Gaylord’s Credit Rating Declines

Moody’s Investors Services has downgraded Nashville-based Gaylord Entertainment’s credit rating. It moved down to a “B3” from a “B2”, both are poor ratings.

Moody’s said one reason for the decline was due to a 15% drop in revenue per available room, a key indicator in the hotel business.

During its first quarter conference call with investors last week, Gaylord CEO Collin Reed said cancellation and attrition levels had fallen 74%, which haven’t been that low since just after 9-11.

From Moody’s statement on Gaylord’s credit rating decline, May 8, 2009:

 “The ratings downgrade reflects Moody’s view that despite the ramp-up of the Gaylord National, weaker than expected operating performance will result in weaker than anticipated debt protection measures for a period longer than first believed and which are more representative of the revised ratings” stated Bill Fahy, Senior Analyst at Moody’s.