has shown some improvement in fiscal 2011 with eight-months year to date traffic increasing 0.6 percent. Management expects this growth to continue throughout 2011 along with slight growth in coming years due to population growth and economic developments in the Jackson downtown area. Service levels from the five air carriers serving the airport remains stable and unchanged in recent years, which Fitch views favorably. However Fitch notes that given the airport’s small enplanement base, even slight changes in service levels by a carrier may translate to material changes in enplanement levels.”

Source: Fitch