After an unprecedented pause due to the coronavirus pandemic, the sports world has changed but is back to delivering content, according to Fitch Ratings. Liquidity options have supported resumption of play and enabled leagues to conduct games in tournament bubbles and/or at home venues.

"Leagues have overcome massive hurdles and incurred significant costs to deliver content," said Senior Director Chad Lewis. "Some venues are back to hosting fans while others remain empty due to local government restrictions or team decisions."

Leagues have demonstrated an ability to be creative by amending schedules and formats to deliver content and finding alternative ways of delivering value to key sponsors and broadcast partners.

As the pandemic escalated, leagues, teams and facilities took action by expanding borrowing facilities, drawing down on lines of credit, managing expenses and delaying capital projects. National and local media contracts provide a significant portion of revenues for sports and are a foundation for Fitch's analysis. Fitch continues to focus on the contractual nature of those these agreements, which provide strong bondholder support for league level borrowing programs transactions and significant cash for team operations.

Fitch has updated 2021 sensitivity and downside scenarios for sports facilities consistent with its "Coronavirus Scenarios: Baseline and Downside Cases - Update." While Fitch applies general standardized assumptions, the analysis is very much case-by-case, reinforcing the unique aspects of our sports ratings.

"Liquidity coverage of near-term operating and debt obligations continues to drive Fitch's short-term analysis while near-term renewals of key contractual revenues may materially impact financial profiles," said Lewis.