Moody's: Snoqualmie outlook stable

Moody's Investors Service said it changed Snoqualmie Entertainment Authority's outlook to stable from negative. The authority's ratings are unchanged, including the Caa3 corporate family and probability of default ratings and the Caa3 (LGD3, 46%) ratings assigned to its $130 million floating-rate senior notes due 2014 and $200 million 9 1/8% senior notes due 2015.

The agency said the outlook revision incorporates Snoqualmie Casino's improved operating trend in the first six months of 2010 and Moody's expectation that the operating performance will likely continue to stabilize in the near term. Moody's believes that the improvement in the authority's operating performance in the first half could be attributed to its more focused and effective marketing program, aided by the moderated unemployment rate in the Seattle metro area as well as a less inclement weather condition in the first quarter of this year as compared to the prior year.

Despite these positive trends, the run-rate revenue and EBITDA remained well below authority's original plan, the agency said, and the Caa3 rating continues to reflect the uncertainty surrounding the authority's capital structure given the high leverage and risk of potential covenant violations.

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