Fitch Ratings has affirmed the 'AA' and 'AA/F1+' ratings on approximately $698.5 million of debt issued on behalf of the Sisters of Charity of Leavenworth Health System's (SCLHS). The outstanding debt issues affected are listed below.
The long-term 'AA' affirmation is based on SCLHS's strong financial profile, geographic dispersion, and effective management practices. At fiscal 2006 (May 31) SCLHS had 445.3 days cash on hand, a cash-to-debt ratio of 229.9% and a cushion ratio of 31.7 times (x), all above Fitch's 'AA' medians of 231 days, 146.5% and 21.8x, respectively. In fiscal 2006 SCLHS earned $45.9 million from operations (2.9% operating margin) and $185.3 million in excess income (10.8% excess margin) on $1.5 billion in total revenues and coverage of maximum annual debt service (MADS) of $51.8 million is excellent at 6.1x for the same period. The system's debt-to-capitalization ratio is moderate at 25.7% versus Fitch's median of 33.1%.
