DBRS Rates GTAA’s $400 Million Medium-Term Note Issue at “A”

DBRS has today assigned a rating of “A” with a Stable trend to the $400 million Medium-Term Note Series 2012-1 (the Notes) issue of the Greater Toronto Airports Authority (GTAA or the Authority). Maturing in September 2022, the Notes are senior obligations of GTAA and rank pari passu with all other senior obligations of the Authority. The rating is consistent with those previously assigned by DBRS on the Authority’s outstanding bonds. Net debt proceeds will be used to repay part of the $475 million MTN Series 2002-2 maturing on December 13, 2012, to fund a Debt Service Reserve Amount for the Notes of $12.1 million, and for general corporate purposes.

For the first seven months of 2012, GTAA has recorded passenger growth of 4.1% on a year-over-year basis. While the pace of traffic growth tailed off in July, the Authority expects traffic levels to have rebounded in August. During the year, two new airlines have begun serving Toronto Pearson International Airport.

Revenues for the first half of 2012 were marginally lower, as higher traffic was offset by lower aeronautical rates. However, expenses for the year have tracked under budget, as snow removal needs were relatively modest last winter and energy costs have also been lower than forecast. Correspondingly, the Authority expects to exceed its budgeted EBITDA for the year.

No material development has been noted by DBRS since the completion of its annual review and the publication of its rating report on GTAA on November 9, 2011. The report is available at www.dbrs.com or by contacting us at info@dbrs.com.

Note:
All figures are in Canadian dollars unless otherwise noted.

The applicable methodology is Rating Canadian Airport Authorities, which can be found on our website under Methodologies.