Fitch Ratings Affirms Hawaii Harbor System Revenue Bond Rating At "A+" Grade
11/08/11 - Fitch Ratings has affirmed the Hawaii Harbor System’s revenue bond rating at an “A+” grade, citing a stable future outlook. The ratings affirmation was based on Fitch’s positive analysis of the harbor system’s strong financial liquidity, scheduled tariff increases for cruise, cargo and pipelines, and the increased stability of the state’s economy.
Under the state Department of Transportation, the Harbors System operates ten commercial harbors on six islands. Hawaii imports approximately 80-percent of its consumable goods, of which, 98-percent of these imports enter the state through the harbor sys
The ratings affirmation was based on Fitch’s positive analysis of the harbor
system’s strong financial liquidity, scheduled tariff increases for cruise,
cargo and pipelines, and the increased stability of the state’s economy.
Governor Neil Abercrombie said, “No other state relies as heavily on their harbors as Hawaii does and our future modernization plans will continue to increase efficiency into the future. This rating is a vote of confidence in our harbor system and our ongoing economic recovery.”
Under the state Department of Transportation, the Harbors System operates ten commercial harbors on six islands. Hawaii imports approximately 80-percent of its consumable goods, of which, 98-percent of these imports enter the state through the harbor system.
In
issuing the upgrade, Fitch identified the following as positives of the harbors
system:
· Strong State Economy: Stability of the state's underlying economy through the downturn with signs of stabilization and return to growth in recent periods.
· Natural Monopoly: The port system provides essential maritime services and serves a state without an efficient alternative means of transporting goods to and throughout it.
· Approved Tariff Increases: The harbor system has adopted scheduled tariff increases for cruise, cargo, and pipelines, with escalations underway since 2010 and scheduled to continue through 2016.
· Considerable Capital Plan: Sizable and evolving capital improvements that will necessitate increasing leverage.
· Strong Financial Profile: Stable operating margins with a sizable liquidity cushion with unrestricted liquidity.
“Our Harbors Division has done a great deal of planning and collaboration with harbor users to ensure that our modernization plan provides a stable future outlook,” said state Transportation Director Glenn Okimoto. “A lot of the credit for this successful bond rating goes to Jean Oshita, Harbors Division Administrative Services Officer, who oversees our harbor financial plans.”
For more information or for a copy of the ratings report, please visit the Fitch Ratings website at www.fitchratings.com.
###
