The Stable Outlook reflects the airport’s ability tomaintain an affordable and flexible rolling three- to five-year capital program

The Stable Outlook reflects the airport’s ability tomaintain an affordable and flexible rolling three- to five-year capital program.Enplanements reached a high of nine million at the end of calendar year (CY)2008, up 62% over 1990 enplanement levels. This represented a 3% on averageannual growth rate, reflecting the airport’s monopoly position and the growth inpopulation and economy. While the airport continued to show positive trafficgrowth through the first half of CY 2008, enplanement declines took hold overthe course of the second half of 2008. The airport’s enplanements ended CY 2008down only 1.2% over 2007 levels. The airport has not been immune to the currenteconomic downturn and traffic declines accelerated in early CY 2009 atapproximately 12%, compared to the same period a year prior. While the pace ofdecline may remain at or around this level for the rest of 2009, the decline ispartially offset by management’s ability to control costs and adjust revenues tomaintain a relatively stable cost per enplaned passenger (CPE).

Current CPElevels are slightly below peer airports and reached a high of $6.26 in fiscal2008, up from $5.55 in fiscal 2004. The airport utilizes a good mix of diverse carriers that include both legacy andlow cost. The largest carrier serving the airport is Southwest Airlines whichrepresented 35% of the market in fiscal 2008, followed by American Airlines(11%, including American Eagle operations), United Airlines (10.4%), DeltaAirlines (7.3%), US Airways (6.7%), and Continental (5.5%). Over the historicalfive-year period market share position for the top carriers remained relativelystable. The airport’s cash balances have measurably improved in recent years and arereported at $70 million in fiscal 2008, up from $29 million in fiscal 2004.Unrestricted cash balances in fiscal 2008 were quite robust and representednearly 150% of the outstanding long-term revenue bonds and about 75% of thecombined outstanding long-term revenue bonds and commercial paper notes.Uniquely underleveraged, the airport’s annual operating income continues tosupport a very stable and predictable financial profile as operating incomereached $26 million in fiscal 2008, up from $18 million in fiscal 2004,representing a 10% average annual growth rate.

In addition, the airport’snon-operating revenues, primarily comprised of passenger facility charge (PFC)revenues, also grew at a healthy 5% annual average. Annual PFC revenues alonereached a high of $37 million in fiscal 2008, up from $31 million in fiscal2004, growing 5% on average annually. Given the large enplanement base andhealthy PFC collections, management is able to execute a sizable pay-as-you-gocapital program that is supported by PFCs. Annual debt service payments aresecured by pledged revenues, which do not include PFCs.