TEXT-S&P Report Says Aust, NZ Airports Outlook Remains Stable

(The following was released by the rating agency)

MELBOURNE (Standard & Poor's) Oct. 5, 2012-After witnessingstrong growth in the recent past, rated Australian and NewZealand airports could be further tested in light of thecontinuing global economic uncertainty, particularly in China.Nonetheless, the outlook for the rated airports remains stable,Standard & Poor's Ratings Services said in a report publishedtoday titled, "Rated Australian And New Zealand Airports AreWell Placed To Face A China Slowdown".

"The ability of the Australian and New Zealand airports tomaintain credit quality in the face of industry shocks has beenunderpinned by resilience in passenger demand, as well as thecapacity and willingness of the airport's management to takenecessary steps to protect their credit profile," Standard &Poor's credit analyst Philip Grundy said. "The strong businessrisk profiles of the rated airports, demonstrated history ofrelatively quick recovery from shocks, and our expectation ofcontinued long-term growth in passenger demand underpin ourstable outlook for the sector."

In our report, we have analyzed the ability of ratedairports in the two countries to withstand pressures from threeindependent hypothetical scenarios: a hard economic landing inChina, significant depreciation of the Australian dollar, andfailure of a major airline. We believe the extent of the impactwould vary for each airport. While an airport's revenue mix andfinancial risk profile would be critical in contending with thechallenges, most rated airports have typically preserved theircredit quality by rationalizing their capital projects, andmaintaining prudent refinancing practices and adequateliquidity.

Keywords: MARKETS RATINGS AUSTRALIANEWZEALANDAIRPORTS