AAPA Seaports Advisory

Finance: Palm Beach, Tampa Bay

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Port of Palm Beach Receives Moody’s Senior Rating Upgrade

Moody’s Investors Service, Inc., has upgraded the Port of Palm Beach District senior rating to Baa3 from Ba1, and reported the outlook to be stable. The report, released October 2, 2015, documented the port’s strengths, challenges and recent developments as the agency’s rationale for the ratings upgrade.

The upgrade recognizes the port’s sustained financial improvement due to successful contract renewals with its largest customers. The improved margins experienced over the last four fiscal years are expected to continue in the mid- term, supported by tenant minimum annual revenue guarantee that improve the port’s cash flow predictability.

"Just as the majority of our neighbors were hit by the 2008 crash, the Port of Palm Beach felt the same blows. In the aftermath of the economic downturn, tenant operations decreased which resulted in subsequent revenue declines," explains Port of Palm Beach Chairman Blair J. Ciklin. "With that said, I am proud to have watched the port use that economic tide as a catalyst to adopt management practices that minimize expenditures while maximizing efficiency, productivity, and revenue possibilities. As a landlord port, which relies on tenant rents and fees for its income, the district was determined to rebuild profits for its tenant base. Through physical infrastructure and technology improvements, our largest revenue generators are now on the verge of surpassing their highest years."

Since 2008, operating revenues have steadily increased. The five-year compounded annual growth rate in 2014 was 8.3 percent in FY 2014. Revenue forecasts for FY 2016 predict continued growth due to minimum annual revenue guarantees in tenant leases combined with forecasts for higher passenger and parking revenues related to cruise operations.

Moody’s believes the port will "sustain its financial performance in the medium-term given revenue guarantees under long-term customer contracts, despite exposure to economically sensitive business partners and trade routes within a highly competitive market," while continuing its efforts to diversify its tenant base, improve liquidity and source alternative funding options for incoming capital improvement projects.

Port Tampa Bay Again Recognized for Financial Reporting Excellence by GFOA

The Government Financial Officers Association of the United States and Canada (GFOA) has awarded Port Tampa Bay the Certificate of Achievement for Excellence in Financial Reporting for its Comprehensive Annual Financial Report (CAFR) for the 2014 fiscal year. It is the 15th consecutive year the port has received this honor.

The Certificate of Achievement – the highest form of recognition in the area of governmental accounting and financial reporting – underscores a significant accomplishment by Port Tampa Bay and a constructive "spirit of full disclosure" in its communication methodology. The CAFR has been judged by an impartial panel to meet the high standards of the Certificate of Achievement in Financial Reporting program, providing Port Tampa Bay’s financial story in a comprehensive, easy-to-read document.

"It’s very gratifying to share the great news of another solid year of financial reporting, which has become a truly outstanding annual occurrence for Port Tampa Bay. This recognition results from a concerted effort toward fiduciary responsibility by our dedicated port management team," said Port CEP Paul Anderson.

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