The Rating Outlook remains Negative.
The bonds are secured by a pledge of gross revenues of the obligated group, a first mortgage lien on certain property and debt service reserve funds on the series 2007A and 2011 bonds.
KEY RATING DRIVERS
WEAK FINANCIAL PROFILE FOR THE RATING: Despite ETMC's predominantly below-investment grade financial profile, Fitch's maintenance of the 'BBB-' rating is based on the expectation that future long-term performance will begin to improve with the settlement, albeit slowly. The Negative Outlook reflects Fitch's view that operating challenges may persist for a period of time while shifts in referral patterns begin to take hold. With high operating losses and depleting cash position, there is limited margin for further compression at the investment grade rating.
DECLINING SHARE OF COMPETITIVE MARKET:
RELIANCE ON SUPPLEMENTAL FUNDING:
ELEVATED DEBT LOAD:
CONTINUED PRESSURE BEFORE POSSIBLE IMPROVEMENT: Given the competitive landscape, there remains uncertainty as to how quickly referral patterns may change now that
SETTLEMENT WITH COMMERCIAL PAYORS
WEAKENED FINANCIAL PROFILE
Profitability in the nine months of fiscal 2016 (
LIQUIDITY AND DEBT PROFILE
Additional information is available at 'www.fitchratings.com'.
Revenue-Supported Rating Criteria (pub.
Dodd-Frank Rating Information Disclosure Form
Email: [email protected]
Source: Fitch Ratings